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Dollar & Stocks Jump; Bonds & Bullion Dump In Lowest Volatility September Ever

Last update October 5, 2017

Tyler Durden October 5, 2017 SNB & CHF

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Summary:
It has now been 318 trading days since the S&P 500 suffered a 5% drawdown – the 4th-longest streak since 1928… So everything is awesome… [embedded content] BUT…US ‘hard’ economic data has not been this weak (and seen the biggest drop) since Feb 2009… US Data Surprise Index, 2006 - 2017 - Click to enlarge Q3 Was a Roller-Coaster… Q3 was the 8th straight quarterly gain in a row for The Dow – the longest streak since Q3 1997. The Long bond was unch, gold up 3.2%,. but stocks outperformed in Q3… Gold(see more posts on Gold, ) - Click to enlarge Nasdaq just outperformed Small Caps on the quarter as stocks reversed their down-trend seemingly around Yellen’s J-Hole speech… Yellen J-Hole Speech - Click to

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It has now been 318 trading days since the S&P 500 suffered a 5% drawdown – the 4th-longest streak since 1928… So everything is awesome…	[embedded content]
BUT…US ‘hard’ economic data has not been this weak (and seen the biggest drop) since Feb 2009…	US Data Surprise Index, 2006 - 2017 - Click to enlarge
Q3 Was a Roller-Coaster… Q3 was the 8th straight quarterly gain in a row for The Dow – the longest streak since Q3 1997. The Long bond was unch, gold up 3.2%,. but stocks outperformed in Q3…	Gold (see more posts on Gold, ) - Click to enlarge
Nasdaq just outperformed Small Caps on the quarter as stocks reversed their down-trend seemingly around Yellen’s J-Hole speech…	Yellen J-Hole Speech - Click to enlarge
Treasury Yields are mixed for Q3 with 2Y notably higher but the rest of the curve barely budged…reversing early gains on Draghi’s hawkish comments…	Treasury Yields, Jul - Sep 2017 - Click to enlarge
Interestingly the yield curve – 5s30s – ended unchanged on the quarter (after 5 quarterly declines in a row)…	US Treasuries, Dec 2015 - Sep 2017 (see more posts on U.S. Treasuries, ) - Click to enlarge
The Dollar declined for the 3rd quarter in a row as Gold managed to eke out some gains as oil soared…	Gold and Silver Prices, Jul - Sep 2017 (see more posts on gold price, silver price, ) - Click to enlarge
On the month… 3 Giant Storms – Harvey, Irma, and Maria crush Texas, Florida, and Puerto Rico Trump threatens “fire and fury” Kim tests H-Bomb NoKo fires missiles over Japan NoKo says Trump ‘Declared war’ Healthcare bill fails again 6th monthly decline in a row for US ‘hard’ economic data September is now in the books and it’s official – it was the least volatile September for stocks in history…	S&P 500 Daily Range. 1970 - 2017 Source: LPLFinancial - Click to enlarge
Some high- and low-lights for September include: Small Caps best month since Nov 2016 Financials jump most in 3 months to record high 2Y Yield’s biggest spike since Nov (to its highest since Nov 2008) Yield Curve (5s30s) flattened most since June (to flattest since Nov 2007) USD Index had best month since Dec 2016 (ending 6 month losing streak) Gold’s worst month since Nov 2016 Industrial Metals worst month since Dec 2016 Oil’s best month since Apr 2016 Bonds & Bullion were the month’s laggard as stocks and the dollar surged…	Gold, S&P 500 and US Treasuries (see more posts on Gold, U.S. Treasuries, ) - Click to enlarge
Trannies & Small Caps ripped…	Trannies, Small Caps and Nasdaq - Click to enlarge
As Energy, Retailers, and Financials were best (year’s laggards)…	Energy, Retailers, Financials, Tech and Utes - Click to enlarge
AAPL was a notable laggard in September as FANGs managed small gains…	FANG and AAPL - Click to enlarge
Equity market gains were also driven by hopes about taxes…	High Tax Corps and Market, Sep 2017 - Click to enlarge
September was an ugly month for Treasuries…(worst month since Nov 2016 for bonds)	US Treasuries, Sep 2017 (see more posts on U.S. Treasuries, ) - Click to enlarge
The Dollar Index reversed its medium-term downtrend in early September after Draghi’s comments…	Bloomberg Dollar Index, Oct 2016 - 2017 (see more posts on Dollar Index, ) - Click to enlarge
It appeared to also coincide with the lagged upturn in President Trump’s approval rating…	US Dollar Index, Jul - Oct 2017 (see more posts on U.S. Dollar Index, ) - Click to enlarge
Notably EURUSD suffered its first monthly loss since February breaking the longest run of monthly gains versus the dollar since January 2013… as 1.20 seemed like the line in the sand for Draghi…	Euro and USD Index, Oct 2016 - Sep 2017 - Click to enlarge
Oil had a big month as PMs and Copper dropped…	Gold and Silver Prices, Sep 2017 (see more posts on gold price, silver price, ) - Click to enlarge
Finally we focus down on this week… The Dow was the laggard on the week, barely scratching out a gain as Small Caps surged – Russell 2000’s best week since Dec 2016	The Dow - Click to enlarge
Dow was rammed above 22,400 into the close…	The Dow - Click to enlarge
But while Small Caps have ripped, high-tax names appear unimpressed by Trump’s plan…	High Tax Corps and Market, Sep 2017 - Click to enlarge
FANG Stocks manage to recoup all of Monday’s losses…	FANG Stocks, Sep 2017 - Click to enlarge
Banks continue to decouple from the yield curve…	Banks and Markets, Sep 2017 - Click to enlarge
Notably XIV – the inverse VIX ETF – hit a new record high today…	VIX ETF - Click to enlarge
As VIX closed at a weekly closing record low, monthly closing record low, and quarterly closing record low…	VIX - Click to enlarge
Treasury yields all rose together this week by 6-8bps…	US Treasury Yields, Sep 2017 (see more posts on U.S. Treasuries, ) - Click to enlarge
The Dollar Index rose 1% on the week – its biggest weekly gains since Dec 2016, led by Aussie and Euro weakness…(NOTE last two days have seen some give back)	Currencies, Sep 2017 - Click to enlarge
Bitcoin +15% on the week, -12% in September (worst month since Aug 2016), +66% in Q3 (4th quarterly gain in a row)	Bitcoin Price, Jun - Sep 2017 (see more posts on Bitcoin, ) - Click to enlarge
And then there’s real bubble… Swiss National Bank -2% on the week (worst week since May), +26% in September (6th monthly rise in a row), +98% in Q3 (most since 1997)	Swiss National Bank, Jun - Sep 2017 (see more posts on Swiss National Bank, ) - Click to enlarge
Crude rallied on the week as PMs slipped lower…	US Crude Oil, Sep 2017 - Click to enlarge
*And finally, a quick reminder – stocks have never… ever… been more expensive than this…*	S&P 500 Nonfinancial Energy and Tech, Jan 1991 - 2017 - Click to enlarge