A continuation of the broad market sell-off that started Friday picked up speed at the open but has stabilized; traders are anxiously looking at the last 15 minutes of trading to see if a downdraft kicks in.
The US Dollar Index is at $79.26 off its daily highs but higher than recent 5 day lows of $78.3.
Rising dollar begets falling markets especially with commodity related investments.
Trades that have tracked dollar weakness (reflation trade) are down as industrials, energy, metals and materials are taking a hit:
High flyer FCX down 6%
GDX gold index down 4%
IYR real estate ETF down 4%
PAAS and SLV down 8.8%
PCN Pimco corp bond down 3.5%
Steel stocks STLD and ZEUS down big
XLE down 3%
The S&P is down 2.5% and the NASDAQ is down 2.8%.
Financials are 3-4%.
One safe haven is healthcare stocks which benefited from the Obama administration’s backing off from a Government run insurance program.
In the green are Abbott, B-D and Pfizer.
Large cap biotechs are down less than 2% but mid and small caps are tracking the NASDAQ and much lower.
The caution flag is still on with the VIX signaling an intermediate market top. The mantra up until today has been to buy the dips so tomorrow will give us a trend line.