'All-Clear' As Europe Recovers Post-NFP Losses

Tyler Durden's picture

All it took was a Frenchman losing his nerve, some chatter on QE, and a few more weak US and EU data points, and hope for better Chinese GDP, and sure enough - free-money-flow is back on the table and risk assets are responding. European equity and credit markets have all but totally recovered to their Thursday closing (pre-NFP-plunge) levels. European sovereigns are mixed with Portugal 27bps wider than pre-NFP, Spain unch, and Italy -11bps but EURUSD is higher on the day and now back above last Thursday's highs as we note Europe's VIX dropped in sync with US VIX today - still maintaining relatively elevated levels historically relative to the US.

European equity (blue) and credit has recovered almost all the losses from NFP...

while sovereigns are much more mixed...

but financials remain underperformers and LTRO Stigma has hardly budged...

EURUSD is rallying nicely as the all-clear has been given - now back to above last Thursday's highs.

And European VIX has dropped but remains elevated relative to the US (even as risk assets have recovered more of the losses in Europe than the US)...

Charts: Bloomberg