What a night.
European stocks went into a broad based meltdown...
The Europe’s blue chip bellwethers the Stox 50 and Stoxx 600 dived by a stunning 3.61% and 3.16%!
The bloodied benchmarks reflected the intense selloff in the major equity benchmarks of Europe’s largest economies: German Dax –2.87%, France CAC –3.63% and UK’s FTSE –2.83%
Europe's periphery took even more punishment: Spain’s IBEX –3.59%, Portugal’s PSI -3.21%, Italy’s MIB –4.44% and Greece’s ATG –6.25%.
Scandinavian stocks had likewise been pummeled: Denmark's Copenhagen 20 -2.27%, Norway's Oslo All shares -2.1%, Sweden's Stockholm 30 -2.9%, as well as Finland's Helsinki index -2.98% and Iceland's ICEX -1.65%
All charts above from stockcharts.com
The bloodletting in Greece financial assets apparently spilled over to her sovereign bonds where 10 year yields have spiked.
Should the meltdown in equities intensify, the Greece bond selloff should spread to other European periphery bonds.
And even prior to last night’s collapse, Europe’s market breadth continues to deteriorate
Notes the Gavekal Team:
To say that MSCI Europe has been the hardest hit equity region over the past several weeks would be a major understatement. European stocks have been washed out more recently than at anytime since 2011. However, if 2011 is an indicator, a vast majority of stocks can continue to trade below its 200-day moving average for quite a few months so the bottom probably hasn't been seen in Europe yet.
US markets came strongly back from an early deep drubbing, nonetheless still closed red.
The periphery to the core dynamic seems to be spreading fast and intensifying.
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