First down after the Syrian air strikes, then up (within minutes after the open) despite a poor jobs number, then down once more on the latest “Truck Terrorist”, now going back up again, stocks can’t make up their mind this morning what to do.

Perhaps spooked by the news of yet another terrorist rampage in Europe, the market has been all over the place in early trading, while Europe is seeing some of the traditional flight to safety, as Italian bonds extend gains to session highs, as the 10-year yield drops 8bps to 2.19%. On the macro front, there was no surprise, with Wholesale Inventories coming in at 0.4% as expected.

Earlier in the session, the USD/SEK spiked to session highs on terrorist concerns , although it has since given up some of the gains.

Some other highlights from Bloomberg:

  • S&P 500 down 0.1% to 2,356 at 10:11 a.m. in New York, clawing back an earlier drop of 0.7%; Dow Industrials down 8 to 20,655
  • Phone, real estate and utility shares lead market as defensive trade takes hold in early trading
  • 10-year Treasury down 4 basis points
  • Financial shares down 0.8% for biggest drop in market
  • Volume 14% below 30-day average at this time
  • “Markets moved into risk-off mode after the strikes, but we are seeing a recovery,” Jim Reid, a Deutsche Bank Group AG strategist in London, wrote in a note on Friday. The Trump- Xi meeting “may make for interesting discussions on North Korea given Trump’s actions overnight and his comments last weekend about taking action on North Korea unilaterally if he had to.”
  • VIX edges higher to 13.1; volatility hasn’t closed above 15 for more than 100 days, the longest stretch since 2007

    • In short, chaos, and we will have news of today’s Trump-Xi meeting to digest.

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