Unlike Monday, Chinese stocks were ugly overnight, erasing yesterday’s ‘odd’ gains…
And Yuan weakened modestly…
European stocks extended yesterday’s losses…
Pushing Europe to its lowest in two years…
US equities collapsed into the cash open, bounced to the European close then gave it all back…
Nasdaq is the biggest laggard on the week…
All major US equity indices went red on the year…
From the highs:
Dow Industrials -9.2%
S&P -10.2% (Correction)
Dow Transports -12.1% (Correction)
Nasdaq Composite -15.1% (Correction)
Nasdaq 100 -15.3% (Correction)
Russell 2000 -15.6% (Correction)
This is the Nasdaq’s worst year since 2011…
Semis entered a bear market and S&P Tech has almost erased the year’s gains…
FANGs are in a bear market, back to lowest since Jan…
But saw some dip-buying today…
Boeing was down for a record 9th day in a row… and despite the bounce from the opening flash crash, still ended lower…
Nasdaq 100 30d volatility sits at 35, the highest level since late 2011, which just means more mechanical “VaR-down” is coming for these “longs”.
US Investment Grade Credit risk continued to charge wider – to widest since Nov 2016 – but still remains ‘cheap’ protection relative to stocks (VIX > 23 today)…
US High Yield Corporate Bonds are down 9 days in a row – a record losing streak…
Investors have demanded more money to provide insurance against junk-rated default risk for nine consecutive days, the longest such period since January 2010. Implied spreads on high-yield bonds, as per credit-default swaps indexes, are the highest since 2016.
It is time…
