NEW YORK • With China's stock market in disarray, American investors are finding out just how long their day can last - before they even get to work.
"This morning, when I rolled over in my bed at 4am to check the markets and saw what happened in China and in US futures, I thought, 'Oh, here we go'," said Mr Howard Ward, a Wall Street veteran of growth equities at Gamco Investors. "I'm getting too old for this."
As the stunning sell-off in China caused two shutdowns and convulsed financial markets around the world this week, Wall Street traders have been left to look for whatever clues they can to make sense of it all.
Once-obscure events like the yuan currency fixing, which comes four hours after the New York Stock Exchange closes, are now being obsessed over by traders everywhere with a mix of anticipation and dread.
EYE ON THE MARKET
It's definitely the Asian tail wagging the Western dog right now.
MR EDDIE PERKIN, at Eaton Vance, adding that looking in on China is the last thing he does before bed, and the first after waking up
The start of the year has been one of the fastest retreats from risk ever by investors coming back from the New Year holiday.
Over the first four days of this week, more than US$4 trillion (S$6 trillion) was wiped from the value of global equities, volatility in the broadest stock gauges has jumped 30 per cent or more, and 9 per cent was shed from the price of oil.
Almost everything - from junk bonds to cocoa and coffee - has tumbled.
Adding to the frustration among American traders was a sense that not much that is happening in China's stock market was relevant to either the Chinese or US economies, let alone prescriptive for how equities should trade in America.
"It's definitely the Asian tail wagging the Western dog right now," said Mr Eddie Perkin at Eaton Vance. Mr Perkin said looking in on China is the last thing he does before bed, and the first after waking up.
Before the authorities announced the suspension of market circuit breakers on Thursday, they had triggered halts in exchanges thrice in four days. Analysts criticised the breaker for exacerbating losses as investors scrambled to exit positions before getting locked in.
"Regulators there have bad ideas," Mr Ward said. "The circuit breakers were poorly designed and were designed almost to instil panic, which is exactly what happened. Talk about yelling fire in a crowded theatre."
Night owls have been rewarded for at least a year as China's influence moved action in US stocks to hours when exchanges were closed. Last year, shares in the S&P 500 swung more during off hours than their small-cap brethren for the first time in at least 15 years. Data compiled by Credit Suisse Group measured the difference in price between when exchanges close at 4pm in New York and reopen the next day at 9:30am.
"When I look at the news, I go, 'that causes this big of a market move?' It doesn't make sense," said Mr Nick Sargen, chief economist and senior investment adviser for Fort Washington Investment Advisors. He added: "The Chinese stock market sells off, I shrug my shoulders and just say that adds to market volatility. Does it fundamentally alter my view on the global economy or US economy? No."