| July 08, 2021 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
|
| | | | Observations & Insight | | | Dear Mr. President,
Almost 100 years ago President Calvin Coolidge said, "The business of (the United States of) America is business." The first business from before our nation's founding that drove its development and rapid expansion was the cotton business. Cotton was the commodity that created international trade from the eighth century onward. To understand the cotton business and many origins of issues we still struggle with today, including race relations, I recommend you read the book "Empire of Cotton" by Sven Beckert.
According to Beckert, "In 1820, the U.S. exported 167.5 million pounds of cotton, which was 32% of all U.S. exports. By 1850, 67% of U.S. cotton was grown on land that had not been part of the U.S. a half a century earlier."
Because of the importance of cotton to our nation's beginnings and all the other commodities it residually drove the production of, the U.S. commodity and related derivatives markets are among the most important in the world. I am writing to you today to urge you to appoint a permanent chairperson of the Commodity Futures Trading Commission.
For the rest of this letter to President Biden, CLICK HERE.
| | | | | | Lead Stories | | | 'A Narrative of Fear': Plunging Stocks Finally Heed Bond Signal
Lu Wang and Claire Ballentine - Bloomberg
Growth is slowing while stock valuations expand and breadth narrows. Throw in a surprising drop in Treasury yields and the result is volatility.
The S&P 500 Index fell as much as 1.6% on Thursday, the most since May, as all major industries slipped. Commodity and financial shares led the retreat, the latest sign that the once-hot reflation trade is sputtering, with the delta variant of coronavirus quickly spreading and talk about monetary stimulus heating up in China.
/bloom.bg/3ws5tmk
Hedging for a Treasury Rally Costs More Than Selloff Protection
Edward Bolingbroke - Bloomberg
For the first time in nearly a year, insurance against a drop in U.S. Treasury yields -- obtained in the options market -- costs more than protection from higher yields.
It's a function of the relative price of put and call options on 10-year note futures. Puts, used to hedge for higher yields, have cheapened versus calls as the Treasury market has rallied this week. As a result, a gauge based on a widely-traded segment of the market -- the implied volatility of the futures represented by the 1-month 25-delta call/put skew -- has returned to positive this week.
/bloom.bg/2UzIHMl
Stock market technicals point to 'near-term turmoil' but not the start of a bear market, says CFRA
Carla Mozée - Markets Insider
The US stock market has been steadily hitting record highs this year but some technical indicators suggest it's set to run into a more challenging and volatile period with fewer stocks sustaining an upward pace, according to research firm CFRA.
Equities early Thursday were under pressure on a mix of concerns including worries about global economic growth with many countries battling the spread of the Delta variant of coronavirus. Meanwhile, rapid recovery in the US economy has prompted investors to question whether the Federal Reserve will withdraw monetary support sooner than anticipated. The Cboe Volatility Index, the stock market's so-called fear gauge, jumped 18% during the session.
/bit.ly/3hpxgj2
Pelosi's Husband Locked In $5.3 Million From Alphabet Options
Billy House and Anna Edgerton - Bloomberg
Speaker Nancy Pelosi's husband, Paul Pelosi, won big on Alphabet Inc. stock and added bets on Amazon.com Inc. and Apple Inc. in the weeks leading up to the House Judiciary Committee's vote on antitrust legislation that seeks to severely limit how these companies organize and offer their products.
In a financial disclosure signed by Nancy Pelosi July 2, her husband reported exercising call options to acquire 4,000 shares of Alphabet, the parent company of Google, at a strike price of $1,200. The trade netted him a $4.8 million gain, and it's risen to $5.3 million since then as the shares have jumped.
/bloom.bg/3xyfvnC
A Lot of ETF Trades Got in Front of the Big Drop in Stocks
Sam Potter - Bloomberg
Thursday's stock swoon will have come as no surprise to players in the $6.6 trillion U.S. exchange-traded fund market, judging by their actions in the past few days.
Months of unbroken bullishness that saw record flows to cyclically-exposed funds is giving way to caution, with bearish bets picking up in the options market and cash diverting to safer assets.
With a red day unfolding on Wall Street, it all looks prescient.
/bloom.bg/3xu8eoy
Meme Stock Index Down Nearly 20%, (GME, AMC, CLOV) Close to Bear Market
Bailey Lipschultz - Bloomberg
It may be time to break out the "Crying Jordan" meme.
A basket of retail traders' favorite stocks is tumbling close to a bear-market plunge of 20% as investors shun the most speculative equities for safer bets.
/bloom.bg/3hqBW8r
Newegg Stock Is the New Meme. Shares Soared 148% on Wednesday.
Eric J. Savitz - Barron's
In a new and dramatic example of the Reddit-driven meme stock phenomenon, shares of online electronics retailer Newegg Commerce soared 148% on Wednesday, extending the company's remarkable six-day run to 560%. The move has ballooned Newegg's market capitalization to nearly $25 billion.
Trading volume on Wednesday reached 75.5 million shares, about 75 times the average turnover in the stock. The volatility triggered trading halts in the stock six times in Wednesday's session, Nasdaq data shows.
/bit.ly/3wmaVY0
A Lot of ETF Trades Got in Front of the Big Drop in Stocks
Sam Potter - Bloomberg
Thursday's stock swoon will have come as no surprise to players in the $6.6 trillion U.S. exchange-traded fund market, judging by their actions in the past few days.
Months of unbroken bullishness that saw record flows to cyclically-exposed funds is giving way to caution, with bearish bets picking up in the options market and cash diverting to safer assets.
/bloom.bg/3hqFhEv
Concern over stock-market volatility among investors has dropped to its lowest in 2 years, Allianz Life says
Carla Mozée - Markets Insider
A little more than a third of US stock market investors have expressed worry about the impact of market volatility on their retirement portfolios, according to insurer Allianz Life, the lowest since 2019 as investors largely see the end of the coronavirus health crisis.
33% of respondents say they are worried about risks stemming from market volatility, according to the second quarter Market Perceptions Study released by Allianz Life Insurance Co. of North America on Wednesday.
That is the lowest percentage since 2019 and a drop from 42% in the same period in 2020 when the COVID-19 outbreak was ramping up.
/bit.ly/2VoMD2P
| | | | | | Exchanges | | | Swiss stocks propel London back to top spot following Brexit decline; According to Cboe's head of European equities, Natan Tiefenbrun, the reintroduction of Swiss securities into London's stock universe has been its saving grace.
Annabel Smith - The Trade
The UK's capital has regained its status as the leading financial hub in Europe over Amsterdam in June after falling behind following the Brexit deadline on 31 December.
/bit.ly/2Vkdv42
Eurex ESG derivatives OI over 3.5 billion EUR
Eurex
Strong volume growth with five NEW records in our ESG derivatives:
1. Daily traded contracts over 168K
2. Monthly traded contracts over 390K
3. Quarterly traded contracts 720K
4. Yearly traded contracts June 2021 exceeds already 2020 of 1.28 million
5. Month end Capital Volume Open Interest at 3.5 billion EUR
/bit.ly/3jXeSjt
Experiences shape the future - Equity Product Roadmap 2021
Eurex
Part II - Q&A with Megan Morgan, Global Head of Equity and Index Sales at Eurex
As the world transitions from the 'new normal' to something resembling the 'old normal,' we sat down with Megan Morgan, the Global Head of Equity and Index Sales at Eurex, to get her views on the derivatives landscape that lies ahead of us.
/bit.ly/3qSUSjm
Euronext announces volumes for June 2021
Euronext
Amsterdam, Brussels, Dublin, Lisbon, Milan, Oslo and Paris - 7 July 2021 - Euronext, the leading pan-European market infrastructure, today announced trading volumes for June 2021.
From this release onwards, cash trading volumes exclude fixed income trading volumes. Comparative data for the past periods have been restated accordingly.
/bit.ly/3hsF189
| | | | | | Regulation & Enforcement | | | President Biden Signs Bill to Fund CFTC Whistleblower Program; The measure would temporarily set up a new account at the Treasury Department to pay for the operations of the Commodity Futures Trading Commission's whistleblower program
Mengqi Sun - WSJ
President Biden has signed into law legislation that would temporarily set up a new account to pay for the operations of the Commodity Futures Trading Commission's whistleblower program, paving the way for the U.S. derivatives markets regulator to resolve a funding crisis over a large potential payout.
/jlne.ws/2VkL9GR
| | | | | | Moves | | | Kaitlin Meyer has joined Cboe Global Markets as director, North America derivatives coverage. She was previously with the CME Group. -- LinkedIn
| | | | | | Strategy | | | China Stocks Have Become Too Risky. How to Play It Safe.
Steven M. Sears - Barron's
One of the most useful insights into successful investing is to be greedy when others are fearful and fearful when others are greedy. Xi Jinping seems determined to disprove the axiom.
China's leader has targeted many leading technology companies in what appears to be, at a minimum, an effort to control data on Chinese citizens at home and perhaps also abroad. The moves are also rough reminders to China's increasingly high-profile technocrats that Xi is more powerful than anyone.
/bit.ly/2TO9ioN
Opinion: The diverging indicators could spell trouble for the stock market
Lawrence G. McMillan - MarketWatch
The S&P 500 index has registered new all-time intraday highs on the last nine trading days and registered new closing highs on eight of those days. That is a remarkable streak, and it has nearly been matched by the Nasdaq Composite and the NASDAQ-100 indexes. The Dow Jones Industrial Average has not quite reached new highs, though, and the Russell 2000 has lagged well behind.
These indexes show the strength has mostly been in a small number of high-flying Nasdaq stocks, many of which are also in the S&P. The "average" stock is faring worse, and this is evident most prominently in the breadth of the market (advancing issues minus declining issues).
/on.mktw.net/2UzJk8F
| | | | | | Education | | | Is Skew Cheap Or Expensive?
Matt Amberson, ORATS - Nasdaq
Skew in options is the slope of the implied volatility of the strikes in an expiration month. Skew is constantly changing and can affect the value of options and spreads. Risk reversals and wide vertical spreads are among the most affected by changes in skew.
So, how do you know if skew is cheap or expensive?
/bit.ly/3ADuluZ
| | | | | | Events | | | U.S. Tax Considerations for Listed Options Registration
onlinexperiences.com
You're invited to a live 70 minute webinar hosted by the Cboe Options Institute to explore U.S. Tax considerations for Listed Options, including a discussion of the outlook for possible legislative and regulatory initiatives that may impact the taxation of options moving forward. Join Matthew Stevens, David Kirk, Joe DeSipio, Roy Haya, and Matt Moran.
Continuing education (CE) credit available - This webcast is accepted for one hour of CFP , CIPM , RMA , CIMC , CIMA , or CPWA CE Credit for webcast attendees. CFA Institute members may self-document their continuing professional development activities in their online CE tracker.
Air Date: Wednesday, July 14, 2021
Start Time: 12:00 pm ET
Duration: 70 minute Webinar and 15 minute Q&A
/bit.ly/3dmg1vm
"Ask Me Anything" Leadership Panel
Women In Listed Derivatives (WILD)
Please join us for a panel discussion with financial services industry leaders on July 28th from 12:00 PM - 1:00 PM Central Time.
Moderated by Elizabeth Cook, the panelists will take us through their career trajectories and share their thoughts on the marketplace shifts that they are paying attention to today.
Please click the registration link below to sign up. The event is free for WILD members; $15.00 for non-WILD Members.
/bit.ly/3hNiC4m
| | | | | | | | | JLN Options is sponsored by: | | | | | | | | | | | | | | | | | | |
|
|
| | | |
| | | | John Lothian News (JLN) is the news division of John J. Lothian & Company, Inc. (JJLCO). The online media and financial services firm is staffed by derivatives industry, journalism and technology professionals. | | | | | | | John Lothian News Editorial Staff: | | | John Lothian
Publisher | | | Sarah Rudolph
Editor-in-Chief
| | | Jeff Bergstrom
Editor
| | | | |
|
|
Disclaimer: All John Lothian Newsletters, JohnLothianNews.com, MarketsWiki.com and MarketsReformWiki.com are products of John Lothian News, a division of John J. Lothian & Company, Inc. The opinions expressed in all John J. Lothian & Company, Inc. publications are strictly those of their respective editors. They are intended solely for informative purposes and are not to be construed, under any circumstances, by implication or otherwise, as an offer to sell or a solicitation to buy or trade in any commodities or securities herein named. Information is obtained from sources believed to be reliable, but is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted. Security futures are not suitable for all customers. Futures and options trading involve risk. Past results are no indication of future performance. Nothing on any John J. Lothian & Company site should be considered an endorsement by any sponsor of any website or newsletter content.
© 2019 John J. Lothian & Company, Inc. All Rights Reserved. |
|
|
