I started writing this article last week, but new stuff came up so we delayed running it. Interestingly, the markets are becoming more headline risk driven. In fact, markets are acting like a proverbial cat on a hot tin roof – With every new step, the markets are likely to slide to new short-term lows or take a temporary leap in the air.
Last Wednesday morning’s hot mess was a good example of this: The central banks of India, New Zealand, and Thailand all dropped interest rates further than expected. This got the global bond markets jumping with prices going up and interest rates diving. Then, German industrial production numbers came in down -1.5% for the month versus an expected slide of -0.4% and the bond yields slid to near record lows in the U.S.
As I write this in the late morning on Tuesday, I’ve been on the set of Varney & Co. at Fox Business Network for almost two hours because of the tariff delay and reduction news that broke spiking the Dow Industrial average by over 500 points.