US Stocks Soar… Because Nothing’s Fixed In Europe & US Growth Slowed

    Equity investors are convinced…

     

    Does this look like Italy is ‘fixed’?

    US Bank stocks bounced but remain notably red on the week…

     

    In fact the big US banks are still notably weaker…

    And Italian banks hardly rejoiced today…

     

    So The ECB bid BTPs at the auction and The Fed PPT bid US stocks at the open… The Dow remain red on the week, S&P and Trannies faded into the close but Small Caps exploded and held gains on the day…

     

    The Russell 2000 was squeezed to another new record high today as the entire US equity market soared on absolutely nothing. In Europe – no resolutions, no nearer a non-anti-establishment government, and no promise of support from the ECB (in fact the opposite)…

     

    Oh and for those who suggest that buying Small Caps makes sense here as they are domestically-focused – well fuck that, US economic data has been dismal and got worse today as GDP missed expectations…

     

    The simple reason why Small Caps exploded higher is – another massive short squeeze…

     

    The S&P 500 bounced off its 50DMA, pushing back above the 100DMA…

     

    Bonds and Stocks decoupled as US market opened (stocks spiked, bonds were bid)

     

    Credit and Stocks decoupled massively

     

    As an FYI – European HY credit trades wider than US HY credit for the first time since Nov 2013

     

    European Investment Grade credit exploded wider today…

     

    Treasury Yields bounced higher, but remain notably lower from Friday…

     

    30Y yields rose but bonds rallied back down to around the 3.00% level into the close…

     

    The yield curve collapsed today, erasing yesterday’s brief steepening… This is the 2nd lowest close for the 2s30s curve since Oct 2007…

     

    And 2s10s plunged back to its lowest close since September 2007…

     

    Breakevens bounced today but faded into the close – having never recovered yesterday’s drop…

     

    The Dollar Index tumbled back to unchanged on the week…

     

    Cryptos gave back some of yesterday’s gains leaving them all in the red on the week…

     

    Commodities remained relatively flat on the week but WTI surged ahead of tonight’s API data…

     

    WTI bounced back above $ 68…

     

    Finally, while the mainstream media celebrates today’s manic melt-up in stocks (blatantly ignoring bonds, credit, economic data, and Italy), the SMART money is paniccing out of the market…

     

     

     

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