Say what, Japan is the new " High Yilder"

The robust US economic data overnight suggests the yield curve inversion isn't a harbinger for a recession. 

Investors are paring back short equity bets while others are happy to bargain hunt at these levels as the robust data will not deter the Fed from cutting in September. So provided the US data holds up, SPX investors will continue dipping their toes back into the liquidity trade, expecting a dynamic policy shift from the Fed.

In Asia markets, there seems to be enough carnage in the HK market, and the fire sale has gone deep enough to encourage bargain hunting as well. Even more so against a massive central bank policy backstop.

On the currency markets, robust US data does not change the picture much, as its concerns over global growth that are mostly driving the currency markets. If anything, it reinforces the US dollar's appeal.

The Oil markets remain supported as the US recessionary fear recede while the calmer dialogue between US-China as adding to the "Feel-Good  Friday" storyline.

Gold markets are looking prone to profit-taking on rallies so as we move through Friday's housekeeping duties, we could see a move lower on profit-taking alone.

On the bond markets, although the volumes were significant on the futures markets this week, it's more likely a result of the US bond markets 5 through 30's looking more attractive in the face of negative-yielding " Sovereigns” as the global economy collapses outside of the US. In a sense, US bonds have become tied to the hip of negative-yielding EU bonds.