From Marc to Market:
Overview: A sell-off in equities is continuing while the foreign exchange market is quiet with the greenback confined mostly to narrow ranges. It is firmer against most currencies, though the dollar bloc is the most resilient today. The dollar reached a new nine-month high against the yen. Despite some escalating rhetoric from the MOF, the market is pushing the dollar higher amid concern about the new fiscal package the government is set to unveil shortly and heighten tensions with China. Emerging market currencies are under pressure, and the Turkish lira is at new record-lows.
All the large equity markets have sold off today. The main indices Japan, South Korea, and Taiwan were hit for more 2-3%, while Hong Kong and Australia were tagged for almost 2%. Europe's Stoxx 600 is off about 1.3%, the most since early September. It is the fourth consecutive drop. US index futures are down around 0.25%. Benchmark 10-year yields are lower outside of Japan. European yields are mostly less than a basis point lower, while the 10-year US Treasury yield is down about three basis points to slightly below 4.10%. Gold slipped through $4000 for the first time in a week but recovered to around $4050 in Europe. December WTI is consolidating within yesterday's range (~$59.30-$60.45) and is knocking on $60 from below in late European morning turnover.
USD: The Dollar Index is fraying the upper end of last Thursday's range (~99.00-99.60), which has confined activity....
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