UPDATE: The pre-open VWAP ramp has been totally flushed in stocks and VIX has exploded
Much as the world of business media would like the world to work in a 'great rotation' like way; in reality the markets - all of them - ebb and flow on the back of leverage, repo, and liquidity. At no time in the recent past has that been more evident than in the last few days as every asset class in almost every ragion of the world is rediced in price by a market of angry liquidity-addicted carry traders demanding moar as their dealer wonders off into retirement. Overnight saw an early rise in Japan (and China) evaporate into a collapse, that spilled over further into Europe, and now the US. Despite a sudden rampaplooza across FX and equity markets in the pre-open, things do not look pretty as the great rotation is replaced by the great unwind.
The Great Divergence since QE went into full swing... (h/t @ConvertBond) China -36%, S&P 500 +36%
Asia - China stocks battered... Japan bounced and faded
Europe - all stock markets systemically lower by 7 to 8% from FOMC - Greece/Italy/Spain worst; Sovereign bonds waking up to the carnage and 30-40bps wider from FOMC
Greece is exploding again...
US - bonds and stocks hammered