Dollar Dumps & Bond Yields Jump On Putin Panic, Trump Tantrum, Japan Jawboning

Anyone else find it interesting that UST bonds collapse the day after Trump directly slams China over its manipulation of the currency...

 

After China's offshore Yuan collapsed overnight, it seems pretty clear that The National Team stepped in to save Chinese stocks... (SHCOMP ended unchanged on the week with PBOX Yuan Fix dropping second most since Aug 2015)

 

European stocks were hit today, erasing the gains for the week...

 

On the week, The Dow, S&P, and Nasdaq were practically unchanged, Trannies outperformed and Small Caps gained...

 

Futures show the chaotic moves better on the week...

 

The last 24 hours in futures show the exuberance in Nasdaq fading after each of its impulsive BTFD ramps from Trump...

 

FANG stocks faded intraday today...

 

But NFLX was the big loser, unable to sustain any bounce above its 50DMA... this was NFLX's worst week since July 2016.

 

US Bank stocks had a good week but faded from midweek...

 

VIX closed with a 12 handle on the week, pushing back lower after testing its 100DMA...

 

While VIX dropped, SKEW soared (crash risk)...

 

Global bonds were plugging along nicely all week until Trump and The BoJ wrecked it all...

 

It appears Trumpflation is back as the 10-year breakeven inflation rate had its biggest daily increase since February...

 

Treasuries spiked at the longer-end (chatter of rate-locks also helped)

 

Dramatically steepening the yield curve...biggest curve steepening in 5 months...

 

10Y roundtripped yesterday's gains...

 

The 30Y yield jumped 7bps, back above 3.00% - the biggest absolute jump since February...

Before we move on, we note that there was NO CHANGE today in the Fed Funds Futures implications for Fed Rate Hikes this year and all the weakness in TSYs was in the long-end (not what one would expect if Trump-related). We suspect the rate-locks reasoning is more realistic.

And the short-end of the curve remains inverted (implying rate cuts more likely in 2020 than rate-hikes)...

 

The Dollar ended the week unchanged - slammed lower by the last 24 hours of Trump tweets and comments... (biggest daily drop in the USD in 4 months)

 

Yuan was a bloodbath this week... (overnight saw the biggest drop in the Yuan fix since 2016)...

 

Here's an interesting one - notice how UST Futs are bid away from, then dumped back down to the sliding Yuan...

 

Net FX speculative positioning has reached its longest USD since March 2017 (but note the decoupling from positioning and the USD)

 

When will yuan's collapse spread to US stocks?

 

Cryptos had a good week...with Bitcoin outperforming...

 

Bitcoin jumped 20% on the week - its best week since early Dec 2017...

 

Despite the dollar's weakness on the week, commodities ended lower (though were bid today...)

 

President Trump did his best to make gold great again on the week...

 

With everyone and their cat complaining about tariffs driving prices Up (or down), we note that Lumber prices are now unchanged since softwood lumber tariffs were introduced...

 

And soybean prices are at their lowest since 2008 (having fallen almost constantly for 5 years)...

 

Will commodity's collapse start spreading to stocks?

 

Finally, we note that while there is plenty of potential for more, The Dow is back to its richest relative to Gold since June 2007...

h/t @Schuldensuehner