From Cabot China & Emerging Markets Report Update
The Halter USX China Index corrected mildly through March and April, and clung to the 5,000 level through the first couple of days of May. But the situation in Greece lowered investors’ appetite for risk, and the Index started to plunge on May 3. This sharp correction has produced losses in 10 of the last 11 sessions, and the Halter is now trading below 4,500. There’s the possibility of technical support between 4,500 and 4,400, but that’s not a great comfort. All we can do at this point is watch.
U.S. and global markets are all transfixed by the continuing soap opera in Europe in general and Greece in particular. The fear is apparently that a Greek exit from the euro would disrupt currency markets and render Greek debt unpalatable. The market has yet to come to terms with the possible outcomes, so investors are responding as they always do to high-stakes uncertainty; they’re heading for cash and Treasuries.
U.S. markets continued their slide today, even gathering a little steam to the downside. The Nasdaq again took the hardest hit, falling 60 points (2.1%), while the Dow dropped 156 points (1.2%) and the S&P 500 declined 20 points (1.5%). The Halter USX China Index fell 79 points (1.7%).
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