As the Romney bounce was removed last night, German (and European) growth is lowered, AAPL's dominance is questioned, and the 'fiscal cliff' (oh yeah that) comes into focus, is it any wonder equity markets dumped today. Depending on which index you looked at, equities fell the most in a year (or a month) with the Dow and Nasdaq closing below their 200DMA.
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The day's plunge was stalled at the European close with S&P futures down 48 points from their overnight highs. Much was made of the 'off the lows' nature of the post-Europe move - but all of that bullshit was dashed as we crumbled (inverse eBay-like) on considerable volume into the close after touching VWAP.
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leaving S&P 500 futures on edge...
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Gold and Silver held up well on the day (+3 and 2.5% on the week) - though the latter well off its highs - as oil plunged back catching down to copper on the week.
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USD strength into the European close dribbled away all afternoon - leaving it +0.25% on the week. Treasury yields leaked back a little wider into the close but remain down 5-8bps on the week.In general risk assets led the way lower overnight and into the US day session; its clear from the chart below that the European close saw a flush of selling relative to risk - which likely spurred the rebound we saw but the close seemed like hedgers fearsome of news (Greece?)
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Our call yesterday that the strength did not feel like risk-on seems prescient now and the plunge into the close today suggests more than a few others used that VWAP ramp (and Boehner's speech) to reduce size more.
VIX closed at 19% - its highest in 3 months...
Charts: Bloomberg and Capital Context [12]
Bonus Chart: Everyone's favorite AAPL... Log-scale chart - so a linear-regression means that trend was exponential... Current price action just broke below 200DMA and -2 Sigma trend line... lasttime this happened we fell 43% and 53% in the next 40 days...
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