Andra Markets

Credit strength drives a constructive session as crude drops and vol drains out

The S&P 500 closed up +0.32% on breadth that barely cleared even, while credit and copper did the heavy lifting inside our risk barometer and gold and bitcoin pulled the other way. The setup rewards owning credit and duration together into a flattening curve, and it holds only as long as the long end keeps leading that move.

Edition 00016 min read

Takeaways

  1. Credit, not equities, carried the risk barometer to Constructive: LQD contributed +2.14 and EMB +1.69 against SPX's +0.46.
  2. The Treasury curve bull-flattened, with the 10-year down 4bp to 4.70% while the 2-year held at 4.24%, taking 2s10s to 46bp.
  3. Crude fell hard, WTI -4.61% and Brent -6.85%, while volatility compressed across equity and rate markets, VIX -2.52% and MOVE -2.79%.
  4. Breadth was a coin flip, 13 advancers to 12 decliners, and single names drove the tape more than sectors, AMD +4.91% against XOM -2.08%.

The day's moves

Gold: +1.62%, close 4,715.90Gold+1.62%Nasdaq 100: +0.64%, close 29,209.23Nasdaq 100+0.64%Russell 2000: +0.50%, close 3,010.02Russell 2000+0.50%S&P 500: +0.32%, close 7,677.28S&P 500+0.32%Euro Stoxx 50: +0.12%, close 6,455.63Euro Stoxx 50+0.12%EUR/USD: −0.03%, close 1.17EUR/USD−0.03%VIX: −2.52%, close 15.45VIX−2.52%WTI crude: −4.61%, close 81.09WTI crude−4.61%
Yahoo Finance, change at the close, 25 Aug 2026.

Desk view

The Constructive read of 0.63 on our risk barometer is a credit number, not an equity one. The three largest positive contributions came from LQD (+2.14), EMB (+1.69) and HYG (+1.25), all bigger than anything equities produced, SPX added only +0.46 and RUT +0.51. Gold (-0.99) and bitcoin (-0.35) sat on the other side of the ledger, both moving against the day's risk-on tone. That split matters: credit is pricing comfort that neither the safe-haven complex nor crypto is willing to extend yet.

The level that decides whether this holds is 2s10s. It flattened 4bp to 46bp today, entirely a long-end move, the 10-year fell 4bp and the 30-year fell 4bp while the 2-year sat unchanged at 4.24%. If the front end starts following the belly and long end lower, that is the market pricing cuts and the flattening becomes a rates story, not a credit one. If 2s10s pushes back above 50bp, the steepening trade reopens and today's credit-led calm needs a second look.

Biggest gainers and losers

AMD: +4.91%AMD+4.91%NFLX: +2.77%NFLX+2.77%NVDA: +2.19%NVDA+2.19%GS: +2.18%GS+2.18%PFE: +2.15%PFE+2.15%LLY: −1.06%LLY−1.06%COST: −1.17%COST−1.17%CVX: −1.58%CVX−1.58%CRM: −1.61%CRM−1.61%XOM: −2.08%XOM−2.08%
Andra Markets watchlist of US large caps; Yahoo Finance, change at the close, 25 Aug 2026.

What we watch

  1. Whether 2s10s holds under 50bp or reverts toward steepening.
  2. Follow-through in crude after WTI's -4.61% drop, with energy equities already down -1.66%.
  3. Whether credit keeps leading the risk barometer or gold and bitcoin's negative pull spreads into equities.
  4. Read-through from Korea and Hong Kong, KOSPI -3.12% and HSI -1.89%, into the US chip and AI-leadership trade.

Equities

The S&P 500 closed at 7677.28, up +0.32%, with the Nasdaq 100 outperforming at +0.64% on chip and streaming strength. The Russell 2000 added +0.50%, ahead of the Dow's +0.30%, while the S&P MidCap 400 slipped -0.04% and the NYSE Composite added +0.17%. AMD led all names at +4.91%, NFLX added +2.77% and NVDA +2.19%. GS and PFE both rose over +2.00%. On the other side, XOM fell -2.08%, CRM -1.61%, CVX -1.58%, COST -1.17% and LLY -1.06%.

Technology (+0.94%) and Communications (+0.77%) led sector rotation, Financials and Health care also firmed. Energy gave back -1.66% and Consumer staples -1.06%, tracking the drop in crude. Materials closed flat at 0.00% despite sitting at a session high on other metrics. Breadth told a different story than the index tape: 13 advancers against 12 decliners, a ratio of 1.08, with dispersion at 1.62. That combination, index gains on split breadth, says this was a leadership rally in a handful of names, not a broad move.

S&P 500 sectors

Technology: +0.94%, close 181.74Technology+0.94%Communications: +0.77%, close 113.18Communications+0.77%Health care: +0.34%, close 175.29Health care+0.34%Utilities: +0.21%, close 43.31Utilities+0.21%Financials: +0.15%, close 58.31Financials+0.15%Real estate: +0.07%, close 45.36Real estate+0.07%Materials: 0.00%, close 53.58Materials0.00%Cons. discretionary: −0.30%, close 117.95Cons. discretionary−0.30%Industrials: −0.34%, close 178.40Industrials−0.34%Cons. staples: −1.06%, close 86.52Cons. staples−1.06%Energy: −1.66%, close 62.06Energy−1.66%
Sector ETFs, Yahoo Finance, change at the close, 25 Aug 2026.

Rates

The curve bull-flattened. 2s10s narrowed 4bp to 46bp, 5s30s narrowed 2bp to 82bp, and 3m10y narrowed 3bp to 83bp. The move sat entirely in the belly and long end: 5-year -2bp to 4.41%, 7-year -2bp, 10-year -4bp to 4.70%, 20-year and 30-year both -4bp to 5.21% and 5.23%. The front end barely moved, 2-year and 3-year unchanged, 1-month and 3-month down 1bp, 6-month and 1-year up 1bp.

Breakevens stayed close to flat, 5-year down 1bp to 2.31%, 10-year unchanged at 2.32%, 5y5y forward up 1bp to 2.33%. The 10-year TIPS yield fell 2bp to 2.38%. Real rates, not inflation expectations, drove the nominal 10-year lower today. No auction color to add.

Treasury yield curve

3.92%4.53%5.14%3M1Y2Y5Y10Y30Y1 month: 3.79%, −1bp3 month: 3.87%, −1bp6 month: 3.96%, +1bp1 year: 4.04%, +1bp2 year: 4.24%, 0bp3 year: 4.31%, 0bp5 year: 4.41%, −2bp7 year: 4.55%, −2bp10 year: 4.70%, −4bp20 year: 5.21%, −4bp30 year: 5.23%, −4bp

24 Aug21 Aug

FRED, close of 24 Aug 2026, the latest published curve.

Credit

Every credit proxy closed higher. LQD added +0.64%, HYG +0.28%, JNK +0.26%, EMB +0.56%, BKLN +0.05%, and duration proxies TLT and IEF rose +1.10% and +0.54%. Investment grade and EM sovereign debt led, consistent with their outsized weight in today's risk score. Tone into month-end reads firm, spreads compressing alongside a rally in long Treasuries rather than against it.

Credit proxies

Long UST (TLT): +1.10%, close 83.47Long UST (TLT)+1.10%US IG (LQD): +0.64%, close 106.86US IG (LQD)+0.64%EM USD (EMB): +0.56%, close 95.38EM USD (EMB)+0.56%7-10Y UST (IEF): +0.54%, close 93.517-10Y UST (IEF)+0.54%US HY (HYG): +0.28%, close 79.92US HY (HYG)+0.28%Loans (BKLN): +0.05%, close 20.51Loans (BKLN)+0.05%
Listed ETFs as proxies for each segment; Yahoo Finance, change at the close, 25 Aug 2026.

FX

The dollar index eased -0.09% to 98.911. EUR/USD slipped -0.03% to 1.168, GBP/USD -0.02% to 1.365, and AUD/USD -0.09%. USD/JPY firmed +0.19% to 159.202 and USD/CHF added +0.05%. USD/CAD moved +0.32%, the largest G10 shift of the session. In EM, USD/TRY sits at a session high, up +0.10% to 48.095, while USD/MXN sits at a session low despite a small +0.08% tick, and USD/BRL added +0.20%. USD/INR eased -0.31%.

Currencies

USD/JPY: +0.19%, close 159.20USD/JPY+0.19%USD/MXN: +0.08%, close 16.93USD/MXN+0.08%GBP/USD: −0.02%, close 1.36GBP/USD−0.02%EUR/USD: −0.03%, close 1.17EUR/USD−0.03%Dollar index: −0.09%, close 98.91Dollar index−0.09%
Yahoo Finance, change at the New York close. A rise in USD/xxx is a stronger dollar, 25 Aug 2026.

Commodities

Energy sold off hard: WTI fell -4.61% to 81.09 and Brent gave back -6.85% to 85.86, while natural gas rose +2.27%. Precious metals diverged from crude, gold added +1.62% to 4715.9 and silver ticked up +0.13%, while platinum fell -0.69% and palladium -1.86%. Copper rose +1.70% to a session high of 6.711 and aluminium added +0.58%. In ags, corn and wheat both closed at session highs, up +6.66% and +3.34%, soybeans added +1.87%, while coffee fell -11.36% and sugar gave back -2.27%.

Commodities

Natural gas: +2.27%, close 2.85Natural gas+2.27%Copper: +1.70%, close 6.71Copper+1.70%Gold: +1.62%, close 4,715.90Gold+1.62%Silver: +0.13%, close 68.63Silver+0.13%WTI crude: −4.61%, close 81.09WTI crude−4.61%Brent: −6.85%, close 85.86Brent−6.85%
Front-month futures, Yahoo Finance, change at the close, 25 Aug 2026.

Volatility

Protection got cheaper across the board. VIX fell -2.52% to 15.45 and VVIX dropped -3.35% to 85.67. SKEW eased -1.63% to 143.27, showing less demand for tail hedges specifically. In rates, MOVE fell -2.79% to 71.919, tracking the drop in long-end yield volatility alongside the flattening curve.

Volatility indices

VIX: −2.52%, close 15.45VIX−2.52%MOVE: −2.79%, close 71.92MOVE−2.79%VVIX: −3.35%, close 85.67VVIX−3.35%
Yahoo Finance, change at the close, 25 Aug 2026.

Digital assets

Digital assets sold off against the day's risk-on equity tape. Bitcoin fell -0.84% to 78305.031, Ether -2.03%, Solana -2.08% and XRP -3.24%. The divergence shows up directly in the risk barometer, where bitcoin's contribution was negative even as equities and credit pushed the score higher.

Digital assets

Bitcoin: −0.83%, close 78,305.03Bitcoin−0.83%Ether: −2.03%, close 2,431.34Ether−2.03%Solana: −2.08%, close 96.51Solana−2.08%XRP: −3.23%, close 1.43XRP−3.23%
Yahoo Finance, change to the New York close, 25 Aug 2026.

International

Europe closed mixed and modestly firm, DAX +0.61%, SMI +0.54%, FTSE +0.29%, MIB +0.34% and EURO STOXX 50 +0.12%, while CAC, IBEX and AEX each slipped less than -0.25%. Asia was the weak link, KOSPI fell -3.12%, Hang Seng -1.89%, TAIEX -1.02% and Nikkei -0.74%, with only ASX 200 higher at +0.49%. The Americas leaned firmer, Bovespa +1.55%, TSX +0.66% and Mexbol +0.79%. New York opened into a session where Asia was selling and Europe was holding, a mixed handoff rather than a clean risk signal.

Global equity indices

Bovespa: +1.55%, close 174,576.80Bovespa+1.55%S&P/TSX: +0.66%, close 36,957.63S&P/TSX+0.66%DAX 40: +0.61%, close 26,266.14DAX 40+0.61%FTSE 100: +0.29%, close 10,886.16FTSE 100+0.29%Euro Stoxx 50: +0.12%, close 6,455.63Euro Stoxx 50+0.12%
Yahoo Finance, change at each local close, 25 Aug 2026. 3 without a print that day left out.

Correlation

Equities, credit and industrial metals moved as one bloc today. SPX, LQD, EMB and copper all rose together, and that bloc supplied nearly all of the positive score in the risk barometer. Gold and bitcoin sat apart, both scoring negative regardless of direction, gold rose while bitcoin fell, and neither participated in the equity and credit rally. That split describes a market pricing growth confidence through credit and industrial demand, not one where every risk-adjacent asset is repricing together.

The level to watch for a break in that pattern is the curve. Today's flattening came entirely from the long end, the 2-year held at 4.24% while the 10-year and 30-year each fell 4bp. If the front end starts falling with the long end, that is a rate-cut repricing, a different and more aggressive regime than the credit-led calm seen today. If credit reverses instead, LQD and HYG giving back today's gains while equities hold, that is the more classic late-stage divergence worth flagging first.

Sources

Levels at the official close from Yahoo Finance; the Treasury curve, breakevens and real yields from FRED. This edition did not fully pass the automated figure check against the session's verified fact pack. It was reviewed before publication. The text was drafted with a language model from that fact pack; the methodology explains how.

For information only. Not investment advice.