| April 17, 2023 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | |
Josh Sterling of Jones Day talks with John Lothian News about NFTs, DeFi, and the role banks play related to climate change
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Josh Sterling, a partner with Jones Day specializing in commodities and derivatives law, spoke with John Lothian News about his work helping trading platforms address strategic enforcement, regulatory, and transactional matters.
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| | | | | | Lead Stories | | | One-Day Call Options Trading Jumps
Gunjan Banerji - WSJ
Traders have been piling into one-day options during the recent stock-market rally.
Around 43% of all options volume has been recently driven by one-day options, according to Citigroup data. And more than half of call options traded have expired by the end of a single trading session, up from roughly 48% around a month ago, the firm said in a note to clients on Sunday.
/jlne.ws/3UFNeYx
Goldman Sachs Simplifies Options Trading With New Visualization Tool
Bianca Chan - Business Insider
Goldman Sachs is expanding on a tool aimed at simplifying the complex world of derivatives trading for its institutional clients.
The tool, called Visual Structuring, aims to change the way traders analyze potential options trades, whether it's determining if the timing or pricing of a certain trade is right based on what's happening in the markets, or how they communicate and work together.
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Is the Worst of the Recent Market Volatility Behind Us?
Gunjan Banerji - WSJ
Traders are betting the worst is over for marketsâfor now, at least.
Measures of volatility across a range of asset classes have dropped sharply, a sign that some investors are positioning for the recent calm in markets to persist.
The Cboe Volatility Index, or VIX, fell on Friday to its lowest level in more than a year. Measures of currency volatility and expected turbulence in bank stocks have also tumbled, according to Tallbacken Capital Advisors.
/jlne.ws/3GM12Ll
Big Bank Earnings Won't Reveal If the Turmoil Is Over. Here's What Will.
Callum Keown - Barron's
After several of the big banks beat earnings expectations Friday there's an air of calm and stability around the markets, which seem to believe the turmoil of last month is a thing of the past.
The CBOE Volatility Index (VIX), the so-called fear gauge, closed last week at its lowest level since early January 2022. The MOVE Index, which tracks Treasury market volatility, has also fallen below where it was before Silicon Valley Bank collapsed last month, Deutsche Bank analysts noted.
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Merciless Market Kills Off ETFs at Double the Rate of Last Year
Vildana Hajric and Katherine Greifeld - Bloomberg
The pace of failures has more than doubled in the $7 trillion exchange-traded fund industry so far this year, as volatile markets and fierce competition put pressure on issuers.
Year to date, 62 exchange-traded funds have been liquidated or delisted, according to data compiled by Bloomberg. That's more than double the number seen in that same span last year, when just 26 had closed by mid-April. And even more funds are on the chopping block. Last year's blistering number of fund launches, made the industry ripe for consolidation.
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Column: Funds' CBOT wheat short hits five-year high despite grain deal doubts
Karen Braun - Reuters
Concerns over the health of the Black Sea grain deal have recently resurfaced, but speculators last week continued selling Chicago-traded wheat, establishing their most bearish stance since January 2018.
Meanwhile, the U.S. winter wheat crop is in rough shape due to drought in the Southern Plains, pushing Kansas City wheat futures to record levels versus Chicago, and that spread has remained particularly elevated for three weeks now.
/jlne.ws/3onjxPD
Oil prices stall as short-covering rally is completed
John Kemp - Reuters
Investors finished covering their short positions in petroleum last week, after Saudi Arabia and its allies in OPEC? surprised traders by announcing an unexpected cut in their output target at the start of April.
Hedge funds and other money managers purchased the equivalent of 36 million barrels in the six most important petroleum futures and options contracts over the seven days ending on April 11.
/jlne.ws/40fSTFR
| | | | | | Exchanges | | | CME Group to Expand Bitcoin and Ether Options Expiries on May 22
CME Group
CME Group, the world's leading derivatives marketplace, today announced plans to expand its suite of cryptocurrency options across its standard- and micro-sized Bitcoin and Ether contracts beginning on May 22, pending regulatory review. With these new contracts, expiries will be available every day of the business week, Monday through Friday.
/jlne.ws/3UFyDw6
Cboe FX Relaunches FX Point
Colin Lambert - The Full FX
Cboe FX has relaunched its bilateral trading service FX Point, initially working with Wells Fargo - the service was first released in 2019 and the renewed service has been live since April 1 The relaunch comes as recent Bank for International Settlements' analysis indicates the strong growth in bilateral, disclosed trading and sees Cboe commit to expanding its franchise beyond its largely anonymous trading franchise.
/jlne.ws/43vEKai
Moscow Exchange launches trading in futures and options on HSCI shares
MOEX
On April 18, 2023, trading in deliverable futures and settlement premium options for ordinary shares of PJSC HSCI (Human Stem Cell Institute) will begin on the derivatives market of the Moscow Exchange. Futures and stock options will expand the investment strategies of private and institutional investors, as well as provide additional opportunities for hedging securities portfolios.
/jlne.ws/3KGhPAI
| | | | | | Regulation & Enforcement | | | Mission Possible
Cboe
EU Policymakers are gathering this week to begin finalising the MiFiR review, and a crucial decision they will need to make is the type of consolidated tape (CT) that will be mandated for the EU equites market. - www.cboe.com
This is a golden opportunity to deliver what the industry needs to support growth in EU capital markets. But the debate has been marked by claims and counter-claims about what flavour of CT is technically possible and would furnish retail and professional investors with reliable and useful data, thereby encouraging greater participation in EU equity markets.
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| | | | | | Strategy | | | 4 signs stocks are headed for a punishing selloff, as even strong performers look vulnerable
Joseph Adinolfi - MarketWatch
U.S. stocks just touched their highest levels in two months. Yet, signs of a looming selloff are piling up, according to Jonathan Krinsky, chief technical strategist at BTIG.
The S&P 500 and Russell 3000 are both trading just shy of their highs from mid-February, but market breadth hasn't recovered, as index gains over the past month have largely relied on megacap names like Microsoft Corp. and Apple Inc. helping to offset weakness in other areas of the market.
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| | | | | | Miscellaneous | | | 'Big Short' Michael Burry Followers Question 'Wrong to Say Sell' Tweet
Theron Mohamed - Markets Insider
Michael Burry tweeted a single, ominous word in late January: "Sell." Two months later, he congratulated investors who bought the dip in stocks at the end of last year, and declared, "I was wrong to say sell."
The jarring reversal by the investor of "The Big Short" fame has divided his close followers. Some have taken his about-turn at face value, and praised him for admitting he called the market wrong. The S&P 500 has advanced 8% this year, while the Nasdaq Composite has surged 17% on the back of high-flying technology stocks such as Tesla and Nvidia.
/jlne.ws/3KL6aAl
The stock market simply ignored a recession once before. Can it do it again?
William Watts - MarketWatch
Can stock-market investors just ignore a recession?
Bond market investors have priced in rate cuts by year end and have sent other signals they're bracing for recession. Stocks, meanwhile, seem to reflect a different outlook, rallying into first-quarter earnings season, with the S&P 500 hovering near the top end of its 2023 range after hitting a two-month high last week. Stocks were on track to end Monday's choppy session with small gains, as the S&P 500 rose 0.2% and the Dow Jones Industrial Average hung on to a gain just shy of 50 points, or 0.1%.
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