That incremental decoupling of equities from crude, which I mentioned in yesterday’s morning’s note, fell flat on its face yesterday after crude fell an additional 5.5% — on top of Monday’s 6% drop. However, keep in mind that this week, crude has dropped nearly 11% while equities have moved only 2% lower. The “decoupling” thesis had held up well up over the past three weeks, but with Tuesday’s additional sharp trade lower, equities simply fell out of bed — in a rather inglorious fashion. The energy, industrials, financials, technology and communications sectors all lost about 2% or more on the session. In fact, the best performing sector on the day was materials. Basically, it was a rout. My commentary on crude as reordering resumes in risk markets featured on Yahoo Finance Market News.
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