Its Over, page-13158

....the large Dow futures drop before the opening bell last night actually surprised me but it was evident that there were lots of nervousness ahead of Powell's testimony...but from 450pts down on the futures, the Dow went into 100pts green within the hour of opening after soothing words from Powell continuing with his glass half full outlook and went on to make big gains until the afternoon selloff took the Dow to close lower by47pts. The XLE was 4% lower as oil & gas stocks were the biggest laggards, Freeport-McMoran plunged 7.96%, Marathon Oil -7.23%, ConocoPhillips -6.27% and Exxon -3.96%. Oil stocks was hit harder than crude oil's decline which has fallen to just under $104. The same thing happened to gold equities which languished , GDX down 1.38% GDXJ lower by 2.07% despite Gold recovering back to $1840.

..whatever Powell can say about recession, the markets are voting that its prospect is increasingly larger, which is why we are seeing US 10 year yield back down to 3.16% and commodities from oil, copper, silver all demonstrating a trend down and the big daddy Iron ore fell 5.6% to $109.

...if a Recession prospect was not enough, do pay attention to the bottom of this Zero Hedge article, there could be something brewing in the credit markets.

Stocks Snore, Bonds Soar As Fed Fears Ease; There's Just One Thing...

BY Zero Hedge
THURSDAY, JUN 23, 2022 - 06:01 AM
Fed Chair Powell actually sounded 'hawkish-er' during today's Humphrey-Hawkins testimony, but the bid in bonds that started overnight drove rate-hike expectations lower and subsequent rate-cut expectations higher...

Source: Bloomberg

Digging into the details, July and September are still pricing a high likelihood of a 75bps rate-hike (though September is fading). December and February rate-hike odds are evaporating fast...

Source: Bloomberg
And the subsequent rate-cut expectations are soaring (and ED markets actually inverted from Dec 22 to March 23 - implying rate-cuts start there)...

Source: Bloomberg
Treasury yields ripped lower - erasing all of yesterday's selling - with the short-end outperforming (3Y -17bps, 30Y -10bps)...

Source: Bloomberg
10Y Yields have erased 35bps of the 50bps spike post-CPI...

Source: Bloomberg
US futures were weak overnight but as soon as the cash market opened, the buying frenzy began ripping the US majors from decent losses to big gains on no real fundamental news. Nasdaq ran from -2.25% overnight top +1.5% ahead of the European close. Trouble started for stocks around 1430ET (Margin call time)...

For the second day in a row, a short-squeeze lifted the market to fill the post-CPI gap-down and failed...

Source: Bloomberg
The dollar ended lower on the day after a big pump and dump (reversing lower as Europe opened)...

Source: Bloomberg
Bitcoin extended losses from yesterday morning, breaking back below $20,000

Source: Bloomberg
Gold managed to end the day unchanged having ramped up to $1850 but unable to hold it...

Oil prices extended their recent downtrend with WTI briefly trading with a $101 handle ahead of tonight's API data...

President Biden unveiled his cunning plan to lower taxes on gasoline... and wholesale gasoline prices went up...

But we do note that national average regular gas prices are down 6c over the past week... Mission Accomplished?

Source: Bloomberg
Finally, there is something serious happening behind the scenes:
The TED spread is blowing out...

Source: Bloomberg
Global broker credit risk is spiking...

Source: Bloomberg
And the demand for dollars is suddenly soaring...the cross-ccy basis swaps signal dollar liquidity is drying up...

Source: Bloomberg
So, whether or not we get a bear market rally short-squeeze here, the global financial system is 'stressed'.