As Nanex’ Eric Hunsader shows, today’s trading session is shaping up – at least for now – as the biggest post-midnight selloff in the S&P in 2017.
With a notable risk-off tone…
The selloff is global…
AsiaPac…
Europe…
And US…
Of course, after months of calm acquiescence to the melt-up in global risk assets, a modest drop like today’s needs a narrative to explain it – in order that bullish asset-gatherers can thusly dismiss the fears as ‘one-offs’ and reiterate how the central banks will step in if things get worse… here are your catalysts du jour…
- Apple: supplier orders for iPhone 8 and Plus are reduced by ~50% for Nov. and Dec. with shipments seen at 5-6m units per month: EDN
- PBOC Zhou warning about household debt levels and asset bubbles
- Hong Kong: Hang Seng stock index crashed into the close – biggest drop in 11 months
- Catalonia: Spain to invoke Art. 155 and suspend Catalan autonomy after regional president refused to drop independence claims
- ECB’s Nowotny: ECB cannot stop QE purchases abruptly; policy can be normalized before inflation reaches 1.9%, would be a mistake to wait too long on changing QE
- China 3Q GDP 6.8% down from 6.9%; Retail Sales 10.3% vs 10.2% est; Industrial Output 6.6% vs 6.5% est; Fixed Assets 7.5% vs 7.7% est.
- New Zealand: new coalition govt formed between Labour and First parties; National Party ousted
- U.K. Sept. Retail Sales m/m: -0.8% vs -0.1% est.
As Alexandre Baradez, chief market analyst at IG France, notes,
“It’s a synchronized risk-off move for stocks, with gold, the yen, the Swiss franc rallying, right on the day of the Black Monday anniversary…
There hasn’t been a clear trigger in the news this time, rather of mixed negative elements, including worries that Trump won’t be able to deliver on tax cuts anytime soon.”
Baradez is correct that Trump Tax hope is gone…
Happy Anniversary…
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