Troubling signs in the emerged (BRICS) and emerging market growth story globally. We are all aware that the Shanghai Index is down 21% year to date and that Chinese authorities are seeking to further dampen real estate speculation and tighten lending rules (while property prices continue to increase along with inflation).
What is not so apparent to market participants is that Copper (a proxy for global growth) has broken its 200 day moving average (last time it did this 7/3/08 commodity prices traded down 60%) and that the following markets are coming under increasing downward pressure (to days prices): Russia’s ETF off 3.44%, Japan's ETF off 2.25%, Brazil's EWZ ETF off 2.49%, while PowerShares base metals ETF DBD off 2.55%, Dow Jones-UBS Copper ETN off 2.22%.
While gold closed up $19.50 up 1.62%.
It would be wise to take note of these market moves as it seems everyone has bet on emerging markets being the critical engine of global growth.
Disclosure: Long GLD Long PHYS