Egyptian President Hosni Mubarak basically just flipped a big bird to the thousands of people out in the streets, mostly youths but joined in the past few days by the nation’s laborers and doctors and lawyers, delivering a defiant speech in which he offered a few, very few, concessions but making it clear he was not stepping down immediately.
Now, this is Market Talk, so we have to talk about this in relation to the markets. And it was a nutty day, nothing like Cairo, but still relatively dramatic. Stocks dropped sharply in the morning, as the long overdue sell-off appeared to arrive. But the market erased the bulk of those losses after word started to spread that Mubarak was going to address the nation, with the widespread consensus that he was going to announce his resignation.
Whether the market was rallying on the news, or using the news as an excuse to rally, well, that’s your call. DJIA finishes down 11 to 12229, after falling more than 80 in the morning; S&P 500 adds 1 to 1322, Nasdaq Comp inches ahead 1 to 2790. Trading in the last half-hour was especially erratic; the Dow came within 0.23 of a point of turning positive, before falling back.
The reaction across asset classes is muted; cruce rises a bit, gold’s down a hair, Treasurys are down, but it has more to do with market internals than the drama in Egypt. Ten-year note yield again hits 3.70% mark.
Mubarak did say he would “delegate” some responsibilities to the newly appointed vice president, Omar Suleiman, who later makes a separate speech in which he implores the people out on the streets to “go home” and work together “in the spirit of a team.”
Suleiman wasn’t exactly a crowd favorite, either. Can’t imagine that one’ll go over well. It’s going to be a long night in Egypt, and tomorrow’s going to be, well, I don’t know what it’s going to be and I don’t even want to speculate. But one observer on Al Jazeera commented that the situation is no longer fluid, it’s volcanic.