Yeah ok – the best day in US equities in 2 months… on what? Data has been crap (even JOLTS 'good news' does nothging but corner The Fed into rate hikes even more), earnings have done nothing, bonds are rallying, and oil rallied on the back of a surge in production (perhaps front-running API inventory data)…"it's all good" up here right?
US economic data continues to deteriorate…
And it appears bonds have been right…
Volume plunges to 2016 lows…
Russell 2000 Small Caps underperfomed on the day as the rest of the major indices seemed to trade tick for tick after Europe closed except for Nasdaq's meltup (today's move felt much more index top down driven than any "stock" buying)
Nasdaq "Golden Cross"-ed this week, seemingly traded very technically, bouncing off the 100DMA and pushing to test the 50/200DMA…
Futures give us a better look at the excitement…
VIX tumbled to 3-week lows (13 handle) extending S&P's bounce off the Year-to-Date "unch" levels…
Bonds and stocks decoupled (both bid)…
Stocks accelerated notably more than VIX implied…
And "Most Shorted" stocks were squeezed for 30 mins after Europe's close, they continue to underperform…
After the biggest 7-day redemption in history (yes ever ever), HYG soared today by the most in 2 months – makes perfect sense… (CDX HY rallied by the most in 2 months also – tightening 18bps to 441bps)
Treasury yields traded in a narrow range, with the curve modestly glatter (2Y +2bps, 30Y -0.5bps)…
The USD Index gained modestly onteh day thanks to continued weakness in JPY (despite strength in commodity currencies)…
While copper ended red, and despite USD gains, Crude soared and PMs managed decent gains on the day…
Finally, it appears the dismal jobs data on Friday has prompted excitment in stocks and crude oil (yay less people employed to buy gasoline!!), left bonds unphased, and caused safe haven buyers to abandon Gold (hey – a job's a job right)…
Charts: Bloomberg
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