Another tough morning for equities

The global slowdown selloff has added Friday morning to its team sheet as equities continue to find the going tough.

City of London
Source: Bloomberg

Yesterday we saw wide ranges, big swings and a US market that closed right on its lows. A 40-point range for the S&P 500 is a tough day at the office, and similar big moves lower in Asia greeted European traders returning to their desks this morning.

Admiral (+0.7%) and RSA (+0.5%) have found some buyers this morning, but otherwise the gainers list is an exclusive one.

Any name with a sniff of commodity exposure is struggling, be it oil or metal. Brent crude is below $90 for the first time in over two years, iron ore is in a similar position and this is making related names feel very unloved. Throw in an unquantified Ebola risk discount to the travel sector and TUI Travel (-4%) finds itself looking up from the bottom, a familiar feeling having spent the last four days in the losers corner.

The fact that the FTSE has been beaten to the 10% from the highs technical correction moniker by the DAX, is of little consolation. Despite closing up last night somehow after a whipsaw day, Europe’s powerhouse economy has given the impression of leading the selloff from the front. Europe’s VSTOXX volatility index is pushing towards 22 and its year-to-date, ahead of the closely watched US equivalent which closed at 18.76 last night.

In the face of the selling in Europe, the US market is trying to hold itself close to a breakeven opening call, only giving away another point on the S&P for a price of 1927.

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