The markets do not appear to be very pleased with Operation Twist, at least not at first glance. Following the Fed meeting, U.S. equity markets turned sharply lower, with the Dow Jones Industrial Average (DJIA) closing lower by 283.82 points, or 2.5%, at 11,124.84.
The S&P 500 Index tumbled 35.33 points, or 2.9%, to 1,166.76, marking its worst day in over a month. Risk aversion surged higher, with the CBOE Volatility Index (VIX) rising 12.1% to 36.83.
Joseph Arsenio, Managing Director at Arsenio Capital Management, commented to Reuters that “The market is deteriorating because the Fed didn’t reduce yields on reserves. There is no additional impetus for banks to lend. It wasn’t sufficiently stimulating. The stock market is reacting to that and since that has been fairly closely coordinated with oil markets, we’re seeing declines there as well.”
The widespread liquidation did not spare any sectors, as gold stocks dropped substantially. The Market Vectors Gold Miners ETF (GDX), which had been higher by as much as 1.9% at $66.90, finished lower by 2.1% at $64.28 per share.
Commodities were also hit hard, with gold retreating $20.02 to $1,783.57 per ounce and copper falling $1.72 to $85.20 per barrel.
Canaco Extends Gold Mineralization at Magambazi
* Hole 178 intercepted 9.3m of 11.6 grams per tonne (g/t) gold on the Magambazi Main zone.
* This intercept builds as a 70-metre depth extension of the previously reported intersection in hole 218, which graded 9.1m of 7.62 g/t of gold in the Magambazi Central zone.
