Markets Reverse, Stocks, Euro And AUD Rally

Markets Reverse, Stocks, Euro And AUD Rally

Fear of Hurricane Sandy’s impact and the uncertainty surrounding it drove money out of equities and into safe haven assets like the US dollar and bonds on Monday but Europe seems to have decided that things weren’t that bad after all and so equities were higher, bond prices fell (yields up) and the US dollar was weaker last night.

Obviously the recovery on the East coast of the US is going to take some time, particularly if you think about the sheer volume of people and industry that is concentrated in this part of the US. So while the New York Stock Exchange and US Bond markets will be open tonight, Wednesday their time, the disruption to economic activity and the cost of recovery is bound to be significant. Indeed as Sandy has slowed down and headed inland it is still impacting on a big swather of the US.