Following Friday's best day in 6 months, gold tumbled most in 4 months today as the German Government crisis sent investors fleeing any source of safe haven!!??
Sell bonds, sell gold, sell protection...
Seriously...
Before we get to the farce in US equities, let's look at German stocks...
Which is odd because EURUSD actually dumped it all back (after its own machine-driven ramp back to unch)...
Oh, yeah and don't forget Chinese stocks' miraculous lift!?
As Bloomberg's Vince Cignarella noted, strong earnings and solid global growth prospects continue to lift stocks while falling Treasuries and higher yields drove dollar gains; investors ignoring the Trump administration’s plan for fresh sanctions on North Korea and the failure of Angela Merkel to put together a coalition government in Germany. U.S. President Donald Trump said Monday he will designate North Korea a state sponsor of terrorism, subjecting the regime to additional sanctions. The EUR fell as coalition talks in Germany ended; German Chancellor Angela Merkel said she would prefer to go ahead with new federal elections rather than try to form a minority government. Gold and the VIX fell, punctuating the market’s disregard for global events.
Which brings us to US equity futures... (odd divergence between Dow and Nasdaq as cash markets opened)...
Small Caps were the day's best-performer... with a total meltup squeeze into the close...
This is the biggest 3-day short-squeeze since February...
NOTE what happened in the subsequent days the last time.
Once again we have The Bank of Japan and the algos to thank for this non-stop bid...
AT&T and TWX slid after anti-trust headlines...
HYG rallied very modestly today early on then sold into and beyond the EU close - notably underperforming stocks...
And credit risk worsened from the open while VIX was crushed...
Treasuries were initially bid (down 2bps) after Merkel's headlines but then as everything rebounded, bonds sold off (but the long-end outperformed)...
The UST weakness sent the spread to Bunds back above 200bps...
But the curve just keeps collapsing!!!
Just hammered...
The Dollar Index echoed the chaos in EURUSD today as the initial surge was met with machines selling all the way down to unchanged... which sparked a rebound...
WTI/RBOB both fell on the day..
Gold swung fron best day in 5 months to worst day in 4 months, breaking back below the 50- and 100-day moving-averages...
Bitcoin soared to new record highs above $8000 this weekend...
Sending Bitcoin's market cap above Nvidia's...
Finally, gold is still clinging to green post-Saudi chaos...