US equity markets were unable to maintain any of the kneejerk, VIX-smashing jerk higher post-FOMC momentum from yesterday and closed unch to slightly red (after some US open exuberance ran all-time-high stops once again). Equities did catch some bid late on as rumors of AAPL iWatch spread. VIX hung very stable at around 10.6 providing some support for stocks. Away from stocks flatness, Treasuries had a violent day. Early strength following Yellen yesterday began to fade as US equity markets opened and yields pushed higher, then when the 30Y TIPS auction tailed, longer-dated bonds slammed higher in yield. There was a mild pullback rally into the close but 10Y ended +4.5bps (30Y +7bps, 3Y unch). The big news of the day - given how flat USD was - is the huge spike higher in gold (+3%) and silver (+4.4%) - the biggest jump in 9 months. Gold and Silver are back at 3-month highs (breaking back above $1300 and $20 respectively). Once again JPY carry entirely decoupled from stocks but a late-day modest melt-up dragged all the major indices (except Nasdaq) just into green for the day) but leaves the S&P lagging gold and silver year-to-date again. S&P 500 closes at another all-time high.
Stocks held yesterday's gains but did not build on them... the v-shaped recovery appears to been predicated around the tail in the TIPS auction...(and after Gold flushed through the 1300 stops)
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As VIX went nowehere...
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Credit was reluctanat to chase stocks higher...
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Bonds cracked higher in yield...
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But precious metals exploded higher...
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As it seems a combination of Yellen's uber inflationist chatter but more likely the unwinds of CCFDs from the Qingdao probe...
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Interesting that stocks sdtarted to recover bounce on no catalyst as soon as gold broke above $1300
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This move pushed Silver and gold back above the S&P 500 YTD...
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Charts: Bloomberg
Bonus Chart: AAPL "Surprise" an iWatch rumor... (priced in?)
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