Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

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Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Quite a week…

The biggest quant quake since 2009 (and 2002)

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

as Momentum collapsed…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

The momo massacre went global…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

And factor dispersion collapsed…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

h/t Michael Krause

And the antithesis of the momo massacre, value had its best week on record…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

And relative to one another, it was a bloodbath…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

And linked to this destruction, 30Y yields (amid record issuance) soared a stunning 33bps this week – second biggest yield spike since 2009…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

But apart from that – global stocks rallied.

China ended higher…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

Europe soared…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

And US equities surged led by Trannies and Small Caps, each of which was panic-bid at every day’s open. The Dow is up 8 days in a row. Nasdaq underperformed on the week…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

That is the best week for Small Caps since Dec 2016 (and best for Trannies since Dec 2017)

Very narrow range in Dow futs in the day session (having tried and failed to break to new highs numerous times)…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

The driver of the Trannies/Small Caps surge was a huge short-squeeze…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

The biggest weekly squeeze since Trump’s election…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

September has seen a massive shift into cyclical stocks…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

Bank stocks soared this week (as rates rose and the curve steepened)…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

…but note below they are merely back at a critical level of resistance…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

The week was an utter bloodbath for bondholders (yields are up 8 days in a row)…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

Just as the start of August sparked a panic-buying period for bonds, so September has seemingly sparked the exact opposite with a huge retracement so far…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

The 10Y Yield is testing critical technical levels…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

Some might argue the 10Y has a long way to go…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

But don’t listen to Jamie Dimon: In 2018, he predicts 10Y yields will hit 4%, 10Y yield drops to all time low. In 2019, he says JPM preparing for 0% rates on 10Y, 10Y yield soars most in years.

Meanwhile, elsewhere in bond land, that 100-year maturity Austrian bond (which was up 85% YTD, is now in a bear market, down 21% from the highs)…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

The US yield curve (3m10Y) remains inverted but had the biggest weekly steepening since June 2013…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

The Dollar slipped lower the second week in a row, testing one-month lows…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

Cable soared this week – its best since May – as BoJo faced defeat and a no-deal brexit was believed to be less likely…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

Offshore Yuan ended the week stronger than the Yuan fix

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

This is the strongest offshore yuan has been relative to the fix since Dec 2018…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

Yuan appears to have caught up to Bitcoin’s stability…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

Cryptos were mixed with Bitcoin down on the week and Altcoins up led by Ethereum…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

But Bitcoin held above $10,000 for now…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

Oil had a volatile week as copper surged but PMs got pummeled today (most notably silver)…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

Soft Commodities soared 5.2% this week, its best rally since May and snapping 10 straight losses in what was the longest losing streak since at least 1991.

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

With the surge in rates this week, the volume of global negative-yielding debt tumbled, and gold tracked it lower…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

But it was silver that was monkeyhammered most…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Smashing Gold/Silver dramatically higher this week…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

Finally, straight from the WTF world we live in, Greek 10Y Yields are now below US 10Y Yields for the first time since 2007…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg

And the market is starting to ease off its pressure on The Fed as it now prices in less than 2 rate-cuts by year-end (from more than 3 in July)…

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown

Source: Bloomberg


Tyler Durden

Fri, 09/13/2019 – 16:01

Stocks Soar Near Record Highs Despite Bond Bloodbath, Momo Meltdown