Commodity Trade Mantra

Stocks Slump Most In 7 Weeks As Silver Surges

Stocks Slump Most In 7 Weeks As Silver Surges

Stocks Slump Most In 7 Weeks As Silver Surges

The cluster of Hindenburgs is indicating a very worried market (for example 99 New Highs and 231 New Lows) and for a change a Fed speaker was unable to provide the headline-reading BTFD ammo to save us from the drop in stocks. The 6th down day in the last 8 in stocks and red on the month-to-date screens is not something we are used to seeing. The USD was flat to slightly lower on the day (even as AUD surged and JPY leaked higher) as were Treasury yields (which took a pause after 2 days of being smashed higher). While bonds were flatish, homebuilders and utilities stocks were jammed lower once again (as AAPL pulled Tech and the Nasdaq to outperform again). Copper and oil were also flat on the day but gold saw some improvement (over $1330) and Silver surged 2% (up over 6% on the week now – biggest week since Oct 2011). Yesterday’s near-record steepness in VIX’s term structure that we warned about seems to have been followed by the usual short-end rip as VIX broke back above 13%.

A late-day confirmation from Bullard of the “Need Moar Data”-before-we-taper meme that Lockhart noted yesterday (and ripped the S&P 9 points higher) only managed to scare stocks up 3 points to VWAP from where they fell back rapidly for one of the weakest closes we have seen in a while… (with the S&P 500 and Dow cash down its second biggest in 7 weeks)

This is the first close for Stocks at the lows of the day since July 31st.

The S&P is clinging to unch for August while Trannies and the Dow are in the red. Nasdaq remains comfortably green on the shoulders of AAPL on the shoulders of Icahn…

Treasuries paused today after 2 days of significant selling…

and FX markets rolled over from Monday and Tuesday’s trend…

Commodities limped higher in general on a slightly weaker USD (and JPY strength) but silver was the winner…

Silver is on a big run…

and as a reminder…

The equity market internals suggest great confusion…

Is it any wonder?

and in case you are wondering “where else are you going to put your money (than US stocks)” – it seems the answer is… European Peripheral debt…

Charts: Bloomberg

Bonus Chart: What happened the last time AAPL rallied like this? In the last three weeks, AAPL has rallied an impressive 18.8%. It seems enough, with Carl iCahn buying 0.2% of the company and a new iPhone just around the corner, to spur hope and faith that “we’re back baby.” The only trouble with that perception is that the last 2 times AAPL’s stock zoomed so exuberantly fast, it did not end well… In April 2012, AAPL dropped 18% in the following 3 weeks, and the other time was September 2012 which marked the all-time (generational) high. Trade accordingly…

Bonus Bonus Chart: Maybe Tim Cook should raise equity and pay down debt… monetize the 15% gain on the bonds (trading at 85c on the dollar) and use record cheap equity to fund the bond buyback…

 

Courtesy: Zerohedge

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