Hmmmm...Wall of worry indeed...
Chaotic flip-flopping headlines hit Spanish stocks today (and continued after the close)...
While Trannies had a big day, S&P and Nasdaq was very quiet...
Authord by Kevin Muir via The Macro Tourist blog,
Sometimes you have to love the naivety of the markets. At this week’s Communist Party Congress meeting in Beijing, the governor of the PBoC (People’s Bank of China) said the following;
After two mediocre, tailing auctions, moments ago the Treasury sold $28 billion in 7 year paper in this week's final bond issuance and it was the ugliest of all.
Stopping at a high yield of 2.28%, this was a tail of 0.8bps - the first since July - to the 2.272% When Issued and the highest yield for 7Y paper since January. The Internals were ugly, with the Bid to Cover of 2.391 the lowest since August 2016, and sharply below September's 2.704, as well as the 2.57 past six auction average.
The S&P Biotech Index is now down 9% from its early October highs, extending losses today thanks to the collapse in Celgene's share price after it lowered its outlook.
As Bloomberg reports, Celgene Corp. dropped 18 percent in early U.S. trading after lowering its long-term profit target.
ECB President Mario Draghi is now walking back QE.
This is not a surprise to our readers. I’ve been forecasting this exact development, (as well as the Euro's spike to 120) since August 2016 (by the way, the Euro was at 109 back then everyone thought it would soon reach parity with the $USD as it collapsed).
Still, why is Draghi doing this?
Because the bond market was in revolt, with yields beginning to rise. Rising yields= falling bonds prices. Falling bond prices over time= bear market in bonds. Bear market in bonds = SYSTEMIC reset.