What a contrast between the bond market, which is plummeting (yields from the 2-year to the 20-year have soared by +20 basis points), and the stock market indices, which are set to set new annual records (Nasdaq) and all-time highs.

The Dow Jones and S&P500 climbed to new highs, with +0.35% to 38,654 and +1.07% to nearly 4,959 respectively... with the added bonus of a clear weekly advance of nearly +1.3% on average.

The S&P500 gained +1.4% over the week, breaking through the +4.1% barrier since January 1 (the index is now on a 50% annual climb): a new high was reached at 4,975, less than 0.6% from 5,000.

The Nasdaq gained +1.74% to 15,629, in the wake of Meta (+20.3% to $475), which beat another quite singular absolute record: that of the most colossal capitalization gain in a single session for a single stock in 140 years. Meta adds $205.3 bn to $1,220 bn (that's more than half the capitalization of LVMH).

Amazon (+7.8% with +$128 bn) joins the top 15 biggest capital gains in history. This makes $333 billion in 24 hours with just two stocks, i.e. as much as Nvidia (+5% tonight), which has gained +33.3% and $330 billion since January 1.

These three stocks simply "weigh" more than 83% of the S&P500's total gains: another historic first. And with AMD (+4.2% on Friday and +20% since January 1), we have 90% of the Nasdaq-100's +4.85% since January 1.

These stratospheric performances completely eclipsed the plunge in bond markets, which had their worst day since October 17, 2023. US yields exploded across the curve: the '30-yr' jumped from 4.103% to 4.243% and the '2-yr' lurched +20 basis points to 4.394%. The '10-yr' has risen from 3.87% to 4.03% in 24 hours, i.e. +16 basis points... for a score of almost zero over the past week.

But the surge in risk appetite only partly explains the plunge in T-Bonds: there is also the 'employment' component, with an 'NFP' that stunned Wall Street with no less than +353,000 job creations, i.e. twice as many as expected. Not to mention a sharp upward revision of December's figures (+117,000 to 333,000), followed by a 0.6% rise in wage costs (twice as high as forecast).

And losses on treasuries deepened still further with the publication of a household confidence index from the University of Michigan at its zenith: in January, it jumped to 79, its highest level since July 2021 (vs. 69.7 in December). Its month-on-month increase of over 13% has only been surpassed five times since 1978.

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