Small Caps Jump, Big-Tech Dumps, As Biden’s Booming Budget Busts Bonds

Biden’s booming budget sent yields higher on the day – and the retroactive capital gains tax embedded in that budget spooked stocks broadly speaking. But Small Caps refused to lay down as the short-squeeze continued. Nasdaq ended lower on the day…

The Dow and S&P haven’t been this uncorrelated since the dotcom crash in 2000…

Source: Bloomberg

Small Caps are ripping back relative to Nasdaq as the spiky trading continues…

The last two days have been the biggest short-squeeze since the panic-spike in “most shorted” stocks amid the last WSB Reddit Raiders attack in January… And hedgies suffer…

Source: Bloomberg

WSB stocks are soaring again…

Source: Bloomberg

…with AMC (and its massive short position) getting its face gamma-squeeze-ripped off…

AMC was the most-traded stock in the world today!!

THEY DID IT AGAIN: $AMC is the most traded equity in the world today w/ $13b, more than $TSLA and nothing trades more than TSLA these days. LOL. pic.twitter.com/Q1fL43NrGJ

— Eric Balchunas (@EricBalchunas) May 27, 2021

VIX crashed to a 16 handle once again…

Bond yields broke higher on the heels of Biden $6 trillion budget bonanza – now that’s a lot of supply to soak up if The Fed is gonna taper. Yields were up around 3bps on the day, but remain lower on the week…

Source: Bloomberg

10Y yields pushed back above 1.60% again…

Source: Bloomberg

Bitcoin oscillated again between $40k and $38k…

Source: Bloomberg

Ethereum is also coiling up for a move…

Source: Bloomberg

The dollar went nowhere on the day, testing higher and lower intraday to end back at unch on the week again…

Source: Bloomberg

Spot Gold fell back below $1900 today, but staged a decent recovery after Europe closed…

Source: Bloomberg

Oil finally broke out of its recent range (top the upside)…

Source: Bloomberg

Finally, the economy is screaming ‘Stagflation’…

Source: Bloomberg

And stocks are loving stagflation? It’s a mad world alright!