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☆ 'Go-to place to get liquidity': ETF efficiency amid the SVB collapse
▼ + stars: | 2023-03-15 | by ( Kevin Schmidt | ) www.cnbc.com time to read: +2 min

"People look at the ETF as a price discovery tool." And because most of an underlying stock within a bank ETF does not actually trade, investors are able to access liquidity without having to trade individual companies. "And we find that the ETF is the go-to place to get liquidity and to see what the market expects." The SPDR S&P Bank ETF (KBE) has fallen nearly 24% since the start of last week, although volumes in the fund were among the highest ever recorded in its 18-year history. Draper said that the larger liquidity story remains strong, and that ETFs are a big driver of that story.

☆ Investor Anxiety Hits a Fever Pitch After Silicon Valley Bank Collapse
▼ + stars: | 2023-03-14 | by ( Gunjan Banerji | Eric Wallerstein | ) www.wsj.com time to read: 1 min

Investors are scrambling to protect against the possibility of a protracted stock-market downturn. The collapse of three banks in the past week has exacerbated a bout of recent volatility that has quickly crested through stock, bond and derivatives markets. Many traders are reaching for bets that would pay out if the haywire stretch for U.S. markets continues.

☆ Analysis: SVB collapse unleashes Treasury volatility, whiplashing investors
▼ + stars: | 2023-03-14 | by ( Carolina Mandl | ) www.reuters.com time to read: +5 min

[1/2] Customers wait in line outside a branch of the Silicon Valley Bank in Wellesley, Massachusetts, U.S., March 13, 2023. REUTERS/Brian SnyderNEW YORK, March 14 (Reuters) - Extreme volatility is rattling U.S. Treasury markets in the wake of Silicon Valley Bank's (SIVB.O) collapse and investors fear a prolonged bout of gyrations before calm returns to bond markets. The Fed chief's hawkish message helped push yields, which move inversely to prices, to their highest levels in years. As investors piled back into Treasuries, yields plummeted. Over the longer term, sustained rate volatility is unlikely to be good for stocks, said Purves, of Tallbacken Capital.

☆ Stocks are bouncing but market will soon face next big hurdle
▼ + stars: | 2023-03-14 | by ( Patti Domm | In | ) www.cnbc.com time to read: +5 min

Strategists see the Federal Reserve's policy meeting next Tuesday and Wednesday as the next big hurdle for markets, barring any other unexpected developments. Traders in the futures market upped their bets Tuesday to a more than 70% chance that the Fed raises interest rates by a quarter point on March 22. Regional bank stocks rose sharply Tuesday after being crushed on fears there could be more bank failures, following the rapid collapse of Silicon Valley Bank and Signature Bank. The central bank will also release forecasts after that meeting, including new outlooks for interest rates and inflation. "Something pretty darn significant just broke as a result of higher rates," said Lori Calvasina, head U.S. equity strategist at RBC.

☆ US options traders bet on near-term recovery as bank stocks rebound
▼ + stars: | 2023-03-14 | by ( Saqib Iqbal Ahmed | ) www.reuters.com time to read: +3 min

Options traders were buying up short-term call options on a variety of names, including the SPDR S&P regional banking ETF (KRE.P) and regional banks such as First Republic Bank (FRC.N) and Western Alliance Bancorp (WAL.N). "It's early days here but … there is some stability returning in bank share price action," said Michael Purves, chief executive of Tallbacken Capital. "Risk-on appears to be the flavor for regional banks today," said Ophir Gottlieb, chief executive of Los Angeles-based Capital Market Laboratories. Bullish speculation was particularly heavy in options expiring in less than a week, while longer-dated options saw less interest, he said. With some calm returning on Tuesday, options traders' also dialed back expectations for more near-term fireworks from the sector.

☆ Premarket stocks: What comes next in the banking crisis? The early 1990s hold clues
▼ + stars: | 2023-03-14 | by ( Nicole Goodkind | ) edition.cnn.com time to read: +8 min

This isn’t 2008: There are some key differences between today’s banking saga and what happened in 2008. This time around the US federal government stepped in early to guarantee all customer deposits and restore confidence in the US banking system. Here comes CPIFormer banking regulators, economists and Wall Street analysts are increasingly calling for the Federal Reserve to pause its inflation-fighting interest rate hikes because of the current banking sector chaos. Last Wednesday, investors were putting 70% odds of a half-point interest rate hike at the Federal Reserve policy meeting next week, according to the CME FedWatch tool. Analysts expect the inflation rate to come in at 6% year-over-year (down from 6.4% in January) and at 0.4% month-over-month (down from 0.5% in January).

☆ Here are Monday's biggest analyst calls: Apple ,Tesla, First Republic, Roku, Sunrun, JPMorgan Chase & more
▼ + stars: | 2023-03-13 | by ( Michael Bloom | ) www.cnbc.com time to read: +19 min

Baird upgrades Truist to outperform from neutral Baird said it sees an attractive risk/reward for the regional bank. "Regional bank risk/reward trade-off improving, and we would get more aggressive on the regional bank side, upgrading TFC to Outperform." Bank of America reiterates Alphabet as buy Bank of America said it's bullish on Alphabet's entry into AI. Bank of America reiterates Roku as buy Bank of America said it's standing by the stock in the wake of the Silicon Valley Bank collapse. "Regional bank risk/reward trade-off improving, and we would get more aggressive on the regional bank side, upgrading TFC to Outperform."

☆ Run on Silicon Valley Bank injects some panic into an already slumping stock market
▼ + stars: | 2023-03-11 | by ( Michael Santoli | ) www.cnbc.com time to read: +8 min

The charts suggest that breaking the December low in the S & P 500 around 3765 – down just 2.5% from here – would lose the bullish case a lot more credibility than has been surrendered so far. Of course, fears of contagion can outrun the facts and sometimes can become self-fulfilling, but the S & P 500 has (for now) simply backslid to a nine-week low. Jason Hunter, technical strategist at JP Morgan, had been expecting "a weakening corporate earnings environment would eventually take the narrative away from the Fed driven rates market. In the past week Apple shares lost about a third of what the S & P 500 did. Inflation has been at generational highs for two years as it was not then, and the labor market wasn't nearly as tight.

Members of the FIA include the major banks on Wall Street. As a clearing house, the OCC settles and guarantee options contracts, working as a central counterparty for credit risk. Apart from the group meeting with the FIA, the OCC has also discussed this issue individually with some market participants, one of the sources said. The OCC told this person it did not see a major risk, but it wanted to assess its members' views and explore different risk scenarios. Many 0DTE options have a low probability of rising in value as they approach expiration.

☆ SVB debacle sparks rush to defensive options on fears of contagion
▼ + stars: | 2023-03-10 | by ( Saqib Iqbal Ahmed | ) www.reuters.com time to read: +3 min

A California regulator shut Silicon Valley Bank on Friday and appointed the Federal Deposit Insurance Corporation as receiver, according to the agency's statement. With many stocks in the sector falling sharply on Friday, traders rushed in to defensive bets. SVB is battling cash burn due to declining deposits from startups struggling with a venture capital funding drought. While investors had largely shrugged off Silvergate’s troubles as strictly crypto-related, "(SVB Financial Group) was a giant wake-up call about the effects of rising rates and an inverted yield curve," Sosnick said. Reporting by Saqib Iqbal Ahmed in New York Editing by Ira Iosebashvili and Matthew LewisOur Standards: The Thomson Reuters Trust Principles.

☆ Wall Street 'fear gauge' options volume jumps to 4-year high as bank stocks sell off
▼ + stars: | 2023-03-10 | by ( Saqib Iqbal Ahmed | ) www.reuters.com time to read: +2 min

The Cboe Volatility Index (.VIX), an options-based indicator dubbed the Wall Street "fear gauge," jumped as much as 6.36 points to 28.97, before closing up 2.19 points at 24.8. VIX options, used by traders to place wagers on whether stock market volatility will rise or fall in coming weeks and months, changed hands in heavy volume, with some 2.36 million contracts traded. Much of the volume on Friday was linked to traders booking profits and adjusting positions to account for the recent market moves, data showed. Betting on upside in the VIX has not been as profitable as many traders had hoped over the past year, despite a steep selloff in the stock market. That gradual pick up in volatility has kept the VIX below the 40 mark, a level associated with high fear in the market.

☆ Silvergate’s Story Is About Fundamentals, Not Just Crypto
▼ + stars: | 2023-03-09 | by ( Telis Demos | ) www.wsj.com time to read: 1 min

Unlike some bank failures of recent memory, Silvergate didn’t have bad assets in the sense of risky loans or complex derivatives. Silvergate Capital was in the newfangled business of cryptocurrency banking. But it ran into some very old banking problems—which could rattle investors in traditional lenders, too. The California bank said Wednesday that it intends to wind down and plans to return all deposits. And therein lies the concerning part for bank investors.

☆ An options strategy from Goldman to profit from Friday's jobs report
▼ + stars: | 2023-03-09 | by ( Jesse Pound | ) www.cnbc.com time to read: +2 min

The options for some major stocks appear oddly cheap ahead of a highly anticipated jobs report, according to Goldman Sachs. Straddles are derivatives that serve as a bet on volatility, regardless of direction. Shares of the Facebook parent have been on a tear in 2023, rising by more than 50% already. Outside of tech, Caesars Entertainment has already gained 28% year to date, and analysts see another 30% of upside, according to Refinitiv. Shares of Moderna have already moved 3% or more on 11 different trading days in 2023.

The local unit of Canada's Xebra Brands (XBRA.CD) is the first company to obtain permits to cultivate, process, produce and market cannabis in Mexico, according to a statement from the firm. In its statement, Xebra Brands said it faces no restrictions where it can grow cannabis in Mexico, the size of cultivation facilities or processing volumes. "This represents an important moment for cannabis globally," Xebra Brands CEO Jay Garnett said in the statement. In an interview with Reuters in late 2021, the firm's former president said regulatory authorizations would position Mexico as the industry's most important North American player. Xebra Brands added it is actively looking for farm land and a site to build an extraction facility to produce CBD-rich hemp derivatives.

☆ UK says financial reforms will be within same 'orbit' as EU, US
▼ + stars: | 2023-03-09 | by ( Huw Jones | ) www.reuters.com time to read: +2 min

LONDON, March 9 (Reuters) - Britain's revamped financial market rules will largely be aligned with U.S. and European Union regulations to minimise disruption to global companies, its financial services minister Andrew Griffith said on Thursday. The EU and United States have also set out market reforms and, with the British changes initially trailed as a "Big Bang"-style shake-up, global banks want to avoid major divergence in rules that bump up their costs. Griffith said Britain has a "clear vision" of ambitious practioner-led reforms to make the country's regulation more proportionate, simpler, modern and based on high standards. Danuta Huebner, a European Parliament member who is leading reform of EU securities rules, said the Edinburgh Reforms put increased emphasis on risk taking and competitiveness, but it was unclear if this will mean divergence from the EU. The 27-member bloc said this week it would activate a new forum for UK and EU regulators to exchange views, key to easing tensions over issues like derivatives clearing.

At the Fontainebleau hotel, Credit Suisse bankers were puzzled by the announcements, and concerned about their jobs being on the line, said the executive, who declined to be named. In response to questions from Reuters for this article, a spokesperson for Credit Suisse in London said: "We never comment on rumours or speculation." 'A ROCK AND A HARD PLACE'Even after Credit Suisse stopped financing hedge funds following the Archegos implosion in March 2021, the equities business remained a key part of its investment bank revenue. One option Credit Suisse is considering is to move its equities research to CSFB, Reuters reported. Slimming down the equities business would draw a further line under Credit Suisse's investment bank ambitions.

☆ Watch CNBC's full interview with Cantor Fitzgerald's Eric Johnston and Cerity Partners' Jim Lebenthal
▼ + stars: | 2023-03-08 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailWatch CNBC's full interview with Cantor Fitzgerald's Eric Johnston and Cerity Partners' Jim LebenthalEric Johnston, Cantor Fitzgerald head of equity derivatives and cross asset, and Jim Lebenthal, Cerity Partners' chief equity strategist, joins 'Closing Bell' to discuss the resilience of the economy, indicators suggesting a significant downside and the strength of the banking sector.

☆ The banking system's resilience is emblematic of the economy a whole, says Cerity Partners' Jim Lebenthal
▼ + stars: | 2023-03-08 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailThe banking system's resilience is emblematic of the economy a whole, says Cerity Partners' Jim LebenthalEric Johnston, Cantor Fitzgerald head of equity derivatives and cross asset, and Jim Lebenthal, Cerity Partners' chief equity strategist, join 'Closing Bell' to discuss the resilience of the economy, indicators suggesting a significant downside and the strength of the banking sector.

Indonesia, the world's biggest producer of palm oil, raised the mandatory blend of palm oil in biodiesel to 35% starting in February, from 30% earlier, to reduce diesel fuel imports amid high global energy prices and to reduce emissions. The benchmark palm oil contract on the Bursa Malaysia Derivatives Exchange slid 24 ringgit to 4,181 ringgit a tonne on Wednesday. An El Nino episode usually results in below-average rainfall in main palm oil producers Indonesia and Malaysia, cutting yields and pushing up global prices. "It used to be palm oil is export-oriented for Indonesia, but sales are declining and domestic consumption is increasing," Fadhil said. James Fry, the chairman of commodities consultancy LMC International, however, cautioned that the correction in gasoil prices could bring down demand for biodiesel and pull-down palm oil prices.

☆ EU restarts work on EU-UK regulatory forum after Northern Ireland deal
▼ + stars: | 2023-03-08 | by ( Huw Jones | ) www.reuters.com time to read: +2 min

March 8 (Reuters) - The European Union's executive body said on Wednesday it will finalise a long-delayed discussion forum for EU and UK financial regulators, once the deal on Northern Ireland has been implemented by Britain. The forum, similar to what the EU already has with the United States, was due to have been created by March 2021, but was put on ice because of disagreements over trading relations with Northern Ireland. Those disagreements have been ironed out in last month's agreement, or Windsor Framework, which has yet to be formally implemented by Britain. "We are ready to start work on the finalisation of the Memorandum of Understanding (MoU) on financial services regulatory cooperation," a spokesman for the European Commission's financial services unit said on Wednesday. The forum has no mandate to decide on EU financial market access, but financial industry officials say it could improve strained cross-Channel relations in the sector, and help ease tension in areas, such as derivatives clearing.

☆ Watch CNBC's full interview with RBC's Amy Wu Silverman
▼ + stars: | 2023-03-08 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailWatch CNBC's full interview with RBC's Amy Wu SilvermanAmy Wu Silverman, head of Derivatives Strategy at RBC Capital Markets, joins 'Squawk Box' to discuss why now is especially a stock pickers market, whether investors are trying to hedge against the Federal Reserve, and more.

☆ Market volatility is low because of correlation going down, says RBC's Wu Silverman
▼ + stars: | 2023-03-08 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailMarket volatility is low because of correlation going down, says RBC's Wu SilvermanAmy Wu Silverman, head of Derivatives Strategy at RBC Capital Markets, joins 'Squawk Box' to discuss why now is especially a stock pickers market, whether investors are trying to hedge against the Federal Reserve, and more.

☆ How an ETF with an 11% yield shows a growing use case for active strategies
▼ + stars: | 2023-03-08 | by ( Jesse Pound | ) www.cnbc.com time to read: +4 min

The JPMorgan Premium Equity ETF (JEPI) has a 12-month rolling dividend yield over 11%, and its 30-day SEC yield was just under that mark as of the end of February. The biggest funds in the market track indexes, like the S & P 500, and give investors market returns minus fees. But 2022 was a surprisingly good year for active managers , and active ETFs gained some share against their passive counterparts. The JPMorgan Ultra-Short Income ETF (JPST) has also been popular this year, with $1 billion of inflows and a 30-day SEC yield above 4%. Among the firm's smaller active fixed income funds, the Core Plus Bond ETF (JCPB) has a roughly similar yield, while the Income ETF (JPIE) yields above 6%.

☆ TPG starts a dicey dance with death Down Under
▼ + stars: | 2023-03-07 | by ( Antony Currie | ) www.reuters.com time to read: +3 min

Little wonder, then, that TPG is taking advantage of Australia’s InvoCare (IVC.AX) recently losing market share, and earnings, by offering shareholders A$1.8 billion ($1.5 billion) on Tuesday. But the private equity firm run by Jon Winkelried has started a dicey dance with death. At 5%, for example, annual interest payments on the new debt would be almost $50 million – a third of InvoCare’s expected EBITDA next year. Follow @AntonyMCurrie on TwitterCONTEXT NEWSTPG Global, a fund run by U.S. private equity firm TPG, on March 7 made a non-binding, indicative offer for InvoCare which values the Australian funeral-services company’s enterprise at almost A$2.2 billion ($1.5 billion). The private equity firm had the previous day bought an almost 18% stake in the company from a variety of investors at A$12.65 a share.

☆ Analysis: Investors revive inflation trades as 6% Fed rate risk grips Wall Street
▼ + stars: | 2023-03-07 | by ( Davide Barbuscia | ) www.reuters.com time to read: +5 min

NEW YORK, March 7 (Reuters) - Spooked by a flurry of hotter-than-expected U.S. economic and inflation data last month, investors are reviving trading strategies that bet on a higher peak in interest rates. The recalibration in inflation expectations has led some investors to bet on a policy rate of 6% or even higher. Trading platform Tradeweb said it saw average daily volume in inflation swaps - derivatives used to hedge inflation risk - increase by 23% month-on-month in February. With higher inflation expectations lifting short-term bond yields higher than those at the longer end, some investors are wary of committing to debt maturities at the long end of the bond market yield curve. "The momentum in the economy is so strong that we may have to get into 2024 before the Fed funds rate peaks."

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