Global stock markets are in a bit of a tizzy this morning. The recent escalations between the USA and DPRK seem to be a bit more than your average sticks and stones name calling between international leaders. Though the stocks have been largely able to ignore this issue as remote for the past few years it does seem that a bit of reality is interrupting the day to day euphoric stock buying cycle. By no means are we in a bear market. The stocks are doing exceptionally well in so far in August. However, there are some telltale signs of fear creeping into the global financial picture. Let’s take a look…
Volatility is up!
Stocks are not
The declines in Asia today are a lot less tame. With North Korea being closer to home, the Nikkei 225 in Japan is down 1.29% today and the China 50 is down 0.56% so far today, not bad for a country that doesn’t allow short selling.Gold is up today as well. So far gaining more than half a percent today. A clear indication that at least somebody is getting nervous. But the main place that we can see the fear playing out is in the…
Currency Markets
Here, take a look…Usually, the Australian Dollar has a strong correlation with the commodity markets since most of their exports are commodities. So seeing it this far down on a day when the commodities are up is more than a bit odd.
The Japanese Yen gaining more than a half a percent since the beginning of the day tells us that Asian investors are indeed nervous.
The kicker of course is the Swiss Franc. An upward movement of nearly 1% tells us that something is definitely wrong.
For those of you looking for extreme volatility, take a look at the AUDCHF, which is looking at its biggest single day movement since Trump’s election (white circle).