Stocks Soar To Best Week Since The ’30s As Dollar & Bond Yields Crash

Stocks Soar To Best Week Since The ’30s As Dollar & Bond Yields Crash

After an unprecedented explosion in fiscal largesse…

Led by USA…

And the greatest easing of monetary policy ever…

Which, for The Fed, looks like this…

Source: Bloomberg

Who would be surprised that we saw stocks dead-cat-bounce this week…

Source: Bloomberg

Exactly on cue with the 1930s analog…

Source: Bloomberg

In fact, after last week’s worst performance since Lehman (2008), this week’s gains were the greatest stock market week (Friday’s drop included) since August 1932

Source: Bloomberg

Meanwhile, as stocks soared, this was the worst week for USD since March 2009 (which is intriguing as it happened out of nowhere right after the G-20 meeting – did they ‘agree’ a Shanghai Accord? A Plaza Accord 2.0?)

Source: Bloomberg

And the plunge in the USD, rather oddly, was accompanied by a continued surge in FRA-OIS (signaling dollar shortages remain extreme)…

Source: Bloomberg

And something is spooking interbank markets – LIBOR-OIS is screaming higher as if banks are frightened of one another once again…

Source: Bloomberg

And amid all this chaos, USA sovereign credit risk has been notched notably higher…

Source: Bloomberg

This seemed to sum things up nicely…

Stocks bounced globally this week…

Source: Bloomberg

US markets were ugly at today’s open but the machines went wild in the last hour try and get back to green until news that The Fed was reducing its bond buying package next spoiled the party…

But the week was extremely impressive – the best week for Dow since 1932…

Helping stocks dead-cat-bounce was the fact that this was the biggest short-squeeze week in history (even with today’s losses)… but still, in context, it’s a drop in the ocean!

Source: Bloomberg

Notably cruise line stocks crashed as it appears their non-US domicile rules out the rescue aid…

The week saw gains for both defensives and cyclicals but Friday was dominated by cyclical weakness…

Source: Bloomberg

And for one thing, bonds were not buying it at all…

Source: Bloomberg

And VIX is not playing along either…

Source: Bloomberg

Nor is market breadth…

Source: Bloomberg

Investment Grade credit screamed higher this week thanks to the promise of The Fed’s new bond-buying program. This is the best week for LQD (the IG Corp bond ETF) ever…

Leveraged Loans also managed a bounce… barely…

Source: Bloomberg

Treasury yields plunged on the week with the belly and longer-end outperforming…

Source: Bloomberg

 

10Y Yields puked back below 70bps today to their 2nd lowest yield close ever after The Fed headlines hit…

Source: Bloomberg

Cryptos had a big week with Ripple outperforming as The Fed’s massive bailout sparked some flows into non-infinite currencies…

Source: Bloomberg

Oil was the biggest loser on the week in commodity-land and Silver the leader…

Source: Bloomberg

WTI tumble to a $21 handle…

And while WTI and Brent are plunging, Western Canada Select crashed to record lows below $5 a barrel!!!!

Source: Bloomberg

Silver surged on the week, testing $15…

As the dollar tumbled, precious metals all ripped this week dominated by Palladium…

Source: Bloomberg

Gold’s spot and futures markets have normalized…

Source: Bloomberg

And finally, this was the US economy’s most disappointing week since June 2011 as real data dashed the optimistic expectations that so many analysts hoped for a v-shaped blip…

Source: Bloomberg


Tyler Durden

Fri, 03/27/2020 – 16:00

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Author: Tyler Durden

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