GERMANY LEADS GLOBAL STOCKS LOWER

A 5% drop in German stocks is contributing to heavy selling in Europe which has spread to the U.S. Chart 1 shows the German DAX falling 5.3% to make it Europe's biggest loser. Most other European stocks are down 4%. Chart 2 EAFE Index iShares (EFA) gapping 5% lower after meeting resistance at its March low. Chart 3 shows Emerging Market iShares (EEM) gapping lower as well. Not surprisingly, U.S. stocks are following foreign markets lower. It certainly looks like the recent short-term bounce has run its course. Money coming out of stocks is moving into gold and Treasuries. Most other commodities are falling along with stocks. It looks like a bad day ahead for stocks.