The New Year for trading really got underway today with a resounding thud for many markets around the world. Very strong Santa Claus rallies in December left many markets vulnerable to corrections which arrived in a big way today. Boiling down all of the major market moves, essentially what we saw today was a huge flight out of risk assets and into defensive havens. Crude oil took another big high and was down sharply through much of the day with Brent breaking $55.00 and WTI testing $50.00 support which has held for now. Stock markets around the world tumbled dramatically with Europe outpacing north America to the downside. The main factor behind this action appears to be growing concern that the forces behind the European debt crisis of a few years back never really went away and are starting to come around again. The potential that a Syriza win in Greece in this month’s election could embolden other Euroskeptic parties in the UK, Spain (who are holding elections later this year) and elsewhere has spooked many traders into thinking political risk may be on the rise once again. Growing political risk combined with weak economies and the risk of deflation after a soft German inflation report has put more pressure on the ECB to take decisive stimulus action at its meeting later this month, causing EUR and neighbouring currencies like GBP and CHF to tumble. Even in the oil sensitive currencies, NOK fell more than CAD in early trading although both bounced back a bit in the afternoon as crude stabilized. The flight out of risk markets today sparked big rallies in common defensive havens. USD and JPY were the top performing paper currencies while gold and silver soared, with gold retaking the $1,200 level as traders looked for places to park their capital. Today’s Asia Pacific sessions could see turbulent trading continue, potentially sparking short-term opportunities across markets and on both sides of the bull/bear fence. Australia trade numbers may attract attention along with service PMI reports as we set up for employment and other big numbers later in the week. Also, tomorrow’s Canadian producer price figures could attract attention as traders may look to them for a sign of whether bid falls in commodity prices have started to work their way into inflation numbers yet. Corporate News There has been no major corporate news after the US close today. Economic News Significant announcements released overnight include: Singapore PMI 49.6 vs street 51.0 Singapore electronics sector 50.5 vs street 50.1 Germany consumer prices 0.2% vs street 0.3% UK construction PMI 57.6 vs street 59.0 Spain unemployment (64K) vs street (80K) Upcoming significant announcements include: 11:30 am AEDT Australia trade balance street ($1.6B) 12:35 pm AEDT Japan service PMI previous 50.6 12:45 pm AEDT China service PMI previous 53.0 4:00 pm AEDT India service PMI previous 52.6 8:00 am GMT Norway manuf PMI street 50.5 8:15 am GMT Spain service PMI street 53.4 8:45 am GMT Italy service PMI street 51.7 8:50 am GMT France service PMI street 49.8 8:55 am GMT Germany service PMI street 51.4 9:00 am GMT Eurozone service PMI street 51.9 9:30 am GMT UK service PMI street 58.5 7:00 am EDT Brazil service PMI previous 48.5 8:30 am EDT Canada industrial prices street (0.7%) 8:30 am EDT Canada raw material prices street (4.7%) 9:45 am EDT US Markit service PMI street 53.7 10:00 am EDT US ISM non-manuf PMI street 58.0 10:00 am EDT US factory orders street (0.5%)