Bonds Shrug As Taper Smashes Stocks To Record Highs

The S&P 500 rallied well over 40 points (and the Dow up over 350 points) off the FOMC knee-jerk lows but bonds were largely unimpressed. USDJPY surged to new 5-year highs over 104. Bonds weakened, rallied,a nd then leaked back higher in yield to close almost unchanged from the FOMC announcement. VIX was smahsed back under 14% - its biggest drop in over 2 months.

• *S&P 500 RISES 1.7% TO RECORD 1,810.79 AT CLOSE
• DOW AVERAGE INCREASES 1.9% TO RECORD 16,171.12 AT CLOSE

We can only imagine what would have happened if he'd tapered $20 billion?

Stocks merely played catch-up to the Fed Balance Sheet...

Seems like not everyone agreed that this "Taper" was a good thing...

Industrials hit a new post-debt-ceiling-low high - as did homebuilders...

USDJPY hit 5 year highs...

Stocks surged on the carry exuberance...

but bonds reverted back to almost unchanged (as Gold tumbled and the USD surged)...

It's all sh*ts and giggles on business TV for now as the stock market's reaction is "clearly" indicative that the Fed has won - never mind the rest of the asset classes of the world are signaling this is not good news. Two things of note are that we saw heavy blocks into these highs (which has marked short-term tops in recent weeks) and that the surge in stocks occurred perfectly off the S&P 500's 50DMA once again (just like Sunday night).

Charts: Bloomberg

Bonus Chart: Treasury Curve was entirely unmoved at today's exuberance....

Bonus Bonus Chart: Will Nikkei and Dow range-trade? or will Nikkei break above Dow overnight?