The word “volatile” comes to mind when reflecting on today’s cross-asset class action. US equities dumped into and beyond the US open, decoupling entirely from JPY carry, only to reverse perfectly at the European close and recover all the way back to USDJPY right as the FOMC minutes hit. A kneejerk sent stocks higher but that quickly decoupled also and stocks fell. Small Caps underperformed and are back in the negative year-to-date. Treasury yields were volatile, ramping higher into the US open, rallying post, then whipsawing on FOMC minutes to close 3-4bps higher on the day. The USD was flat on the day despite the surge in USDJPY back above 118. Commodities were a mess with a big dump on Swiss Gold polls, rip higher on Russian buying rumors and dropped again on FOMC (oil and copper followed suit). HY Credit was “bidless” and continues to decouple from stocks (along with VIX). The Dow was levitated back into the green to close
On the day, Russell 2000 underperformed… and they tried their best to get The Dow green to prove how The Fed is right…
This post was published at Zero Hedge on 11/19/2014.
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