| May 10, 2023 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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| | | | Observations & Insight | | | FIA President and CEO Walt Lukken offered congratulations to Cboe Global Markets on its 50th anniversary in a YouTube message posted to the FIA YouTube account.
| | | | | | Lead Stories | | | Options investors guard against US stock tumble, despite buoyant markets
Saqib Iqbal Ahmed - Reuters
Options market demand for insurance against a stock market crash has soared to multi-month highs, even as equities have calmed down after a choppy start to the year.
U.S. stock market volatility has subsided as the S&P 500 (.SPX) has logged a 7% year-to-date gain. However, an undercurrent of worries, ranging from a looming showdown over raising the U.S. debt ceiling to Federal Reserve policy, still swirls, pushing some investors to take positions that would pay out if stocks slump.
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Option Traders Doubt Fed Cuts as Hedge Funds Boost Futures Short
Edward Bolingbroke - Bloomberg
Traders of interest-rate options are harboring the same doubts as Wall Street strategists when it comes to bets that the Federal Reserve will pivot to interest-rate cuts within months.
In the past week, multiple positions have emerged in options linked to the Secured Overnight Lending Rate that target additional tightening being priced into the next couple of Fed policy meetings, scheduled for June and July.
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Cboe Sees Fundamental Change in Options Trading
Shanny Basar - Traders Magazine
Edward Tilly, chairman and chief executive of Cboe Global Markets said there has been a fundamental evolution in options trading as many market participants now open and trade positions on the same day that options expire.
Tilly said on the first quarter results call on 5 May that Cboe continued to make progress delivering on its top strategic growth priorities - derivatives, data and access solutions, and Cboe Digital.
/jlne.ws/42oqJug
Is Short Selling Legal? Ban Talk Has Experts Defending Investment Tactic
Carmen Reinicke - Bloomberg
For all the latest calls to prohibit short selling amid the banking turmoil, there's an argument to be made that such a ban would actually hurt investors.
Short sellers may have reaped billions of dollars this year by betting against banks, but some market pundits say they're also helping to shed light on overvalued companies in the sector. And a ban on the tactic, similar to one imposed by the Securities and Exchange Commission during the Global Financial Crisis, seems unnecessary as other regulatory measures could be explored.
/jlne.ws/42OjUlz
The Impact of the Regional Bank Crisis Isn't Over, Finance Pros Say
Steve Garmhausen - Barron's
It seemed like the 2023 regional bank crisis was over back in March, after bank regulators stepped in to protect depositors at several doomed institutions. Soon, however, First Republic Bank had to be bailed out by a consortium of other banks. After a brief period of stability, its stock plunged anew, leading to its seizure by the Federal Deposit Insurance Corp. and sale to JPMorgan Chase on May 1.
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5 Questions Investors Are Asking As the S&P 500 Wavers
Carla Mozée - Markets Insider
With large-cap US stocks essentially meandering and the Federal Reserve seemingly at a policy crossroads, what's next for the $40 trillion equity market?
Barclays in a note Tuesday addressed five questions clients are asking at a time the S&P 500 continues to move rangebound as it has been since the middle of the first quarter.
/jlne.ws/42LmwRa
Why Wednesday's U.S. inflation report could ignite stock-market volatility as investors boost bets on Fed's rate cuts
Isabel Wang - MarketWatch
Stock market investors will be closely watching Wednesday's U.S. April inflation report as a significant deviation from forecasts may cause losses for those expecting the Federal Reserve to keep interest rates unchanged at its next meeting and potentially cut rates later this year as its year-long monetary tightening cycle ends.
/jlne.ws/452btFd
| | | | | | Exchanges | | | Cboe files with U.S. SEC for third time to list ARK 21Shares Bitcoin ETF
Reuters
Cboe Global Markets on Tuesday filed a proposal with the U.S. Securities and Exchange Commission to list and trade shares of a spot bitcoin ETF by stock-picker Cathie Wood's Ark Invest and crypto investment product firm 21 on the Cboe BZX exchange.
/jlne.ws/44MYXJn
| | | | | | Regulation & Enforcement | | | U.S. prosecutors look at short selling in bank shares - source
Chris Prentice - Reuters
Federal prosecutors in Washington are looking into short seller activity around the recent volatility in U.S. bank shares sparked by the failure of three regional lenders since March, a source familiar with the matter said.
/jlne.ws/3VTdEXt
| | | | | | Technology | | | Yuanta selects Eventus for trade surveillance
Eventus
Eventus, a leading global provider of multi-asset class trade surveillance, market risk, transaction monitoring and algorithmic monitoring solutions, has been selected to provide trade surveillance for Yuanta Futures in Taiwan, representing the firm's first Taiwanese client. Yuanta Futures is a subsidiary of Yuanta Financial Holdings and ranks number one in Taiwan for its futures and options market share, profitability and capital.
/jlne.ws/3NVN5yI
| | | | | | Moves | | | William Collins is starting a new position as director, corporate listings, U.S. at Cboe Global Markets.
| | | | | | Strategy | | | Don't Worry, Be Greedy. How to Play the Debt-Ceiling Crisis.
Steven M. Sears - Barron's
Hakuna matata. If we created a musical score for the markets, the famous song from The Lion King would be hard to beat.
Everyone knows that the global financial markets will implode if Congress fails to let the U.S. government borrow even more money, but investors seem to have faith in Congress and President Joe Biden.
/jlne.ws/3nNkpNG
Equity Options and Debt-Ceiling Risk Premia: Macro Man Podcast
Bloomberg (Audio)
Bloomberg's Cameron Crise discusses relative debt-ceiling risk premium pricing in the Treasury bill and S&P 500 options markets.
/jlne.ws/3nSQZxS
| | | | | | Miscellaneous | | | Market Mover: Desperation Is the New Fear, and It's Smart to Be Afraid
John Authers - Bloomberg
Fear matters in markets. Indeed, it's traditional to see prices as determined by the balance between fear and greed. Between them, the two instincts will prompt investors to back exciting growth opportunities but avoid foolish risks. One of the many ways to explain the weird markets of the last few years is by making one substitution. People are still greedy, because they're human, but what's really driving investment decisions is not so much greed as desperation. And despair can overcome fears.
/jlne.ws/3HVvfIr
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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
Publisher | | | Sarah Rudolph
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| | | Jeff Bergstrom
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