Monday, stocks in Asia continued the downward wave from the West — falling 1.9%. In Europe, they fell 0.8% and 0.5% in the U.S. on low moderate volume. Precious metals fell 1.5% as their miners dropped about twice that amount. Tuesday, the decline in stocks in Asia tapered off with a drop of 0.4%. In Europe, stocks rose 0.6% and in the U.S. they rose 0.9% on low volume.
Wednesday, stocks in Asia ramped up 1.4% after Turkey rose lending rates dramatically to stem currency panic. In Europe though, they lost ground, falling 0.6% in anticipation of further tightening by the FOMC. When the announcement was made that the taper would continue with another $10B reduction in bond buying, stocks fell, recovered, and then drifted back down to close near the day’s lows. Stocks lost a little over 1% for the day on low moderate volume. Precious metals miners shot up over 3% as its competitor, the 10-Year U.S. Treasury Bond yield dropped nearly 3% to close at 2.67%. The VXO blasted 11% higher to close at the still complacent 16.56 level.
Thursday, Asian stocks followed the West’s lead, falling 1.2%, but by the time European markets closed, sentiment had turned. Stocks in Europe rose 0.3% and in the U.S. they powered upward 0.9% on low volume led by turkey stock Facebook (up 14%) and its fantasy balance sheet. Precious metals miners gave back most of the previous day’s gains — falling over 2%.
Friday, stocks in Asia dropped 0.3% as the Nikkei breached below the 15,000 mark. In Europe, stocks fell just slightly, but the U.S., the day showed a lot of movement — starting low, recovering to about even, and then losing most of the recovery to end down 0.8% on moderate volume. VXO closed up over 10% ending at 17.44.
For the month, the VXO rose over 40% but is still in the complacent zone. Stocks actually fell nearly 4% and 10-Year U.S. Treasury Bond yield dropped nearly 10% in that same time frame. Will stocks finally succumb to reality? If so, they have a long way to go.