Good afternoon. What a day – the old “stairs up, elevator down” expression continues to get flipped on its head as a weaker than expected CPI ignited another big rally day with the QQQs up 2.1%. Small caps led the way with IWM up 5.5% and ARKK up 5%. SOX outperformed up 3.6%. Highly shorted stocks outperformed while large cap tech lagged a bit. A lot of moves in TMT related to the move in yields as treasuries surged with yields dropping 14-25bps across the curve as fed expectations continued to shift in a dovish direction with the odds of another 25bps rate hike basically 0. The year end funds rate is now down to 4.3%, 80bps below recent dot plot. The dollar fell 150bps, while crude was flat and BTC fell 3%
We took some gains in some of our longs as thought it was prudent to do so after this big rally. The market is surely extended, but not many tea leaves at all pointing to an inflection in another direction, especially after a strong breadth day like today.
A lot of big moves today, many didn’t have stock specific reasons for the moves, but I’ll do my best to recap…