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Market Close: The War Rotation

Tyler Durden's picture




 

All was well in the world early on. Dismal durable goods orders were terrible enough to provide the index-watching-muppets with the bad-news-that-is-good-news to pump stocks higher. Other markets reacted in a pro-Taper-off mode (aside from Gold and silver which were man-handled back down from the $1,400 level). Volume is/was terrible in stocks but they clung to earlier highs as homebuilders surged (seeming to ignore Friday's data entirely). Then Kerry spoke... first WTI broke higher (catching up Brent), then gold (and silver), the USD sold off (as JPY strengthened as a million carry traders were suddenly silenced), and US equity markets fell out of bed with a thump. The dow lost 15,000; S&P futures tested down to their 50DMA; gold traded up to $1,403; silver well over $24; VIX snapped 1 vol higher to 15.0%; and AAPL tumbled from early highs (holding above $500 though). An ugly close at the lows of the day for stocks...

Shortly after Kerry spoke...

Gold breaks $1400; Dow loses 15,000; AAPL fading; USD sold as JPY strengthens on carry-unwinds; Treasuries bid...

 

 

 

and then as the market closed...

S&P futures tested back down to the 50DMA...

 

It would seem that broad risk-assets were aware of the potential weakness early on - stunning catch-down to CONTEXT (proxy for global risk-assets)...

 

FX markets were roiled...

 

Commodities jumped as war premia were added (and USD dropped)...

 

Charts: Bloomberg and Capital Context

 

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