With credit spreads on the rise and the 10-year TIP trading at 2.2%, financial conditions are tightening, sparking concerns among investors. While systematic funds tread cautiously amid thinning market depth, the next fortnight looms as a critical period. Contrary to expectations, inflationary fears drive Treasury yields up, leading to a plunge in stocks and a surge in the dollar, exacerbating market volatility and pushing the Goldman Sachs Panic Index to its highest level since March 2023.
Credit spreads are rising; this time may be very different. 10-yr TIP trading 2.2%… Financial conditions are tightening pic.twitter.com/wKhd6JwU90
— Michael J. Kramer (@MichaelMOTTCM) April 15, 2024
"CTAs are treading on 'thin ice' but haven't started the deleveraging process quite yet. The next two weeks will be a crucial window for the Systematic fund space."@t1alpha pic.twitter.com/TAM9B8oAak
— Daily Chartbook (@dailychartbook) April 16, 2024
"If the market were worried and playing the flight to safety game, #inflation expectations wouldn’t have risen; they would have fallen, and #Treasuryyields would have moved down, not up"#STOCKS PLUNGE AS RATES AND THE #DOLLAR SURGEhttps://t.co/87THjZtjpA @MichaelMOTTCM pic.twitter.com/TO56Y1fndn
— Felipe Adan Lerma (@FelipeAdanLerma) April 16, 2024
Book depth thinning out, bid-ask spread widening pic.twitter.com/NqfyTunO5P
— Michael J. Kramer (@MichaelMOTTCM) April 16, 2024
Goldman Sachs Panic Index soars to highest level since March 2023 pic.twitter.com/PVmyoNQOjI
— Win Smart, CFA (@WinfieldSmart) April 16, 2024