For once, stocks are trending lower as bonds are more bid in trading this week. 10-year Treasury yields are marked sharply lower to 1.77%, retreating further from the highs this week of 1.90%. But the latest move today appears to be one that is related to risk aversion as equities are being hammered lower following the selloff yesterday.
US futures are pointing red with the declines this week set to deepen. S&P 500 futures are down 0.7%, Nasdaq futures down 1.3%, and Dow futures down 0.3%. Once again, tech looks to be the big laggard and the technicals are looking rather ominous too.
This is setting a more risk-off tone in FX as well. The yen is broadly more bid alongside the dollar so far today, with commodity currencies being shoved lower on the day. AUD/USD is undoing its good work from yesterday with a fall of 0.5% back below 0.7200 currently. Meanwhile, USD/CAD continues to keep above its 200-day moving average - now trading @ 1.2525.
