MARKETS have a habit of turning on a dime and surprising the unwary commentator. But one tip your blogger can share after 30 years is to see how long the counter-trends last; if they peter out quickly, that is a sign the mood is set. That certainly seems to be the case in 2016. We have had brief rallies but within a couple of days, bearish sentiment seizes the upper hand again.

European stocks are heading for their eighth down day out of nine. Just as strikingly, look at government bond markets. The 10-year Treasury bond yield has fallen more than half a percentage point so far this year; Japanese 10-year yields went negative (they are now at the giddy heights of 0.01%); French yields are at 0.58%. But there are also signs of differentiation; Portuguese yields are up a percentage point over the last month and Greek yields have surged two-and-a-half points to 10.7%. The euro crisis was supposed to be behind us. 

Another sign of the prevailing mood is that <a…Continue reading

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