A day dominated by geopolitical headlines saw stocks hit 4-month lows, gold jump to 3-week highs, and bond yields tumble to 14-month lows. The Dow made new "sell in May" lows today, now -1.5% from end-April (joined in weakness since then by the Russell). The S&P 500 broke its 100-day moving-average (and did not bounce) as USDJPY broke the critical 102.00 level. The Dow stalled at its 200-day moving-average (16343). 10Y Treasury yields continued to plunge pressing a 2.41% handle - new 14-month closing low-yields. Gold jumped above $1315 closing near the highs of the day (and silver above $20). The USD ended up on the day but JPY carry unwinds continued. VIX broke back above 17 (and remains inverted for the 10th day in a row). Equities continues to catch down to high-yield credit's weakness. A late-day buying-panic, sparked by VIX-slamming, was triggered as S&P futures broke 1900.
Gold reacted notably to every headline...
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USDJPY was in charge (as EURJPY was off limits thanks to ECB and AUDJPY blew up last night)... 102.00 was all that mattered... fun-durr-mentals
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Interestingly, The Russell 2000 remains green on the week with Trannies worst...
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All the major indices are at or breaking key technical levels... (except Russell which is holding below)
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"Sell In May" is working...
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Stocks continue to slide towards credit's warning levels...
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VIX pushed back above 17... but once the S&P 500 futures dropped to 1899.75, VIX was rammed lower...
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With the VIX term structure inverted for 10 days now...
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10Y Yields close at 14-month lows...
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as the week sees compression accelerating
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FX market were active with the USD ending higher - balanced between EUR weakness (Draghi's jawboning was mostly undone though) and JPY strength (carry unwinds)
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Gold is up on the week as today saw oil prices start to react more as Iraq headline shit...
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Charts: Bloomberg
