Since the start of 2016, most markets have been in turmoil.
Yesterday we reported that the ‘bears are in charge‘.
Some see this as the start of GFC2.
Sentiment, even when disconnected from the recent ‘data’ is a powerful driver of markets. It is supposed to reflect group thinking about what will happen in the near, plannable future.
But, like many individuals, markets often get things wrong, or way ahead of themselves. Corrections happen.
But there is no way to know which is which until after the fact.
This update is a way to show what has happened so far in many markets this year, and what happened overnight.
|Market||Index||31-Dec-15||12-Feb-16||% change||% change
|Auckland, New Zealand||NZX50||6,324||5,934||-6.2%||-0.9%|
|Shanghai, China||SSE Comp||3,539||2,763||-21.9%||-0.6%*|
|New York, USA||S&P500||2,044||1,865||-8.8%||+2.0%|
|U91 discounted pump price||NZ$/l||$1.765||$1.575||-10.8%||n.a.|
|UST 10yr yield||2.27%||1.73%||-23.8%||+6.1%|
|NZ 2yr swap||2.86%||2.54%||-11.5%||-0.3%|
|Aust. IG CDS||iTraxx||126.53||166.65||+31.7%||+4.6%|
|* Closed for Chinese holidays – This is for Feb 5|
New Zealand swap rates for terms 4 to 10 years reached record lows at the end of trading on Friday. Record lows are approaching for the shorter terms as well.