Equity vol finally caught up

The VIX rose 9.52% to 16.34. On Friday it fell on a day the two-year moved 14bp, which was the strangest number of that session and left an obvious question hanging. It took three sessions to answer. The path from Thursday reads 14.51, 14.43, 14.92, 16.34. The options market did not disagree with the bond market last week so much as arrive late.

The two-year added 5bp to 4.39%, the five 6bp, the ten 4bp and the thirty 2bp. Since Warsh spoke the two-year has gone 4.20, 4.34, 4.34, 4.39 — nineteen basis points in three sessions, none of it given back. 10s2s sits at 40bp against 47bp a week ago. This has stopped looking like a reaction to a speech and started looking like a repricing.

Nothing was spared. The Nasdaq 100 lost 1.29%, the Russell 1.23%, the Dow 0.79% and the S&P 0.71%. Semiconductors gave up 2.05%, Nvidia 1.51%. After a week where the Dow and the Nasdaq took turns being the one that fell, everything fell at once, which is what a rates move does once equities decide to believe it.

Dell dropped 6.80% to $425.00 during the session, and after the close put up revenue of $47.0bn, up 58%, with non-GAAP EPS of $7.04 against roughly $4.95 expected. AI-optimised servers did $16.4bn in the quarter alone. It booked a record $60.9bn of AI orders and exited with a record $95bn backlog, and raised the full year from $167bn to $192bn. Whatever the session was pricing, it wasn't that.

MongoDB grew revenue 30% to $771.8m, its fastest in several years, and raised the year. Credo more than doubled, revenue $479m and up 115%, guiding optical above $600m for the year. GitLab did $286.3m, up 21%, ahead of its own guide, and raised both revenue and earnings for the year. Palo Alto grew 34% with next-generation security ARR up 63% — though its FY27 ARR guide implies that growth more than halves by year end.