by Chris Becker
A wild, wild ride last night as the ECB foiled its mandate for stability by launching the Euro into the stratosphere and sinking stocks into what could be a new bear market going into Christmas. Well done Mario! By not meeting market expectations of a rate cut or further bond purchases, the fickle post-GFC environment was hammered on lack of central bank support, with European stocks sinking 3%, bonds sold off and a huge reversal in European currency shorts, with the Euro and Pound soaring against the mighty dollar.
Commodities were let off as OPEC meets in Vienna to try to get the near bankrupt Saudis to cut production, while releases in the US and Fed Chair Yellen’s testimony was the clearest signal yet that rates will rise in two weeks. Bath of blood on Aussie stocks this morning, especially banks with SPI futures pointing to a return to last weeks lows.