Bonds have gievn up, comodities have given up, inflation expectations have given up, bank stocks have rolled over, and even 'soft' data is starting to rollover... still the 'rally' is in tact, it's just a fleshwound according to the business media...
Bonds just overtook The Dow year-to-date, Banks are red and gold leads...
This is getting silly...
A turmoily day:
- Theresa May announce surprise general election - crashes FTSE100 (most since Brexit), sends cable soaring most in 3 months to highest since Oct 3rd
- Goldman big miss - worst day since Brexit
- Industrial Production disappoints with plunge in factory output - never been down this long outside of a recession
- US Macro Surprise index plunges most since May 2011
- Dollar tumbles most in a month after Goldman folds on Long Dollar (and cable strength) - lowest close since day after election
- 30Y Treasury yield tumbles most since first day of January - lowest close since day after election
But, thanks to the ever-present willingness to sell vol, stocks managed to BTFD...
Small Caps managed to close green...
After yet another squeeze...as soon as Europe closed
VIX call volumes are spiking...
With a record net speculative short positioning, it is perhaps not surprising that Cable exploded higher today...
But then margin calls and algo panic ran the pair over 1.29 in the afternoon...
The Dollar Index and The Long Bond (yield) have plunged to the lowest levels since 11/9/17... blame The Fed...
The front-end reflation trade has tumbled...
The Treasury curve has collapsed to 6-month lows...
Goldman suffered the worst day since Brexit...
Surprise!! Maybe Goldman credit markets were right after all?
Still a lot of hope priced into Goldman shares...
Banks have been ugly since Trump spoke to Congress...
Gold was mysteriously hammered into the London Fix but headlines about The Pentagon planning to shoot down North Korean missiles sent the precious metal soaring again...
WTI and RBOB bounced back in the afternoon (ahead of tonight's API data)
But weakness across Asia last night was dominated by the collapse in industrial commodities...whoich have erased all the gains post-Trump
So, what happens to the stock market next?
Of course this is no surprise to bond traders...