The Russell 2000 had its best day in over 17 months today - up 2.5% (best since Jan 2nd 2013) and +4% from Friday's lows. All US equity markets exploded higher our of the gate thanks to a ridiculous spike lower in VIX (below 12) and USDJPY stop-run back through 102 which squeezed "most shorted" dramatically higher. The Dow, Trannies, and S&P all made new record high closes...and it's not even Tuesday yet! Away from stocks, silver jumped over 2% for almost its best day in 3 months. Gold rebounded over $25 from overnight smackdown lows. Oil broke back above $100. Treasury yields rose modestly (2-3bps) - majorly out of sync with equity exuberance. JPY was large and in charge of stocks but the USD ended the day unchanged. S&P futures volume was 30% below recent average.
A major short-squeeze...
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lifted all the major US equity indices into the green for May... (and the Nasdaq green for 2014)
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The Russell is up 4% from Friday's lows - destroying the meme that this is a healthy rotation from high-valuation names to low... this is just another squeeze
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Homebuilders were the best performers... sure they were... makes perfect fucking sense as rates rise...
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From the early March highs in the Nasdaq and Russell...
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Volume was dreadful...
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USDJPY was in charge all day...
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FX markets were volatile during the European session but ended the NY session unahcnged from Friday... (with JPY weakest)
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Copper and Silver surged, oil and gold rose...
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and this came after the overnight smashdown in PMs...
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Treasuries sold off very modestly - not exactly the heart-pounding wreck that huge risk on belief in stocks woul dhave one believe...
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And tomorrow's Tuesday!!!! Fuck yeah! Just 3 more points for Goldman Sachs 2014 year-end target (8 months early!)
Charts: Bloomberg
Bonus Chart: Some context for today's "recovery" in high-beta momo stocks...
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