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Bond-Buying-Frenzy Saves Stocks From Giving Up All 'Goldilocks' Gains

Tyler Durden's picture




 

Another day of carnage in bond markets, rescued to a smolder by a mysterious global bond buyer... makes us wonder just how long before that 'smolder', explodes...

 

Bonds made the headlines... as overnight carnage was aggressively bid from before the US Open to assuage equity weakness... (TSY yields are still up 8-11bps on since Friday)

 

Bond prices since Payrolls are higher for 5Y, flatish for 10Y and down for 30Y...

 

Futures show the swings better than cash... as we pushed down to pre-payrolls levels then bounced as bonds were bid (weak close today like yesterday)

 

Cash equity indices decoupled today - Trannies ugly, the rest rallying along with bonds, desparately hoping to hold green - but failed 3 times...

 

The Bottom Line - Stocks now need lower bond yields... or there's trouble ahead...

 

And Rate Vol has dramatically decoupled from Stock Vol...

 

The Dollar gave up yesterday's gains and then some but once again USDJPY was very stable as EUR and GBP strengthened...

 

As The Dollar slipped, commodities gained ground... but with a lot of noise on the way...

 

Post-Payrolls, crude is winning but everything is up...

 

With crude exuberantly pushing 2015 highs...2nd highest close in 6 months...

Charts: Bloomberg

 

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Tue, 05/12/2015 - 16:13 | 6086322 Weaponized Innocense
Weaponized Innocense's picture

Lol

Tue, 05/12/2015 - 16:59 | 6086416 Ham-bone
Ham-bone's picture

Not really much of a "mystery" who the ultimate buyer is...

Since July '11, you can pretty much count in any foreign nation with a central bank swap line with the Fed.  And you can pretty much rule out any nation running a dollar trade surplus; rule out domestic pensions, banks, insurers; rule out any intra-governmental buying from surplus SS dollars.  It's all come down to a handful of foreign CB's buying thanks to swap lines with the Fed.  No mystery.

http://econimica.blogspot.com/2015/05/the-feds-backdoor-qe-central-bank.html

And America's present and future depends entirely on this "foreign" bid be maintained...

http://econimica.blogspot.com/2015/05/veneer-of-us-growth-normalcy-has-worn.html

Tue, 05/12/2015 - 17:04 | 6086544 johngaltfla
johngaltfla's picture

Alas, Mr. Ponzi would be proud. Sadly, Mr. Ponzi is cashing out and running for  the islands after turning in his US citizenship and paying the exit taxes and penalties.

The U.S. Stock Market is Flashing more Warning Signs

Tue, 05/12/2015 - 17:53 | 6086829 max2205
max2205's picture

I am confused again so it's working 

Tue, 05/12/2015 - 17:07 | 6086560 ucde
ucde's picture

thanks for the links. tight analysis, Hambone

Tue, 05/12/2015 - 16:16 | 6086325 Keltner Channel Surf
Keltner Channel Surf's picture

Odd day.  While it’s not unusual for machines, flush with profits from 2 a.m shorts, to tickle retail shorts the first half of the day session,you’d have expected an ending closer to the lows.  Unless ‘professionals’ think this is a short-term fixed technical move, one wouldn’t suspect the start of a lower bond price trend to lead equities to trade tick-for-tick with the 10-YR like a carry trade.

Tue, 05/12/2015 - 17:09 | 6086583 Weaponized Innocense
Weaponized Innocense's picture

What's more fun when nothing is based on capitalistic fundamentals but when those powers that be (not u) seem to think nothing based on capitalistic fundamental matters. Like it's okay the entire machine is no longer running on capitalistic fundamentals but THAT (whatever thing) not running in capitalistic fundamental has just gone too far. As in it's okay for the entire system to not run on fundamentals but we have to draw the line somewhere for the double standard laced in lies of equality.

Yea I know they are talking out all sides of their mouths and the markets be insane!!!!! Math and physics~ soothing how lies crumble with in it sooner or later as psychopaths can only stretch the rubber band of deciet so far till it all breaks.... so that those who broke it can pretend to fix it (munchausin syndrome ... Can't get caught with ur hand in the cookie jar) ~as if they ever needed it fixed in the first place.

Tue, 05/12/2015 - 16:15 | 6086328 Thisisbullishright
Thisisbullishright's picture

You think you hate it now....wait til you drive it.

 

Tue, 05/12/2015 - 16:17 | 6086333 jubber
jubber's picture

...and ALL US futures now Green AH, looks like an overnight ramp as they couldn't manage to hold 18100 during business hours

Tue, 05/12/2015 - 16:21 | 6086352 Keltner Channel Surf
Keltner Channel Surf's picture

“It’s a Cult”     from “Catapult”   by R.E.M.

Oooh, we hear an awful noise
Oooh, sounds like fighting squirrels

It's six o'clock, turn CNBC off !
Before that cowardly troll opens his mouth
and takes questions
You won’t miss anything, you won’t miss anything

It’s a cult (Cramer’s cult), it’s a cult
It’s a cult (freakish cult), it’s a cult

Oooh, we’re still hearing noise
Oooh, a rabid sheep herd

It’s 6:15, please try and turn him off !
Throw him in a hole -- first tape his mouth
Even ‘Three Stooges’ was bland, when compared with this
Hear him howl like a wolf when viewers call with questions

You won’t miss anything, you won’t miss anything
It’s a cult (Cramer’s cult), it’s a cult
It’s a cult (mystical cult), it’s a cult

That dog is quite a barker
But my dog’s a little sharper

It’s a cult …

Tue, 05/12/2015 - 16:24 | 6086363 SERReal1
SERReal1's picture

It's not rigged, nothing to see here. Just buy something already!

Tue, 05/12/2015 - 16:39 | 6086413 FreeShitter
FreeShitter's picture

Nope, that is why I'm balls deep.

Tue, 05/12/2015 - 19:42 | 6087310 Arthur Schopenhauer
Arthur Schopenhauer's picture

Does anyone know what happened at around 10:20 AM Eastern time? Everything looked like it was going to shit and all of a sudden everything, everywhere - spiked up.

What happened? Was it just the same old shit? An obvious central bank pumping operation?

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