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Is the top in for margin debt? Has the concern about higher rates potentially put an end to the massive borrowing that is helping to fuel the stock market surge? Who knows for certain, but the June NYSE margin debt data showed a slight decline from May.

The June debt level of $376,632M was down from $377,002M in May and down from the May peak of $384,370M. This was the first multi-month decline since May 2011 just before the market got spooked by the euro crisis. As you can see below, the S&P 500 tends to correlate highly with margin debt.

Of course, there's no way to be certain that this is anything more than a highly correlated data set and not necessarily a case of causation. Margin transactions do not require borrowing first and then placing a transaction, so this could be nothing more than a sentiment indicator as opposed to a leading indicator.

Interesting nonetheless.

(click to enlarge)