Apr 7, 2021 AT 10:21PM
US stocks closed mixed with S&P 500 hit a record high in thin volume while small caps were the days biggest losers tumbling by 1.5% with Nasdaq holding modest gains and the Dow/S&P closed flat. Nasdaq continued its significant outperformance over Small Caps, surging to its strongest since mid-Feb (reversing around The March FOMC meeting). FOMC minutes once again were interpreted as dovish as Fed continued commitment to accommodative policy to support a full economic recovery as it refrained from signalling it will make any changes to its QE program any time soon. Fed Funds futures were active after Chair Powell acknowledges it might be appropriate to implement adjustments to administered rates at upcoming meetings or even within meetings if undue downward pressure on overnight rates emerged (Hikes on IOER and ON RRP remain in play I guess). Elsewhere, Yields were choppy with 10YR closed around 1.66%. Junk bond spreads compressed to their tightest since 2007, back below 300bps. Cryptos puked with Bitcoin back <$56k and Ether <$2k. Crude tumbled on last nights API, tested $60 overnight, then tumbled again on the official EIA data only to bounce off $58 to end higher on the day.
