Volumes - expectedly - were extremely light and so, we all know what that means: a dash for trash meltup. NASDAQ keeps powering ahead as the S&P and Dow recover from yesterday afternoon's cliff dive. Trannies now up 13.3% off the debt-ceiling lows 5 weeks ago... sure, why not. "Most shorted" names outperformed once again but it seems investors, while not wanting to sell, are happy to bid for protection as VIX diverges. Credit markets also diverged bearishly today. Stocks disconnected (a la yesterday) from JPY carry briefly but rapidly caught up in the low volume churn. Bonds leaked higher in yield (unch on the week now); the USD pushed higher after Europe's close (back to unch on the week); but inventories and USD strength weighed on oil prices and precious metals limped modestly lower.
NASDAQ is playing catch-up to the Trannies...
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The "most shorted" names continue to push higher on momentum from yesterday's major squeeze after the attempt to sell on Monday...
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Another day of divergence and convergence with JPY carry trades - this time sellers banged higher by the carry arbs...
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VIX has been relatively well bid for the last week as managers appear loathe to sell but desirous of protection (VIX is notably rich relative to realized vol)...
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Credit markets diverged notably on the day...
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Oil slumped and commodities in general slid lower...
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The USD rallied back to unch on the week led by notably JPY (and AUD) weakness...
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Since the previous October 2007 highs in stocks, the S&P is +14.5%, The Long Bond is +19.3% (price), and Gold +68%...
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Finally, putting everything into perspective, US Federal debt joined the party, obviously, and just printed at a fresh all time high of just over $17.2 trillion
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Charts: Bloomberg
Bonus Charts: Give Thanks...
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