The HYG strength is worth noting here. When high yield credit is rising alongside equity gains, it usually signals that risk appetite is solid and not just concentrated in tech/growth names. I've noticed LQD and HYG divergences can be early warning signs when they start to break down, so seeing both higher together is constructive for the near term. The VIX at 14.19 aligns with this too, basically saying the market isn't pricing much tail risk despite yields edging higher. Curious how tomorow's FOMC minutes shift things if they sound more hawkish than expected.
The HYG strength is worth noting here. When high yield credit is rising alongside equity gains, it usually signals that risk appetite is solid and not just concentrated in tech/growth names. I've noticed LQD and HYG divergences can be early warning signs when they start to break down, so seeing both higher together is constructive for the near term. The VIX at 14.19 aligns with this too, basically saying the market isn't pricing much tail risk despite yields edging higher. Curious how tomorow's FOMC minutes shift things if they sound more hawkish than expected.
Very interesting insight, thanks for sharing!