When There’s No One Left To Sell

Real Vision: Finance & Investing

Real Vision

Investing, Business News, News, Business

4.1 • 1.1K Ratings

🗓️ 13 October 2022

⏱️ 35 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Within three hours today, S&P 500 futures swung from a 3.9% decline to a 3.9% rally. “It's pretty incredible,” tweeted Jared Dillian shortly after noon, “to watch people get fooled by the market over and over again. It's not hard – when there's no one left to sell, they cover.” Weston Nakamura has a more global perspective on the reversal, noting that the U.K. and the pound as well as Japan and the yen still linger as potential crisis points. Jared raised an interesting point in today’s edition of The Daily Dirtnap: that we’re in “a bubble of bearish sentiment.” Weston and Jared join Maggie Lake to talk about the significance of today’s price action. The violent reversal was surely concerning, hardly the sign of a healthy market. Jared, Weston, and Maggie unpack the reaction to the most recent U.S. inflation data and what it means for central bankers and global financial markets. Learn more about your ad choices. Visit podcastchoices.com/adchoices

Transcript

Click on a timestamp to play from that location

0:00.0	What caused you as stocks to turn around? Hi, everyone. Welcome to the Real Vision Daily
0:11.0	briefing with me today is Jared Dillion, editor of the Daily Dirt Knot Newsletter and Real
0:16.1	Vision's Global Editor, Weston Nakamura. Hi, gentlemen. Thanks for being here.
0:20.1	Hey. Hey, everyone. So, uh, wow, what a round trip, Jared. This look like it was shaping
0:26.2	up to be going to be a horrible day. We saw really steep sell off. Um, we got a hotter
0:31.4	than expected CPI reading here in the US. And then about mid day, we saw a huge turnaround.
0:38.2	Um, you know, what, what do you make of it? Why do we see that happen?
0:41.9	Well, I mean, a lot of people are trying to interpret this move in the context of CPI,
0:48.7	right? They're saying, well, you know, maybe people are realizing that CPI is lagging and
0:54.0	that this is actually the peak in core. And that's why we rallied. Doesn't have anything
0:58.7	to do with that reason. The reason we rallied today is because everybody was limit short.
1:07.4	And they, they crashed S and P futures 100 points on the number. And there was nobody left
1:14.6	to sell and people had to cover. I mean, it was pure positioning. Like the, if you look
1:20.9	at the chart of the S and P today, it exploded higher around 10 or 11 o'clock. I mean, it
1:27.5	was a pure short covering move. Now, the question going forward is, you know, is this going
1:33.5	to turn into some kind of durable rally? And I think it is, you know, first of all, just
1:39.2	the amount of shorts that we have in the market, it's, they're not going to all cover in
1:43.9	one day. It's going to take a long time for this to come out. But, you know, I also think
1:49.4	that you're going to see some, the bond market this morning after the CPI number was under
1:54.8	a lot of distress. We came within a couple of ticks to the long bond to having the whole yield
2:00.6	curve over 4%. Two's were trading around four and a half. I mean, one thing I pointed out
2:07.5	on Twitter today, the on the run bond is, was trading in the 82 handled this morning. This bond
	...

Please login to see the full transcript.

Previous episode | Next episode

Disclaimer: The podcast and artwork embedded on this page are from Real Vision, and are the property of its owner and not affiliated with or endorsed by Tapesearch.

Generated transcripts are the property of Real Vision and are distributed freely under the Fair Use doctrine. Transcripts generated by Tapesearch are not guaranteed to be accurate.