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Market Snapshot: Dispersion Rising As EU Financials Underperform
While US equities are well off their post-NFP euphoria highs, the hope that Europe is solved remains. However, today's price action in European equity and credit markets and the very significant divergence between the effervescent equities and calm credits suggests concerns growing among professional traders. We noted yesterday that financials did not rally as much as other credits and equities into the European close and that trend continued today with subordinated financials majorly underperforming and seniors underperforming all other assets. Given that the 'plan' upon which this rally is based is to 'fix' banks, the underperformance of their credits prompts the question - why are we still rallying? In line with equities, and sucked there by the ever-increasing correlations, TSYs, 2s10s30s, precious metals, oil, and carry pairs are all tracking in a risk supportive manner with EUR clinging to 1.35 into the close.
US financials are staggering lower a little - perhaps on the back of our earlier discussion of the potential canary in the coalmine that is PrimeX (or maybe just that they have rallied 20-25% in the last few days!)
Charts: Bloomberg
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How is this global motherfucker holding up still? Should be bursting at the seams and leaking shit reeking hopium ooze!
To attempt to fix zombie banks, esp mid-level one's, at this stage is to completely miss the entire point! Banks are for lending and saving and for that we don't need dozens of TBTF institutions that leverage the end of the world with their ultimately irrelevant desperate survivial!
How? It's simple really. People refuse to accept reality until forced to, the first stage of accepting ideas outside your worldview is denial.
The limits of reality have truly been exhausted. I guess the appreciation of, more at lack therof, concepts such as fundamentals explains some of this......
The markets gotta take a breath before it goes under again. I'm waiting, we're all just waiting and watching (for now.)
I was going to short the pigs this morning, but the rally wasn't as big as I hoped. I got a few shorts. Good enough until the next panic selling.
BTW, the next drop will be led by AAPL.
I agree. Who is short? Wait, or... who needs to take profits?
Really looking the start of Q3 earning reports season!
let me bclear, the sale of CDS is a scam. No way in hell the banks are ever going to pay off, at least not with their own money. either they won't pay through bailout shenanigans, or else the taxpayer pays off. either way this is just another screw job. [/rant]
*cough* AIG.
The fire economy is a very bad joke.
Driving that train, high on cocaine................trouble ahead......trouble behind.........
Ya, toy train.
Flash crash on the SPY at 12:04. Contact NANEX later to see that chart. Plastered over in less than a minute
The Fed is obviously only drawing lines in the sand, and not driving the market like the last two years--must be lack of funding for the PPT program. I predict they'll let this market drop slowly in 7% increments each month rather than crash, and there will be no market recovery for 2 years.
Because the EU will take "brave and dramatic steps" (print print, cough cough) shortly and everything will be ok. How long do you think the cartel will be able to surpress gold and silver with print fever?
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