No Joy In Hilsenratville: Stocks Have Worst Week Of 2013 With Bonds Massacred; Precious Metals Soar
The Hilsenrumor turned out to be a Hilsenstocktease, and with a closing that will leave many wondering "why hast he forsaken us" and ES going into the weekend at the lows, stocks end their worst week since November.
Spread by sectors, the week's best performer were tech stocks which were dragged higher thanks to a Carl Icahn tweet and closed the week nearly unchanged. On the other end of the spectrum: utilities, which were down by a whopping 4%.
But while stocks largely went nowhere, the news of the day was the bond complex, and especially the 10 Year, which dribbled lower all day and the yield soared wider to fresh two year highs, only to be saved in the last hour courtesy of the abovementioned rumor which turned out to be fake. Still, as the chart below shows, the carnage among bonds was massive, although nowhere more so than at the Fed, which over the past 3 months has booked a P&L of over -$300 billion on its portfolio. If, that is, the world's largest hedge fund marked to market of course.
Yet it wasn't all doom for investors. Those who have been patiently holding on (or jumping into) precious metals had the best week in months, with silver surging higher by double digits, and gold returning to levels last seen since the first Bernanke taper announcement. Considering the plouging the USD took this week, we expect that as the market starts pricing in the untaper, the upside case before gold and silver will only be made that much more substantial in the coming weeks.
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