Draghi did it (or didn't), blame him... From record intraday highs (on vapid volume) to 5-day lows in the S&P 500 as Mario Draghi cut rates even negative-er and promised to do more QEing. EURUSD collapsed over 2 big figures to 14-month lows below 1.2950. The implicit USD strength sparked selling in everything else. Treasuries pushed notably higher in yield (30Y +13bps on the week, 5Y +8bps) and held their yield highs as stocks started to collapse after Europe closed. The standard late-day machine-driven VWAP ramp lifted stocks off the lows, but S&P 2,000 remained elusive. Gold, silver, and oil all pushed lower as USD jerked higher. High-yield spreads jumped most in 6 weeks to 3-week wides and provided a warning to stocks all day. Bottom line - USD up, everything else down... (except Trannies).
Stocks manage to just regain the levels from the ECB rumor pump early in the EU session...
[5]
On the week, Trannies remain green
[6]
S&P 500 2,000 remains all that matters... no matter how much damage intraday
[7]
All the volume was on the downswing...
[8]
Note that Treasuries did not rally as stocks collapsed...
[9]
As September convergence continues...
[10]
And credit markets flashed red all week...
[11]
Commodities all slipped...
[12]
As USD soared to its highest in 14 months...
[13]
@PipCzar [14] yep pic.twitter.com/13BJ5awrDP [15]
— Not Jim Cramer (@Not_Jim_Cramer) September 4, 2014 [16]
So ECB is 'easing' therefore all the hot money in the world slushes to European assets (remember does not need EUR as its all via repo and leverage)... leaving US assets the dirtiest clean shirt... this must be how Russia feels sometimes?
Charts: Bloomberg
