Mike Zigmont, author of the Zigmont Report, is a partner at New York-based Harvest Volatility Management, a hedge fund with over $10B AUM, offering volatility management solutions to its investor base worldwide. Mike has been publishing his daily newsletter (Monday-Friday) privately for the firm’s investors and his personal contacts in the investment business
since 2008, sending it daily shortly after the market close.
The opinions expressed below are my own
Stocks up but…? I’m more confused than usual today. It was a pretty unremarkable day today. Here’s the summary:
- News was quiet
- Capital flow was light (80%)
- Overseas markets didn’t change much
Those things suggest a quiet day, which the bulls might like…. which they did and the tape climbed for most of the day, but…
the confusing part is that yields climbed across the curve again today, 1-2 bips along the curve. The 10-year yield made new relative highs (3.09% at the end of the day).
So the bulls controlled a thin market again despite higher interest rates and what appears to be a new leg in the interest rate trend higher.
Let’s just look at some plots of yields. These are 1 year histories.
3-month T-Bill
1-year T-Bill
5-year T-note
I hope you get the idea. Other treasury maturities tell the same story. Rates are climbing and they don’t look like they are stopping.
The equity market doesn’t care today. At some point it will care again.