Bull or bear?

Yesterday I experienced the worst global equity sell-off after September, 2001. STI index shedded 4 percent or 127.87 and closed at 3104.15 with all of the major stock markets across Asia, Europe and Latin America are in the sea of red. The story was started with a bloodbath in Shanghai on Tuesday with dramatic 8.8 percent drop followed by 416-point plunge on Wall Street overnight.

But it was quite an expected event since the global equity markets were long been overdue for a correction. Stock markets across the globe were at their record highs after multiple years of bull-run.

But what had ignited this sell-down? Did the rumors of China government's crackdown on stock speculation change the global economic fundamentals overnight so as to trigger this sell-down? Did the suicide attempt to kill US Vice President Dick Cheney in Afghanistan change the world's geo-political lookout suddenly? Is it because of the former Federal Reserve chairman Alan Greenspan's warning on Monday that a year-end US recession could be possible? There was a report which showed durable good orders are much more lower than expected in January, and the news which announced leading US mortgage lender Freddie Mac' tougher lending standards. Did those reports and news give the investors clearer picture of wold economy outlook than previous ones?

Whatever the reason is, one thing I can be sure is global stock markets are heading for more and more volatility.

Currently with a mixture of good and bad economic reports, it is too early to say if the markets are heading for prolong declining trend or yesterday event was just a minor accident in a decade long bull markets.

Anyway I must be more cautious nowadays.