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U.S. business activity is up and is on its fastest rate this year. Good news for the economy, but the preliminary data from S&P Global also said tariffs are making things more expensive. That’s a discouraging sign for inflation.
#Economy#US
https://t.co/i8FPlDwBFo
What just happened?
At 1:00 PM ET, the S&P 500 fell nearly -80 points in 30 minutes without any major "news."
What actually happened was a weak 20Y Bond Auction which sent US Treasury Yields soaring.
Investors MUST watch yields here. Let us explain.
(a thread)
New Fed data shows 76% of manufacturers and nearly half of service firms plan to pass tariff-related cost increases straight to customers. With only a small share shifting suppliers or reshoring, most firms are choosing the path that fuels inflation
-Torsten Slok
This is exactly what I think.. they knew this since that “fake news” last Monday. Somebody just spilled tea too soon or maybe it was on purpose to test the markets’ reaction!
Alright, I think people knew of the tariff pause and traded it beforehand.
You can see before Trump posted "buy" on Truth Social, traders opened $QQQ $TQQQ and $SPY calls
RIGHT BEFORE THE NEWS, someone opened $SPY 509 calls, expiring TODAY!!!!!!!!!!!!!!!!!!!!
Those calls are up 2100% in one hour.
You can see all volume was literally opened TODAY!!!!!!!!!! (That little green arrow). You can see all volume is new opening volume (not only on the Zero days, but also on the weekly $QQQ and $TQQQ calls). This is especially odd given IVR on these was around 82 this morning, with IV through the roof. The traders really wanted to trade directionally...
In fact, using Unusual Whales' net premium, you can see people have been loading calls trading for a reversal, following these opening calls. Very clear example here.
Insane, someone knew.
What just happened?
At 10:10 AM ET, rumors emerged that the White House was considering a "90-day tariff pause."
At 10:15 AM ET, CNBC reported that Trump is considering a 90-day pause on tariffs for ALL countries except for China.
By 10:18 AM ET, the S&P 500 had added over +$3 TRILLION in market cap from its low.
At 10:25 AM ET, reports emerged that the White House was "unaware" of Trump considering a 90-day pause.
At 10:26 AM ET, CNBC reports that the 90-day tariff pause headlines were incorrect.
At 10:34 AM ET, the White House officially called the tariff pause headlines "fake news."
By 10:40 AM ET, the S&P 500 erased -$2.5 TRILLION of market cap from its high, 22 minutes prior.
Never in history have we seen something like this.