VIX Crushed As Curve & Commodities Scream Recession; Banks Skid, Big-Tech Bid
Solid US housing data was offset by weak Chicago Fed National Activity Index data, poor labor market signals (claims), dismal LEIs, and ugly Kansas City Fed Manufacturing data as a wave for hawkish central bank action prompted an odd assortment of actions across asset classes - dollar strength, yield curve compression, VIX hammered lower, long-duration stocks bid, commodities and bonds dumped, banks sold, bitcoin flat.
Nasdaq strongly outperformed with Small Caps lagging (huge 2% divergence) as The Dow ended flat with the S&P green...
As that pairs trade surged back up to recent highs...
Another day, another dump and pump for 'most shorted' stocks - though we note the strength of the bounce is getting weaker...
Source: Bloomberg
0-DTE traders fought the uptrend in Nasdaq all day... and failed...
But, VIX was clubbed like a baby seal, hitting a 12 handle intraday....
Banks extended their losses on the week (after the surge in deposit outflows reported last Friday)...
Treasuries were dumped across the curve - up around 7-8bps - leaving all yields higher on the week with the short-end underperforming on the week...
Source: Bloomberg
The yield curve compression continues to signal recession (along with all the macro data above)...
Source: Bloomberg
The dollar surged back today, erasing yesterday's weakness...
Source: Bloomberg
The dollar gains weighed on gold which tumbled to fresh 3 month lows...
Finally, we note that NVDA was red on the day, having gone nowhere for a week...
Makes you wonder eh?
Or is that just too easy?
