NEW YORK (Reuters) - Elections in Greece and France over the weekend have ushered in a new period of uncertainty for financial markets that could stand in the way of the easy-money rally that boosted stocks at the start of the year.
Marc Chandler submits:The US dollar is mixed at the start of the new week. The absence of London markets is serving to dampen turnover. The reluctance of the Bank of Japan to get ahead of market expectations saw the yen recover smartly after the greenback neared JPY86. Initial support for the dollar near JPY84.50 is likely to be tested shortly. For its part, the euro has been confined to its pre-weekend range. Three times in as many sessions, the euro was turned back from approaching $1.2780.
Every year in early January they run the Dakar Rally which has actually been in South America for the last few years due to the safety of the participants having been threatened in the middle of the previous decade. It is on the NBC Sports Network (formerly Versus, formerly OLN) in the middle of the night so it is a DVR situation.
Italy has a debt rollover needs and the market just shut off efficient funding across the entire yield curve. There is no place to hide while waiting for the long-end of the curve to calm down.Yields are above 7% from 2-year bonds all the way to 10-year bonds, with an inversion in 3-year and 5-year yields vs. 10-year yields. Moreover the 2-year yield is very close to inversion as well.Sovereign Debt Table Italy vs. Germany
The Mole submits: With the US and much of Asia out on holiday Monday, and little in the way of substantial economic news, it should be no surprise that the price action has been very limited and subdued over the past 24 hours. European equities generally advanced modestly.