This is a bit of a strange move in the stock market as equities catch a big bid. The S&P 500 is up 34 points after opening lower. To be fair, in the context of the rout yesterday, it’s a small bounce but it came a bit out of left field.
SPX 5 mins
Some of that could be month-end flows or short-covering after a dive in Mag7 stocks. Nvidia is now up 2% after trading 2% lower in the pre-market.
I tend to think it’s something idiosyncratic rather than a larger change in part because bonds and FX have stayed largely stable through the move. US 2-year yields are almost exactly where they were when the market opened and the whole curve is 2-4 bps lower today.
In FX, the loonie is making something of a comeback but in general the dollar is strengthening at the momement, which is the opposite of what you would expect in a ‘risk on’ rally. Cable tried the upside but has been pulled right back into the daily range.
GBPUSD 10 mins
On asset that is playing along is bitcoin, which has bounced nicely to $84K after falling below $80K briefly in Asia.
