| November 30, 2023 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Lead Stories | | | Appetite for stocks drives VIX options as investors guard portfolios
Laura Matthews - Reuters
Renewed appetite for stocks is helping to drive investors' interest in volatility-linked options that could buffer their portfolios against stock swings, putting those contracts on track for record trading volume this year.
The S&P 500 is up 18% so far this year, compared to last year's 19% decline - a rally turbocharged in recent weeks by expectations the U.S. Federal Reserve is done raising interest rates.
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JPMorgan's S&P 500 Outlook for 2024 Is Grimmest on Wall Street; Firm calls for 8% drop in index but predicts earnings growth; Waning consumer trends, geopolitical risks to weigh on stocks
Alexandra Semenova - Bloomberg
As a rush of Wall Street strategists call for all-time highs in US stocks in the year ahead, JPMorgan Chase & Co. stands apart, releasing the gloomiest forecast so far among its peers. The S&P 500 Index is set to drop to 4,200 by the end of 2024 - roughly 8% from its current level - as global growth decelerates, household savings shrink and geopolitical risks remain high with national elections including those in the US that could add to policy volatility, according to Dubravko Lakos-Bujas, the bank's chief global equity strategist. The call reiterates the bank's outlook heading into this year that has fallen short, with US stocks headed toward a double-digit annual gain amid economic resilience.
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Traders Bet on Earlier and Deeper ECB Cuts as Inflation Slows
Aline Oyamada and James Hirai - Bloomberg
Traders are betting on an earlier start to European Central Bank interest-rate cuts next year and a deeper easing cycle, after a string of surprisingly low inflation readings in the region's main economies.
A quarter-point decrease to the ECB's deposit rate is now fully priced by April and an almost 50% chance is assigned for a cut as early as March, according to swaps tied to the central bank's meeting dates. Just over a month ago, the expectation was for a first reduction in June.
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Stocks Had a Huge November. Here's What Might Lie Ahead.
Teresa Rivas - Barron's
With November drawing to a close, the stock market will say goodbye to the best month of a good year. That understandably leaves investors to wonder whether there's is enough juice (or milk and cookies) left for a Santa rally. There's good news for those who want to believe.
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Hedge Fund to Back Traders Who Risk Their Own Money If Bets Fail
Nishant Kumar - Bloomberg
When hedge fund traders make money, they get a share of the kill. When they lose, it's all pushed to the clients.
Two former top executives at Steven Cohen and Crispin Odey's investment firms are trying to turn this traditional model on its head.
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| | | | | | Exchanges | | | Miami Exchange Preps Trading Floor in Wynwood During Options Boom; MIAX is building both a physical and electronic trading venue; Options volume has soared since the pandemic lockdowns
Katherine Doherty - Bloomberg
Miami International Holdings Inc. plans to operate a trading floor in its namesake city for the first time. The company, also known as MIAX, is building a 38,400-square-foot (3,500-square-meter) options trading pit and offices in Miami's Wynwood neighborhood, according to Chief Communications Officer Andy Nybo. Its new options exchange will be part electronic, set to open in the second quarter of 2024, and part a physical trading floor, which will go live later in the year. The combination gives MIAX the ability to offer trading in either an old-school open-outcry or modern, electronic format.
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Webull Completes Purchase of Flink in Mexico
Webull Corporation
Webull Corporation ("Webull"), the owner of the popular Webull trading platform that has been downloaded over 40 million times worldwide, today announced its acquisition of all of the outstanding shares of Miflink S.A.P.I. de C.V. ("Flink"). Flink is an investment platform based in Mexico City that allows Mexican customers the unique opportunity to invest in fractional shares of U.S. listed companies without commissions. As part of the transaction, Webull will also acquire Mexican brokerage Vifaru Casa de Bolsa, which Flink agreed to purchase in May 2022, subject to regulatory approval by Mexico's CNBV.
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****** "Webull's innovative and intuitive mobile trading app is a great opportunity for the BMV cash equities and MexDer listed derivatives exchanges to gain exposure to Webull's eight million global clients."~Gary Flagler - MexDer
Euronext expands clearing operations: a step towards a unified European financial landscape
Back
Euronext
Monday 27 November saw the Euronext cash markets in Amsterdam, Dublin, Lisbon and Paris start sending their clearing activity to Euronext Clearing, the new pan-European clearing house managed by Euronext. This significant milestone establishes Euronext Clearing as the default clearing house for its European cash markets. It contributes to the vision of a seamlessly connected European financial ecosystem.
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Students Across the Globe Awarded Top Honors During CME Group's University Trading Challenge
CME Group
CME Group, the world's leading derivatives marketplace, today announced the winners of its 20th annual University Trading Challenge, led by Universidad De Guadalajara in Mexico, the fourth consecutive time a team from Latin America and second consecutive time a team from Mexico earns top honors in the global competition.
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| | | | | | Regulation & Enforcement | | | SEC Says WeWork Options Plot Failed on Botched Press Release
Patrick Clark - Bloomberg
The US Securities and Exchange Commission accused a strip mall owner of a botched attempt to profit by manipulating the price of WeWork Inc. shares and using client funds to pay for his lavish lifestyle. The real estate investor, Jonathan Larmore, was behind an entity called Cole Capital that made an offer to buy WeWork stock at a large premium earlier this month, in the days before the coworking company filed Chapter 11 bankruptcy. The move briefly sent the shares soaring, according to the SEC complaint filed in Arizona.
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LME court win affirms the broad powers of exchanges; The court said it would not second-guess the LME's 'specialist decision-maker' role
Jeremy Chan - Financial News
The London Metal Exchange's win in its court battle with Elliott Management and Jane Street has made clear the broad power of exchanges in protecting the markets they oversee.The High Court in its decision on 29 November said the LME didn't act unlawfully when it cancelled trades and upheld margin requirements on 8 March 2022 after a short squeeze sent nickel prices surging to over $100,000 per ton.
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IRS Court Win Paves Way for Higher Taxes on Hedge-Fund Managers; Ruling could close off a tax-reduction technique popular among fund managers
Richard Rubin and Peter Rudegeair - The Wall Street Journal
The Internal Revenue Service scored a significant win over the hedge-fund and asset-management industries this week in a case that could bring higher taxes for many fund managers. The U.S. Tax Court's ruling could require managers to pay self-employment taxes of more than 3% on much of their income. If the opinion survives additional legal battles and is applied broadly, it would close off a popular technique that lets them exclude millions of dollars in income from self-employment taxes and related levies that others must pay.
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Citadel and Its Peers Are Piling Into the Same Trades. Regulators Are Taking Notice
Katherine Burton, Hema Parmar, Madeline Campbell and Nishant Kumar - Bloomberg
Even Ken Griffin is a little worried. Multimanager funds like Griffin's Citadel have come to dominate the hedge fund industry, riding a steady run of outperformance to oversee more than $1 trillion, including a healthy dose of leverage. But the explosive growth has led the industry giants to pile into many of the same trades.
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SEC Case Threatens Widespread Disruption; The commission may have gone too far in relying on in-house judges. But a radical Supreme Court ruling could cause chaos.
The Editorial Board - Bloomberg
On Wednesday, the Supreme Court will consider a case of potential overreach by the Securities and Exchange Commission that could have far-reaching consequences - both for the commission and for every other government agency. One of the questions before the court is whether the SEC violated hedge fund manager George Jarkesy's right to a jury trial by assigning his case to an in-house judge, who imposed financial penalties and barred him from the industry. The justices have previously ruled that there are limited situations, such as the protection of public rights, when a government agency can bypass a trial.
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| | | | | | Technology | | | Trading Technologies' TT platform captures Derivatives Trading System of the Year at 2023 FOW International Awards
Trading Technologies
For the second consecutive year, global markets technology platform provider Trading Technologies International, Inc. (TT) captured the award for Derivatives Trading System of the Year for its TT platform at the 2023 FOW International Awards. The awards were presented at a dinner ceremony last night, following the Trading London Conference. The recognition follows the platform's win of the same category at the FOW Asia Capital Markets Awards in September. The TT platform was also named Best Solution for Futures Trading at the TradingTech Insight USA Awards in June.
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| | | | | | Strategy | | | It's Eerily Calm Out There In the Stock Market
Gunjan Banerji - The Wall Street Journal
The Cboe Volatility Index, or VIX, is hovering around 12.7, on pace to close below 13 for a fifth consecutive trading day.
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Wall Street's 'fear gauge' may be sending a bullish signal
Julie Hyman and Stephanie Mikulich - Yahoo Finance
The CBOE Volatility Index (^VIX), also known as Wall Street's 'fear gauge,' is trading near its 2023 low. Yahoo Finance's Jared Blikre breaks down the charts to show why that could potentially be good be a good sign for stock investors.
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| | | | | | Events | | | Cboe Global Markets to Present at the Goldman Sachs 2023 U.S. Financial Services Conference Wednesday, December 6
Cboe press release
Cboe Global Markets, Inc. (Cboe: CBOE), the world's leading derivatives and securities exchange network, announced today that Fredric Tomczyk, Chief Executive Officer, David Howson, Executive Vice President and Global President, and Jill Griebenow, Executive Vice President, Chief Financial Officer and Chief Accounting Officer, will present at the Goldman Sachs 2023 U.S. Financial Services Conference in New York City on Wednesday, December 6 at 3:40 p.m. ET. The live webcast and replay of the presentation will be accessible at www.cboe.com in the Investor Relations section, under Events and Presentations. The archived webcast is expected to be available within an hour of the presentation.
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| | | | 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
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