Stocks Surge On Endless Easy Money Promises As Italy Is Long Forgotten

Tyler Durden's picture

Stocks surged their most in 2013 today on slightly above-average volume as the Dow pushed towards its all-time closing highs and Transports went vertical (up 3.5% in Feb). While it no longer matters, it is worth noting that Treasuries and FX markets were not partaking as a broad basket of risk-assets suggests the S&P going out 20 points rich to reality. Materials are stil -1.5% on the month and Staples are leading +2.4%. In the last hour, the S&P even left behind its main driver - VIX - as the 'fear' index could not break below 14.5%. Of most notice today was the fact that equities have retraced all of their losses from the Italian election headlines and recoupled with gold on the week. The high-yield bond ETF HYG rose along with stocks but also notably the underlying HY bond market actually saw selling pressure as HYG's intrinsic value dropped markedly. Late on, trade size rose notably as S&P futures touched the under-side of the 3-month up-trend channel.

Equities and Gold recouple at pre-Italy levels...


Professional activity (h/t @eminiwatch) as we approached the underside of the 3-month uptrend channel...


which is clear in the performance of the Nasdaq at the close...

as even VIX gave up early..


Sectorally, Materials aren't confirming this cycle (and Staples are the big winners in Feb)...


Credit and equity markets moved higher together on the day at the index level but the underlying cash markets did not play along at all... We last saw this disconnect in the last week of Jan when HY began its decline...

Summing up today's equity market action in one chart - th ered line is the S&P 500, the green line represents the performance of Capital Context's CONTEXT model (based on FX, Rates, curves, credit, commodities, and swaps) - it appears equities had quite a day on their own...


Charts: Bloomberg and Capital Context


Bonus Chart: Gold and Stocks have recoupled post-QE2


Bonus Bonus Chart: AAPL had a hell of day... closed at yesterday's VWAP (and who still claims this market is not dominated by machines

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
LawsofPhysics's picture

Obamacare isn't even a fucking drop in the bucket.  The world is awash in debt, debt dealers, and debt junkies;


Vampyroteuthis infernalis's picture

Monster short squeze. Shake the money out of the muppets before the real short opportunity hits.

insanelysane's picture

Apparently the dreaded sequester isn't to be dreaded after all.  It must be priced in at +500 at least.

Silver Bug's picture

QE to infinity, just let the good times roll!

SheepDog-One's picture

Yea 'stawks surge'...all the way back to where they were 2 days ago! (not counting JC Penis horror show of course)

markettime's picture

Chart Porn is the best!

thismarketisrigged's picture

is there any chance we do not hit the all time high tomorrow? just get it out of the way, its not even impressive anymore. if i was able to print like they do, id be a billionaire as well.

Inthemix96's picture

Never mind bunga bunga,

these fuckers are cunts.

One and all.


q99x2's picture

Market trajectory set to hit +78% by year end as WWIII begins.

McMolotov's picture

....has a depleted uranium lining?

e-recep's picture

cool, i have never been in a nuclear war.

r101958's picture

All the Fed and central banks care to do, at this point, is control the price of commodities. Note how equities have recovered to their previous levels but gold, silver and oil all remain suppressed. They know that there is nothing that will quell the 'recovery' faster than high oil prices and nothing that would present a better alternative to equities, as an investment, than PM's. Especially in the current investment environment which they created.

max2205's picture

AAPL was filled with trader land mines.


Most scary was a full reversal in the long bond +.3%.... Ben could lose the long end if he keeps driving IWM higher

Just Ice's picture

but...a recovery of 144, basis June, I'll be long there

agent default's picture

Meanwhile the east is buying the physical metal at a discount.  And when the whole thing unravels Prez Husein and CNBC will blame China, Russia and Marvin the Martian as responsible for the results of the myopic policies of the Westrn Political/Banker cabal.

Lost Wages's picture

Apparently no one thinks there will be a sequester.

mayhem_korner's picture



No one (read: Algos) thinks the sequester matters.  It does matter, but not in terms of near term market ramps or flash crashes.  The sequester holds the potential of awakening a number of sheep by putting them out of work for at least a little while.  And the most critical ratio to the whole Ponzi scheme is the number of awake as a percent of the total.

lotsoffun's picture

there will be no sequester - and that should be another 300+ dow points easy.  it's all show and tell.

EclecticParrot's picture

Groupon's tanking after hours.  Could this bellwether impact tomorrow's trading? 

Mark123's picture

It will only impact overnight....then a miracle turnaround will occur just before markets open.  Voila...bull market.

max2205's picture

Still has a incredable Mkt cap of $3, yes $3 Billion.....

Poof!.....more to come if aapl doesn't buy them

GMadScientist's picture

Yes, I'd look into a 3x short on the whole lame-ass online ponzi sector.

Bastiat's picture

Message is clear: Fed can QE $1trillion a year and only the desired assets will inflate:  RE, Bonds, and Stocks.  Gold, the inflation canary, has been replaced with a freeze-dried replica.  It will be like this forever!  We are in complete control! 

agent default's picture

It works.  Until it doesn't... Then what?

Bastiat's picture

I think that question is what has the Bernank looking so drawn these days.

LooseLee's picture

Na. He is thinking of what the penalty of perjury might be later.

Bastiat's picture

An academic haunted by the increasingly insistent presence of real world consequences.

silver surfer's picture

And led me thinking of Heavy Voodoo by Lee Scratch Perry... one dollar come.. hallo .. ten dollar come.. international woodoo

Bastiat's picture

Wow! Thanks for that.  I noticed in the credits: Keith Richards, guitars.

Bastiat's picture

The comments under that on youtube are great: 

"My panic attacks started by watching this when I was a? very young boy in the late 60's. I still get goosebumps watching it now 40 years later!" 

natronic's picture

Stocks are up and PMs are down.  So one must conclude that everything is fine right?  WRONG!!!!!

Philippines's picture

Something recently seems to be cooking, and it's not Italian food.

Law97's picture

It's called "The Books."

Mark123's picture

Everything looks good when you borrow and spend money.  Well, everything except your long term prospects.


Take a look at a long term stock chart....say back to 1985.  Three massive bubbles:

1. Banking deregulation bubble (bursts early in 2000's)....massive growth in exotic financial instruments (con men gone wild)

2. Housing bubble (bursts in late 2000's)....massive growth in access to credit for people with poor credit

3. Money printing bubble (bursts in ????)....massive growth in government debts all over the world


Of course, when bubble #3 bursts perhaps we won't see the impact in the stock market....but its time is up.  Any moment now....I'm waiting!!!

mayhem_korner's picture



The stock market will know when the dollar/govt debt bubble bursts.  Panic selling across the board as the masses head for the exits.  And Gold will separate from GLD once and for all.

But it will take a little more patience.

20-20 Hindsight's picture

In theory, you're right, but we all know that this is not going to happen any time soon, because we remain stuck on fucking Groundhog Day.  

NEOSERF's picture

Says something that on the first sequestration go around, there was almost exactly two weeks of angst...this time, not even 24 hours...nobody believes Congress will either do the right thing or even not do anything....perfect world as this legislative body has almost hit bottom in terms of irrelevance.  Whatever is passed is already a tree falling in the woods...

Oldwood's picture

Denial of reality cannot persist in a constant state. Like any addiction it must "progress". The dose must increase. When you get caught short you might have a moment of clarity, the thought that maybe you have gone terribly wrong in your path, but that passes pretty quickly. The only thought in the front of your mind is that you must have MOAR! The errors in your ways will be dealt with later, but the crisis must be The markets will go higher until they simply cannot. None of us know where or when that might be. It could be a weak heart or just stepping off the curb in front of a bus...or your pusher might get tired of your lame promises to pay tomorrow for a little nudge today, and just put a cap in your ass. There is no tomorrow because these assholes have made sure of it. So carry on. Stop bitching about reality because those that could do anything about it DON'T CARE. They are the pusher and when you are dead and gone there will be another one there just like you to take your place.

GrinandBearit's picture

Notice what's been happening for the last year or so...

1. TPTB create some fear event (ie. sequester, fiscal cliff, debt limit, Euro crisis or whatever). 

2. The HFT algos climb the wall of worry.  

3. The potential disaster is magically fixed/papered over and the market shoots up to new highs.

4. Rinse and repeat as necessary.

tahoebumsmith's picture

EU phoria BITCHEZ. Just keep on smoking the crack pipe and playing lets pretend with yourselves. The more they play the worst it gets. This shitstorm is beyond most people's comprehension. OBTW I would highly recommend any Johnny come latelys to start stacking while the opportunity still presents itself, especially after the cephalopod's call yesterday of 1450. With that said you know it's only going one way...yup


jtmo3's picture

Not forgotten, just ignored. It doesnt fit the buy anything anytime scheme.

traders must love this market knowing down is not an option!

Super Broccoli's picture

banks are the only ones left on the market so whenever they decide to prop the shit up ...


good thing is when the ponzi collapses they'll be the ones biting the dust !