Federal Reserve Bank Governor Lael Brainerd makes hawkish comments suggesting a reduction in the Fed’s balance sheet could begin as early as next month. This statement prompted a selloff in some growth stocks that had seen a sharp bounce off the steep declines they experienced earlier this year.
Notable selloffs were seen yesterday in the semiconductors stocks in general and tech stocks in particular.
We saw large bearish bets in $HYG high-yield, Cathy Wood’s $ARKK Innovator ETF, and $EZU. In late February, we suggested investors consider selling VGK, a competing ETF to EZU, which tracks the European stock market.
Institutional options traders sold over $6 billion dollar-deltas on the macro stage, net overall. There was a substantial but low probability bullish bet in $XLF, the financials ETF, looking for an extreme event going the other way.
