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Small Caps Suffer Worst Quarter In 3 Years; Bonds Leading Year-To-Date
Despite the ubiquitous v-shaped recovery in stocks from the US open to EU close (decoupling entirely from bonds), stocks slumped into the end of the quarter leaving the S&P and Dow barely positive for Q3 and Russell 2000 down 7.9% - its worst quarter since Q2 2011 (and -5.2% year-to-date). Treasury yields flip-flopped around in a 4-5bps range with a late-day ramp (suggesting liquidations cough PIMCO cough) leaving 30Y -1bps on the week. The USDollar suged higher in the European session and traded lower in the US session. The bigger news on the day was the carnage in commodities that appeared to occur around the European close (desk chatter of commodity fund liquidations). Silver and WTI Crude were monkey-hammered, gold and copper dropped to down 1% on the week. VIX pumped and dumped again but closed above 16. Stocks closed very weak with Russell tumbling 1.5% on the day to not "off the lows."
Year-to-date, bonds are the big winners (long-end +14.2%) with the Dollar and S&P up around 6.7%, Gold unch, and Silver -12.7%.
On the quarter, Russell 2000 is the big loser but it was hardly a big one for the rest of the US equity market... (woirst Quarter for S&P since Q4 2012)
30Y bonds massively outperformed in Q3 (while 5Y drastially underperformed) with a 30bps flattening in 5s30s over the quarter...
And High Yield credit notably underperformed and decoupled from stocks...
Especially notable in financials...
The USD surged on the quarter... a oneway street
Commodities all slid, led by Silver...
* * *
On the day, Equities followed yesterday's playbook pivoiting around the European close but closed very weak today...
Stocks decoupled from bonds once again out of the gate... and then bonds and stocks weakened late on..
USDJPY seemed modestly in control...
Treasury yields chopped around today closing higher on the day...
FX markets once again saw USD buying in Europe and EUR buying in US...
Commodities on the day were monkey-hammered from the US open to EU close...
Charts: Bloomberg
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The silver price...
I'm -50% off my average, bastards..
Space.com.
"Its not what you don't know but what you are sure you know that just ain't true."
It sounds like you need to buy more. You know the coin dealers are out of stock and there is massively manipulation, right?
$5 or so will be a suitable entry point for silver. It should be any day now that the Gold gets monkey hammered back down to reality.
You can't fight USD strength. The whole reason everyone jumped on the precious metals bandwagon many moons ago was the dollar was going to be destroyed. It may well be destroyed, but it is clear that the rest of currencies will need to implode first.
Keep an eye on the BRICs, you know the ones that were going to break off an rule the world, as they implode the USD is going higher.
The trade has changed my friends. Since the downing of the MH17 flight....
If the USD gains too much strength then less will be barrowed/ lent
Less lending means less need to repay in USD, Less USD trading is not good for any USD trade but it is good for international banks.
They can save in USD and Barrow in failing currencies.
USD becomes the 21 centurys Gold only this time the US government cant walk away from its liabilities as it did with the gold once.
Nothing has changed the cancer is still terminal.
Its a V recovery. Green shoots are sprouting wherever you look. Obama is going to take of us and I'ma goin joggin.
What a wonderful world. S&P 500, Nasdaq extend quarterly win streak to seven. La la la la la la.
Everything is subject to the reflexive QoQ rebalancing and window dressing. Get your gold because this quarter will be strong. And sell all float scams because the indexes ate already stuffed and they have a long way down.
with the Dollar and S&P up around 6.7%,"
strong dollar will hurt corporate earnings
"And High Yield credit notably underperformed and decoupled from stocks.."
goodbye, so long ... corporate buybacks
G/S RATIO AT 71. TROUBLE A-BREWIN.
Good thing markets are not rigged.
Hellish day to trade, even for the big-moving Russell (I assume a month-end effect?).
We had a near POMO-like major retracement (though there was no QE today) at 10 that took back most of the opening plunge and likely caused havoc with stops then, after an agreeable return to the lows at 12:30, IWM spends 3 1/2 hours doing a whole buncha nothing, retracing every minor move, until the final 5 minutes when it hits target lows it'd been teasing about since lunch, most of it in the final two 2-minute big red candles. Machines in charge, a particularly annoying autumn algo -- gather leaves one by one all day then dump 'em in a pile on the devilstrip . . .
The last hurricane to make landfall in the USA was...