SPY Has Just Done Something It’s Never Done Before

It appears “clots” won’t stop this meltup…

…as early weakness was met by a wall of buying around the CPI print and a replay of the reflation bet (Big-Tech up, Small Caps down) at the cash open. Nasdaq was the day’s best performer, S&P closed green as Dow and Small Caps erased most of their losses for a small down day…

The Dow was hampered from its exuberance by JNJ’s modest drop.

Underneath the surface, the market is assuming a defensive posture today led by mega-cap Tech and the bond proxies — Utilities and Real Estate (yields on 10-year Treasuries are back down to 1.63%). On the flip side, the procyclicals – Industrials and Financials – are lagging.

Source: Bloomberg

Notably, however, the defensive tilt is taking place in an environment of relaxation, not anxiety. The VIX is down again today to 16.6 — nearing the 15 level that the VIX was camped out at during long stretches of the pre-pandemic/post-GFC era. VIX has now closed below 20 for 10 straight days – something it hasn’t done since Feb 2020

Bonds were bid with with 5Y-10Y segment outperforming…

Source: Bloomberg

A very strong 30Y auction helped…

Source: Bloomberg

The dollar continued to drift lower…

Source: Bloomberg

Crypto surged above $2.1 trillion market cap today with Bitcoin above $63k for the first time…

Source: Bloomberg

And Ether surged above $2300 – a new record high…

Source: Bloomberg

Dollar weakness helped send Gold higher…

WTI managed to close back above $60 ahead of tonight’s API data…

And finally, this is the 13th day in a row where the S&P 500 ETF (SPY) closed above its opening price…

Source: Bloomberg

Since SPY’s inception in 1993, that has never happened before.