– An ugly night for global stocks and at the close the Nasdaq is holding onto the 4000 level but has slipped 0.2% to 4,037. But the Dow and S&P 500 have slipped through 16,000 and 1800 respectively. The Dow is down 0.59% at 15,914 while the S&P at the close is off 0.33% to 1,795..
– In Europe, the stock market meltdown was more acute with the FTSE off 0.96%, the DAX down 1.90% and the CAC off a huge 2.66%. In Milan and Madrid, stocks fell 1.95% and 1.44% respectively.
– What is driving the sell-off seems a natural focus on the strength of the US economy, Friday’s non-farm payrolls and the FOMC in a couple of weeks which might deliver Dectaper. Anecdotally, I’ve also noticed on Twitter the number of people talking about how strong December is usually for stocks, suggesting that some of the November rally was pre-emptive and leaving little fuel in the tank for strength in December. We are only a few days into December, so time will tell.
– Closer to home, the SPI 200 contract on the ASX continues its freefall, losing another 39 points overnight to 5215 bid at 7.30am AEDT. On the bond boards, the 3’s and 10’s are up 2 and 2.5 points respectively.
– A big reversal for the US dollar (as counter-intuitive as that is if there is going to be a Taper) helped lift the Aussie dollar off its low at 0.9043 overnight, but equally, both NAB and Westpac have told clients in the past few days they would be buying under 0.9050. It sits at 0.9130 this morning, up 0.24% over the past 24 hours.
– In other pairs, the US dollar tumbled against the yen with USDJPY making a high of 103.37. It is back at 102.06 this morning, not far off the low of 101.97. Euro is higher, rising 0.4 % to 1.3594. GBP is up 0.27% to 1.6399.
– On commodity markets, the US dollar’s reversal didn’t lift Gold at all and it sits at $1,222 oz this morning. Silver fell 1.08% to $19.01 oz but Crude rallied 2.33% to $96.01. Copper fell 0.47% to $3.20 lb. On the Ags, Corn rose 1.32%, Wheat was 0.62%, while Soybeans dropped back a little, down 0.13%.
– Bitcoin was fairly quiet with only a $120 range in the past 24 hours and it sits at $1152 this morning.
On the data front today we get the release of Australia’s 3rd quarter GDP at 11.30am AEDT. Partial data over the past few days has lead to a number of upgrades to forecasts and a number around 0.8% would be on the money for expectations.
Elsewhere, it’s non-manufacturing PMI day with the HSBC China Services PMI due in our time zone before a raft of European and other services PMIs to be released tonight. Euro area GDP and retail sales tonight will also be important in guiding expectations about what the ECB will be doing with monetary policy.
In the US tonight, we see the ISM non-manufacturing PMI, new home sales, the Fed’s Beige book and crude stocks.