5Y yields rose a stunning 37% this week - the most in the 50 year record of Bloomberg data. The 38bps increase in yields is also among the worst absolute shifts over that period but off such low levels it is quite a shock. Credit markets saw hedge protection bought early on in the week and then covered as real money started to sell their bonds on the back of redemptions in the last two days. The high-yield bond ETF had its biggest weekly loss in 13 months (notably clinging to the Lehman ledge levels). Equity markets suffered too (down 3.5 to 4.0% from the FOMC) with the S&P's worst week of the year (even as it bounced off its 100DMA). Most sectors hung around the 3-4% drop but homebuilders are down over 8% since the FOMC. The USD surged over 2.1% on the week with JPY's worst week in 43 months. VIX ended the day down 1.7 vols at 18.8% but beware as OPEX and hedge unwinds into underlying covers seems prevalent. Gold's worst week in 21 months left it back under $1300.
Treasuries (especially the belly) were crushed... while in context the move may be small, what most forget is the increasing leverage that has been applied to this constantly compressing market in order to generate returns
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HYG's worst week in 13 months leaves it back at the Lehman ledge...
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FX markets were not pretty either - JPY's worst week (Abe's happy we assume) in 43 months...
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Gold's worst week in 21 months...
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Since the FOMC, indices are down notably (even with today's Hilsenramp interruption)...
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and Homebuilders are on their own as momo-chasers realize that high-beta is a two-edged sword...
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Credit markets did not 'believe' the Hilsenramp but OPEX dragged stocks higher...
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and the Hilsenramp was all no volume - with the crack lower into the close perfectly ending at VWAP...
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The week in Commodities, FX, and Bonds...
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Charts: Bloomberg