Equities slipped to their lowest close since Draghi's 'I-have-a-dream' speech and 4th red day out of the last 5. Things were choppy in a tight range before the FOMC and immediately after (aside from a little noise) but as the close approached S&P futures tested yesterday's lows, APPL slipped from its VWAP moorings (but ended green) and even FB eased lower (10% off its pre-open highs). The last hour saw selling pretty much everywhere as Treasury yields popped 2-3bps (even as stocks fell), Gold slid, Oil Slid more and the USD sold off into the close. Given the 'distance' between bonds and stocks, this compression might make some sense (thanks to a lack of anything new from Bernanke to keep the wolves from the depression door). Credit markets tracked stocks - though HYG tried to outperform, only to fade Baumgartner-like into the close. Stocks caught down to VIX's weakness from yesterday and then VIX decided to outperform flat into the close as stocks ended just 'off the lows' as CNBC would say. Only Citi remains green from post-QEtc. among the financials with Buffett's fave WFC -7.9% since 9/14.
Seemed like a broad-based sell-off in all USD-related 'thing's as Treasuries, Commodities, Gold, and Stocks all saw pressure this afternoon... Note the late-day surge was an effort to get back to VWAP at 1408.5 - which failed interestingly...
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Only Citi remains green from the post-QEtc highs of 9/14...
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Credit was slightly less sanguine after the day session close as stocks limped higher but the plunge in HYG after trying to levitate stocks post-FOMC was on heavy volume...
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In general, stocks underperformed risk assets once again - and as the day wore on systemic correlation fell notably (especially as TSY weakness into close did not 'fit' with equity weakness in an algo-driven world)...
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Charts: Bloomberg and Capital Context
Bonus Chart: Still plenty of room left for the TSY-Stock convergence... which might help explain the TSY weakness with stock weakness today
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and the HYG strength with stock weakness earlier on...
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