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Bobbys Corner-Open Market-Sept.6.2011

Good Morning:

The FX markets were taken by surprise as the SNB (Swiss Nat’l Bank)-being very tired of the relentless rise in the CHF, intervened to weaken their own currency, and set a floor with the EUR/CHF at a rate of 1.20. With  continued concerns that the rising CHF will deteriorate the country’s export sector, the SNB moved aggressively in the FX markets.  This move prompted a short squeeze in all CHF pairings.
The CHF fell the most ever versus the Euro after the announcement.
The SNB has made comments that they are determined to enforce this setting, and is prepared to buy foreign currency to maintain this rate.

The ECB stated that the SNB acted alone, and did not collaborate with them regarding this announcement.  The ECB is seen buying Italian and Spanish Bonds today-does anyone really care-on a day like this-probably not.

Gold jumped over $1900/oz-while Oil dropped.

World equity markets are mostly lower-and US Dow futures are lower by over 200 points at this time.

We have ISM-PMI data at 10 Am today-markets will be watching this data for signs of stability in the service sector.