It’s All Down But The Dollar.

Markets remain on edge Wednesday as traders and investors brace for a global recession and fret that no amount of stimulus, monetary or fiscal, will be enough to offset the downturn precipitated by increasingly draconian containment efforts to combat the spread of coronavirus.

Almost everything was down Wednesday, as gold looks to be succumbing to more selling to cover margin calls in other assets and bonds are under pressure amid concerns about a supply deluge tied to some $1.4 trillion in global stimulus promises.

Yields in Italy, Germany, the UK, Spain and France are all up after the worst day for US bonds since 1982. The German 30-year is back above 0% for the first time since February 26, a few days before the global equities rout began to snowball. Italian yields were up more than 60bps. (Last week, Italian bonds suffered their worst day in history and today’s not looking much better)

“In the US we have seen a virus fiscal package swell from USD500 billion to USD850 billion to USD1 trillion to USD1.2 trillion”, Rabobank’s Michael Every said. “That is 5.6% of GDP, or what GDP was before it suffers what is likely to be an epic contraction in Q2 [and] given the fiscal deficit was already 5% of GDP and rising, let’s say hello to double-digit deficits”.

Early gains for Asian shares were eventually faded, and US equity futures once again hit limit-down bands. Global stocks have erased years of gains in the space of just weeks.

WTI crumbled to below $26 as a supply tsunami and the worst demand shock in recent memory combine to create a perfect storm. Goldman now sees Brent at $20 in Q2. Standard Chartered said Brent “will likely be well below $20”.

Crude is now sitting at the lowest in 17 years. (Maybe gas stations will pay drivers to fill up soon – as long as you buy a Slurpee – fuel is the new gas station loss leader.)

Gold is down 5% this month as investors raise cash to cover losses, while silver and platinum are both deeply oversold.

And yet, there’s one thing that’s up: The dollar, which is riding a seven-day win streak.

The greenback’s inexorable ascent continues even as Fed swap lines look poised to help alleviate the funding crunch which manifested itself dramatically on Tuesday.