Selling pressure persisted through the European morning, with a rally into European close. Selling then continued into US close. Unsure if there are any new drivers, but caution seems to be prevalent with tensions in the Middle East persisting.
There seems to be a dearth of positive news (headlines read job cuts in the US), or at least a dearth of positive reaction to positive news. For instance, the Bundesbank indicated German GDP may no longer contract today: does this imply ECB rate cut expectations need to be revisited? La Garde may have indicated this on indications of stronger industrial production in Germany (I missed this headline on Tuesday).
The US leads, the EU follows. At least the EU has difficulty rallying without US risk-on. That’s conventional wisdom. It therefore worries me that the US is slightly ahead in terms of short term selling.
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