By Greg Peel

The Dow closed down 76 points, or 0.5%, while the S&P lost 0.6% to 1631 and the Nasdaq fell 0.6%.

A big bounce in the Aussie dollar on Monday night helped stabilise the Australian market yesterday as the foreign exit took a breather. No rate change was expected from the RBA so when no rate change was delivered, stocks were little impacted. The session's major data release showed Australia's current account deficit reduced to $8.5bn in the March quarter from $14.8bn in December, close enough to expectation. The reduction represents a fall-off in heavy equipment imports as the mining capex boom peaks, matched with a rebound in iron ore export prices from the December quarter.

Notably, Australia's foreign debt rose by 1% in March to $764bn, or $33,217 for every man, woman and child, but it will be interesting to see how that number fares in the June quarter given the foreign exit we have seen from Australian government bonds.

The RBA may have left the cash rate at 2.75%, but the central bank made it clear another rate cut could be on the cards depending on how the data play out from here. There was little reaction from the stock market, but the Aussie tanked on the news, ultimately falling 1.2% to US$0.9650 last night despite the US dollar index being only 0.1% higher at 82.76.

Wall Street opened slightly higher last night, but wobbled its way through the morning, with tonight's private sector jobs number and Friday's non-farm payrolls likely keeping trading subdued in the interim. But just after lunch Kansas City Fed president and FOMC member Esther George issued a statement voicing her eagerness to reduce the size of the Fed's bond purchase program, suggesting the risk of not winding back soon enough was as great as the risk of winding back too quickly.

So Wall Street plunged, falling 150 Dow points. The pointlessness of these volatile Fedspeak reactions is highlighted by the fact George has been one of the most vocal critics of QE3 to date and has voted against it at every FOMC meeting this year. So her comments were hardly a surprise. Cooler heads on Wall Street are happy to assume that if ongoing US data are positive, the Fed will think about tapering by year-end, and if they're not so positive, QE3 will remain intact into 2014. If anything, volatility to should be reduced by this assumption.

Whenever Wall Street has taken a dive this year it hasn't taken long for the buyers to emerge from their caves, hence stocks began rallying to the close. Momentum waned at the death hence a net weaker close. And so came to an end the Dow's record run of twenty consecutive Tuesday rallies.

Through all this stock market to-ing and fro-ing of the last week or so, the US bond market has remained relatively steady. Having shot up to 2.13%, the ten-year yield has trod water for several sessions now. The US dollar index, as noted, was also steady last night, no doubt assisted by yesterday's 2% bounce in Japanese stocks. Hawkish Fedspeak in not gold for gold though, so it fell US$11.90 to US$1399.30/oz.

Base metals were mostly stronger last night as traders square up ahead of the all-important US jobs data, with copper up 1%. Has the recent rapid slide in iron ore prices come to an end? The spot price jumped a substantial US$4.70 yesterday to US$116.60/t. There is talk of Chinese consumers having reached the end of their destocking phase.

Middle East tensions are again impacting on oil prices. The war in Syria is escalating as the government's Russian and Iranian-armed troops win back ground over the so far little supported rebels. There are movements afoot in Europe to arm the rebels, which would take the conflict to a more international scale. Meanwhile Turkey ? once a bastion of secular calm and a buffer between Middle East and West ? is imploding. And last night the US stepped up sanctions on Iran in further retaliation for its nuclear program.

Brent crude is most impacted by the Middle East now that West Texas crude is increasingly more home grown. Brent rose US$1.18 to US$103.24/bbl last night, while West Texas was quiet ahead of tonight's weekly US inventory data, rising only US5c to US$93.50/bbl.

The SPI Overnight fell 19 points, or 0.4%.

It's GDP day in Australia today, with the market expecting 0.8% quarterly growth to 3.1% annualised growth, up from 2.7% growth for 2012. It's also services PMI day around the globe, ADP will release its US private sector jobs report tonight, and the release of the Fed Beige Book may spark more Fedspeak reaction.

Jobs will be the biggie, nevertheless.

Rudi will appear on Sky Business today at 5.30pm.