Optimism started overnight with reports that China is considering further bailout moves for its ailing real estate industry (any stimulus is good stimulus and fully fungible, right?). Then payrolls printed hot (job gains better than expected), cold (unemployment jumps significantly), and just right (hourly earnings flat) and while rate-change expectations surged hawkishly…
Source: Bloomberg
…so did stocks! Small Caps were the week’s biggest winners (ripping from down over 2% on Wednesday to up 3% by the Friday close). The rest of the majors were up around 2% on the week…
Today saw the ratio of Nasdaq-to-Small-Caps hit its dotcom record high and reverse…
Source: Bloomberg
All thanks to a huge short-squeeze in the last two days…
Source: Bloomberg
Consumer Discretionary stocks outperformed while Staples lagged but all sectors ended the week green…
Source: Bloomberg
Regional bank stocks rose for the 3rd straight week, despite ongoing deposit outflows and rising usage of The Fed’s emergency bailout facilities…
Before we leave cash equity-land, it’s worth noting the divergence between Nasdaq and NVDA today…
Source: Bloomberg
And the fact that amid all the euphoria, NVDA has gone nowhere since the post-earnings spike…
VIX tumbled to a 14 handle today, breaking out of the three month range from 16-20…
…basically back to pre-COVID-lockdown levels…
Source: Bloomberg
The Put/Call ratio across all stocks dropped to its lowest since March 2022…
Source: Bloomberg
…driven by a surge in call volumes…
Source: Bloomberg
Bear in mind that the last two times that the options market has been this exuberant (or ignorant of risk) have marked local tops…
Source: Bloomberg
In spite of today’s selling pressure, Treasuries were bid during this holiday-shortened week with the short-end underperforming…
Source: Bloomberg
Despite today’s gains, the dollar was lower this week – breaking a three week streak of gains…
Source: Bloomberg
While BTC and ETH were the least exuberant, this week saw some strong gains in altcoins…
Source: Bloomberg
Bitcoin ended the week hovering around $27,000…
Source: Bloomberg
Commodities were mixed but China headlines overnight sparked gains today in crude and copper (and iron ore). Gold, silver, NatGas (ugly slide though), and copper all ended the week marginally higher while oil fell…
Source: Bloomberg
Gold futures tagged $2000 intraweek but faded back today…
Oil prices V’d on the week with WTI back at $72 by the close…
Finally, while mega-cap tech is a long-duration asset, since the start of May, the markets have hawkishly priced higher rates (and most notably today) and tech has soared (that’s not how it’s supposed to work)…
Source: Bloomberg
And that decoupling is more obvious on a longer-term basis…
Source: Bloomberg
How long can that last?
But that can’t happen again, right?
