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Many are looking for an event or official action that will stop the rout that is of historic proportions to start the year.   We too have been thinking about what it would take to stop the rot.    However, none of the frequently mentioned events, like an agreement to cut oil output, or for a coordinated policy response by the major countries, are particularly likely.

Nevertheless, perhaps the selling has been a bit like a fire than can exhaust itself.  If market speculation that the sovereign wealth fund is an important driver here, we can assume that it is a one-off portfolio adjustment.  Many Asian markets, including China, have been closed in the past week, and their return poses the immediate risks.  However, the European and US markets may have begun stabilizing at the end of last week, and increasingly media reports quoted analysts and fund managers recognizing the excessive nature of the price action.