Oil Headline Rescues Stocks From Bloodbath As Precious Metals Soar

Market Psychology has swung from this...

 

To this...Losing SPY Religion

 

And seemingly back.

*  *  *

Gold grabs the headlines today. After beginning to surge yesterday, Hong Kong's reopen sparked a spike which then accelerated all day.

 

This was gold's best day since Nov 2008 and the highest level in a year...

 

With the best quarter in 30 years...

 

Perhaps even more stunning is the collapse in USDJPY since Kuroda unleashed NIRP - this is the worst 2-week drop (Yen strength) since LTCM in 1998...

 

Damn It, Janet!

 

It seems much of today's turmoil began as Hong Kong re-opened last night...

 

An OPEC Rumor - which struck perfectly as the S&P broke 1812 - a crucial technical level (January's intraday low back to Feb 2014)... And just look at VIX!!! Does that look like a "normal" market?

 

Spiked stocks briefly (enabling NASDAQ to briefly get green before dropping), and the soared again...

 

Techs managed to scramble green in the last hour but financials were the biggest loser...

 

Deutsche Bank's dead-cat-bounce died and is back to tracking Lehman's analog...

 

And it is spreading to US banks - Sub financial credit risk is up 18% this week - the worst week since at least 2011...

 

High Yield Bond yields and Leveraged Loan prices are at their worst levels since 2009...

 

Treasury yields crashed overnight - 2Y was down 10bps and 10Y down 20bps at its apex, before a miraculous bid for USDJPY appeared and rescued risk...

 

The yield curve (2s10s) collapsed even further below 100bps - to Dec 07 lows near 95bps at its lows today - leading financials lower...

 

The last time 2s10s was flattening and at these levels was Jan 2005

 

FX markets were volatile early on (with a huge drop in USDJPY when HK opened) and the USD drifted weaker...

 

The biggest 2-week drop in USD Index in 4 years...

 

Crude and Copper slumped as Gold & Silver surged...

 

As front-month crude plunged relative to 2nd month crude to 5 year lows..

 

Charts: Bloomberg

Bonus Chart: If everything is awesome, why is USA default risk on the rise?