Global equity markets lost ground over the last 24 hours as shown in the EMI Global Equity Index table below. Heavy selling originated in the U.S. during Tuesday's trading session but the selling seems to have subsided a bit during the Asian trading session as well as during the European session so far. The improvement in China's flash PMI Index stabilized Asia a tad and that has carried over to Europe even though Europe's data was not as encouraging as China. The Index lost about 1% over the last 24 hours narrowing the year to date gain to 6.2%. The Index has now lost 1.5% on the week pushing the Index to the lowest level since the first half of September. Only Germany, Hong Kong and Australia are still showing double digit gains for 2012 with China still in negative territory for the year and at the bottom of the EMI leader board. Yesterday was a good example of the tight macro correlations among most all risk asset markets as a sell-off in equities quickly translated to a sell-off in the oil complex as well as in the broader risk asset markets.
The API report was mixed with the outcome in directional sync with the range of expectations. The crude oil build was smaller than expected as was the gasoline build while distillate fuel inventories declined within the expectations for a modest draw. The API reported a build (of about 0.3 million barrels) in crude oil stocks versus an industry expectation for a larger build as crude oil imports declined marginally while refinery run rates also decreased slightly by 0.2%. The API reported a modest draw in distillate stocks. They also reported a small build in gasoline stocks.