Disappointment again…
Early exuberance in stocks – as overnight gains suggested panic buying at the US open, faded rapidly as financials and tech faded and crude plunged (despite better than expected data)… then after NYMEX closed VIX was smashed lower and stocks lifted…
S&P was best on the day, Trannies were red (thanks to Ford news impacting rails)… NOTE – stocks ripped at the open, then dumped into the European close, then went nowhere…
This is the 14th day of disappointments for Dow 20k fans…
Bets on Regional bank declines are soaring in the last few weeks… (Put/Call ratio is highest since Feb 2014)
Restaurant stocks tumbled for the 8th straight day, to the lowest since Nov 17th… (today was worst since Oct 25th and worst 2-day drop sine September 9th)
SunTrust Robinson analyst Jake Bartlett writes that there is some risk to industry stock prices given strong performance of restaurants since election, lack of any clear improvement of sales trends (casual dining comps. appear to have decelerated, QSR promotional activity remains high)
Bonds were mixed today with most of the curve higher in yield overnight then, bonds went bid as US equities opened andas the long-end outperformed – 30Y yields were down 9bps from overnight highs…
As the yield curve continues to flatten and bank stocks are starting to realize that…
Notably the recent shifts in US, Japanese real yield differentials suggests USD weakness from here…
The US Dollar Index surge after better than expected Manufacturing data to fresh 14-year highs (before fading back)…
Led by EUR weakness…
But the Mexican Peso was pounded after Ford news…breaking above 21/$ once again…to a new record low close
Bitcoin continued to rise – up 18 of the last 21 days – topping $1000…
Silver rallied notably today – mirroring the downward move in Crude…
Big plunge in Oil priced in silver…biggest drop since July…
While headlines focused on Crude’s demise (after news that Iraqi Kurds are producing more than they are supposed to), it was NatGas that was monkey-hammered, dumping over 10% on the day (after warmer-than-expected January weather forecasts)
John Kilduff of Again Capital LLC says: “Too much faith has been put in OPEC and the other countries that have promised cuts. They have been increasing output the last few months, so the cuts will be like New Year’s crash diet, and we know how those end.”
Finally, gold is 2017’s best performing asset-class…
