| July 11, 2023 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | Cboe Global Markets shared on LinkedIn that "Options on Cboe iBoxx iShares High Yield Corporate Bond Index futures (futures ticker: #IBHY) and Cboe iBoxx iShares Investment Grade Corporate Bond Index futures (futures ticker: #IBIG) are now available to trade."
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Tom Hutchinson - Open Outcry Traders History Project - John Lothian News - Part Two
JohnLothianNews.com
In part two of the JLN Open Outcry Traders History Project interview with Belvedere Trading Founder Tom Hutchinson, he tells the stories of his best trading days and his worst trading days.
Watch the video »
| | | | | | Lead Stories | | | Activision (ATVI) Options Bet Pays 246% in an Hour After Merger Cleared
David Marino - Bloomberg
One trader made a well-timed bet that Microsoft Corp.'s $69 billion bid to acquire Activision Blizzard Inc. would get the okay to move forward from a US court Tuesday.
A block trade of 2,000 Activision call spreads â which would gain in value as the shares rise â was reported about 10 minutes before the company's shares spiked when a US judge denied the Federal Trade Commission's request to halt the deal.
The spreads, which are equivalent to 200,000 shares, traded for $1.20 each at 10:44 am New York time. They were worth about $4.15 an hour later after shares rallied as much as 12%, potentially netting the buyer about $600,000 in profits.
/jlne.ws/44G8cdG
Inflation Data Isn't as Anxiety-Inducing for Traders These Days
Gunjan Banerji - WSJ
The options market is pricing in around a 0.6% move for the S&P 500 on Wednesday, when the monthly consumer price index data is released. That's the smallest expected move around the inflation data this year, according to Laurent Laskowski, a director at Mizuho Securities.
/jlne.ws/44jL44V
Currency Hedges Are Burning Traders' Wallets as Volatility Fades
Alice Atkins and Naomi Tajitsu - Bloomberg
Currency-market volatility is starting to look like a no-show, making hedging strategies too costly to maintain for some.
As central banks' hawkish drumbeat drags on and global growth stays surprisingly resilient, the swings that investors bought options to protect themselves against have yet to materialize.
/jlne.ws/3XObKbt
UK scraps public disclosure of short selling
Nell Mackenzie - Reuters
The UK government said on Tuesday it would no longer require short sellers to publicly disclose their trades on UK companies.
A short position is a bet that a company's stock price will decline. Under the rule change funds will no longer have to tell the public their individual net short positions on a stock.
/jlne.ws/3PS1GML
The elusive US recession and its 'misleading' indicators
Jamie McGeever -Reuters
The longer the heavily touted U.S. recession fails to materialize, the more doubt is cast over the relevance and usefulness of leading economic indicators that have accurately predicted every downturn for decades. The economy grew much faster than expected in the first quarter of the year, unemployment is ultra-low, job growth remains solid, and inflation is decelerating fast.
/jlne.ws/3XPr5ss
Bonds Are Getting Scary Again. Why the Stock Market Has Barely Budged.
Jacob Sonenshine - Barron's
Bond prices have drooped amid rising inflation fears, yet stock prices remain robust.
There are growing signs that the Federal Reserve may have to keep interest rates high longer than expected to tame inflation, which is why bond yields are rising and bond prices are falling. High rates are bad news for stocks as well, but equity investors are betting that corporate earnings will strengthen in late 2023 and in 2024.
/jlne.ws/3pJ3lJL
John Williams: 'I don't have a recession in my forecast. I have pretty slow growth'
Colby Smith - Financial Times
After an extended battle against stubbornly high inflation, the US central bank is at a critical juncture. And as president of the New York Federal Reserve, John Williams is a pivotal figure in discussions about the next phase of the Fed's historic monetary tightening campaign.
Having raised their benchmark interest rate 5 percentage points in just over a year, Fed officials are now engaged in a protracted debate about how much more to wallop the world's largest economy at a time of vast uncertainty. Unknowns include the pace at which price pressures will recede, the economic consequences of the central bank's past actions to date and the spectre of financial instability following a brief bout of banking sector turmoil earlier this year.
/jlne.ws/3NNEufZ
| | | | | | Exchanges | | | Explainer: What is Nasdaq's special rebalancing and its impact?
Sruthi Shankar and Medha Singh - Reuters
A "special rebalance" of the Nasdaq 100 index (.NDX) will take place later this month as exchange operator Nasdaq (NDAQ.O) looks to reduce the concentration of heavyweight companies that account for nearly half of the index's weight.
A blistering rally in growth and technology stocks has lifted the Nasdaq 100 index by 37.5% this year. That compares with a 14.8% gain for the benchmark S&P 500 (.SPX).
/jlne.ws/3NMa7q7
Comparing Crypto Exchanges is Similar to Apples vs. Oranges
Katherine Kirkpatrick - Cboe
Lately, it feels as if part of crypto is being split into two camps - "TradFi crypto" versus the crypto native or "crypto incumbent" exchanges. It was not lost on some that Cboe Digital gained a long-awaited margin approval from the CFTC, complete with supportive statement from CFTC Commissioner Romero, in the same week the SEC sued Binance and Coinbase.
One of the best parts of participating in the crypto ecosystem, however, is the "we're all in this together" mentality. In my experience, no one wants to see frauds, hacks, thefts, or other wrongdoing within crypto, because it does a disservice to the good. Legitimate entities in crypto agree that this is a nascent industry and to grow it, we hope that other projects worth supporting find a path forwardâeven when they present competition.
/jlne.ws/3ObTqpD
Cboe 'reached an agreement on terms' with Coinbase for bitcoin ETFs
Ben Strack - Bloockworks
Chicago Board Options Exchange (Cboe), an exchange seeking approval from the SEC to list several spot bitcoin ETFs, has resubmitted its applications with slight amendments regarding its surveillance-sharing agreement with cryptocurrency exchange Coinbase. The amendments appear to signal Cboe's attempt to mirror language already included in filings by rival exchange Nasdaq, which would list the spot bitcoin ETFs for BlackRock and Valkyrie, if approved.
/jlne.ws/3rq0Xbp
| | | | | | Strategy | | | S&P 500 is most likely going to correct back to 4,100, Mizuho warns market bulls
Joy Wiltermuth - MarketWatch
It isn't a bullish sign for the stock market that the Federal Reserve is still chasing "an elusive soft landing" for the economy more than a year into its battle against high inflation, according to economists to Mizuho Securities.
The Fed already lifted its benchmark interest rate to a 5%-5.25% range in roughly the past year, bringing its benchmark rate to the highest level since 2007.
/jlne.ws/46LxfOk
Hedge funds slash bets on US stocks after tech-led rally and pivot to Europe
Costas Mourselas - Financial Times
Hedge funds have slashed their bets on a rising US stock market to the lowest level in at least a decade and pivoted to Europe over concern about the resilience of the US tech-led rally.
Prime brokerage data from Goldman Sachs shows that hedge funds have the lowest weighting to the US stock market since the records began in 2013 while raising their bets on European stocks to the highest-ever level.
/jlne.ws/3riXOKd
10-Year Yield Rising
Cboe (Video)
In #Vol411, Tim Biggam @Delta_Desk checks in on the $VIX Index, VIX #options activity, upcoming inflation data and #earnings. $SPX
/jlne.ws/3PODpXF
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