Stocks Melt-Up As Bond Yields Spike Most In 2 Years

Tyler Durden's picture

The market remains confused. The better-than-expected headline jobs data prompted USD strength (Taper-on), gold/silver weakness (Taper-on), Homebuilder stocks drop (Taper-on), Bond yields surge (Taper-on), and credit market widening (Taper-on); but the good-old trusty US equity market was not having any of that. After dumping 25 points from its post-NFP highs, S&P 500 futures gapped and jerked up to VWAP, ran stops at the highs of the day, dropped back to VWAP, then surged into the close. The Dow ended up 150 points. Treasury yields rose the most in 2 years - an impressive 22bps. Despite a late surge, high-yield bonds had their worst day in 2 weeks. Gold and silver down 2.3% and 3.5% respectively and copper dumped 3.2% (not exactly the growth-exhibiting factor that everyone suggests is driving stocks up and bonds down). Meanwhile, WTI topped $103 for its highest close in 14 months.


A 'well-supported' rally in the markets...


The S&P closed above its 50DMA for the first time in 2 weeks... with the best 8-day run since the start of the year - and it looks like (for cash markets) this fills the post-FOMC gap...


and the NASDAQ (thanks to AAPL's great week and today's loss) is now above FOMC levels...


Treasuries were battered... closing at their high yields of the day with 7Y underperforming +26bps on the week.


Spot the odd market out... (credit was not playing along with stocks)


But the late-day 330Ramp Capital driven idiocy was insane... with plunging volume


Homebuilders did it again (though managed to rally along with the market from early lows) and Discretionary laughs in the face of a Taper...


WTI surges 7% and above $103, gold and silver hurt as the USD rips and Copper ignoring the growth meme...


Charts: Bloomberg and Capital Context


Bonus Chart: Gold and AAPL continue their dance...

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Catch-22's picture

Far gone are the days of articles asking “Who is Zero Hedge, and why should we care?”, asserting that  “Mr. Durden and Zero Hedge have a reputation as provocateurs…” (The Globe and Mail, Friday, Aug. 19 2011).

MailOnline (aka didn’t take the bait on the job numbers but did take our friend M.Durden’s analysis…

“The popular financial website Zero Hedge also blamed June's net loss in full-time jobs on Obamacare, suggesting that many employers shifted full-time workers to part-time status in June in order to avoid long-term costs of offering them health care coverage.” (

To the prescient observers/members who supported Tyler at inception…

Thanks! ...   Cheers!


TheEdelman's picture

Maybe we'll see a gold plated iPad soon.  

/fingers crossed

tsx500's picture

it won't be complete until i get short it      <sarc>

Lets Buy The Dip's picture

I had to plus one you. 

Investors are nervous, but remember the FED has done nothing yet, all this selling off and buying up on yields is all on rumour and speculation. Gotta luv it ey?

plus the Weekly DOW chart looks amazingly good ==>

NotApplicable's picture

Popular? Well, there goes the neighborhood!

ptoemmes's picture

Can't wait for Jay Carney (to try) to call out ZH ;-)

Need someone to ask him what the Admininstration thinks about Mr Durden at ZH.



Obchelli's picture

US DEB 100 bln shy of 17 trillion - it's all bullish

Being Free's picture

99 Bln - still bullish.

Panafrican Funktron Robot's picture

10 year is a complete disaster, 2.5% was the point where IR swaps start becoming a problem.  This will get ugly very quickly.

Aurora Ex Machina's picture

Having the Daily Mail in your corner is basically 'the Establishment' declaring war on you (in a managed way, and for specific intent).

No-one serious believes them (and their owner / editors are very carefully managed), and it's certainly a counter-stroke to *ahem* Guardian links. The only interesting thing is that someone feels that middle England needs to feel angry at the banks, and they want to split ZH from Guardian sources.

The fact they had to marshal the Daily Fail is more telling than you realize, at least for domestic UK politics. [Probably the pro-Farage stuff, more points to the theory that back-bench Tories are looking for an ally].


Shit is complicated: Daily Mail guarantees that a certain % of UK "left wingers" will switch to hate mode, and will tar by association. It's clever, but it's also incredibly parochial and rather *ahem* 1.0. The smart lefties (a tiny bunch) already know about ZH. Let's just say, they're not entirely "positive" about it. You're all the evil fascists, waving the Nazi flag.


The media has moved on, dears. So, so, so slow. Still, fuck it: more pageviews, bring it on; the Daily Mail is good for a couple million hits. They might even learn a thing or two if they're not immediately terrified of the comments. Although - that feeds the cycle: trust me, any comment on this board is going to cause EPIC levels of outrage to most DM readers. Francis is going to hit +10,000 reports about his Cheesepopes immediately, and I trust I won't be too far behind when I mention Church sponsored pedophilia.


Positive Feedback Loop, engage. Warp Speed, Mr Spock.

Catch-22's picture


By the time I read this I was knee deep in “happy hour”…. I might actually agree with you…

Unless you’re from the UK, your statement  would be a little cryptic… It’s nice to get a little feedback from the chaps overseas…

I’m sorry you had to bring Nigel into this… Some of us are really fond of him…  :-) 

I mentioned to my wife, they (Daily Fail) is using ZH only because it suits their current agendas…

Thanks for your input… I appreciated your perspective.


Aurora Ex Machina's picture

The other way to look at it is tracking just how much traction The Guardian has got via ZH to American readers who would never, ever, ever have thought to read them before. If the Daily Mail is trying to get onto the action, you know there's money to be made.

It's all about the Benjamin's. Expect a HEROIC and EPIC level dismissal of ALL of the HATED BRITISH COLONIAL MEDIA from Bloomberg, NYT and Fox News soon. Shit sells - the question of how honest your shit is, well, that's a different question. (And Francis, despite his failings, is correct to ask who is sponsoring what news. He's not far off, but he's wrong about the intent: "ZE JEWS" [Non-Zionist version] tend to like the truth, and hate propaganda, 'cause that didn't end well for them last time).

Yeah, but then Hollywood. Shit. I hate it when reality and Magical Accounting get in the way of a nice story. Guess we devolve into "Use of Weapons" again.

It's all bullshit: and TPTB have total information dominance (including people, if you want to get into spooktastic OPs, if not populations, and trust me: Phase IV is not a joke), so you're really only choosing the level of bullshit you want. I'd advise the Guardian level: they like you people, and have notions where the eloi and morlocks live harmoniously.


And, Farage has a role: but never, ever, ever forget he made his money trading, and is a City of London boy. He represents the City, always has, always will. He's nothing but a City spokesman - an educated and funny one, but he's toeing the City Line at all times.

trader1's picture

i'm trying to understand something...i think you can help.

why does my british colleague at work say that:

  • the Independent is most "fair and balanced"
  • The Guardian is "right-wing / conservative"



Aurora Ex Machina's picture

He's an idiot. (Or, he's not working for who you think he's working for - that's far more likely).

The Independent was incredibly good (and still is, in certain cases, with some of the best reporters out there), but was bought out by a Russian Oligarch. Said Oligarch has remained fairly "hands-off", but I can't link it to ZH - there's simply too much Russian politics involved. RT is obvious Moscow propaganda, everyone knows that, Independent is getting into murky London based stuff, and is far too open to American accusations of bias (or "THE NWO OMGA!!!"). I read it, but politically and financially, it's in a weird space that Americans simply won't get.

The Guardian is essentially the face of liberal [European meaning, not USA - important to note and grokk] Capitalism. It's friends with the RSA and other pro-Capitalist but fairly fluffy stuff. They're the people who think the old tripartite power structure worked, and would love for the rational world where shit got done, culture progressed, everyone got richer etc. It's only "conservative" in the manner that it thinks the old balances worked.


Top tip: No English MSM media is left wing (in the old sense, barring the horror that is SWS); they're all fucking Capitalists. So, yes, they're all "right wing" in the old 2D spectrum ~ this is largely meaningless to Americans, however, since Democrats are the European version of the Hard Right, and Republicans are basically in Taliban land.

trader1's picture

thanks for those insights.  

trader1's picture

sorry for the flattery, but you continue to impress. your knowledge is so divergently broad, yet often deep enough to make me feel like this... 

had to look up eloi and morlocks. 

stumbled upon:

the morlock manifesto

maybe harmonious is just the way it is?  nature has its own way of restoring imbalances

Aurora Ex Machina's picture

One of the hardest, and most salient lessons that ecology only just learnt is that if you remove all the top predators, you totally fuck an ecosystem. Totally.

Hint: homo sapiens takes special care to remove any threats from its environment, which are the top predators. You can apply this to your own ecology, but let's not go there. (Hi DSK! I see you got a job after all the drama, quelle surprise!)

Hunting the whales to extinction was culling sentient creatures, cruel and post the discovery of oil, entirely pointless - sure, kill a few, but the genocide was disgusting, they even resorted to helping you hunt ffs (orca / killer whales - look it up, muppets); culling the sharks was short-sighted fuckwittery on a scale beyond all measure, given it was merely based on fear, removing "threats" to short-term fishery stocks and eating their fins. If homo sapiens had any sense, it'd step away from the Oceans for at least 50 years, entirely. That's basically the only way you're going to make it, given the ocean heating issues.  You won't, which is why you're going to die off in massive amounts in the next 50 years. I'd research jellyfish, since that's all you'll be pulling from the oceans if you don't start enforcing some serious notions of ecological understanding.

The point when it's decided you're going to tip the oceans is the point the Interesting Times Gang[TM] step in with enforced culling, btw. Enjoy your fucking sushi, you total ignorant cunts. And yes; Spielberg might think he's saving his soul via Schindler's List, but trust me: Jaws fucking doomed your species (both of them - don't think you get out of this either, sharp pointy teeth strain). Oh, and if you need some burn: most nations have fully functioning Navies tooled up to the hilt, that wurble around the world burning $ like nothing and doing fuck all: homo sapiens has the Power to protect all Oceans and stop this. You have nuclear subs that spend their entire time doing shit all but waiting for the end of the world, whilst not preventing the thing that's gonna tip it - this is irony.


You could stop it, but you won't; that's the joke.  (Bulk Food - warning PDF. A story for you - trust me, ZH, you'll enjoy it - I won't spoil it, but let's just say, the hippies are rather naive. Oh, and never doubt there's a singing, all dancing split to the world that doesn't have two separate species. You're both fucked, but hey).

trader1's picture
ha - go figure! Dominique Strauss-Kahn makes French parliament comeback

edit: something very weirrd happened to above hyperlink.  strange that i re-checked any case, i'm leaving it as is, but here's the original link:


Whether jellyfish increases are global or not, cyclical or not, or not changing is an academic debate, and one that might take several decades of improved data collection and refined hypotheses to answer. It is an interesting question, but unfortunately the answer does little to help manage current problems associated with jellyfish blooms. Marine systems and their resources are generally managed at the local and regional level, where the full suite of potential drivers are best understood. And in the case of jellyfish, with the exception perhaps of fishing, different drivers are likely to be more or less important in different systems. Nevertheless, problems associated with jellyfish blooms are undoubtedly increasing because of greater beach use, more recreational fishing in the coastal zone and more coastal infrastructure. Our research resources need to be focused on better managing problems associated with impacts happening now.  [Gibbons, 2013]

When distributed in reasonable numbers, native jellyfish play important ecological roles.  But when jellyfish populations run wild, they may jam hundreds and perhaps even thousands of square miles with their pulsating, gelatinous bodies.  

In recent years, massive blooms of stinging jellyfish and jellyfish-like creatures have overrun some of the world’s most important fisheries and tourist destinations--even transforming large swaths of them into veritable jellytoriums.  The result: injuries (sometimes serious) to water enthusiasts and even occasional deaths.

Jellyfish swarms have also damaged fisheries, fish farms, seabed mining operations, desalination plants and large ships.  And proving that jellyfish can be political animals, knots of jellyfish have done the work of anti-nuclear activists: they have disabled nuclear power plants by clogging intake pipes. 

In short, since the 1980s, worldwide jellyfish blooms have caused hundreds of millions--or perhaps even billions--of dollars in losses.  Worldwide reports of massive jellyfish blooms are triggering speculation that jellyfish swarms are increasing because of human activities. But are they?

This report--which is guaranteed to make your skin crawl--explains the basics of jellyfish biology and what scientists have thus far discovered about the causes and future of jellyfish blooms.  [National Science Foundation]


Box jellyfish have a square-shaped float with tentacles streaming from the corners of the bell. All box jellies can sting using nematocysts, tiny stinging cells that line the other surface of the animal. When an animal touches the box jellyfish, the nematocysts fire, puncture the victim and eject venom. The venom paralyzes and kills the box jelly's prey, which are usually invertebrates.

The venom of some box jellies can be deadly to humans as well. Of the 28 known species, only three can cause death in humans. These live in the Gulf of Mexico, Japan and Australia, according to Jamie Seymour.  [Straw, 2005]


There is a concern that the abundance of jellyfish is increasing globally as a result of climate change and degradation of marine ecosystems under the pressure of human activities. In many places in the world, jellyfish blooms (a sudden, massive increase of jellyfish numbers) have already proved they can have critical socio-economic impacts e.g. clogging fishing nets, causing mass mortalities of farmed salmon, or blocking the cooling water intake of power stations. They are also suspected to prey (feed) on certain fish eggs and larvae and thus may limit the potential recovery of already weakened fish stocks.  


Although we always tend to focus on the negative when we consider jellyfish, they might also provide some unexpected opportunities. For example, it may be possible to harvest jellyfish for export to the far-east market (where jellies are a delicacy) or even the potential of a developing recreational hotspots for divers to swim with blooms of giant jellyfish, similar to the experience offered by 'Jellyfish Lake', a well-known dive site in the Pacific island of Palau.  [Ecojel]


Boom in Jellyfish: Overfishing Called Into Question

“We’re very strange animals,” he said. “We’re so clever and civilized, but our hearts are very primitive. If our hearts weren’t primitive, there wouldn’t be wars. I’m worried that we will apply the science too early, like we did with the atomic bomb.”

"we are feeling machines that happen to think"


i'm still trying to parse your message, but my head is spinning.  going to watch the latest dexter episode...

gratefultraveller's picture

Prime Interest on Russia Today just opened citing ZH as well

fonzannoon's picture

THis bond update was not brought to you by PIMCO and Doubleline funds.

disabledvet's picture

why not? "how else to play in the uber dollar" but in the treasury market? "all debt is created equal" you say? hmmmm. still not buying it...not with gold and silver simply getting annihilated here. "Wall Street's little bitch" as they say. and with Larry Kudlow still blabbing about "no capital investment" going on...2000 years now...i have a hard time listening to that without laughing. all this money is flowing into municipal bond portfolios and ultimately "state" banks. the idea that "Wall Street is winning" by driving up interest rates in general is...well, strange. i mean "at some point you'll be forced to pay an interest rate on deposits." obviously the dollar is soaring just for that very reason! SOMEBODY'S GETTING THE PRIVATE RATE. THAT'S FOR CASH! in the meantime "the recovery still suffers." if gold and silver start getting a bid here (via "no longer collapsing in price") i will jump back in equities. i fail to see what i'm missing out here. in other words give me an 800,000 jobs number. THAT would be inflationary.

101 years and counting's picture

im guessing the shock will come this w/e from europe and the US will be "caught off guard"?  whocouldveknowed?

holdbuysell's picture

Whether this weekend or another, it's only a matter of time.

Long popcorn and laz boy recliners.

Obchelli's picture

And Imagine what's happenning to OIL price in EUROs as Euro drops against dollar and OIL price surges.

But who cares - it's all bullish...

101 years and counting's picture

f the price of oil in europe.  imagine the price of it in japan!  50% price increase YoY.

Obchelli's picture

Yes but there is no inflation in Japan still...

Oh well

Atlantis Consigliore's picture

Printing $ 1 Trillion more, for the record,  till i can get outta town.

Waitress oh waitress, get your nose out of that book, and wipe this table with your law degree.

Jobs all P.T.,  real estate?  rent suckers. rent.  Growth industry?  :Pawn shops.

Meat Hammer's picture

Bullshit.  That's kito pumping you on the handlebars.

frankthomaswhite59's picture

Hah!  I see you just got your hair done

Cursive's picture


I always knew you had the Russell Brand look.  I can just tell from the way you write stuff and all....

kito's picture

dang, ben is care in the world.........there isnt even a friggn worry wall to climb.......stocks heading back towards 16, heading down towards 1200, yields up (and yes, ben does want to see a rise--just not too fast).....propaganda numbers killin is good for the bernank............................

Al Huxley's picture

I'm just glad to see stocks are able to power ahead in this environment and that nobody's worried about the way Treasuries are falling off a cliff. 

fonzannoon's picture

This is awesome eh Al? I figure $5 gas by august with the 10yr at 3.25% so put Mortgage rates in the high 5's...

Put the GDP at  -5%

How can this not be bullish for stocks?

kito's picture

why is it that we are always wrong???? always.....everytime i think something logical would result from some setback in economic data....or some world event....or from some hiccup in the markets......nothing ever fucking happens.........WTF MAN!!!?!?!?!?!? why is the bernank still right???? why is nothing blowing up in his face???? WHY WHY WHY WHY WHY WHY WHY?!?!?!?!? (temper tantrum ensuing..........)

fonzannoon's picture

that's what you get for listening to the guy in the white shorts with the blue stripe.

You are not wrong Kito. It's over. It really is. No more talk about ratings agencies downgrades....debt/gdp...interest payments on the debt...

we are now at that point where you have had your 15th drink. You are at the bar. People are talking around you but all you hear is blurred backround noise and your vision is blurry. You can't drive home. Your friends left. You can't even articulate to anyone that you need a cab. You know how it's going to end. You are going to keel over into a pile of your own barf and wake up in an alley if you wake up at all.

The problem is this stage could take a while.

kito's picture

The problem is this stage could take a while........

so then.......i should expect...that nothing will happen...again.....for a while......forgive me....for growing wary............

fonzannoon's picture

ghordius told me the other day he had a mentor who told him that when preparing for the future, always accept the possibility of 7 more years of the same shit. sounds about right.

kito's picture

that would peg it to around......2015......hmmmm.....

fonzannoon's picture

exactly, so for you 2015 is the year when it all goes to shit. so when we get to 2015 you have to anticipate 7 more years of the same shit. 


kito's picture

LOL....thanks for the laugh signing off now....i need a weekend of blue pill more gloom and doom until next week......just in case anything happens........collapse, war,etc...... please "friend" me and give me the heads up........otherwise im outta here.........

TheFourthStooge-ing's picture

fonzannoon said:

we are now at that point where you have had your 15th drink. You are at the bar. People are talking around you but all you hear is blurred backround noise and your vision is blurry. You can't drive home. Your friends left. You can't even articulate to anyone that you need a cab. You know how it's going to end. You are going to keel over into a pile of your own barf and wake up in an alley if you wake up at all.

The problem is this stage could take a while.

Which stage, the barfing or the waking up?

Its Only Rock N Roll's picture

do not think for one second that BB isn't shitting his pants this weekend at the events in the bond market....but unless he calls off QE pronto and talks of UNWINDING...he is not going to get lower rates at this point

his little monetary experiment has blown up and he knows it

every day the equity markets hold up or march higher while rates soar, than harder the fall is going to be

Cursive's picture

@Its Only Rock N Roll

I completely agree.  We're at that point in the movie where the guys who pulled the heist know they are doomed.  That's BernanQE.  He knows that he/the Fed is checkmated.  Of course, this usually happens half way through the movie, so it takes a while to play out.  We're already much longer than I ever thought in 2009, but you can see that, to continue BernanQE's recent airplane analogy, this QE "soft landing" is rapidly running out of landing strip.

Its Only Rock N Roll's picture

don't put it past others to try and "fix" it though, which will FUBAR it in short order

the one thing you can not underestimate is the hubris and ego of central bankers

why the talk out of the ECB this week of prolonged lower rates?  what message was Carney trying to give with his first meeting?

I still believe the Cinese market is the key here and BB is scared shitless about the PBOC chocking off liquidity while there isn't enough good collateral around to contain an epic crisis. 

IMO this will be similar to the panic of 1907 when what were considered sound institutions went under after the Knickerbocker Trust failed.  Who/what is our Knickerbocker Trust? 

Central bank?  Sovereign nation?  TBTF institution? 

We are taking the lead on the race of central banks that have lost control.