U.S. Markets Fall Again….

U.S. markets extended their steep losses for the third day in a row as investors are even more confused as to when the Federal Reserve (Fed) will begin to taper back its bond purchase program. They are also worried about the looming debt ceiling and constant fighting over the budget in Washington. Asian markets, led by the Shanghai Composite were also significantly lower this morning.

Rattling investor confidence were a plethora of comments made by New York President William Dudley and Dallas Fed President Richard Fisher. Fisher commented that there are many fiscal uncertainties that “loom very large right now.” He defended the Fed for not reducing its massive $85 billion a month purchase program for right now. He says any decision to reduce the program must be based on current economic growth and health.

Fisher comments were just the opposite of Dudley’s comments. He says last week’s decision hurt the central bank’s credibility. He was also highly critical of the White House in handling the picking of the next Chair of the Federal Reserve.

STOCKS
Asian markets were all lower this morning. The Shanghai Composite has now hit a one week low below 2,190 as it fell about 1 percent. The Nikkei 225 came back from a holiday on a weak note. The yen has strengthened against the weakening dollar, trading at $98 at one point. The Australian benchmark quietly fell below 5,420 as lower metal prices hurt trading. The South Korean Kospi was down a tad over 0.7 percent on the day.

U.S. markets were also down. The DJIA lost 49.71 points to close the day at 15,401.38. We are in the midst of a three day skid. The S&P 500 lost 8 points to close at 1,701.84 and the tech heavy NASDAQ Composite lost 9.44 points to close at 3765.29.

Blackberry (NASDAQ: BBRY) has announced they are being acquired by Canadian insurance company Fairfax Financial. The deal is at $9 a share and totals $4.7 billion. BBRY trading was halted temporarily just before the announcement. Last week Blackberry lost 17 percent of its market value after another weak quarterly result. They also cut 40 percent of its workforce.

CURRENCIES
EUR/USD (1.3493) has fallen below the support at 1.3500. We could now dip to 1.3300 and the 1.3250. Profit taking. The U.S. Dollar is remaining weak against the yen thanks to a looming budget shutdown. USD/JPY (98.79) is at an interesting crossroads. We see support at its current level and if we break below it we test 97.00. If we hold, we test 100.00 again then 101.00. See the below chart.

The GBP/USD (1.6027) has risen again. We are now testing 1.6050 but if this level holds we could move lower again and target 1.5900.

COMMODITIES
Gold (1327.20) is up a bit. Overall we are trading sideways from 1300 to 1400 in a bearish pattern. The resistance at 1375 is holding very well and until that breaks we will remain to the downside. Copper (3.288) is moving lower on U.S. budget concerns. Also copper imports to China dropped 10 percent in August. We have support at 3.24.

WTI Crude (103.46) has moved higher and is targeting 105.00.

TODAY’S OUTLOOK
Markets are now data driven. The confusing comments coming out of the mouths of area Fed Chiefs are not helpful. We will hear from Pianalto today and will get some data as well. The FHFA home price index and some consumer confidence data as well. We will also get some remarks from the Fed’s George.