With today's volume over 30% below average (and the lightest since July), the week ended on an up note as the Dow managed to gain just over 1% having meandered well over 1000pts to get there. EUR closed off its best levels of the day but was the outstanding achiever and with credit markets closed (cash and CDS), it seemed the last hour saw major demand for high yield corporates as HYG surged (dislocating from everything) as perhaps it was the lever to try a late day ramp. Commodities surged with copper best on the day and Oil easily best on the week as Gold and Silver added around 1.5-2% on the week. The USD ended the week practically unch despite all the excitement.
Dowxtravaganza this week...
Ends with DXY almost perfectly unchanged.
In the CONTEXT of broad risk based drivers of equity movements we reverted quite astoundingly after extending too far up on Tuesday and too far down on Wednesday. We ended the week as we began - pretty much in sync.
But perhaps the best way to get some perspective on the day/week/month performance is to see where we have come from this year:
Gold is +16% YTD, The Long Bond +15% (plus carry), and the S&P 500 +0.5%. And where did all that equity underperformance come from? Not financials, Materials, or Industrials - that's for sure.
And while the last few months has felt incredible in terms of volatility (which it has), the moves are on par with 2008/9. It seems that 100+ moves in the Dow are standard now but we do note that the number of 300+ moves in the Dow are second only to 2008 - and we have 2 more months to go yet!