Nasdaq Nears Best August Since DotCom Peak But EM, VIX, Bonds, & Macro Decouple

Since China intervened mid-month (ahead of the US-China trade talks), the Yuan strengthened and US equities soared (until decoupling the last few days)...

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And bond yields have fallen (QE trade!?)

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But Emerging Market currencies have started to collapse again...

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The Nasdaq is on course for its best August since the year 2000...Things did not end well last time (-74% in under 3 years)

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Ramping in an echo of January's exuberance - ...Things did not end well last time

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And we note that VIX has recently decoupled from stocks...

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Buoyant appetite for call options may offer one explanation for why VIX rose in tandem with equities in recent sessions. A similar situation preceded the record spike in volatility earlier this year that abruptly ended the previous stretch of all-time highs for U.S. stocks.

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And finally, if you think stocks are rallying on fun-durr-mentals, you're wrong!

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But apart from that, BTFATH!!!

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Chinese stocks continued to drift lower after Monday's National Team pumpathon...

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And record highs in US stocks, because why not! From 10amET (Freeland!?) to 1130pmET (EU close), there was a clear systemic bid across the entire US equity market. Cash markets closed on a weaker tone despite 1 billion MoC to buy...

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Everything was calm overnight but the fact that US equity markets actually opened seemed to invoke a buying panic that ended when EU closed...

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Treasury yields were mixed today with most of the curve up around 1-2bps only but the long end slightly lower...

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30Y Yields remain above 3.00% but appear to have peaked in this micro-ramp...

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The Dollar ended the day lower, once again though shifting-trend in the middle of the day...

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The yuan has started to slide once again...

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But EM FX was ugly. The Brazilian Real managed modest gains along with the Mexican Peso but the Argentine Peso collapsed and the Turkish Lira continued its renewed weakness...

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Turkey is tumbling back toward pre-holiday record lows...

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But the Argentine Peso was utterly destroyed... (biggest drop since 2015's devaluation) ARS closed on its low tick, a fraction below the 34.0/USD level.

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