Every day this week saw early weakness (the dump) succumb to a rampathon (pump) but as those dump-and-pumps progressed the gap between small-cap/high-beta and large-cap/blue-chip widened and widened. The Russell (and the S&P) had its worst week in a month but the Dow (and just Trannies) managed to close the week green and new record highs. Homebuilders were the worst sector on the week (-2.5%) and Staples best with a modest gain. Away from stocks, the USD surged 0.55% on the week (its biggest jump in 7 weeks) led by EUR weakness (250 pips on Draghi promise). The biggest news was in bond-land where the 30Y yields exploded post-Yellen (+10bps on the week) and the short-end rallied (-4bps) for the biggest steepening in 20 months. Gold closed the week at its lowest in 3 months. Much was made of the shift lower in VIX today (back under 13) - especially ahead of the Donetsk referendum - but given the market's relative underperformance it would appear hedges were lifted and positions derisked simultaneously.
Courtesy of the JPY (and VIX see below)...
[2]
If 3:30 pm isn't enough to send the Dow Jones to an all time high, nothing is
— zerohedge (@zerohedge) May 9, 2014 [3]
Mission accomplished: Dow all time high on 3:30 pm
— zerohedge (@zerohedge) May 9, 2014 [4]
The Dow closed at all time record high close - and made it perfectly unchanged on the year...
[5]
The week in stocks - dominated by dump-and-pumps and high- versus low-beta
[6]
As growth and value are stuck at six-month lows relative to one another...
[7]
This was not a short-squeeze... in fact this was the worst week for "most shorted" stocks in 2 years... (and they are now down almost 13% from their highs)...
[8]
VIX did not do the job it was supposed to do - as it seems 'real' sellers dominated the pumpers for change as they unwound hedges and underlying risks...
[9]
Which leaves the VIX term structure near its steepest in months...i.e. most complacent!!
[10]
The USD had its best week in the last 7 as EUR dumped 250 pips on Draghi's promise of next time...
[11]
But bonds were the most active...
[12]
with 5s30s steepening the most in 20 months...
[13]
Gold closed at its lowest weekly close in 3 months...
[14]
Charts: Bloomberg
Bonus Chart: The Flow is not your friend...
[15]
Bonus Bonus Chart: Either we re-pump this credit bubble or stocks are gonna blow...
[16]
Summing it All Up...
Victory: This weekend Americans will spend money they don't have as the rigged Dow Jones closed at all time highs because 3:30pm happened
— zerohedge (@zerohedge) May 9, 2014 [17]