Reuters - The euro sank to four-year lows on Monday as stocks and commodities fell after disappointing U.S. jobs data and angst about euro zone debt problems fed fears the world economy may falter in its recovery.
LONDON — The clear signal from the U.S. Federal Reserve that it will soon stop pumping money into the global economy and data pointing to Chinese growth slowing sparked sharp falls in bonds, shares and commodities on Thursday.
Emerging markets, many of which have been primed by the cheap Fed cash, saw some of the biggest selling as investors rushed to the exits.
Canada’s dollar declined to a two- week low versus its U.S. counterpart as concern increased that the world’s 11th-largest economy is slowing.
The currency weakened versus the majority of its most-traded peers after data on Feb. 8 showed employment unexpectedly fell, the nation had its ninth straight monthly trade deficit and housing starts sank to the lowest since 2009. The loonie also fell as commodities and global stocks sank amid ebbing risk appetite.
Calafia Beach Pundit submits:
The title of this post is a bit tongue-in-cheek, but it's clear that the only time in recent years that the dollar has managed to rise above historical lows has been thanks to widespread concerns that the global
Yesterday's high volume dumpfest in stocks - its biggest drop in 5 months - is followed by a considerably smaller volume pumpfest that elevates the S&P by its 2nd most of the year (2nd only to the opening day of the year). The 'excessive' grab for protection yesterday that took VIX above 17% was smashed into the open and provided the ammo to leak stocks higher all day (VIX fell 3.3vols back under 14% - the biggest VIX drop of the year).
Gary Townsend submits:This morning: After fair value adjustment, equity futures are lower this morning, after a disappointing November employment report. Notwithstanding the past two day’s advances, markets remain in correction.
I've been discussing possible explanations for the recent tendency of the dollar prices of commodities to move together. On Friday we received a very useful data point for distinguishing between the different hypotheses.