Europe Having been fixated on the US election and the preferred market outcome of an Obama victory the initial morning feel good bounce turned out to be one of the dead cat varieties, as markets quickly moved on to the next potential banana skin. In this case there are several, starting with today's Greek parliamentary vote on austerity, not to mention concerns about how the newly elected President will deal with the US fiscal cliff concerns, given that the numbers on both sides of the political divide haven't changed. The main catalyst that tipped the markets back down the "wall of worry" was the announcement by the European Commission by downgrading their growth forecasts for the euro area for 2012 and 2013, cutting their growth forecast for Germany from 1.7% to 0.8% for 2013, while German economic data continues to move in the wrong direction after industrial production for September dropped 1.8%, well below expectations of a 0.7% drop. Having led the gainers in early trade the basic resource stocks and banks lead the turnaround with gold miner Randgold Resources leading the decliners after a disappointing Q3 trading update. Luxury fashion retailer Burberry is also slipping back despite a slightly better than expected first half trading update, as growth concerns in its core markets continue to limit the upside. On the plus side Polymetal is an outperformer after Russian scuba divers managed to find the location of 700 tonnes of its gold that went down in a shipwreck in October. Also on the up is outsourcing company Serco despite being on the receiving end of a downgrade from Investec. US Last night's late US market rally appears to have been one of those "act in haste and repent at leisure" types of market reaction which investors in hindsight wish they'd thought better of. This morning's news from Europe has seen US markets plunge on the open as investors quickly realised that for all the noise, and relief the same old problems remain with the same set of protagonists looking for a solution, with the same fiscal cliff problems waiting to be resolved by year end. In the absence of any economic data investors have looked across at Europe and today's news out of Brussels and decided to once again head for the sidelines. Earnings announcements have continued apace with the latest Q3 update from Time Warner beating expectations on the back of stronger cable TV business. Revenues came in short due to tougher comparatives from 2011 when the last Harry Potter film boosted income. FX After initially sliding back as it became apparent that President Obama was going to be re-elected the US dollar has bounced back strongly on the back of renewed concerns about events in Europe, with the single currency falling particularly sharply as markets digested the poor German economic data and the downbeat comments from ECB President Draghi about the Germany economy and the downgrade of EU forecasts for the European economy. The Japanese yen despite all its own worries about its own fiscal cliff has also risen sharply on safe haven capital flows as uncertainty once again moves from one worry to the next one. The pound in contrast has had a fairly neutral day despite speculation that the Bank of England might ease policy further tomorrow. Despite this week's poor economic data the balance of probabilities still favours a hold from the bank given recent comments from senior policymakers, while the effects of funding for lending continue to be assessed. Commodities After surging on the expectation and then reality of an Obama victory gold prices have once again slipped back after failing to overcome the highs seen last week at $1,728. As for other commodities it's been a sharp sell-off with oil prices, after two days of strong gains have hit reverse gear quite sharply this afternoon dropping sharply on the back of the growth downgrades from the EU and this morning's comments from Draghi about the German economy as once again the focus shifts back to the demand question in a weakening economic environment. Brent prices, US prices and gasoline prices have all plunged on the lowered growth outlook. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.