Evacuate The Dancefloor: Coordinated Dump In Stocks, Bonds, Commodities And Crude
Equities slipped to their lowest close since Draghi's 'I-have-a-dream' speech
and 4th red day out of the last 5. Things were choppy in a tight range before
the FOMC and immediately after (aside from a little noise) but as the close
approached S&P futures tested yesterday's lows, APPL slipped from its VWAP
moorings (but ended green) and even FB eased lower (10% off its pre-open highs).
The last hour saw selling pretty much everywhere as Treasury yields
popped 2-3bps (even as stocks fell), Gold slid, Oil Slid more and the USD sold
off into the close. Given the 'distance' between bonds and stocks, this
compression might make some sense (thanks to a lack of anything new from
Bernanke to keep the wolves from the depression door). Credit markets
tracked stocks - though HYG tried to outperform, only to fade Baumgartner-like
into the close. Stocks caught down to VIX's weakness from yesterday and
then VIX decided to outperform flat into the close as stocks ended just 'off the
lows' as CNBC would say. Only Citi remains green from post-QEtc. among the
financials with Buffett's fave WFC -7.9% since 9/14.
Seemed like a broad-based sell-off in all USD-related 'thing's as Treasuries, Commodities, Gold, and Stocks all saw pressure this afternoon... Note the late-day surge was an effort to get back to VWAP at 1408.5 - which failed interestingly...
Only Citi remains green from the post-QEtc highs of 9/14...
Credit was slightly less sanguine after the day session close as stocks limped higher but the plunge in HYG after trying to levitate stocks post-FOMC was on heavy volume...
In general, stocks underperformed risk assets once again - and as the day wore on systemic correlation fell notably (especially as TSY weakness into close did not 'fit' with equity weakness in an algo-driven world)...
Charts: Bloomberg and Capital Context
Bonus Chart: Still plenty of room left for the TSY-Stock convergence... which might help explain the TSY weakness with stock weakness today
and the HYG strength with stock weakness earlier on...
Seemed like a broad-based sell-off in all USD-related 'thing's as Treasuries, Commodities, Gold, and Stocks all saw pressure this afternoon... Note the late-day surge was an effort to get back to VWAP at 1408.5 - which failed interestingly...
Only Citi remains green from the post-QEtc highs of 9/14...
Credit was slightly less sanguine after the day session close as stocks limped higher but the plunge in HYG after trying to levitate stocks post-FOMC was on heavy volume...
In general, stocks underperformed risk assets once again - and as the day wore on systemic correlation fell notably (especially as TSY weakness into close did not 'fit' with equity weakness in an algo-driven world)...
Charts: Bloomberg and Capital Context
Bonus Chart: Still plenty of room left for the TSY-Stock convergence... which might help explain the TSY weakness with stock weakness today
and the HYG strength with stock weakness earlier on...
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