Ahead of the open, (29-03)
Thursday, March 29, 2012 at 07:28AM
A concerted selling effort overnight (-2.6%) in China and an ugly European close forced US equities to give back majority of Monday’s 19 SP handle move by mid-day. And, 'forced’ it was as no material market mover was present. Interestingly, Global markets were having a muted reaction to Shang’ nearly giving back nearly half of its YTD gains overnight on no specific news. ES futures were up a few points premarket and most European market were up nearly .5 -1% during their lunch hour before the basic resource sector took on the chin late. The ES markets were probably right in the early morning and purely succumbed to do what the Global market pack was doing.
Unfortunately, it looks like the last, ‘Ahead of the open’, foreshadowed the eventual sell off in Europe/ US…. ....“A market with little to go on rest of week may look for ‘excuses’ to dip by exaggerating news flow out of Europe or get back on China’s growth question marks for the umpteenth time this month.” Seems China worries took over again and Europe (Spain, Greece) got back into the spotlight. Spanish yields were flattish, so not getting into whatever the fear factor story was today.
A possibility here in March has been a commodity led correction/pullback and not a general equity one(so far, China, Australia ‘commodity’ markets lagging in world performance YTD). Today’s beatings of underlying commodities / linked stocks was hardly felt here as Financials (BKX up on day) and mega cap Tech outperformed keeping that premise alive.
In all, let’s not lose sight the market cut it’s losses in half today and is less than a 1% off '12 highs.