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20 Out Of 20 "Tuesdays" For The Dow; Worst Day In Bonds For 19 Months

Tyler Durden's picture




 

The streak is alive. For the 20th Tuesday in a row, The Dow Jones Industrials have closed green. With an average gain of 80 points, since 1/25, the Dow is up an impressive 11% but absent Tuesdays is merely unchanged at +0.2%. Today saw significantly volatility in stocks though with Nikkei and S&P futures giving up all their gains at one point only to bounce back into the close for a glorious victory. Volatility was everywhere as the collapse of the JGB market spills over. VIX rose 0.5 vols to 14.5% (disagreeing with stocks). FX markets jerked and gapped with JPY ending down around 1% from Friday's close. Commodities diverged today with Copper and Oil rising and Gold and Silver sliding even with the 0.75% gain on the USD this week. High yield credit slid lower all day but we suspect this was dominated by rate risk as Treasury volatility exploded. 10Y yields rose by their most (+16.5bps or 5-sigma) since Oct 2011 to close at their highest since April 2012.

 

20 out of 20...

 

Leaves the Dow unchanged in 4 months absent Tuesdays...

 

Nikkei (and S&P) futures ramped out of the gate, sold off after POMO and the European close to slump back to unchanged before taking off into the day-session close...

S&P futures collapsed back to the lows of the day after the cash close...

 

 

As Treasury Yields exploded higher...

 

Credit markets (this is just spread in the red so the only bleed from rate vol is cyclical) were not buying at all...

 

FX markets were extremely volatile with USD bid as CHF was sold hard...

 

Just how much longer are corporations going to be able to borrow at cheap rates if this pace of yield decompression continues? And will those buybacks continue if the free money dries up?

 

Charts: Bloomberg

 

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Tue, 05/28/2013 - 16:17 | 3604813 insanelysane
insanelysane's picture

Maybe next Tuesday we could try POMO free and see how good the economy is?  Just try it?  Once?  1/2 POMO???

Tue, 05/28/2013 - 16:27 | 3604869 Pareto
Pareto's picture

"1/4 POMO, 8th POMO, common fellas where do you want to start.  SIXTEENTH  - 16th POMO thank you sir, 16th POMO 16th POMO, will ya give me 1/8th, and now 1/4. - Comeon boys, she's a good looking half POMO day right there - whats another 4 fingers.......and now a half....thank you sir....somebody bidme the 3/4 POMO, the 3/4 POMO, bid me 3/4 POMO, 3/4, 3/4, ALL IN.  SOLD to the insanely sane - 1/2 POMO. :)

Tue, 05/28/2013 - 18:51 | 3605489 cynicalskeptic
cynicalskeptic's picture

The Plunge Protection team only works on Tuesdfays?!?!?!   

How do I get one of those gob'mint jobs? 

Tue, 05/28/2013 - 16:18 | 3604823 slaughterer
slaughterer's picture

Serious bloodbath in bond land.  Bernanke has to be nervous here.  

Tue, 05/28/2013 - 16:20 | 3604832 Winston Churchill
Winston Churchill's picture

Where is the money going ?

The safety of Greek Govt. bonds perhaps ?

Tue, 05/28/2013 - 16:23 | 3604844 EscapeKey
EscapeKey's picture

I thought the risk-free investment that is Greek government bonds (now that the finances are entirely under control, and in no way disappoint no more) were on a continuous rise?

Oh, and as is subprime bonds. Stellar investments, if you ask me.

Tue, 05/28/2013 - 16:25 | 3604862 nope-1004
nope-1004's picture

Bernanke reminds me sooooo much of that really hot chick from College that you were sure would look good without make-up.  Then......  the truth hit one day and she looked 'funny'.

That's totally how I feel about Bernanke and this market.  It is so fucking fake.  One day this grand experiment in stoking illusions is going to end very badly.  And perceptions of the bearded scientist will change drastically.

 

Tue, 05/28/2013 - 17:01 | 3605082 jcaz
jcaz's picture

...It's going to cover the carry trade after the Japanese market melts down tonight.....

Tue, 05/28/2013 - 19:02 | 3605518 gatorengineer
gatorengineer's picture

Lets see yen up, Bonds down.... perhaps just perhaps the Japs are selling Tbills, and repatriating the cash to cover liquidity or BTFD....?????

Tue, 05/28/2013 - 16:37 | 3604921 wallstreetapost...
wallstreetaposteriori's picture

I agree with that statement.  As much as everyone touts that bond yields can only go up, I seriously doubt that they can up much more as long as the US Govt carries its deficit.  

Tue, 05/28/2013 - 16:45 | 3604980 fonzannoon
fonzannoon's picture

Bernanke has to be shitting himself and yet that cumquat Bartiroma still chirps "taper" every 3 seconds. The only shot Bernanke has right now is to convince everyone he started tapering already. Because there is no way he can drop the bid from here.

Tue, 05/28/2013 - 16:21 | 3604838 EscapeKey
EscapeKey's picture

Before you know it, the markets will be up every day ending with "-day". That's how free markets operate.

Tue, 05/28/2013 - 16:24 | 3604854 dracos_ghost
dracos_ghost's picture

I thought it was already "any day with a vowel or consonant in it". Why be so restrictive?

Tue, 05/28/2013 - 16:56 | 3605059 Peter Pan
Peter Pan's picture

It will be up on all days ending with -day except DOOMSDAY.

Tue, 05/28/2013 - 17:01 | 3605079 EscapeKey
EscapeKey's picture

Stock markets will be ESPECIALLY bullish on doomsday.

Tue, 05/28/2013 - 16:22 | 3604840 SheepDog-One
SheepDog-One's picture

Bonds are what Bernank actually cares about, and they're shit. Of course, no one really cares about bonds, so volumeless stock exuberance can be used as a crutch I don't know for how long though.

Tue, 05/28/2013 - 16:22 | 3604842 Dareconomics
Dareconomics's picture

Everybody loves Turbo Tuesdays, except Yogi and his friends.

 

http://dareconomics.wordpress.com/2013/05/28/around-the-globe-05-28-2013/

Tue, 05/28/2013 - 16:22 | 3604843 LostPolarBear
LostPolarBear's picture

10Y now at 2.13%?  Wonder where the breaking point lies...

 

 

Tue, 05/28/2013 - 16:24 | 3604853 EscapeKey
EscapeKey's picture

Meh, no breaking point. Bernanke will just increase the pace of "sterile" bond purchases "temporarily", in order to "stabilize financial markets".

Tue, 05/28/2013 - 18:36 | 3605452 disabledvet
disabledvet's picture

pretty much. the word "forever" comes to mind when it comes to that plan. and if Japan can Tankaning...he can drop the pretense of "stabilization" and simply say "hell yeah i'm stabilizing this thing." who knows what else what he might be buying as well...can't buy everything though. http://www.youtube.com/watch?v=AVDGgphmcX8

Tue, 05/28/2013 - 16:46 | 3604985 fonzannoon
fonzannoon's picture

I thought it was 2.18%

Tue, 05/28/2013 - 17:44 | 3605281 Panafrican Funk...
Panafrican Funktron Robot's picture

Above 2.5% is a pretty big fucking problem.

Above 3.0% everything breaks.  And I'm talking absolutely fucking everything.

Tue, 05/28/2013 - 19:47 | 3605634 PiltdownMan
PiltdownMan's picture

For the US is pop 16 bps in one day is pretty unusal with all The Fed activity.

What should scare the Fed is the rising MBS durations from Tresury increses. This guy has some nice charts.

http://confoundedinterest.wordpress.com/2013/05/28/us-treasury-yields-jump-16-basis-points-as-lumber-continues-to-decline-on-positive-news/

Tue, 05/28/2013 - 16:23 | 3604848 Cacete de Ouro
Cacete de Ouro's picture

Roll on Humpday!

Tue, 05/28/2013 - 16:23 | 3604850 TahoeBilly2012
TahoeBilly2012's picture

I now here is Led Zeppelin on Two for Tuesdays...on KZAP radio Sacramento...

Tue, 05/28/2013 - 16:25 | 3604857 q99x2
q99x2's picture

Gives me the willies.

Tue, 05/28/2013 - 16:32 | 3604897 realtick
realtick's picture

what rhymes with tues?

Tue, 05/28/2013 - 16:33 | 3604903 Major Major Major
Major Major Major's picture

booze

Tue, 05/28/2013 - 16:52 | 3605031 Peter Pan
Peter Pan's picture

I think he meant Jews.

Mind you the part of non-Jews is just as worrisome.

Tue, 05/28/2013 - 16:35 | 3604914 Frank N. Beans
Frank N. Beans's picture

There's a new pizza joint downtown Phoenix called Pomo Pizza

go figure

Tue, 05/28/2013 - 16:54 | 3605045 Peter Pan
Peter Pan's picture

I think it has something to do with making dough.

Thu, 05/30/2013 - 07:37 | 3609818 Uchtdorf
Uchtdorf's picture

pomodoro is Italian for tomato. interestingly, doro is the Japanese word for mud. rotten tomatos falling into the mud to be trod under the feet of physical owners.

Tue, 05/28/2013 - 16:37 | 3604924 bks
bks's picture

So if you take out the top twenty days, the market is still up for the year?  Good year to be in the market.

    --bks

Tue, 05/28/2013 - 16:40 | 3604951 Peter Pan
Peter Pan's picture

Given that there is virtually no movement in the DOW for the other days of the week it would seem the logical thing to close the stock msrket on all those days and have it operate on Tuesdays only.

In the face of such provocation it should be clear to all and sundry that the threat of a further crush in the gold market may well happen but will only serve to prove that the system is beyond hope, repair or salvation.

Tue, 05/28/2013 - 16:43 | 3604975 bluskyes
bluskyes's picture

Proabably the result of some derivative arrangement foolishly entered into with JP Morgan paying 10,000 to 1, if the S&P advances 21 sequential Tuesdays.

Never bet against the house.

Tue, 05/28/2013 - 16:46 | 3604987 electricgorilla
electricgorilla's picture

Everything is back correlated to the USD/JPY....were gonna get some major exuberance if the market bounces out of last weeks minimal downturn...If Ben doesn't say he is going to Taper at the June meeting, this already unrealistic market is going to get even more unrealistic.

Tue, 05/28/2013 - 16:58 | 3605068 WhiteNight123129
WhiteNight123129's picture

JUst in case you did not get the Memo.

SHORT TREASURIES BITCHEZ!

Tue, 05/28/2013 - 19:04 | 3605523 gatorengineer
gatorengineer's picture

the rubber band is getting wound tighter... One day the dow drops 300 pts and treasuries move 20 bps the other direction.....

Tue, 05/28/2013 - 17:04 | 3605100 Rimon
Rimon's picture

Looks like dead cat bounce in spooz and nikkei.. Don't think they can handle the rate puke.. 10s now yielding above spooz.. HYG at 2 months lows and XLU imploding.. Nikkei tonite wud be fun to watch

Tue, 05/28/2013 - 17:11 | 3605128 grekko
grekko's picture

Hey, does anyone remember if "Tuesday" is Prince Spagetti Day?

Tue, 05/28/2013 - 20:01 | 3605663 Cobra
Cobra's picture

I'm not gonna look it up, but I remember it as Wednesday.
EDIT: http://youtu.be/KlNAYCcxgUw

Tue, 05/28/2013 - 17:16 | 3605152 pragmatic hobo
pragmatic hobo's picture

POMO + end-of-the-month-window-dressing = new-high.

Tue, 05/28/2013 - 17:19 | 3605169 Rimon
Rimon's picture

Has got to be a monster allocation need from stocks to bonds this monthend based on performance

Tue, 05/28/2013 - 17:25 | 3605192 taketheredpill
taketheredpill's picture

YTD move in SPX not validated by USD strength.  Not that it matters anymore...

 

Tue, 05/28/2013 - 17:43 | 3605276 Imminent Crucible
Imminent Crucible's picture

I'm pretty sure the Fed can do this FOREVER. Unless trees don't grow to Alpha Centauri.

If trees don't grow that high, one of these days the bond markets are going to give Uncle Ben a lesson in humility.  I don't think he can resign fast enough to save his, uh, "legacy".

Tue, 05/28/2013 - 17:46 | 3605282 Meremortal
Meremortal's picture

"10Y yields rose by their most (+16.5bps or 5-sigma) since Oct 2011 to close at their highest since April 2012."

 

"The heart, Ramon. Always aim for the heart."

-Cint Eastwood, in Fistful Of Dollars.

The bond market will tell you what's coming. It has no choice, unlike the govt. That's why Bernookie is preparing the stock market for interest rate increases. He has to stay close to bonds wherever they go. Otherwise he gets slaughtered.

 

Tue, 05/28/2013 - 17:46 | 3605287 Hubbs
Hubbs's picture

Getting to the point that it all reminds me of a variation of Dirty Harry come next Tuesday when we'll be asking ourselves....

Was it 20, or 21 (positive Tuesdays)? Do you feel lucky, punk?

 

Tue, 05/28/2013 - 18:30 | 3605433 Pareto
Pareto's picture

I totally agree and yet sort of don't.  We've been saying this for a long time.  And I beleive we could be saying it for another long time, until we really look retarded.

Tue, 05/28/2013 - 19:43 | 3605613 MetalFillBoy
MetalFillBoy's picture

Duplicate post.

Tue, 05/28/2013 - 20:10 | 3605691 thismarketisrigged
thismarketisrigged's picture

it would only be fitting that these greedy bastards in the stock market have all their gains wiped away in 1 day.

 

it would serve them right, and id get so much joy out of it.

 

fuck the fed and the bankers who steal from our children and future grandchildren. wish them nothing but the worst

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