The best way to describe this year is to say that Pavlov’s Dog was fed. Market participants ignored an onslaught of softer data , tensions and headline gyrations, believing that ‘Bad news was good news’ and so salivating at the thought of Central Banks being called into action. And they did ride in.
As we approach the anniversary of the week of the tragic Fukushima earthquake and its nuclear fallout briefly crashing the markets , we finally see combined risk assets getting their first co-ordinated hammering of this year. From the London cabbie to the Tibetan monk, this pullback was looked for everywhere.