**Stocks & Bond Yields Tumble On 'Hawkish Pause'; Gold Gains As Crude Collapses**
Stocks & Bond Yields Tumble On 'Hawkish Pause'; Gold Gains As Crude Collapses
'Good' headline macro news (strong ADP and ISM Services beat) was somewhat trumped by 'bad' macro news (inflationary pressures re-accelerating under the hood)... all of which do nothing at all to support The Fed's 'easing' anytime soon (strong jobs and resurgent inflation).
Of course, today was all about Powell and his pals who signaled a 'hawkish pause' (despite the market's very dovish beliefs). June rate-hike odds rose...
?itok=XyWXClbB (
?itok=XyWXClbB)
_Source: Bloomberg_
Now it gets interesting...
?itok=8o4FIv8S (
?itok=8o4FIv8S)
_Source: Bloomberg_
With Real Rates positive for the first time since 2019...
?itok=VVYqHrRL (
?itok=VVYqHrRL)
_Source: Bloomberg_
Powell's comments did nothing at all to help (unusually):
- POWELL: **SENIOR LOAN SURVEY CONSISTENT WITH OTHER DATA**
- POWELL: POSSIBLY **AT SUFFICIENTLY RESTRICTIVE LEVEL,** MAY NOT BE FAR OFF
A recession is coming but don't expect rate-cuts...
- POWELL: POSSIBLE **WE'LL HAVE WHAT WOULD BE A MILD RECESSION**
Yield curve gives 94% odds of a recession within 12 months...
?itok=-Bm40F0D (
?itok=-Bm40F0D)
Don't believe the market's dovish hype!
- POWELL: **FOMC'S INFLATION OUTLOOK DOESN'T SUPPORT RATE CUTS (the 'inflation is transitory' outlook?)**
And that spooked stocks lower (not helped by Powell's hints at how bad next week's SLOOS data will be). Small Caps managed to hold on to gains but the S&P, Dow, and Nasdaq tumbled...
?itok=Ele_mbfl (
?itok=Ele_mbfl)
0DTE traders were betting on the downside in a big way today and took profits after the post-Powell puke...
?itok=gB534gK2 (
?itok=gB534gK2)
Big reversal in "most shorted" stocks today (which helps explain the early gains in Small Caps)...
?itok=SUfht-YZ (
?itok=SUfht-YZ)
_Source: Bloomberg_
**Regional banks puked** after Powell said the banking system was sound and resilient...
?itok=WHqcth7s (
?itok=WHqcth7s)
VIX1D remains notably higher than VIX...
?itok=fE7O0ZO4 (
?itok=fE7O0ZO4)
_Source: Bloomberg_
Treasury yields tumbled once again today with the belly of the curve outperforming (5Y -11bps, 30Y -2bps). It's been quite a week in bonds already...
?itok=kVir-bLB (
?itok=kVir-bLB)
_Source: Bloomberg_
The 2Y extended below 4.00%
?itok=iLUTmdUc (
?itok=iLUTmdUc)
_Source: Bloomberg_
The STIRs curve adjusted (small) hawkishly in the shortest end but notably more dovish next year on...
?itok=IVF-9pLk (
?itok=IVF-9pLk)
_Source: Bloomberg_
The Dollar dived on the day to two-week lows...
?itok=znY07aCH (
?itok=znY07aCH)
_Source: Bloomberg_
Bitcoin chopped around but ended marginally lower...
https://www.zerohedge.com/markets/markets-shrug-powells-hawkish-pause-crude-collapse-continues