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Detroit Default... Microshock... And New All Time S&P High

Tyler Durden's picture




 

Between Detroit's bankruptcy, Microsoft's miss and worst drop in over 13 years, and GOOG's miss (latter gobbled back by the BTFD'ers), it is no surprise that stocks rallied (thanks to GE's explosion higher and Trannies surging). Mixed bag overall in stocks with the Nasdaq -1.4% on the week and TRAN +2.2% (with the S&P and Dow around 0.6%). Treasuries 'outperformed' stocks relatively speaking with a 11-12bps compression in the belly and 6bps at the long-end on the week - ending today at the low yields of the week. As an aside, AAA muni spreads pushed to their highest in 13 months as yield remain notably elevated as Treasuries rallied. Despite a 1% weakening of the JPY, the USD ended the week down around 0.4% driven by EUR (and AUD) strength. Despite USD weakness, Silver lost 2.2% on the week while gold gained 0.7%. WTI crossed above $109 and Brent today gaining 2.25% on the week (off today's highs). VIX dumped back to 2 months lows under 13%, volume was dismal all week (worst today), but new highs all around for stocks (amid another idiotic Friday closing ramp) so we must be doing great?

 

Remember last Friday? The ramp to close the Dow green and dump as cash ended...

 

Well they tried again...

 

and close up - was all about 330 RAMP CAP LLC again...

 

This was Microsoft's worst single-day drop since April 2000 (click for large legible version)

 

The indices this week diverged quite notably...

 

And Tech joined Builders as the laggards this week...

 

Though from the 6/19 FOMC, Tech has no joined Materials and Homebuilders in the red...

 

But Treasuries were on a tear... with a major compression in the belly relative to the long- and short-end of the curve... This is the best 2-week run for 5Y in 11 months...

 

The USD dropped 0.45% as FX markets were quite dispersed as the JPY lost 1% and AUD gained 1.6%...

 

Despite the USD weakness, silver caught no bid as it appeared to trade inversely with WTI as it surged. Gold gained 0.7% on the week...

 

Charts: Bloomberg

 

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