Wednesday is not Tuesday (except for Trannies). Some early weakness in stocks was bid mindlessly back to its highs even as 10Y bond yields kept tumbling to 11-month lows and oil and copper rolled over. VIX ended the day higher (again) ignoring the exuberance in the light volume equity market. 10Y yields dropped to 2.43% - its best day in 5 months (breaking last October's key support). The yield curve flattened dramatically with 2s30s at its tightest in a year. The USD was bid (led by GBP weakness) buy JPY's volatility is what ran the stock show today. Gold and silver fell further as did WTI crude (back under $103). The S&P 500 is now around 60 points rich to 10Y bond yields (and the world is still short bonds); credit spreads are well off their tights and VIX isn't falling; breadth is weakening and so is volume... but apart from that... BTFATH. A late-day selling frenzy took the shine off the CNBC headlines with stocks closing red.
10Y at 11-month low yields... fuck yeah America...
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Trannies don't care... but the last few minutes saw selling volumes pick up notably...
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as USDJPY ran the show...until stocks decided to catch down to EURJPY
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And stocks are entirely decoupled from bonds
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Utes remain the year's big winner and builders not so much...
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It's been quite a week for the entire bond complex...aside from 2Y!! which slammed the yield curve to its flattest in a year
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VIX remains stubbornly high relative to equity exuberance as it seems some protection is warranted with stocks so decoupled...
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Commodities were ugly...
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And suddenly everyone excited about Biotechs and MoMo stocks.. here's some context...
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Charts: Bloomberg
Bonus Chart: Wee Divergence...
Wee Divergence pic.twitter.com/ZbZD90CfFD [23]
— Not Jim Cramer (@Not_Jim_Cramer) May 28, 2014 [24]