If only bellwether stock IBM hadn't indicated that earnings hopes for global tech were in the toilet, the world could be celebrating a new Dow record too. What a day... with stocks flash-crashing (Wal-Mart), bond yields screaming lower (2nd biggest 2-day drop in yields in 17 months to 2-month lows), the USD collapsing to 9 month lows, gold (and silver) soaring by their 2nd most in 16 months, and stocks tractor-beaming up to the Fed's balance sheet year-end target of 1800 for the S&P 500; even the talking heads are lost in explaining the charade. The box that the Fed has put itself in is becoming obvious for all to see - there is no argument that this is 'fundamentals' and so the Fed knows it can never leave as the wedge between perception (prices) and reality (value) has grown too wide... Low volumes in stocks on an all-time high day hardly support anything but doubt as 'safety' is sought in bonds and bullion.
New record highs in S&P 500 and Russell 2000; despite a 70 point drag from IBM, the Dow managed to get back to unchanged!!
The S&P 500 is up 5.3% from last week's lows - that is the best 6-day run since Dec 2011...
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With the Nasdaq (and Russell not shown) leading the way off last week's lows...
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Off the lows last week, the run in sectors has been impressive with Financials and Healthcare (government aid?) leading the way with massive gains...
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How the last 3 days look across asset classes...
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10Y Yields collapsed to thei lowest since early August...
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Still wondering how it's all possible? Surprised at the rise given not one of your peers is putting fresh capital to work in the markets? Once again, it's all about the marginal carry-based buyer driving up stocks at the algo-driven edge...
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Charts: Bloomberg and Nanex
Bonus Chart... WMT Flash-Crash...
Walmart dropped 5.3% in less than 1 second on about 1,000 trades (200K shares) from 11 exchanges and one or more dark pools. Price came to 1 cent of triggering a limit up, limit down (LULD) halt. LULD basically has legitimized sudden large price moves in mega-cap stocks. High Frequency Traders placed and canceled more than 4 orders at the top of book for every trade execution during the drop.
1. WMT ~ Trades color coded by reporting exchange from 15:02:28 to 15:02:55.