The domestic major indexes pulled back right after the opening as well, but the drop was contained in terms of magnitude. Mid-day buying kept the damage limited with the S&P; 500 losing only 0.61%.
It could have been a lot worse, but a recovery in oil stocks seemed to have provided a lift. Nevertheless, the Nikkei’s 6.2% loss was its worst since December 2008.
Gold inched up and interest rates moved lower, while the dollar rallied against the yen but closed lower against the euro.
The U.S. markets will certainly be impacted by Japan’s problems today, as the struggle in attempting to gain some control over the nuclear reactors will be front page news.
Sharing the spot on the front page will be reports from Fed’s FOMC meeting, where it is widely expected that interest rates will remain unchanged. The main focus, however, will be on the QE-2 campaign and if these efforts really will come to an end by June 2011.
Will there be more fallout on stocks globally or will the main effect be limited to the Japanese market? For some thoughts on that please refer to the WSJ article: “What the Japanese Quake Means for Stocks.”