A wave of risk aversion hit global stocks like lightning, out of the blue.
There is no big macroeconomic catalyst for this move, which is now driving the S&P 500 down 39 points, or 0.75%. Stocks opened higher today and all seemed calm with no economic data scheduled for today.
Then the bottom fell out. The move even caught CNBC’s ticker editor by surprise.
One place that many are highlighting is NVDA, which has undoubtedly driven the market this year. Shares are down 4% today after some less enthusiastic comments from a UBS analyst. Pinning him on this alone is a stretch as he has been warning about NVDA’s October earnings for over a week, but it’s the best we have.
I suspect there is a significant technical element in place, as the NVDA decline came after a breakout of $850, which held over the previous three attempts. Greg notes some things to look out for on the NVDA map.
Others believe that de-risking ahead of tomorrow’s CPI report would be the catalyst.
In any case, the evolution of the stock market has repercussions on the exchange rates with a sharp rise in the yen. USD/JPY fell to 151.60 from 151.80 and broader bids for USD, despite falling Treasury yields.
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