Two days after the biggest rout in US stocks in 8 months, and one day after Brazil’s stock market was halted due to a circuit breaker, wiping out out 8.8% of its market cap, traders are eager to put it all in the rearview mirror and in a quiet session on the last day of the week – there have been no “anonymously sourced Russian blockbusters” overnight by either the NYT or WaPo – S&P futures are set for a green open, up 0.2%, in line with Asian and European markets, all looking to close the week on a positive note.
And what a week it has been: the most eventful week of 2017 for markets started with stocks at record high but then saw one of the sharpest cross-asset routs in years. Yet despite early bullish sentiment, jitters have persisted, leaving safe-haven gold headed higher again for its best week since April and the dollar back on the slide after falling to its lowest level since Trump’s U. S election victory in November.
“The frustrating element is that we are now at the mercy of equity markets,” said Nick Parsons, global head of FX strategy at National Australia Bank’s. “We can be pretty confident that 10 points on or off of the S&P 500 is a big figure on or off of dollar/yen,” he added, saying the only thing likely to break the link would be a confident-sounding Federal Reserve at its next meeting.
This post was published at Zero Hedge on May 19, 2017.
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