“While the selling seems to have slowed for now, the prospect of a week filled with big earnings and a crucial Fed meeting means there might not be a rush to buy the dip just yet.”

US indices stabilise, but Europe keeps on falling

“After their nose-dive yesterday, US stocks have managed to steady themselves, but European markets are still playing catch-up to the downside. Poor earnings provided the catalyst for additional downside yesterday, so today is at least quiet on that front, but until the Fed meeting is out of the way a bounce seems unlikely. Sentiment has reset across the board, and if this is a routine pullback then the time to buy the dip is probably approaching, but next week’s action-packed calendar, full of PMIs, earnings and central bank get-togethers should stay the hand of all but the hardiest of investors.”

Oil prices recoup Thursday’s losses

“The rout in stocks has not spread across to oil prices, which are still animated by expectations of robust demand and constrained supply. This of course feeds into the inflation story, and so is another reason to explain the skittishness of most stocks this week. Further gains will put pressure on consumer spending, hurting the broader rebound, but it is an open question whether a Fed rate hike or two will do much to arrest the rise in crude oil.”

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