Image Source: PixabayUgly Micro (Mag7 earnings fail to impress…enough) and Ugly Macro (home sales and manufacturing meltdown) left an Ugly day for stocks and bonds (the long-end) while the dollar, crypto, and commodities were all relatively unch by the close.As UBS notes, similar to last Wednesday, today seems very much an Equity event which suggests that technicals and positioning are the major drivers.All the major US equity indices were lower today but mega-cap tech was hit hardest, smashing Nasdaq down over 3.5% for its worst day since Dec 2022. Ugly close did not help at all. The Dow was the least ugly horse in the abattoir today…The S&P 500 ‘no-2%-drop’ streak is over…The Mag7 basket of stocks suffered its biggest daily loss since Oct 2022 (having lost almost $1.75 trillion in market cap from their highs 10 days ago)…Source: BloombergAll 7 of the Mag7 were lower today (unusual in itself)…Source: BloombergThe focus for selling pressure appeared on Google’s inline/reiterating capex is causing concern in some of the AI pockets of the market
 with VRT – 10%, AI Semis (GSCBSMHX) -420bps, Data Centers (GSTMTDAT) -330bps.Source: BloombergGoldman Sachs trading desk noted that volumes were explosive today (tracking +18% vs the trailing 20 days). Liquidity remains in focus with S&P top of book avg ~$13mm today (this has almost HALVED in the past week).

But the pain didn’t end in stocks as the long-end of the Treasury curve was clubbed like a baby seal…Source: BloombergThe yield curve is inflecting rapidly with 2s30s at its most disinverted since July 2022 (and 5s30s at its steepest since May 2023)…Source: BloombergRate-cut expectations pushed higher again today with 4 full cuts priced back in for 2025 (and a 50-50 chance of 2 or 3 cuts in 2024)…Source: BloombergThe dollar ended the day basically unchanged, rallying during the US session, and recovering European losses…Source: BloombergMajor Yen carry unwind continues…Source: BloombergGold was a mirror of the dollar with overnight strength sold during the US session to basically end unchanged…Source: BloombergAnother strong day for ETH ETF volumes…Source: Bloomberg…but ETH underperformed BTC, reversing yesterday’s outperformance…Source: BloombergOil prices limped higher off their 200DMA but remain near six-week lows…Source: BloombergIt’s different this time…Source: BloombergRight?More By This Author:New Car Incentives Soar 53% Amid Rising Inventories & Lackluster Demand Hint At Downturn
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