Today in Small Caps...
SPOTTED: Chasing the $RUT pic.twitter.com/aXwW7pfHG2
— Sven Henrich (@NorthmanTrader) September 27, 2017
Small Caps exploded over 2% higher - the biggest gain since the election - on Trump Tax hype... (we note that marketd di roll over a little once Trump began speaking)
(NOTE - today was the biggest short-squeeze in 2 months)
VIX was monkeyhammered back to a 9 handle... because why not...2500 was rescued once again...
Interestingly, while Russell 2000 melted up insanely, its VIX also rose notably...
Quite a decoupling...
In an ironic move, The Fed's Bullard warned that "equity valuations may be stretched" and the S&P ripped to a new record high above 2510...
While the market seemed to sell off on the leaked tax plan details, we note that 'high tax' corporations extended their recent gains relative to the market...
The last 6 days have seen the biggest spike in 'high-tax corps relative to the market' since the election... (NOTE - the last surge was in June as Mnuchin shared his one-pager and once again we are back at the election level that stalled hope before)
Notably the initial spike faded quickly then accelerated but once the Republicans began their press conference, high-tax stocks underperformed the market, but that did not last long...
FANG Stocks were bid with both hands and feet...
Ugly day in bond-land as Treasury yields surged extending losses after yesterday's hawkish Yellen comments...
This was the 30Y Yield's biggest spike since the election...back to the same level as at the June Fed rate-hike...
The yield curve steepened massively... as bank stocks underperformed the market
Will Gundlach be right after all?
But, as Bloomberg notes, the world’s most important bond market is stuck in its worst rut in more than half a century. Ten-year U.S. Treasury yields have been locked between 2.01 percent and 2.63 percent in 2017 -- a measly 62 basis points. That’s the tightest trading range since 1965 and analysts see little capacity for a breakout going forward: The median year-end estimate of 62 analysts and strategists surveyed by Bloomberg is for 2.48 percent.
The Dollar Index rallied to its highest in over 6 weeks (since Aug 16th when the FOMC Minutes were released)...
The Loonie was the big mover after Poloz backed away from continued rate hikes...
FX Volatility is trading at the upper end of its multi-year range relative to stock vol...
WTI rebounced but RBOB did not after DOE inventory/production data...
Copper, Gold, and Silver are all down on the week...
Gold tumbled to a $1280 handle (one-month lows) as the dollar surged and Bitcoin spiked towards $4200...
Erasing Bitcoin's post-Dimon drop after Gorman's comments...
Bitcoin also pushed back well ahead of The Swiss National Bank...
Finally, there is this...hope is a strategy after all...