Over the past few weeks, there has been practically no correlation between the moves in carry trades and the move in the Dow.
This is a big departure from a year or even just a few months ago when risk appetite had the same impact on the currency and the stock market. On Friday, the Dow dropped over 200 points and yet EUR/JPY and CHF/JPY rallied. Since the middle of May, the stock market index has tumbled more than 1000 points and yet pairs like AUD/JPY has climbed 400 pips while EUR/JPY has climbed 500 pips during the same period. This suggests that the sell-off in stocks may not be entirely due to risk aversion.