"Mission Accomplished"

We could tell you all about the fact that high-yield credit did not play along with this rally today (and that the underlying cash market for corporate bonds has been weak for well over a week now); we could note that VIX did not take part in this surge today as the stops were run; we could point to the total lack of volume (NYSE or futures) confirming the move; we could highlight the fact that Treasury yields rose a de minimus 1.5bps on the day and while the USD slipped modestly on the day, it is only down 0.22% on the week and that Gold, Silver, and Oil are all unchanged on the week. But - all that matters, in this headline-driven algo-aided market is - The Dow hit all time highs - 'Mission Accomplished' Mr. Bernanke, well played - record stocks, record debt, record food stamps recipients.

 

Since The Dow last hit these levels, Gold and Silver are up 111%, the long-bond has gained 31% (in price alone), Oil is 9% higher in price and European stocks are 40% lower...


 

Since the Italian elections cast doubt of the Merkel-Draghi wager's success, Stocks remain the only asset class in full risk-on mode...

 

Today saw stocks surge up to the up-trend-channel, see some professional large block activity up there...

 

and then hang around volumelessly for the rest of the day... with a late day pull to VWAP

 

Credit markets look on and smile wryly - we've seen these Johnny-5's do this before - and we draw attention to the fact that the underlying cash value of the HYG ETF (the dark red line in the chart below) has been falling for around 10 days now - real men are selling risk-assets in the bond markets...

 

VIX didn't want to follow through on this today... as instead of conviction buying we saw concerned hedging...

 

Another day, another total disconnect from risk-asset reality for stocks... as correlation to reality fell away quickly

 

The late day sell-off no real surprise given the spurt - but hardly a positive high conviction signal for the new highs.

 

"More media attention than investor attention" summed it up perfectly

 

Charts: Bloomberg and Capital Context