Watch the Hang Seng

By Global Macro Monitor

We’ve posted many times on this blog about how the Hang Seng Index is one of our indicators species for global risk appetite. The index usually leads global markets on the downside and turns up before most.

While all eyes are focused on Europe the Hang Seng has been in a death spiral. It is down 25 percent from its November peak and off 17.5 percent since its intraday high on August 1st, while the S&P500 is down around 9 percent. It’s signaling something ain’t right and may — and we stress may — be a precursor to a big break in the markets. Keep it on your radar.