Bonds Bid, Stocks Skid As Emerging Market Massacre Returns

Just when you thought it was safe BTFRH, EM explodes, US macro dumps, and China resumes devaluation…

 

DECOUPLED:

Yuan and US Stocks…

Bonds and US Stocks…

Yield Curve and US Stocks…

Commodities and US Stocks…

World Stocks and US Stocks…

EM Tech Stocks vs US Tech Stocks…

Macro and US Stocks…

And finally – and most importantly – Global Central Bank Balance Sheets and US Stocks…

*  *  *

Ok, having got that off our chests.

China’s National Team was back overnight, bidding China stocks after an ugly morning session…

 

Small Caps (Russell 2000) managed a new intraday record high before tumbling. Nasdaq broke its 5-day win streak. Cash equities tumbled into the European close, tried to stage the normal momo-ignited rally, then dumped at the close…

 

Futures show the chaos better… (Aussie political headlines overnight, pure algo chaos at the open, then another ugly close)…

 

 

Once again the S&P failed to make higher highs and extend its record high breakout gains…

 

Tough day for China tech – BABA released earnings (seemed solid), dumped, pumped, and then really plunged…

 

 

Treasury yields were mixed with the long-end lower and short-end higher…extending the week’s trend and flattening dramatically…

 

Flattening the curve further still (2s10s at 20bps)…

 

30Y yields dropped to 5 week lows…

 

The Dollar bounced overnight and extended gains from the kneejerk drop on Fed Minutes…

 

After brief pause from the bloodbathery, Emerging Markets were clubbed like a baby seal today with all EM FX lower…

Led by the Rand (Trump tweets), Real (Lula increasing his lead in polls), Mexican Peso (NAFTA), Turkish Lira (on way back from vacation), and the Fornit and Zloty as Eastern Europe hots up…

Turkish Lira remains relatively quiet as the whole country is on vacation, but did fade today…

PBOC fixed the Yuan weaker overnight for the first time in 6 days, and offshore Yuan is tumbling again as the trade talks come to an end…

 

Crytpocurrencies jolted lower overnight on the SEC ETF headlines but Bitcoin crept back higher to unchanged on the week…before they snapped in the last hour

 

Dollar strength weighed on commodities…

 

Gold futures drifted back below $1200…

 

Finally, 2018’s US Macro data is now the most disappointing since 2004…

So much for the greatest economy ever.

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Author: Tyler Durden