Bonds & Bitcoin Jump, Stocks Dump As Yield Curve Carnage Continues

Chinese markets were rescued by a mysterious beneficiary who panic-bid stocks back into the green on the day...

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EU markets extended yesterday's late-day weakness but managed to now ubiquitous bounce - though still ending lower, led by Italy to the downside...

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As German bund yields collapsed to within 3bps of record lows...

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And US markets followed the overnight excitement, opening higher and accelerating at the cash market open once again. But that did not last... the afternoon was brutal...

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The closing dump seems to confirm the recent trend of overnight weakness and no one wanting to hold longs through the night...

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And US markets ended much worse than China and Europe...

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This despite proclamations that month-end pension rebalancing would spark buying in stocks this week.

S&P closed just above the critical 2800 level...

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Semis suffered again with the lowest close since Feb 5th (back below its 200DMA)...

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Financials are notably outperforming the market and hugely divergent from the collapsing yield curve...

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Credit markets are blowing out notably while VIX is holding in for now...

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HY Spreads are at their widest since Jan...

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And the VIX term structure re-inverted today...

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Treasury yields collapsed today on growth fears and a very aggressive 2Y auction...

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Pushing to fresh cycle lows...

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Collapsing the yield curve (3m10Y to -9bps) to its flattest since August 2007...

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The yield curve is inverted to around 15 years...

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And Breakevens collapsed further to critical support...

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Before we leave bondland, we note that the probability of a rate cut by end Dec is now 82%

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With the market expecting almost 2 full rate cuts now...

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The dollar rallied on the day, erasing over half of the Thurs/Fri losses...

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Yuan continued to sink despite another attempt by Guo to threaten shorts today...

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Cryptos held on to their significant gains over the weekend...

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With Bitcoin hovering around $8800...

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After a few days of outperformance, Silver was slapped lower today as WTI managed gains (despite a strong dollar) early on but faded into the close...

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