The slow-motion wreck continues...
Trannies are now up over 2% from the start of the ramp at 330ET yesterday... It was all nearly ruined by a late-day "credible threat" headline... but there's no way that's breaking this Santa Claus rally...
With stocks having retraced 50% of the post-Fed plunge...
With crude failing.. and JPY fading... all that was left was to crush VIX (via VXX selling)
Volume was terrible... And so was breadth...but The Long-Bond continues to outperform post-Fed (along with gold) as WTI and stocks lag...
"Most-Shorted" stocks were smashed higher after Europe closed today (same as yesterday)...
And The "dash-for-trash" is most clearly seen here... as Weak Balance Sheet stocks suddenly surge relative to Strong Balance Sheet stocks...
Today's dash-for-trash appears to be a desperate high-beta run for the Santa Claus rally into year-end as they reverse the biggest losers of the year...
But The S&P and Dow remain red for the year... in other words 1% more in this rally for The S&P before we see selling pressure
Chipotlecoli is now down 35% from October highs...
Credit's decoupling yesterday was crushed today...
Corporate bonds rallied (but only retraced around half of the plunge post-Fed)...
But while energy stocks find support at the year's lows, the energy sector's credit risk is continuing to dive... (very late on Energy spreads below even further out to 1406bps - record wides)
Who do you think is right? A 28x Fwd P/E equity market.. or credit professionals?
Treasury yields surged today (led by the long-end) as the curve steepened 3bps or so
Cable plunged today but it was EUR weakness after the european close that sparked a modest recovery in the USD (which closed red)...
Despite the USD Index weakness, commodities drifted lower (with copper worst)...
But WTI rallied as Brent sold off, driving the spread to zero for the first time since January... with Brent hitting cycle lows...
Charts: Bloomberg