5Y yields rose a stunning 37% this week – the most in the 50 year record of Bloomberg data.
The 38bps increase in yields is also among the worst absolute shifts
over that period but off such low levels it is quite a shock. Credit
markets saw hedge protection bought early on in the week and then
covered as real money started to sell their bonds on the back of
redemptions in the last two days. The high-yield bond ETF had its biggest weekly loss in 13 months
(notably clinging to the Lehman ledge levels). Equity markets suffered
too (down 3.5 to 4.0% from the FOMC) with the S&P’s worst week of
the year (even as it bounced off its 100DMA). Most sectors hung around
the 3-4% drop but homebuilders are down over 8% since the FOMC. The USD
surged over 2.1% on the week with JPY’s worst week in 43 months. VIX ended the day down 1.7 vols at 18.8% but beware as OPEX and hedge unwinds into underlying covers seems prevalent. Gold’s worst week in 21 months left it back under $1300.Read More @ ZeroHedge.com
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