| March 15, 2022 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Lead Stories | | | MEMX to Launch Options Exchange
Josh Beckerman - MarketWatch
Members Exchange, which said last May that it had become the sixth-largest U.S. equity exchange, will launch an options exchange, targeting a fourth-quarter debut pending Securities and Exchange Commission approval.
MEMX was founded in 2019. Its investors include Goldman Sachs Group Inc., Morgan Stanley, Citigroup, Citadel Securities, Virtu Financial Inc., Charles Schwab Corp. and BlackRock Inc.
/jlne.ws/3wpZMJB
**** JB: Also see Reuters' story, Wall Street-backed MEMX to launch options exchange.
Investors see risks spiking, fear market-wide liquidity crunch
Davide Barbuscia - Reuters
Wild swings in asset prices following Russia's invasion of Ukraine are prompting some investors to pare risk in their portfolios, fearing that the type of volatility seen in commodities in recent weeks could hit other markets.
At issue is liquidity - or the ease at which investors can buy or sell an asset without affecting its price. While episodes of low liquidity have contributed to sharp gyrations across markets over the last decade, signs of stress have become more plentiful in the last few weeks, exacerbated by everything from sanctions against Russia to expected central bank tightening.
/jlne.ws/3wdRoMX
SEC Tells Brokers to Be 'Vigilant' as Volatility Grips Markets
Benjamin Bain - Bloomberg
The U.S. Securities and Exchange Commission is warning brokerages to be vigilant in watching out for trading risks amid increased volatility in global markets.
The SEC's trading and markets unit said in a statement on Monday that firms should have "strong" risk management practices in place and that concentrated positions of prime brokerage counterparties "pose particular concerns."
/jlne.ws/3tZGGa9
List of Bear Markets Grows as Global Stocks Erase $12 Trillion
Thyagaraju Adinarayan - Bloomberg
As risks pile up for global equity markets -- from soaring inflation and central bank policy tightening to the economic fallout from Russia's invasion of Ukraine -- the list of indexes that have fallen into bear market territory is growing.
The technology-heavy Nasdaq 100 Index was the latest major gauge to enter a bear market on Monday. It joins a host of other major stock indexes around the world, from China's CSI 300 to Germany's DAX, that have dropped 20% or more from recent highs at some point this year. In total, the equity selloff has erased almost $12 trillion in value from global stocks -- measured using the MSCI All-Country World Index -- in 2022.
/jlne.ws/3q74PKX
LME to Reopen Nickel Trading With a Price Cap After Epic Short Squeeze
Hamza Fareed Malik - Business Insider
The London Metal Exchange has said it will resume nickel trading on Wednesday, having called a halt last week after the metal's price surged to $100,000 a ton in an massive short squeeze.
It is also bringing in new rules setting daily upper and lower price limits for contracts for nickel and other base metals, it said in a notice Tuesday.
/jlne.ws/36nzxrV
Barclays suspends sales of two products linked to oil, volatility
Iain Withers and Saqib Iqbal Ahmed - Reuters
British bank Barclays (BARC.L) said on Monday it had suspended the sales and issuance of two exchange-traded notes (ETNs) with combined assets of about $1 billion - one linked to crude oil and another to a gauge of market volatility - due to capacity constraints, in a move that some investors said could spur big price swings in the products.
/jlne.ws/3KGBuyC
The 10% That Changes Everything
Edward Harrison - Bloomberg
We're one shocking event away from the unthinkable: double-digit inflation.
Even with prices rising at the fastest pace in decades, inflation hitting the 10% mark would seem a far-fetched prospect, only dreamed up by doomsayers, as recently as a month ago. And yet, here we are, just a couple of percentage points away from a significant threshold and with oil prices teetering around $100 dollars a barrel. I was having a chat with my colleague Michael Mackenzie the other day. And he throws out "you know, Ed, inflation at 10% would be a game-changer." And that stopped me in my tracks because I immediately realized he was right; TWO digits changes entirely how people think and behave around inflation.
/jlne.ws/3i8dAzJ
Oil tumbles below $100 on China lockdowns, as OPEC leaves demand forecast 'under assessment'
Myra P. Saefong and Barbara Kollmeyer - MarketWatch
Oil prices tumbled below $100 a barrel on Tuesday, setting prices up to settle at their lowest levels since the initial days of the Russian invasion of Ukraine nearly three weeks ago, as investors reassessed the huge run-up in prices seen in recent weeks.
/jlne.ws/3CHSmlW
Investors Haven't Faced a Market Like This in Decades. Here's How They're Coping.
Alicia McElhaney - Institutional Investor
Investors have few places to hide in an increasingly volatile and risky market, experts say.
Volatility has effectively doubled since the beginning of January, with the Chicago Board Options Exchange's CBOE Volatility Index hitting 32.78 by midday Monday. The last time the index reached these heights was ahead of the 2020 election, in October of that year.
/jlne.ws/3tdrIhx
| | | | | | Exchanges | | | FIA releases progress report on derivatives industry standards initiative
FIA
FIA today released a progress report on the industry standards initiative that it launched last year. The progress report describes three important near-term objectives for this initiative, which is being spearheaded by a taskforce of representatives from leading brokers, asset managers and clearinghouses.
First, FIA is preparing to establish an independent body to be called the Derivatives Market Institute for Standards or DMIST. This body will focus on developing standards around behaviors, workflows and processes for exchange-traded and cleared derivatives. These standards will be developed through a public consultation process and will be technology- and vendor-agnostic. FIA expects that the specific details on membership, governance and function will be finalized in the near term and intends to launch DMIST in the second quarter.
/jlne.ws/3tYpUIn
Eurex Exchange Readiness Newsflash | Introduction of Daily Futures on KOSPI 200 Weekly Options - prerequisites for trading and simulation
EUREX
With this Newsflash, Eurex would like to provide more detailed information regarding the requirements for trading of the new Daily Futures on KOSPI 200 Weekly Options (OKW1, OKW3, OKW4, OKW5) to be introduced on the Eurex/KRX Link, as announced in Eurex circular 006/22 and in Eurex Clearing circular 001/22. The effective launch date for these new products is 28 March 2022.
/bit.ly/3KMLSoN
| | | | | | Strategy | | | The 8 worst-performing S&P 500 stocks with the highest ratings are expected to rebound by more than 50% over the next year
Philip van Doorn - MarketWatch
Investors don't need to be told that stocks have been volatile. There's a market of extremes as Russia's war in Ukraine continues and investors wait to see what the Federal Open Market Committee does with interest-rate policy March 16.
Below is a list of eight stocks in the S&P 500 that have dropped at least 50% from their 52-week highs, but are favored by analysts for gains of as much as 102% over the next 12 months.
/jlne.ws/3Ich3If
VIX (VX) Consolidating Just Above Key 30 Level Ahead Of FOMC
Darren Chu - Barchart
The VIX (VIJ22) is consolidating in today's Asia morning yesterday's surge from the psychologically key 30 whole figure level. Significantly, although the VX appears likely to retest its 2022 high (from last week) before month end, any headline around a Ukraine-Russia ceasefire or the FOMC and US Fed rate announcement Wednesday could first send the VX sliding back briefly to the 50% Fib retrace of the January-March rally.
/jlne.ws/3CS4Ozx
| | | | | | Miscellaneous | | | Ken Griffin's Citadel Securities Posts Record $7 Billion Windfall in 2021
Katherine Doherty - Bloomberg
Citadel Securities LP was thrust into the spotlight in 2021, with day traders, lawmakers and regulators all scrutinizing the firm at the center of one of the U.S. stock market's wildest periods. They're about to learn that amid the uproar, the financial giant had its best year ever.
Billionaire Ken Griffin's stock-trading powerhouse posted record revenue of $7 billion, as frenzied bouts of volatility helped drive up earnings. The figure, disclosed by people familiar with the matter who declined to be named discussing private information, topped the firm's previous record of $6.7 billion in 2020, when the pandemic upended global markets.
/jlne.ws/3MPWBR5
China's Wealthiest Lose $52 Billion in a Day on Stocks Plunge
Venus Feng - Bloomberg
China's stock rout cost the nation's richest tycoons more than $53 billion on Monday.
Zhong Shanshan, known as China's king of bottled water, led the plunge as his fortune fell by $5 billion, while Tencent Holding Ltd.'s Pony Ma dropped $3.3 billion, according to the Bloomberg Billionaires Index.
/jlne.ws/3i7LCEo
Retail traders have been more aggressive buyers of the recent dip in the stock market than in any other correction since the 2008 crisis, Bank of America says
Phil Rosen - Business Insider
As hedge funds reduce their exposure to stocks amid intense volatility, retail traders have been buying the dip more aggressively than in any other correction since 2008, according to Bank of America.
Last week, while the S&P 500 was down almost 3%, BofA said in a Tuesday note that its clients were net buyers of US stocks, adding that they have been net buyers in seven of the last 10 weeks.
/jlne.ws/3COgUcT
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