What a ridiculous day, even with the FOMC minutes being released, we saw very little action. The biggest action of the day was the release of the ADP Report which job growth, which the markets took as more Tapering to come. At cash close, S&P Futures (ES) are up 1.25 handles at 1832 with 1.32MM minis traded. Bonds saw heavy action today, with 10Y futures dropping significantly after the ADP report released. Yield on the 10Y jumped back over the 3% mark. Oh and for the people who still believe in the ridiculous “recovery” here comes Macy’s at the end of the day, announcing 2,500 job cuts. Nothing but Layoffs and Buybacks in this new normal. Thank God for central planning.
VIX fell slightly, closing down -0.39% at 12.87. VIX Futures also dropped slightly. Volume was light, with only 486K VIX contracts traded. Europe’s VIX closed higher by 1.01% at 17.36. We will see if we get volatility in the next two days, with ECB tomorrow, and NFP on Friday.
Best of the FOMC Minutes headlines and excerpts (excerpts from minutes) * “members expressed concern that additional asset purchases increase likelihood that the Fed might at some point suffer capital losses” * FED OFFICIALS SAW WANING BENEFITS FROM MONTHLY BOND PURCHASES * “most participants judged that exceptionally low levels of the federal funds rate would remain appropriate for the next few years.” * “several participants commented on the rise in forward price-to-earnings ratios for some small-cap stocks, the increased level of equity repurchases, or the rise in margin credit. * “Fiscal policy continued to restrain economic growth.”