Selling the dollar and buying stocks and commodities has become a crowded trade these days, and some of the throng unwound a little today.
Session began with a negative tone as the dollar strengthened, euro weakened significantly premarket and high expectations on some earnings (IBM, AAPL late yesterday) weren’t met. Chatter about mortgage put-backs fan the flames, but it’s pretty clear from market action in stocks, gold, oil and other commodities that currencies were the key influence.
Euro gets hammered, falling well below $1.38 after flirting with $1.41 just yesterday. US dollar index up about 1.7%.
Major indexes trim losses near the close. Energy, materials and health-care lead sector decliners. IBM alone knocks 36 points off the DJIA, which falls 165.07 to 10978.62. Nasdaq Comp tumbles 43.71 to 2436.95, and S&P 500 ends 18.81 lower at 1165.90.
Data calendar tomorrow is pretty thin, with most notable item being the Fed’s latest Beige Book regional economic assessments.