The massive earthquake that has struck Japan during early morning hours here in the US is resulting in a surge in activity across the currency markets, the bond markets and the precious metals not to mention the equity markets which are generally lower across the board on the news.
Bonds immediately caught a firm bid as they continue to now look strong on the technical price charts. What QE could not do for long term interest rates, namely lower them, rising crude oil prices and their effect on economic growth have done.
With the market keeping a watchful eye on Saudi Arabia coupled with the after-effects of the earthquake in Japan, prices could move very sharply in a short amount of time. Stay alert.
This may be one of those days we will talk about years from now. Not sure whether to stay glued to the TV for news and computer to gauge the markets or shut it all off and count my blessings. Probably a bit of both for balance.
ReplyDeleteEither way, prayers out to Japan and all affected by the earthquake and those in the path of the tsunami... in the Pacific and the Middle East.
Interesting how the long bond was able to rebound so convincingly after being range bound for so long and breaking on the way down. 121 -120.5 is the level I am watching.
ReplyDeleteThe earthquake in Japan may not affect tv companies and its prices. Actually the rebuilding costs (mostly paid for by insurance companies) will help to generate more economic activity. The only way that Japan’s economy would have been seriously affected is if the epicentre of the quake had been much closer to Tokyo and severely damaged the city.
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