Amid a plethora of financial news headlines, the predictable early POMO ramp drifted away and U.S. equity markets were left in a volatile state in the mid-morning session with many short term stocks falling.
The PMI and POMO ramp came at the forecast time and ended at EU closure as Washington took the reins once more.
Following the political upheaval in Italy, commodity and FX prices jumped and dumped in a familiar fashion spurred by an early EUR boost which pushed the greenback down again, encouraging investors to go risk-on once more.
“We’ve experienced a recovery of the dollar for the rest of the day and its now unchanged,” said Michael Richmond, Senior Vice President at Sinolink Japan in an email to clients. “Commodities have settled down and are at a comfortable level, with gold and silver leading the way.”
Commodities are now shackled at -0.5 percent right in their comfort zone, especially considering the turbulence in the morning session. The S&P reflected this by underperforming the precious metals as it dropped 4 percent from its record highs.
The last second rally was mostly due to the MSFT which drove a large amount of selling in the midday session. News from Italy regarding a division in Berlusconi’s party led to a battering for the greenback but other positive rumours around Europe drove the market back to acceptable levels.
