| March 05, 2024 | | | | | Jeff Bergstrom
Editor
John Lothian News | |
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Term of the Week - Compensation for a Potential Obligation
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This week's Term of The Week is Compensation for a Potential Obligation.
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| | | | | | Lead Stories | | | Stocks with strongest demand for bullish options keep outperforming the S&P 500
Joseph Adinolfi - MarketWatch
Surging demand for options contracts has accompanied a rally for stocks this year as both professional and retail traders have piled into bullish bets on individual stocks at the fastest pace since the meme-stock craze, according to data from Cboe Global Markets.
To illustrate the relationship between heavy call buying and stock-market returns, a team of equity strategists at Citigroup found that a group of 50 companies with the heaviest demand for bullish options has outperformed the S&P 500 since the advent of the COVID-19 pandemic.
/jlne.ws/3T7Ex91
Short-sellers rake in nearly $1 billion targeting US regional bank ETF
Manya Saini and Niket Nishant - Reuters
Short sellers targeting a key regional U.S. bank exchange-traded fund have made $977 million on paper so far in 2024, data from analytics firm Ortex showed, as troubles at New York Community Bancorp rippled across the industry. The fallout from NYCB's exposure to the troubled commercial real estate (CRE) market has made many investors jittery about the health of the sector.
/jlne.ws/4c0UNRE
Gold price surges to record high; Hopes of US interest rate cuts and 'phenomenal' buying by Chinese investors help drive rally
Harry Dempsey and Mary McDougall - The Financial Times
The price of gold has surged to a record high, driven by growing expectations of US interest rate cuts, investors hunting for haven assets and months of prodigious buying by central banks and Chinese investors.
The yellow metal struck $2,141 per troy ounce on Tuesday, beating the previous record of $2,135 set in December, according to LSEG data, before soon paring gains to trade up 0.8 per cent at $2,131 on the day.
/jlne.ws/4bYLDoN
Market prophet Gary Shilling warns stocks could crash 30% â and says the odds are 'very much in favor of a recession'
Theron Mohamed - Markets Insider
A legendary market prophet has warned that overpriced stocks may come crashing down, and a recession might strike within months.
"Stocks are very, very expensive now" relative to both corporate earnings and rival assets like Treasury bonds, Gary Shilling recently told the Retirement Lifestyle Advocates radio show.
/jlne.ws/3wExwVA
Reddit's Meme Stock Forum Users Threaten to Bet Against Its IPO
Bailey Lipschultz - Bloomberg
Reddit Inc.'s stock-trading enthusiasts made it a household name by backing companies that Wall Street wouldn't. For Reddit's own initial public offering, a group of them are about to flip the script.
In the days after the social-media company filed for an IPO, thousands of members of the WallStreetBets forum â which boasts around 15 million users and helped popularize meme stocks like GameStop Corp. â voted to boost a forum post about shorting the company, a sharp reversal of their typically bullish ways. Their avowed reasons varied from the company's lack of profitability to competitive concerns, and mostly centered on spite.
/jlne.ws/3Tph9oA
Oil prices rise as funds scale back bearish positions
John Kemp - Reuters
Investors have become less bearish about the outlook for oil and gas prices as U.S. shale producers scale back drilling while Saudi Arabia and its OPEC+ allies extend their own output cuts for a further three months.
Hedge funds and other money managers purchased the equivalent of 10 million barrels in the six most important petroleum futures and options contracts over the seven days ending Feb. 27.
/jlne.ws/3V6GMfs
| | | | | | Exchanges | | | Modest improvement in farmer sentiment, yet financial concerns loom
CME Group
The latest Purdue University/CME Group Ag Economy Barometer reveals a modest increase in farmer sentiment compared to the previous month, though concerns remain regarding farm financial performance in the year ahead.
The February barometer reading reached 111, marking a 5-point rise from last month. The small uptick is attributed to producers expressing increased optimism about the future, with the Future Expectations Index climbing 7 points to 115. However, the Current Conditions Index remained unchanged. Despite their improved outlook for the future, farmers' financial performance expectations did not keep pace. February's Farm Financial Performance Index registered at 85, a slight dip from January and notably lower than its recent peak in December. The February survey was conducted from Feb. 12-16.
/jlne.ws/4c2KHjh
| | | | | | Strategy | | | Positioning
Cboe (Video)
So far today, the $VIX Index is back above the 14 level with calls outpacing puts -- Tim Biggam @Delta_Desk updates us on this and more in #Vol411.
/jlne.ws/49CiBK1
| | | | | | Miscellaneous | | | Two Years On, Ken Griffin's Plan for a Miami Headquarters Finally Begins to Take Shape; Citadel plans 'an iconic building' including a luxury hotel
Deborah Acosta - The Wall Street Journal
Billionaire Ken Griffin made a big splash when he said that his giant hedge-fund firm Citadel was moving its headquarters from Chicago to Miami. It was the most significant relocation of any financial firm to Miami. Now, nearly two years later, a waterfront site Griffin purchased for his planned $1 billion headquarters remains empty. Citadel employees still tap away on keyboards at temporary space in the financial district, and the firm has yet to replace the developer it parted ways with last spring.
/jlne.ws/3IpJtRE
****** He should build a citadel.~JJL
Hedge Fund Startups on the Rise With Giant Firms Under Scrutiny
Liza Tetley and Nishant Kumar - Bloomberg
At a Morgan Stanley conference in January at the Breakers luxury resort in Palm Beach, Joshua White was treated like a mini celebrity as his startup hedge fund piqued the interest of attendees. The founder of London-based Regents Gate Capital, who's striking out on his own after spending 15 years as portfolio manager at Balyasny Asset Management and Ken Griffin's Citadel, said he got more than twice the number of requests for meetings at the event than he had time to accommodate all.
/jlne.ws/3Iosor7
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