Tough to say what the catalyst was for this kneejerk lower aside from severe weakness in Philly Fed (which is admittedly a 2nd tier economic data series at best), but the dollar is tumbling...
While the BOE kept rates unchanged at 0.5% as expected, the market was surprised by both the hawkish undertones of the statement and the addition of Haldane to the list of dissenters (McCafferty and Saunders), which made the decision a 6-3 affair.
It started off well enough, with S&P futures in the green and the Nasdaq set for another all time high, however things quickly turned sour thanks to Daimler's "trade war" profit warning and as investors got spooked about Italy once agian...
"... the decisive factor is that, fewer than expected SUV sales and higher than expected costs - not completely passed on to the customers - must be assumed because of increased import tariffs for US vehicles into the Chinese market. "
"The possibilities of policy errors (fiscal and monetary) are multiplying...Hastily crafted policy that conflates politics is dangerous in a flat and networked world"
After 6 consecutive declines in the Dow Jones, the longest stretch since March 2017, and erasing all of 2018’s gains, the cash index is finally set for a rebound, trading some 130 points higher as the trade war panic fades, for now.
"After the trade war wobbles earlier this week, it feels like we’re on more or less an even keel this morning. What can possibly go wrong next? (Form an orderly queue to the right please)"
Beware of big banks - this is what we could learn from the latest financial and economic crises 2008/2009. Big banks have the potential to take an entire economy hostage...
"...the supremacy of the US dollar is not as solid as many people believe it is. A sell-by date as a global reserve currency is looming. The process of de-dollarization is gradually gaining momentum."
