Tue. Oct 19th, 2021
From <a href="https://www.zerohedge.com/"Zero Hedge

Soaring Stocks Shrug Off Debt Ceiling Doubts As Taper Tantrum Sparks Bond Bloodbath

Since The FOMC released its hawkish statement, the dollar is down modestly, gold has been monkeyhammered, bonds have puked, and stocks have soared…

US equity markets rallied overnight then tumbled on Evergrande headlines early in Europe’s day that SOEs are preparing for the developer’s collapse. Weak jobless claims sent stocks down another leg ahead of the US cash open, but once the bell went off, algos were buying stocks with both hands and feet and ripped everything higher (Small Caps outperformed as Nasdaq lagged). This chart shows the major US equity’s performance since 1400ET (FOMC statement) yesterday…

That was stocks’ best day since July 20th…hawkish Fed, weak claims data, ugly PMIs, Evergrande offshore bond default, debt ceiling & stimulus size doubts… BTFD!!! (Simplfied as ‘bad news is good news’ for stocks again!)

“Most Shorted” stocks squeezed higher once again, erasing all of Monday’s losses… Will that be it? Is the short-squeeze ammo run dry?

Source: Bloomberg

All the major US equity indices broke back above key technical levels…

Energy and Financials are the best performers in the last two days with Utes the only sector underwater…

Source: Bloomberg

All except Nasdaq are now green on the week…

As real rates spiked dramatically higher, value stocks (Russell 2000) outperformed growth (Nasdaq)…

…and as the chart below shows, if rates continue here then big tech will be a big underperformer…

Source: Bloomberg

And while stocks were incessantly bid, elsewhere there was pain as Powell hinted at ‘cutting the rope’

The dollar plunged back to yesterday’s lows after spiking on the Fed statement…

Source: Bloomberg

Yields exploded higher today as a mini-taper-tantrum begins…

Source: Bloomberg

Steepening the yield curve, erasing most of yesterday’s flattening…

Source: Bloomberg

30Y Yields could not push past critical resistance though…

Source: Bloomberg

As the market prices in a full rate-hike by the end of 2022…

Source: Bloomberg

Crypto rallied notably off yesterday’s lows with h Bitcoin extending gains after Twitter announce its BTC tips feature…

Source: Bloomberg

Gold was clubbed like a baby seal today (even as the dollar dropped)…

Oil surged once again, with WTI back above $73 (and Brent closed at its highest since Oct 2018)…

Finally, did no one actually notice that Evergrande did actually default on its offshore dollar bond today?

Source: Bloomberg

We guess everyone was too busy buying US stonks and Evergrande equity… because, well who the f**k knows anymore.

Tyler Durden
Thu, 09/23/2021 – 16:00
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