Global markets will survive currency crises
The chase by Frances Horodelski:

And another day begins as equity markets in New York come off the worst start to a new year – ever.

For reference, the world’s equity markets do survive currency crises: 1985 - Plaza Accord, the U.S. dollar dropped 50% over two years; 1992 – Soros breaks the British pound, -29%; 1993 Russian Ruble collapses 95% over five years; 1994 Mexican currency crisis, down 40% in four months; 1997 – emerging market currency crisis when the Thai Baht fell 59% over the next eight months; 2015 – the Swiss Franc de-pegs and gains 22% in two days. In all cases, markets were higher one year later.

Today, we are surviving. Again, I’ll be brief. The market is oversold is some major areas. The percentage of stocks trading above 50-dma is into the teens percentage-wise. Fear/greed is well into fear. AAII bears have risen and AAII bulls have fallen. The Investors Intelligence reading is also seeing more bears and less bulls. According to Bespoke research – every country in the world has its stock market in oversold or very oversold territory with the exception of Indonesia and New Zealand which are neutral. There is no market that is overbought.

In the news today we’ll be focused on the jobs report. In the U.S., the economy added 292,000 jobs when the estimate was for a gain of 200,000. In Canada, 8,000 jobs were expected but a whopping 22,800 positions were created. The positions were mostly part-time.

In corporate news, items of note include: this is the last day to tender to Suncor’s offer if you’re a Canadian Oil Sands shareholder. The offer expires today unless extended. Performance Sports will be in the spotlight as it hovers at a 52-week low as the ex-chairman of the firm, Graeme Roustan (who apparently owns more than 1.4%) is looking to have the current CEO Kevin Davis ousted due to among other things his “misguided retail strategy”. We’ll speak with Mr. Roustan later this morning. We’ll also be watching big oil as the Saudis confirm that they are looking at possibly privatizing a part of the big oil company Aramco with its oil reserves in the neighbourhood of 321 billion barrels of oil (10x Exxon). I’m also looking at the new low list – do these companies deserve to be there? Bank of Nova Scotia, Canadian Tire, CPR, Manulife, Pembina, Magna. In the U.S. VF Corp., Metlife, American Express, Oracle, UPS, Goldman, Morgan Stanley, General Dynamics.

From the analysts desks – Great Canadian Gaming upped to Action List at TD Securities, Scotiabank raised to buy at Desjardins with a $68 target; Barrick now a buy at Sterne Agee, DuPont now a buy at Bernstein (“too much upside to stay mad”); Birchcliff Energy, Freeport-McMoRan, Cliffs Natural and Enerplus cut to neutral at Macquarie while MEG Eenrgy cut to sell.

Markets are stabilizing as Chinese authorities provide calming words and also bought stock. European markets are modesty higher while North American futures are showing the Dow up triple digits. After the TSX fell hard into bear territory (on a price basis down more than 20% from September 2014 high), we’re also seeing some stability with the TSX 60 futures up 4 points and oil up 50 cents.

On BNN today we’ll be talking coffee, gasoline and wind (Commodities), big U.S. banks (BDAM), technology stocks (TBN). And we’ll keep you on track with all the major data points. Apple should be watch as it hit another 52-week closing low yesterday. Lots to do – time to stay focused.