Bonds Have Best Day In Over 3 Months Amid China Carnage, Turkey Terror, & Berlin Bloodbath
By Tyler Durden
Despite considerably weaker than expected Services PMI, an assassination in Turkey, a terrorist attack in Zurich, and a bloodbath in Berlin, stocks rallied…
As a reminder – Chinese bonds crashed overnight again..
Hong Kong stocks tumbled into correction (red for 2016)…
And Italian banks all crashed (led by BMPS)…
First things first in The US – the market broke today and stocks loved it…
The Dow still has not had two down days in a row since before the election (7 weeks)… despite all the turmoil today… (and of course the standard panic-buying into the close)
Dow failed its 20k mission again…
Leaving all sectors red post-Fed (Energy laggard)
Treasury yields tumbled across the curve with the long-end's biggest yield drop since August… (The Turkey headlines and Berlin bloodbath sparked safe-haven buying)
Best day for the long-bond since August…
Bond yields suddenly seem attractive to stocks…
Post-Fed, the long-end is now down 2bps (with the rest of the curve notably higher in yield…
And the yield curve continues to flatten “policy-error-like”…
But it appears financial stocks love flatter yield curves…
The USD Index ended the day unchanged (rallying back on the Turkey-Russia headlines)…
Gold was the only major that managed gains today as copper crumbled amid China fears…
Gold prices rose for the 2nd day in a row – the first time since the election…
Financial Conditions are worsening once again…
And Commercial Paper market yields are at their highest since Jan 2009…
Source: Bonds Have Best Day In Over 3 Months Amid China Carnage, Turkey Terror, & Berlin Bloodbath
