Spreadex Market Update
Slow start turns sour as European indices plunge on intensified investor fears
With Citigroup warning of a potential market ‘death spiral’ if investors behave irrationally to the stronger dollar/weaker commodities/harmed emerging markets cycle that the world appears to be trapped in at the moment the markets have taken another kicking this Monday. It doesn’t help, of course, that the day’s economic calendar is so sparse, with investors left pondering the purely negative side of things as the morning continued.
The FTSE sank by nearly 2%, plummeting past 5800 in the process as Brent Crude fell back towards the $33 per barrel mark. The DAX, always the liveliest index in instances like this, lopped off a whopping 2.6% in value as the morning progressed, and is in serious danger of falling below the 9000 mark; the CAC, meanwhile, matched its dramatic German peer with its own 2.5% drop. The Eurozone had the added negative of a 10 month low Sentix investor confidence figure, the reported 6.0 far lower than the 9.6 announced in January, whilst the German index has the extra burden of a dismal morning from Deutsche Bank, which is currently down 4.5%.
Once again it falls to the US indices to try and rescue European from a dire morning of trading. However, it looks like things are going to be just as bad for the Dow when the US session gets underway, the futures suggesting a 200 point plunge when the bell rings on Wall Street. Hopefully this afternoon’s US labor market conditions index figure can inspire a change in sentiment; then again, maybe not.
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