{"id":59297,"date":"2011-12-13T08:58:23","date_gmt":"2011-12-12T21:58:23","guid":{"rendered":"http:\/\/www.fnarena.com\/index.php\/2011\/12\/13\/the-overnight-report-when-the-market-speaks\/"},"modified":"2011-12-13T08:58:23","modified_gmt":"2011-12-12T21:58:23","slug":"the-overnight-report-when-the-market-speaks","status":"publish","type":"post","link":"https:\/\/staging.fnarena.com\/index.php\/2011\/12\/13\/the-overnight-report-when-the-market-speaks\/","title":{"rendered":"The Overnight Report: When The Market Speaks…"},"content":{"rendered":"

\n\tBy Rudi Filapek-Vandyck<\/span><\/p>\n

\tThe Dow finished today's session 162.87 points, or 1.3% lower, at 12021.39, wiping out most of the gains in the summit's immediate wake on Friday. The Standard & Poor's 500-stock index shed 18.72 points, or 1.5%, to 1236.47, and the technology-oriented Nasdaq<\/span> Composite slid 34.59 points, or 1.3%, to 2612.26.<\/p>\n

\t"When the market speaks, only the foolish do not listen".<\/p>\n

\tInvestors who are still trying to squeeze a profit out of the financial markets two weeks ahead of Xmas better take note of Dennis Gartman's<\/span> warning in today's newsletter, The Gartman<\/span> Letter. Up until today's session on Wall Street, Gartman<\/span>, like so many others, had been cautiously positive on short term prospects for US equities as well as for gold. All that has now changed.<\/p>\n

\tHence the warning that also opens today's Overnight Report.<\/p>\n

\tAfter an initial positive reception of the latest European deal, financial markets swiftly reversed course on Tuesday. As I stare at various tables provided by the Wall Street Journal, it is difficult to think in terms other than "bloodbath" or "a sea of red". The good news is: it all looked much worse during the day, with most indices in the US ending Monday's session substantially off their lows.<\/p>\n

\tThe bad news is that technical support levels were breached during the process, which probably indicates today's reversal is not just a one-off. Note: the Chinese market also fell through an important technical support yesterday. In today's session the S&P 500  immediately opened below 1245, which is supposedly the level that would keep underlying sentiment positive. Then it fell further after a brief consolidation. The gauge<\/span> did, however, reduce losses towards the end of the session.<\/p>\n

\tWeakness was across the board, all-pervasive and persistent.<\/p>\n

\tUS bond yields fell. The10-yrs<\/span><\/span> were down 4bps<\/span> to 1.02% and the 2-yrs<\/span> were steady at 0.22%.  WTI<\/span> oil fell 1.4% to US$98.04\/bbl<\/span> (Jan futures). Brent futures fell 1.3% to US$107.26\/bbl<\/span>. LME<\/span> base metals dropped 2.4%, copper lost 2.7%.  Gold fell 2.8% to US$1669\/oz. Cotton fell 3.6%. The euro came under pressure in FX markets, sinking to a 2½ month low against a resurgent USD, while the AUD was pushed back to US$1.0050.<\/p>\n

\tPrior to Wall Street's opening, equities in Frankfurt plummeted 3.4%, Paris shed 2.6% and London dropped 1.8%.<\/p>\n

\tEye-catching, to say the least, is gold's bad fortune when everything risky is having a hard time. This puts some serious question marks around gold's safe haven status at a time when the European Central Bank is not following in the QE footsteps of its peers in London and New York. Dennis Gartman's<\/span> warning was specifically meant for investors in gold, with today's warning coinciding with the observation that gold priced in euro has now fallen below a well-defined trend-line.<\/p>\n

\tGartman<\/span> warns these are not the sort of market signals astute investors should cast aside.<\/p>\n

\tAs for what exactly caused today's all-abundant risk aversion, one could point at warning statements by rating agencies Moody's and Fitch. Both clearly remain unimpressed by developments in Europe. But… there was also a sudden profit warning by leading global chip manufacturer Intel, putting a big question mark around the usual hope the US will stand on its own when everything else is faltering.<\/p>\n

\tEconomic data around the world are now disappointing; from China to Korea, to Brazil and to India, including Australia. Note also the OECD leading indicator is back in negative territory, including the US read, which suggests 2012 is looking a lot worse than where we are in late 2011. At least from the perspective of economic growth.<\/p>\n

\tSPI<\/span> futures in Australia are indicating a risk-off day today, suggesting 79 points or 1.9% down to 4181.<\/p>\n

\tInvestors should pay close attention to the release of the NAB survey. Today's FOMC<\/span> meeting is not expected to deliver the next round of QE, but various experts believe the next meeting in January might.<\/p>\n

\tGreg Peel is on holidays.<\/p>\n

\n\t[Note: All paying members at FNArena<\/span> are being reminded they can set an email alert specifically for The Overnight Report. Go to Portfolio and Alerts in the Cockpit and tick the box in front of The Overnight Report. You will receive an email alert every time a new Overnight Report has been published on the website.]<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

The world’s assessment post yet another European solution is negative, or so it appears. (Locked for subscribers until 10:00 AEDT)<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[84],"tags":[46],"acf":[],"_links":{"self":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/59297"}],"collection":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/comments?post=59297"}],"version-history":[{"count":0,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/59297\/revisions"}],"wp:attachment":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/media?parent=59297"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/categories?post=59297"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/tags?post=59297"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}