Video summary
The daily market recap begins with a session where major indices finished slightly in the red, driven by escalating tensions in the Middle East and rising crude oil prices. The Nasdaq 100 dipped by one-tenth of a percent, dropping 240 points from its highs but remaining within 1,000 points of its peak levels. Similarly, the S&P 500 fell by four-tenths of a percent and the Dow Jones Industrial Average declined by half a percent, losing 258 points to settle near 53,000. Despite these declines, the market is noted for having recorded a strong open on Friday, suggesting that today's losses have largely erased those initial gains, bringing indices back to levels seen at the beginning of Thursday's trading action.
A significant focus of the discussion is the surge in interest rates, particularly concerning the 30-year Treasury yield which hit 5.31%, marking a new high not seen in nineteen years. This acceleration in yields is being fueled by rising crude oil prices, which are pushing inflation higher and causing investors to demand more compensation for risk. While the headlines often highlight the 30-year bond, the speaker emphasizes that the 10-year yield remains the critical metric, currently sitting at 4.73%. The dollar index has also strengthened slightly in response to these rising yields, moving from around 99.48 to nearly 99.63, though this move is viewed as relatively modest compared to the dramatic shift in bond markets since the start of the conflict.
Commodities and alternative assets are showing resilience amidst the equity pullback, with gold rising by $23 to trade at 4,460 and the GDX mining ETF gaining 2%. However, trading volume across equities and futures was described as quite light, indicating a lack of strong buyers in the current environment. The VIX volatility index also provided a warning sign, climbing above 15 after opening near that level, which contrasts with its historically low levels seen recently. Additionally, the Japanese yen weakened further against the dollar, pushing the exchange rate toward 160, a level that has previously triggered government intervention concerns in Japan, highlighting the ongoing pressure on global currencies due to diverging economic conditions and geopolitical instability.
Read the full video transcript
[music]
>> Good afternoon, folks. Tommy O'Brien
coming to you live from TFN and Monday
trading. We got markets slightly in the
red, crude prices escalating tensions in
the Middle East, but we got a market
giving it up a little bit. And I say a
little bit, right? We got Nasdaq 100
folks negative by 1/10%. Okay, yeah,
we're off by 240 points from the highs.
We're within 1,000 points of the highs
in the Nasdaq. You got an S&P right now
negative by 4/10%, but that's having a
record open on Friday. Just near that
level this morning, we're back to where
we were at the beginning of Thursday
action. S&P's off by 4/10%, the Dow off
by half a percent right now, off 258
points, 53,000
548, and a Russell off by half a percent
as well, off 14 points at 3,060.
Tell you yields, you're going to see a
lot of headlines, folks, about the
30-year. Now, we always look at the
10-year.
Okay?
But the 30-year hits 108.07. We hit
5.31%
for the yield on the 30-year. This is
what we're looking at right here, ZB on
the futures.
Okay?
And that's the highest level in 19
years. You know what's remarkable is? Do
you remember when Silicon Valley Bank
took all of those deposits, a
generational deposit, and they put it
into 30 years?
And that capital just disappears, okay?
Now, yeah,
uh
you they will get paid back for that,
but on a day like today, man, you're
making new lows in price, new highs in
yield, and the 30-year is just
accelerating higher
to 5.31. Now, the 10-year is not immune
from that, okay? We got crude prices
pushing higher. That's driving inflation
yet again, which pushes yields higher.
You got the crude contract up 2.5% right
now. Okay? You jump over the headline
for crude.
And yeah,
the peace prospects dim. You get a
rejection. It seems like they're very
far apart. Okay?
No is the answer. Quote unquote, if he
would seek an extension of the
memorandum of understanding signed in
June. Now, realistically folks, that
memorandum memorandum of understanding
seems to be pretty worthless considering
what's going on right now, where things
are, and what that memorandum actually
said. Crude
handling things okay as India come in at
82.50
before that acceleration, but we're
higher today. That's pushing yields. So,
that's the backdrop.
And there's your tenure. 4.73 folks.
4.73%
on the tenure. It's quite a number.
Okay, you jump over the dollar. Dollar
catches a bid from this morning as
yields accelerate, right? On that recent
run in yields, you get the dollar
trading from about 99.48 prior to that
move. We're pushing 99.63
right now. Dollar.
Now,
we're actually right back to where we
were on Friday.
Okay? The dollar has looked weak
relative to where yields are. I did the
scenario earlier.
Okay? But if you take a look at this
dollar, folks, you look at the run we've
had since the war began. So, here's
where the war began.
Right? The dollar was pushing almost 98,
right? You had highs the prior week or
two to about 98. Well, we're at 99.63.
During that same period of time,
this has been what the tenure's done.
You've gone from 114 to 108, and the
dollar has only went from 98 to 99.50.
Okay? So, we got dollar weakness in this
market even as yields exacerbate and
we're at 4.73% right now. Gold, yeah,
even with that dollar holding onto the
gains. Gold up $23 right now, trading at
44.60. The equities are running today.
GDX up 2% right now.
Now, we'll see about the volume. Okay,
pretty light day on the equities. Check
it out. You got 10 million shares on the
GDX right now.
Okay, we got an hour left to go, but
that's a light number. Now, on a weekly
basis,
and that's two strong weeks, folks.
Okay, you accelerate
out of this downtrend channel, you break
away from October highs. I really like
the action in gold right now, folks.
Doesn't mean you can't rip lower when
you trade, I mean, the equities in
particular, okay, up 30% over the last
three to four weeks. But nonetheless,
today, up another 2% for the GDX. Jump
over the VIX.
Now,
okay, a little bit of a warning sign
this morning. You got a VIX goes from
14.18 to end last Friday coming into a
summer weekend. You accelerate above
15.40, but you open the session at 15 on
the VIX.
And that's when you had an S&P opening
the session
basically positive by a couple points, I
think, is where we were, almost flat.
The tick to the VIX coming into the
opening bell, we were at 78.06
coming into the opening bell, and you
had a VIX
up almost a full point.
Now, 14.14.18
is something remarkable. Okay, you don't
get much lower than that, folks. All
right, we take a look at a weekly, you
got to go back to last Christmas Eve,
basically. Yeah, when we hit 13.38 on
Christmas Eve, all of 2025, folks, you
only hit that price level a couple
times.
What you get to 14.21, 14.12. So, you
got down there in August. It's an
exacerbated low on the VIX. We pop a bit
today up by 95 pennies as the market
pulls back a bit.
All right, so the headlines of the war,
yeah, they keep marching on, and we're
almost at the end of that memoran-
memorandum of understanding. I don't
think that's a big deal cuz nobody's
really paying attention to what's in
there. So, will we get another one?
Possibly.
But
like it's some threat that that expires
and things are going to get worse, I
don't think that's really playing into
basically what's going on right now. But
yeah, tensions escalating, nonetheless.
All right.
And then, yeah, you're going to see the
headline on the 30-year, folks. And the
10-year is so much more important than
the 30-year, but it's it's happening to
a certain degree in the 10-year as well.
4.73 right now is the number. And the
markets pulled they've pulled out some
hikes from what was priced in, and we're
still pushing almost 4.75
from 4% March 1st. Now, what's crazy is
that's like 6 months ago, folks. Time
flies. 6 months ago, we've been in war
with Iran. And that whole time, right,
yields persisting higher, and we're
approaching it again. Approaching that
4.75% level.
And quite a number, and you got the
30-year now at 4.31,
but yields look at this, man. All right,
UK, France, Japan.
All of them going higher.
We jump over that yen.
Dollar yen.
And yeah, weakens again.
Look at this move, man. Up a full point
from 158.84. We're pushing 160, just
like that.
The yen
giving bankers in Japan their hands full
right now. Pushing 160, just like that,
yet again. Look at this, man.
And we're right back to almost where we
were, that intervention in April.
All right, we take a look at the volume
in the S&P right now. Yeah, pretty light
day in the futures. Now, we got an hour
left to go in trading, but right now,
841,000 contracts on the futures.
You jump over the Nasdaq futures, NQ.
Same deal. Look at this light. You know,
we had a nice acceleration here. Little
bit light today. We'll see. We got an
hour left to go. We're at 351 right now,
but you got highs out here with strength
at 450.
All right, [snorts] you jump over to the
ETF structures, the spy.
Look at how light the spy is today. Very
light volume today. Just lacking buyers.
Spy.
Look at that. 19 million shares. And you
did 31 and 35 the last few days. You
jump over the Qs.
Not quite as pronounced, but still light
day.
You going into that day of strength of
31 million? We got 20 million today. And
how about SpaceX, folks? Up another 4%.
You talk about the volatility. We're
coming back with Steve Routs, folks,
author of Mastering Probability. Always
great segment. We'll talk to Steve.
We're coming right back.