European outperformance showing no signs of slowing

The near-term selloff in the bond market has persisted in recent days, and finally seems to be joined by some minor selling pressure in Equities.  While the larger two-week trading range will remain intact barring a break below SPX-4060, Thursday’s trading showed the first break of the recent triangle, which has the potential to bring about some minor selling into next week.

SPX violating 4060 should allow for a quick test of 4000, but should not get materially below 3950 before turning back higher to exceed 4200.

Looking back, this week’s better than expected economic data regarding Retail Sales and PPI resulted in interest rates spiking higher globally.  Yet US Equity markets have merely gone sideways since February 2.  Meanwhile in Europe, many markets are nearing or have reached all-time highs.

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