Yes, we’re getting yet another ramp job in front of the latest dismal economic news.
Like all the others, this one was driven by another sharp drop in VIX, which finally managed to tag our 100-DMA target (but, only because the 100-DMA has been steadily rising.)
It was also driven by a pop in oil prices, driven by Aramco’s announcement that it was raising the official selling price of Arab light crude offered to Asian customers by $1.40/barrel, to US customers by $1.50/barrel, and to Northwest European customers by $6.55/barrel.
The announcement did manage to push prices slightly above the Feb 2016 26.05 lows. But raising prices in a buyers’ market is obviously an exercise in futility. Its value is primarily in signaling algos that better times lie ahead — at least for a few hours so that any damage wrought by the unemployment data starts from a higher bar.
Speaking of unemployment, initial claims totaled 3.17 million, slightly above the 3 million consensus, and points to a total of 33.5 million for the past seven weeks for an unemployment rate of 16%. From Bloomberg:
It remains to be seen whether reopening some states will make a material difference.
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