daytrade diaries... tuesday

Morning traders.

Market wrap: this month's global rally faces its first real test after European and US markets tumbled overnight. Turmoil in the auto industry and concerns about the financial sector saw Wall Street retreat for a second straight session, following big falls in Asia and Europe. The major US indexes lost 3 - 3.5% after the CEO of GM was forced out and the White House warned that GM and Chrysler face administration.

The financials that led the March rally were hammered as banking indexes recorded double-digit falls. REITs lost 6%.

Oil was hit hard by the collapse in confidence, falling 7.5% to $48.50. Gold jagged about in volatile trade and was recently off about 1% at $917. Base metals also caught the downdraught and pulled back from recent highs.

Futures traders expect another solid down-day on the local market to match yesterday's 2% retreat. The SPI closed down 57 points at 3559.

Looks like a day for careful stock-picking and bounce trading. At the very least, this week's pullback will start to open up opportunities in overbought stocks. There's always a silver lining.

Good luck to all.