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Global Market Wrap-Up - June 12, 2013

Wednesday, June 12, 2013
Mark Hanna
U.S. stocks continued to selloff as the three week corrections continues apace. The same items that have hurt the market's psyche of late - worries about the Fed reducing the scope of its massive punch bowl, and currency movements dominate. Stocks initially jumped at the open as the yen weakened versus the dollar but a reversal in the currency led to a reversal in the equity market. The S&P 500 fell 0.8% and NASDAQ 1.1%. Treasury prices declined after the government sold $21 billion in 10-year notes at a high yield of 2.209%; by the end of the session yields were at 2.232%. The market's main fear gauge -- the CBOE Market Volatility Index (VIX) -- spiked almost 8% Wednesday, and has shot up more than 35% in the last month.
  • The government reported Wednesday that the U.S. budget deficit widened in May by $139 billion. But the annual deficit stayed on track to finish below $1 trillion for the first time since 2008. With the May increase, the deficit through the first eight months of this budget year totaled $626 billion, according to the Treasury. That's down $218 billion lower than the same period last year.
Oil added 0.5% to $95.88, gold 1.1% to $1392.00, and silver 0.7% to $21.80.

Germany dropped 1%, Britain 0.6%, and France 0.4%.
  • Industrial production in the euro zone increased 0.4% in April, beating forecasts.
  • Germany's constitutional court began its hearing over the legality of the European Central Bank's bond buying program on Tuesday and the head of the court said the success of the program wouldn't be relevant. Speaking in court, the German Finance Minister Wolfgang Schaeuble said that the German government sees "no signs that measures taken by the ECB so far violate its mandate." Schaeuble said he did not think the ECB's policy was subject to German or national jurisdiction.
Japan's Nikkei Stock Average declined as much as 2.4% before recovering to close down 0.2%. China remained closed for holiday.