The equity market was mixed today with The Dow lagging and Small Caps leading (S&amp;P/Nasdaq modestly lower) ahead of tomorrow's big day. NOTE the drop in the morning was reportedly triggered by WSJ HLs that Russia is suspected of a plot to send incendiary devices on US-bound planes, citing Western security officials, but that was quickly BTFD back...

The bigger theme of the day was profit-taking on the so-called "Trump Trade" after extreme outpereformance of the Kamala basket in recent weeks...

VIX ended the day notably elevated with the vol term structure extremely inverted ahead of this week's extreme event risks...

...in fact this is the VIX's longest stretch above its 200dma since 2019...

For the first time since early 2019, VIX Specs are net long futures...

Maybe this is more than an election-uncertainty trade... maybe it's structural...

Mega-Cap Tech fell once again today but has found support for now...

After Friday's utter chaos in bond land, reality set in that piss poor payrolls means lower yields and Treasury yields tumbled across the board with the long-end outperforming (2Y -3bps, 30Y -8bps). Yields are still marginally higher from Thursday's close...

The 10Y yield ended back at pre-payrolls levels...

The dollar continued to drift lower (ignoring the manic buying after payrolls)...

Arguably another "Trump Trade" continues to build as the Mexican Peso plunges to its weakest since Sept 2022

Despite the dollar weakness, gold trod water today, holding just above support around $2730...

Bitcoin fell again after tagging record highs last week. BTC is finding support in the $67-68k region for now

Oil prices rallied (with WTI back up near $72), erasing last week's plunge on Israel-Iran optics...

With oil prices rising again, we wouldn't question you for being surprised that pump-prices are testing multi-year lows (right ahead of the election)... probably nothing, right?

Finally, what happens to USA Sovereign Risk tomorrow?

From 12-month highs - will a divided govt soothe the pain?

...VIX curve inverts, USA sovereign risk at 12-month highs, pump-prices decoupled...
{ai:summary}The equity market showed mixed results today, with Small Caps leading while the Dow lagged. A drop was noted early on due to reports of a Russian plot involving incendiary devices on US-bound planes, but the market rebounded. Profit-taking on the "Trump Trade" was a significant theme, contributing to volatility.The VIX ended elevated, indicating increased market uncertainty, with net long positions in VIX futures for the first time since 2019. Meanwhile, Treasury yields fell following disappointing payroll data, and the dollar declined. Oil prices rose again, and concerns about USA Sovereign Risk loom ahead of potential election implications. #economy

Bonds Bid, Bitcoin Skids As Traders Take Profits On 'Trump' Bets

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