The last few minutes of the European day [3] ended with a resplendent surge in stock prices in the face of sideways to wider credit markets and deteriorating sovereign and FX markets. Not to be outdone, US equities remain in a world of hope of their own today having disconnected shortly after the US day-session open as Treasuries, Gold, and the USD have all moved in a more derisking mode. Also, despite S&P's 0.6% gain, VIX has just pushed higher into the green for the day.
Equities (blue) on their own in hope...
[4]
and relative to a broader set of risk-assets, stocks also look somewhat alone again today...
[5]
as markets attempt to orchestrate a squeeze, we suggest that the recent notes on FX and Credit positioning being considerably less short than perhaps most believe will temper any squeeze even on good news.
Chart: Bloomberg