For the first time since 1998, primary dealers are net short corporate bonds.
They've sold more credit exposure than they actually own—a dramatic shift from holding an average $16B of inventory in 2017. Most of the short position is in longer-dated bonds, where rising yields hurt the most. With credit spreads near multi-decade lows, the reward for taking that risk is minimal. If yields keep rising, dealers look well positioned. But if bonds rally, they could be forced to cover into a market with limited supply, accelerating the move. One thing history shows: credit markets often crack—or recover—before equities do. Source: Bull Theory
1.2 million Korean investors were hit with margin calls in a single market crash.
That's roughly 1 in every 30 working-age adults in the country. As the KOSPI plunged 8.95%—its third-worst session since Lehman—more than 1.2 million leveraged retail accounts triggered margin calls. Around 320,000–360,000 accounts were fully liquidated, with some investors left owing money even after their positions were sold. The damage was brutal: SK Hynix: -15.4% (largest daily drop on record) Samsung: -10.7% Meanwhile, retail brokerage cash balances have fallen by ₩30 trillion to their lowest level since February. And here's the key point: forced-selling data lags by two days. The full impact of Monday's liquidation wave has **not even appeared in the official figures yet. Source: Bull Theory
The diesel market is sending a warning that the oil market isn't.
Diesel crack spreads jumped another ~9% today, extending an already powerful rally. Why does it matter? Crude oil can be influenced by headlines, geopolitics and strategic reserves. Diesel reflects the real economy. It powers trucks, trains, ships, construction equipment and mining operations. When diesel crack spreads rise, refiners are signaling that distillate demand is outpacing supply. In other words, the market for one of the world's most important industrial fuels remains exceptionally tight. You can suppress the price of crude for a while. But it's much harder to hide what's happening in the fuel that keeps the global economy moving. Source: Lukas Ekwueme
Her's why crack spreads are surging everywhere... Russia's refining system is showing real signs of strain.
Russian refinery throughput fell to just 3.8 million barrels per day in June, down 1.5 million bpd from the start of 2026. For comparison, refinery runs during 2023–2025 were consistently around 5.0–5.7 million bpd at this point in the year. Then came April 2026. Throughput collapsed—and has yet to recover. The key driver? Ukrainian drone strikes appear to have inflicted more immediate damage on Russia's refining capacity than years of Western sanctions. The impact extends far beyond Russia. With fewer Russian refined products reaching global markets, diesel and other fuel supplies have tightened, helping drive crack spreads sharply higher. Sometimes the clearest signal isn't the price of crude—it's what refiners can no longer produce. Source: Jack Prandelli on X
JP MORGAN $JPM
Q2’26 EARNINGS HIGHLIGHTS 🔹 Revenue: $58.02B (Est. $51.39B) 🟢; +27% YoY 🔹 EPS: $7.70 (Est. $5.72) 🟢; incl. $1.56/share from significant items 🔹 NII: $25.62B (Est. $25.64B) 🟡; +10% YoY 🔹 Net Charge-Offs: $2.37B (Est. $2.62B) 🟢 🔹 Investment Banking: $3.9B (Est. $3.06B) 🟢; +45% YoY 🔹 Equities S&T: $6.03B (Est. $3.98B) 🟢; +86% YoY 🔹 FICC S&T: $6.05B (Est. $6.29B) 🔴; +6% YoY Other Metrics: 🔹 Loans: $1.54T (Est. $1.52T) 🟢 🔹 Total Deposits: $2.71T (Est. $2.69T) 🟢 🔹 AUM: $5.1T; +18% YoY Segment Performance: 🔹 Consumer & Community Banking Revenue: $20.27B; +8% YoY 🔹 Commercial & Investment Bank Revenue: $24.85B; +27% YoY 🔹 Asset & Wealth Management Revenue: $6.85B; +19% YoY Financials: 🔹 Net Income: $21.2B; +41% YoY 🔹 Provision for Credit Losses: $2.52B 🔹 ROE: 24% (Est. 18%) 🟢 🔹 ROTCE: 29% 🔹 Standardized CET1 Ratio: 14.1% Capital Return: 🔹 Dividend: $1.50/share 🔹 Buybacks: $6.2B of common stock net repurchases 🔹 Authorization: New $50B buyback program effective July 1, 2026 Source: Wall St Engine
Very cool prices in the June CPI were across the board.
US Headline inflation (CPI) comes in lower than expected, at 3.5% vs expected 3.8%. This is the biggest drop in MoM headline CPI (-0.4%) since covid crash. It is also much lower than expected (-0.1%). Core CPI is also the lowest since covid at +2.6% yoy (vs. +2.8% expected). The core CPI *declined* on a MoM basis, falling -0.02%. This is the first MoM drop since May 2020. Source: Bloomberg
US 2 year yield is tumbling -7 basis points as US CPI number came in cooler than expected.
Odds of a July rate hike are now 14% (vs. 45% this morning). Source: www.investing.com, CME Fed Watch tool
SK Hynix has now plunged 40% from its all-time high just a few weeks ago
Source: zerohedge
