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Small Caps, Crude Oil, & The Yield Curve Dump'n'Pump As Soaring CPI & COVID Cases Stalls

Tyler Durden's Photo
by Tyler Durden
Wednesday, Aug 11, 2021 - 03:41 PM

Sheesh... that was quite a headline-heavy day.

The $3.5 trillion socialism bill passes its first hurdle (called "irresponsible" by Manchin), a desperate demands from Biden to OPEC to open the oil production floodgates, Core CPI appears to start to confirm the 'transitory' inflation narrative, a red hot 10Y bond auction, Delta variant COVID cases topping in some states, and hawkish Fed speakers pushing an early taper... all combined for quite a chaotic day in the day in the markets, which was hidden by the relatively small close-to-close changes across asset classes.

By the close, Nasdaq was down modestly, The Dow up notably, S&P small gains, as Small Caps dumped-and-pumped back into the green...

Dow & S&P record close today.

Small Caps today... -0.2% overnight to +0.3% on CPI... to -1.0% after the open into EUR close... to +0.4% at the close

Notably Small Caps have been unable to break back above their 100DMA...

Value continues to dominate growth...

Source: Bloomberg

MRNA was clubbed like a baby seal as gamma squeezers ramped up the pain combined with EU regulators warning of mRNA vaccine side effects and Delta variants stalling in the US

Treasury yields drifted higher overnight, extending the recent trend, but a weaker than expected CPI and strong 10-Y auction sent yield reeling lower... only to be bid back up

Source: Bloomberg

Treasury yields were noisy today after being offered all night, the Core CPI print saw the first leg down in yields and then a stellar 10Y auction legged them down again, but bouncing off 1.3000% perfectly...

Source: Bloomberg

The Dollar tumbled back to unchanged on the week...

Source: Bloomberg

Bitcoin extended recent gains, back above $46k...

Source: Bloomberg

And Ethereum topped $3250...

Source: Bloomberg

Gold extended its rebound off Sunday night's carnage...

Oil was volatile today, tumbling on Biden's demands that OPEC+ open the floodgates of supply (bwuahaha!) and then surging when White House claimed to see new cases topping in various states, easing fears of Delta variant demand destruction...

Finally, in keeping with the inflation/deflation theme, rents in the New York City metropolitan statistical area -- which also encompasses northern New Jersey and Long Island -- dropped in the 12 months through July for the first time since 1958...

Source: Bloomberg

Before that, the series indicates rents in the region hadn’t fallen on a year-over-year basis since 1934. The figures underscore the historic nature of the pandemic and its impact on the U.S. economy. Luckily the stock market couldn't give a shit!

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