Bonds “Quiet, Too Quiet” As Big-Tech Soars Into New Bull Market

The last ‘calm’ day before GDP and PCE saw bond yields uncomfortably quiet (“too f**king quiet” as one rates vol trader MSG’d us), and more squeeziness in stocks (S&P above 50DMA and Nasdaq soaring) ahead of the month-/quarter-end flow-show.

Big banks took a small hit late in the day on a headline that FDIC is “mulling squeezing the big banks to plug its $32 billion hole” but shrugged that off pretty quickly to end a strong day…

Regional banks opened exuberantly once again and were sold off once again at the cash open, back into the red. They stabilized then dropped on FDIC headlines only to recover and end modestly green…

Mega-cap tech reasserted itself today, with Nasdaq soaring 2% today. The Dow and Small Caps lagged (but were still up 1% on the day…

This is Nasdaq’s first close above 20% off the December lows – a new bull market?

The S&P 500 is back above pre-SVB levels… but Office REITs remain in pain…

Source: Bloomberg

Semis were on fire today after Intel said new server ships will come sooner than expected, and Micron jumped on upgrades due to “supply discipline”

Source: Bloomberg

The massive divergence between the Nasdaq and the A/D line confirms this rampage higher is all in the ‘safe-haven’ mega-cap tech names…

Source: Bloomberg

And tech is now trading almost as rich as it has ever traded to the overall market…

Source: Bloomberg

The S&P 500 broke above its 50DMA…

We do note that 0DTE traders stormed in to the short-side as the S&P traded back below its 50DMA around 1340ET, but that did nto work out for them and their covering helped lift stocks in the last hour…

Source: SpotGamma

Treasuries had a second ‘calm’ day in a row (after the raft of IG/HY issuance earlier in the week). Across the entire curve, yields were basically unchanged today…

Source: Bloomberg

Notably there is some divergence in positioning in bond-land with aggregate TSY futures specs still near record short (thouhg we do note the last couple of weeks have seen a notable cover)…

Source: Bloomberg

But, as Bloomberg notes, short interest as a percentage of shares outstanding in the $33 billion iShares 20+ Year Treasury Bond ETF (TLT) fell near record lows (least short)…

Source: Bloomberg

“Long-duration bonds are coming back as that shock absorber and it helps that the starting yield is a lot higher than it was a year ago,” Gene Tannuzzo, global head of fixed income at Columbia Threadneedle Investments, said in a Bloomberg Television interview.

“That’s why you’re not seeing the incredible short interest in long-maturity Treasuries as you were earlier in the year.”

The dollar was also practically unchanged on the day (after some buying in the Asia session gave way in Europe)…

Source: Bloomberg

Bitcoin surged back above $28,500 today…

Source: Bloomberg

Ethereum topped $1800…

Source: Bloomberg

After a week-long bounce, crude prices slipped despite a large inventory draw, with WTI dropping back to a $72 handle…

US (front month) NatGas prices tumbled back to a $1 handle today again…

Which left Nattie at its cheapest to crude in 9 years (a level that historically led to switching efforts)…

Source: Bloomberg

Gold managed to hold modest gains (despite dollar’s small gains), testing $1990 intraday…

Finally, off-topic a little, but US unemployment is now worse than Russian unemployment…

Source: Bloomberg

That’s awkward for the sanctions-pushers.

And then there’s this – the S&P is back at pre-SVB Failure levels while Gold and Bonds (safe havens) remain far away from that level of risk appetite…

Source: Bloomberg

Will GDP and PCE break that spell?