OK, the rally that we’ve seen in the first few days of the year has come to a halt.
Stocks in Europe are lower across the board.
The big loser is Italy’s FTSE MIB index, which is down 1.6%. Germany’s DAX is down just under 1%.
The good news is that we’re not seeing any wild up move in yields or anything, so probably no reason to panic.
The bad news is that use of the ECB’s deposit facility — which lets bank safely hoard cash at virtually no yield — has hit a brand new record, which means banks are hoarding their cash more and more, rather than lending it to other banks or into the economy.
Also having a negative effect: Shares of Italian bank UniCredit are getting clubbed after being forced to raise new equity at a heavy discount.
US markets aren’t going anywhere right now.