Dismal Data Sends Stocks To Record Highs As Short Interest Collapses To 2007 Lows

Tyler Durden's picture

Overheard everywhere today...

 

Stocks (Dow and S&P) hit record intraday highs... (must mean everything is awesome, right?)

 

With Nasdaq's best week of 2017...So clearly, unlike The Leftists, Trump Jr's email means absolutely nothing...

 

BUT...

This morning's terrible retail sales and inflation data sent 'hard' data to new post-Trump lows - lowest since May 2015 - as 'soft' data clings to hope once again, sending 'animal spirits' back near record highs...

 

GDP expectations have plunged...

 

And then there is this... Short Interest in the S&P 500 has not been this low since May 2007, right as the market peaked...

 

And as JPM Prime Broker Services shows, this week saw the largest amount of short-covering year-to-date...

*  *  *

Here's today's completely uniform, not at all odd, straight line, 100% correlated price action in stocks...

 

VIX chopped around into the close but it was a one-way street all day to get the S&P to intraday record highs (above 2453.82 on 6/19)...

 

FANG Stocks had their best week in 3 months... (up 5 of the last 6 days)

 

Despite all the exuberance over Bank earnings, financials lagged on the day (but as the green line shows, the dip-buyers were desperate) as Tech led...

 

JPMorgan was the biggest loser at the open, but you 'buy the dip' because it's a no-brainer...

 

The "Most-Shorted" stocks are up 5 of the last 6 days - this week was the biggest 'short squeeze' since Dec 6th...

 

VIX was smashed lower again to its lowest weekly close since 1993... (9.48 close 12/24/93)

 

The stock market is near peak euphoria here (tracked by the ratio of Fwd P/E to VIX)...

Oh and Shiller's P/E crossed above 30 (30.15).

While stocks gained on the week, so did Bonds (though the long-end underperformed)... (while 2s30s steepened for the 3rd week in a row, 2s10s flattened modestly on the week, after two big weeks of steepening)

 

10Y Treasury Futures briefly spiked above their 50DMA at 125'27 on the weak data, but fell back as the equity ramp began...

 

The Dollar Index was hammered this week on Trump Jr and Yellen dovishness (worst week for USD in 4 months)...

 

The Dollar is now at its weakest in 10 months...

 

Cable has spiked above 1.31 - its highest in 10 months...

 

WTI Crude rose for the 5th day in a row... (note how this week's API/DOE moves were a pefect mirror of last week's)

 

Gold and Silver up for the 4th day in the last 5 breaks a 5-week losing streak...best day for gold and silver in 5 weeks...

 

Finally, Bitcoin tumbled again today ending the worst week in 4 months...

 

So to summarize - After months of hawkishness, Yellen drops a slight hint at 'dovishness' on the rate-hike trajectory and stocks soar to record highs, VIX closes at a record weekly low, bonds rally, crude oil rips, and gold has best week in months...oh, and macro data dumps!

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troubadourcapital's picture

The stock market is going up because economic growth is solid and u.s. Corporate earnings are also strong

Despite today's weak retail sales, the economic data ON BALANCE is positive. You can't cherry pick the negative data

And bitcoin is a bubble. Real demand is actually going down, not going up. It's just a bunch of speculators playing hot potato right now

http://bearmarket.net/stock-market-on-july-14-2017-thoughts-and-outlook/

BlueHorseShoeLovesDT's picture

Solid as that shit I took this morning.

espirit's picture

Lagging data is like 20-20 hindsight.

To da Moon, Alice.

(as long as the CB has your back)

Perimetr's picture

Sorry, the only thing that matters these days

is endless QE and Central Banks buying everything

Charts are absolutely meaningless if everything that happens in the markets amount to interventions by Central Banks

It's the fascist business model at work.

BurningFuld's picture

Shit I took this morning and 20 20 hindsight. I get it.

yogibear's picture

VIX to zero babay! Yellen and Dudley going to make it happen.

Short da VIX to 0.

D.r. Funk's picture

It's cannibalizing.

(ie they are cannibalizing it)

To suggest a 0 or 5 or 6 or whatever, vix level is sustainable

Is beyond ignorant and assinine. It feels very possible! Doesn't it! 6 7 vix yeah!

Of course it does. It's not. Whoever's programming it at sub 10, knows there's no model of sustainability much lower

so they know they're cannibalizing it, by the way which is what I SAID

about 6 fucking months

ago

 

Rainman's picture

did it require a 2-flusher ? .. a 3 ? .... describe its form and texture.

BlueHorseShoeLovesDT's picture

I have been eating a lot of oat meal for breakfast.

Other than that, you will have to wait until the Fed interprets the data dump.

GUS100CORRINA's picture

Now that everyone, and i mean everyone, is on the SAME SIDE OF THE BOAT!!!!

It is time to: SELL, SELL, SELL!!!!

Snaffew's picture

that guy is as much a soothsayer as the rest of them...he didn't extrapoloate one reason other than showing a retail sales chart trend that is identical in contraction as the precise moment the markets plunged in 2009.  All rationalizations point to massive exuberance against weak, weak data without even considering the 41 trillion of debt we are carrying compared to 15 trillion when the market crashed in 09.  Perhaps the fantasy extends further, but I'm betting not very far from here.

pkea's picture

If only they could find another lehman... they just cant find it anymore without throwing  the whole system off the balance....

Wookie's picture

Party on Wayne! Party on Garth!

yogibear's picture

Means Federal Reserve does awesome amounts of QE 4.

Infinite amounts of QE. Starting out out at $200 billion/month.

Then $500 billion/month

Eventually, 1.2 trillion/month.

All to boost stocks ever higher. The fed cannot allow a stock market crash.

 

D.r. Funk's picture

It's called digging a hole

deeperanddeeperanddeeper

Chupacabra-322's picture

@ trouba,

Seriously?

Why don't you Cherry Pick the Dingle Berries out of my AssHole?

Fah_Q_Fed's picture

Yeah gotta love them Non-Gaap earnings beats there, cap'n koolaid

D.r. Funk's picture

The stock market is going up because the Dow30 components are being fed at least the higher-weighted ones, and the Tech leader so called high-flyers are being fed, both of which translate to the spy tagging along.

Oh, also, gee I almost forgot, gee, the vix in which many algos are merely dependent on to carryout Their programming is under full control as well, commandeered a few years ago, refined over the last couple

That's why the stock market is going up as a sarcastic friendly establishment middlefinger reminder

the globalists who have #45 doing everything in their fuckeng faces against them bubbling stocks "who would think"

 

 

Vlad the Inhaler's picture

The consumer is the engine of the US economy, if people aren't buying shit then that means the only way companies are making money is by ripping people off for the essential things that they have to buy or making their money from the government after they stole it from the consumer.  That's not a "solid" economy sorry.

BlueHorseShoeLovesDT's picture

I told you, I smelled a Happy Ending Friday coming.

NugginFuts's picture

It was so happy that I sold all my remaining equity holdings going into the weekend. Yay cash position!

Kaiser Sousa's picture

you know i searched and searched for news that would explain why the Fraud Markets suddenly surged at 12:30 est. achieving new all  time record highs despite nothing but ABSOLUTELY NEGATIVE MACRO-ECONOMIC NEWS & DATA from this morning…and then i remembered...

Happy Ending Friday (noun):  "A market phenomenon that occurs every Friday whereby losses across most of the U.S. fraud indices, in particular the Dow Jones Propaganda Index, are erased by the Federal Reserve, Exchange Stabilization Fund, and scum of the fucking earth large Wall St. commercial banks usually in the last hour of "trading” to ensure a positive close for the Fraud Markets on ABSOLUTELY NO POSITIVE MACRO ECONOMIC NEWS OR DATA WHATSOFUCKINGEVER.”

and if there were any doubts about where Gold & Silver SHOULD & soon WILL be given whats unfolding hear it from the CEO of the fraudulent Crimex

https://goldsilver.com/blog/cme-chairman-terry-duffy-gold-should-be-5000...

still stacking…nuff said.

© DEATH TO THE MONEYCHANGERS

Games Without Frontiers's picture

Aaaaaand it happened again. Silver and gold kneecapped for the last two weeks before macro data shits the bed, and they get a huge bump to...........where they were trading two weeks ago. Almost as if it's being managed. Better go get my tinfoil. 

ThirteenthFloor's picture

Latin - Sine qua nom
meaning as used ~ 'without this everything else collapses'
a literal translation "without the name", seems perfect.

jamesmmu's picture
Global Currency Reserve At Risk – The US Economy And US Govt Are On The Verge Of Losing The Exalted Privilege

http://investmentwatchblog.com/global-currency-reserve-at-risk-the-us-ec...

poland spring's picture

Unbelievable.  I now officially have to say "where are my crazy pills"....

assistedliving's picture

Short Interest collapses?  there goes the last fuel source

pound the vix's picture

Bankers will have Fun times in the Hamptons this weekend (everyweekend), Drinks on the FED

cstu7011's picture
“It is not a matter of what is true that counts, but a matter of what is perceived to be true.” - ((( Henry Kissinger )))
Fartboxbuffet's picture

Is my wife slipping crazy pills in my morning coffee

herkomilchen's picture

Not your wife, but Janet Yellen who is doing that.

junction's picture

On Bastille Day, the stock market is again showing a total disconnect from reality.  The Dow Industrial average is just like a Hollywood false front movie set held up by wooden beams.  The FANG stocks are doing great but they are the exception.  Why is the Fed continuing with its ZIRP program?  Big deal, one or two 25 basis point increases.  Why has the FBI done nothing about the string of sudden deaths associated with the Clintons?  Peter Smith, the latest victim, committed "suicide" using helium, so they say now.  Where is the helium tank and was the helium in it the new cheaper helium-air mix that can't even do a good job inflating a balloon?  Why did CMS allow Mylan for 8 years to overcharge it for EpiPens, when CMS knew that Mylan failed to give the government the required brand name discount?  The United States now is a RICO enterprise

Peak Finance's picture

Fucking Helium

This is so nuts I was thinking the "Helium" was some kind of message or an inside joke

BlueHorseShoeLovesDT's picture

Helium, Wall Street's favorite gas!

jmack's picture

no comparison to nasdaq central bank balance sheets?

jamesmmu's picture

Every signs from today's trading is indicating a sell signal. gold and silver up - risk off. dollar weaken and yen strenghten. 

Yield drop, JPM disappoint ( atleast in the wall st's view, they expected a blowout beat), thats why financials drop.

Its friday, so anything can happen. probably the hangover from Yellen. But starting next week, investors should start placing their bets for the earning season. like buying call/put options....risk on or off.

Vinividivinci's picture

I know I'm feeling the wealth effect...
/sarc

espirit's picture

From the front or the back?

Jus askin.

NDXTrader's picture

NDX trying desperately to get back up and crack all of the head and shoulders on the chart. Of course Apple has rallied a solid 6-7% since it was revealed they are likely to delay iPhone 8 and are a full year and half behind Samsung in innovation. And what if I would have told you 4 months ago that Grandma Janet was preparing for a balance sheet unwind, has rate hikes still on the table and has talked openly that some assets are overvalued? Would anyone call that dovish? I still think this is a bagholders rally and the Fed is really going to disappoint at month's end

vegas's picture

The most manipulated day ever in the SP500 I have ever seen. Never seen a day like this with as much straight up action with no trading ... only bursts to a new price that stays there until the next burst. This is bullshit, but we now live and trade in the era of central banks. God help us all when this shit ends.

 

www.traderzoogold.blogspot.com

D.r. Funk's picture

thank you vegas

"themostmanipulateddayevereverseen"

The manipulation/programming is vindictive. right now. very very vindictive which I started describing as such a few weeks ago which today shows as accurate. implies an endgame, they know how complete bullshit it is, so it implies an endpoint throwing complete fucking bullshit increasing frequency, vix suppression/programming at 9 level entering any final sustainability stage, along with the political russia impeachment progress

think about it, the effort theyre putting in, with shillerPE now over 1929 black tuesday, in the historically june-july weak or red index avg, the complete control and programming of the indexes can only be described as predatory. and its obvious

its obvious. youre not, fooling us

 

Ban KKiller's picture

Laugh of the day...just like last Friday.