Another Tuesday, another sell-off in bonds and rally in stocks. The hawkish inflation data this morning sparked stock weakness and bond weakness but while the latter saw yields keep pushing higher, the former rallied back extravagantly ignoring the dismal housing data - well why not, its Tuesday today and FOMC tomorrow. The Russell 2000 was the winner once again as traders embrace high beta as alpha (and financials outperformed (2s30s steepened for once). 10Y Treasuries saw yields jump the 2nd most in 2 months (with 7Y the worst performer +6.5bps). Gold, silver, and copper all rose notably after the inflation data but oil prices decided to waterfall lower having briefly reached unch for the week (as soon as POMO ended). "Most shorted" stocks were smashed higher today (+2%) enabling the early ramp and while a late-day selling scramble nearly rescued failure from success, VIX pressure was enough to save stocks' green track record.
"Most Shorted" stocks were monkey-hammered higher...
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Another Tuesday and stocks are up...
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and Bonds are down...
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As 10Y breaks its medium-term downtrend...
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VIX was in charge of stocks today as stocks entirely decoupled from JPY carry today...
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Commodities all rallied on the inflation print...
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But oil prices rolled over notably after touching UNCH on the week (and POMO finished)...
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Gold's initial reaction was to dump in size on the inflation print...
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Charts: Bloomberg
