Rekt Mkts: New day new hack(s)

A less comfortable start after yday's recovery...stocks and crypto are giving some back, with Korean memory taking a particularly nasty hit. Treasury yields are falling too, so this isn't simply another day of higher rates dragging everything down. Better company numbers haven't disappeared overnight, but the willingness to buy the wider tech trade is looking less convincing. I believe the main reason for the market fears was the cyber-security scare that escalated yday, with critical PHP flaws triggering emergency patches and precautionary website shutdowns, while Railway separately warned of potentially exposed credentials. Millions of hacking attempts have since been reported, adding another reason to be nervous about tech, even if it doesn’t explain the whole sell-off (I still personally think all of this is bullish for ZEC).

US jobless claims are due today, with 200k expected against 199k previously. A meaningful jump would add to the weaker-demand picture discussed yday; another low reading would make it harder to argue that the labour market is suddenly cracking. The 10Y is around 5.07%, down more than 7bps on the session, while the 2Y is around 4.77%, down more than 5bps. WTI is around $99 a barrel, with fresh reports that the US and Israel are considering renewed strikes on Iran keeping supply risk in the picture. Gold futures are around $4,088, down roughly 1.5%, so the buying in Treasuries isn't translating into a bid for every supposed safe haven.

S&P 500 and Nasdaq-100 futures are lower, with tech under more pressure. SK Hynix finished down roughly 5.5% in Korea and Samsung 4%, reversing much of the strong bounce in yday's brief. Micron did join the recovery on Wednesday, closing up around 2%, but Korea is giving the US memory names a much less encouraging lead today. Meta's results give a better answer on growth than the broader tech selloff might suggest. Revenue rose 26% to $64.6bn, and the company guided to $73bn-$76bn for the next quarter. The shares initially rose after the report, but that hasn't stuck: they turned lower in premarket....likely due to the broader cyber security concerns. The spending question hasn't gone away though. Quarterly capex was $34.9bn and free cash flow was negative $2.1bn. Meta narrowed its full-year capex outlook to $135bn-$145bn, lifting the bottom end, and approved a new non-voting share class that could be used to raise capital. That isn't an announced cash raise, but it does make the discussion about funding the buildout more concrete.

BTC is down roughly 1.9% over 24H, ETH 2.5%, SOL 2.2% and HYPE 3.8%. ETH and HYPE were ahead of BTC in yday's recovery; they're now falling harder. Getting a couple of green closes was encouraging, but it hasn't made crypto immune to another weak day in tech although its outperformance continues to be noteworthy. US spot BTC ETFs took in $524.8m yday, up from Tuesday's $23.2m and their third consecutive day of inflows. That brings this week's buying to roughly $1.07bn through Wednesday. ETH funds took in $14.9m, ending five consecutive days of outflows, altho they remain net negative for the week. The BTC demand picture is much better than Tuesday's small inflow suggested...today's weaker PA doesn't erase that buying, but the buying hasn't stopped the pullback either. VVV is up around 4.8% over 24H, significantly outperforming, while ZEC is down 2.4% despite surging above 15% yesterday. Worth noting that CYPH, a ZEC DAT+miner was also up about 20% yesterday although it's expected to be lower today along with the broader market move. As mentioned in the opening paragraph, I actually think yesterday's headlines continue to be bullish for ZEC, my expectation is you see an initial parallel move down with the market, but once the dust settles, you should see an outperformance. Good luck today...treacherous waters!