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☆ The explosion of risky zero-day options could worsen market shocks, JPMorgan says
▼ + stars: | 2023-03-06 | by ( Yun Li | ) www.cnbc.com time to read: +2 min

Daily notional volumes in these 0DTE options that track the S & P 500 recently reached a record above $1 trillion, according to JPMorgan data. The Wall Street bank conducted an experiment to see the impact of these options during a sudden drop in the broader market. "The estimated market impacts from 0D option unwind exceed the original market shocks in all scenarios, highlighting the reflexive nature of the 0D options and their potential risk posed to market stability," JPMorgan said. The S & P 500 pulled back by 2.6% in February after rallying more than 6% in the prior month. In early March, the broader market index is up by more than 2%.

"(But) it feels like I should keep some dollars on hand, as the yuan will depreciate further." Others anticipating a bumpy ride ahead for the Chinese currency include China Southern Airlines (600029.SS). Such moves are perhaps not surprising given yuan volatility since Beijing suddenly unwound its zero-COVID strategy. "Overall, yuan exchange rate will remain basically stable at reasonable levels," he added at a March 3. news briefing. ($1 = 6.9009 Chinese yuan)Writing by Tom Westbrook; Editing by Vidya Ranganathan and Alexander SmithOur Standards: The Thomson Reuters Trust Principles.

☆ Japan Post’s deal will test interest rate optimism
▼ + stars: | 2023-02-28 | by ( ) www.reuters.com time to read: +2 min

HONG KONG, Feb 28 (Reuters Breakingviews) - The $12 billion triple initial public offering of the Japan Post Group by the government in 2015 was done in the name of economic efficiency. After a brief rally, the collective market value of the three companies it comprises has declined from a peak of 18 trillion yen to below 10 trillion yen, per Datastream. The Ministry of Finance holds over a third of Japan Post Holdings (6178.T), which in turn retains big stakes in the banking and insurance units – although it has trimmed the latter to below 50%. Japan Post Holdings plans to unload shares worth up to $9.3 billion, Reuters reported, reducing its stake to below 65%. It’s a huge deal in a rickety market but the prospect of interest rate normalisation could see more investment into domestic banks – Japan Post Bank shares have rallied this year alongside local peers.

☆ Dollar edges higher, headed for 1st monthly gain since September
▼ + stars: | 2023-02-28 | by ( ) www.cnbc.com time to read: +4 min

"The market has repriced the Fed and it now sees a higher terminal rate and low scope for cuts for the rest of the year. And that's what the dollar strength reflects," said Vassili Serebriakov, FX strategist, at UBS. The dollar index, which measures the currency against a basket of peers, was 0.29% higher at 104.98, and is set for a February gain of 2.4%, its first monthly increase since September. We think some of the dollar strength is exaggerated. So we are cautiously fading dollar strength," UBS' Serebriakov said.

☆ After splitting with Kanye West, British audio startup Kano asks for funding
▼ + stars: | 2023-02-27 | by ( Ryan Browne | ) www.cnbc.com time to read: +6 min

The two would go on to discuss the beginnings of what eventually became the Stem Player. It was originally named the "Donda Stem Player," a reference to West's 10th studio album, Donda. Faced with "worse" terms and news of Ye's antisemitic comments, Kano didn't accept, Klein said. Despite recent outcry over Ye's antisemitic remarks, he has frequently raised eyebrows. The Stem Player, along with West's dedicated fanbase, drove great commercial success for the small London startup.

☆ AT&T seeks to shed cybersecurity division -sources
▼ + stars: | 2023-02-21 | by ( Milana Vinn | ) www.reuters.com time to read: +2 min

NEW YORK, Feb 21 (Reuters) - AT&T Inc (T.N), the second-biggest U.S. wireless carrier, is exploring a sale of its cybersecurity division, potentially undoing an acquisition it completed five years ago, according to people familiar with the matter. The sale of the cybersecurity business would add to a string of divestments AT&T has turned to in order to pay down debt following its $108.7 billion acquisition of Time Warner Inc in 2018, a deal it has since also unwound. AT&T has been working with Barclays Plc (BARC.L) to solicit potential bids for its cybersecurity business, which was called Alienvault when it was acquired in 2018 in a roughly $600 million deal, the sources said. The sources cautioned that no deal is certain and requested anonymity because the matter is confidential. AT&T's cybersecurity division helps small-to-medium-sized businesses keep their information technology networks, including laptops, desktops, servers and mobile devices, secure.

☆ Jim Cramer says six things must happen before the market sell-off can end
▼ + stars: | 2023-02-21 | by ( Rebecca Picciotto | ) www.cnbc.com time to read: +2 min

CNBC's Jim Cramer on Tuesday gave a six-item checklist for what must happen before he will be ready to declare an end to the market sell-off. As the market swings the other way, in what Cramer called a "Presidents Day sale," he said the downturn might not be just a one-day affair. In order for the sell-off to end, according to Cramer, six things need to happen:The accelerated rise in Treasury yields must slow down. Anomaly stocks that are trading disproportionately high, many of which are in the tech sector, need to come down. "Unfortunately, this Presidents Day sale doesn't feel like it's over.

☆ AT&T seeks to shed cybersecurity division, sources tell Reuters
▼ + stars: | 2023-02-21 | by ( ) www.cnbc.com time to read: +2 min

AT&T Inc , the second-biggest U.S. wireless carrier, is exploring a sale of its cybersecurity division, potentially undoing an acquisition it completed five years ago, according to people familiar with the matter. The sale of the cybersecurity business would add to a string of divestments AT&T has turned to in order to pay down debt following its $108.7 billion acquisition of Time Warner Inc in 2018, a deal it has since also unwound. The sources cautioned that no deal is certain and requested anonymity because the matter is confidential. AT&T's cybersecurity division helps small-to-medium-sized businesses keep their information technology networks, including laptops, desktops, servers and mobile devices, secure. The acquisition of Alienvault was aimed at giving AT&T an edge in signing up and retaining corporate clients, but the deal's rationale has eroded as cybersecurity startups that offer cheap alternatives mushroomed.

"Markets are priced for perfection," Schnabel, the head of the ECB's market operations, told Bloomberg. Money markets now show investors betting on a peak ECB rate at around 3.75% by late summer, up from levels around 3.4% earlier this month, as a string of hawkish ECB comments in recent days unwound earlier bets. He and fellow board member Fabio Panetta said the impact of many of the ECB's rate hikes so far had yet to be felt by the economy, with the latter calling for "small steps" going forward. The ECB raised rates by 50 basis points this month and pre-announced another increase of the same size for March 16. But it kept an open mind about future moves, with most policymakers expecting another rate hike in May.

☆ Dollar finds friends after sticky U.S. inflation readout
▼ + stars: | 2023-02-15 | by ( Tom Westbrook | ) www.reuters.com time to read: +2 min

SINGAPORE, Feb 15 (Reuters) - The dollar found some support on Wednesday after stubbornly high U.S. inflation suggested interest rates are going to remain high for longer than investors had expected. The U.S. dollar climbed to a six-week high of 133.30 yen and sat not far below that at 132.73 early in the Asia session. "Inflation remains too high," Commonwealth Bank of Australia strategist Joe Capurso said. There is not much good news for (the Fed) that is looking for inflation to head down much further towards its 2% target." Federal Reserve officials said the U.S. central bank will need to keep gradually raising interest rates to beat inflation.

[1/2] U.S. Dollar and Euro banknotes are seen in this illustration taken July 17, 2022. Initial claims for state unemployment benefits rose 13,000 to a seasonally adjusted 196,000 for the week ended Feb. 4, data showed. In late morning trading, the dollar index fell 0.7% to 102.74 . The euro , the biggest component in the dollar index, climbed 0.6% to $1.078, while sterling rose 0.9% to $1.2179 , with both boosted by improving risk sentiment across markets. The dollar fell 0.4% against the Japanese yen to 130.92 .

☆ Italian banks' lending to firms stagnates in December
▼ + stars: | 2023-02-09 | by ( ) www.reuters.com time to read: +2 min

A monthly report on the balance sheets of domestic banks showed loans to non-financial companies were flat year-on-year in December compared with a 2.7% expansion the previous month. Extraordinary government support measures during the pandemic and the energy crisis fuelled strong growth in corporate bank lending, but the trend has weakened as support measures have been gradually unwound. Banks' corporate loans totalled 649.2 billion euros at the end of December, down from 666.3 billion euros a month earlier. Thursday's data also showed Italian residents' deposits with domestic banks fell to 2.71 trillion euros ($2.92 trillion) compared with 2.74 trillion euros the previous month. Gross unpaid loans declined to 30.15 billion euros at the end of December from 34.01 billion euros a month earlier.

Median 2023 price forecasts for all the core LME base metals are lower than both last year's price and current trading levels. The LME copper cash settlement price was $9,075 per tonne on Tuesday, up 10% on the start of January. A median forecast of $8,625 for the full year is 2.1% lower than last year's average of $8,814 per tonne. Aluminium is viewed as more finely balanced, with a median forecast supply surplus of 80,535 tonnes this year and 92,100 tonnes in 2024. That said, last January's median forecast proved surprisingly close to the mark at $34,880 in what was a year of extraordinary volatility.

☆ China's reopening could boost global growth — and worsen inflation
▼ + stars: | 2023-01-27 | by ( Anna Cooban | ) edition.cnn.com time to read: +7 min

London CNN —China’s swift reopening after nearly three years of strict coronavirus controls could provide a much-needed boost to global economic growth, but may also stoke inflation just as it has shown signs of falling back. The revival of the world’s second largest economy — and its biggest consumer of commodities — threatens to push up global prices for fuel, industrial metals and food this year. The speed of the reopening, as well as indications that infections may have already peaked, has been surprising, analysts told CNN. Yet, if global food and energy prices start rising again, that could feed through into higher consumer prices. China’s reopening could bump up demand for agricultural goods, while the world is still in the grips of the worst food crisis in modern history.

"This step will allow us to push down longer-term interest rates, without directly affecting supply and demand of the cash Japanese government bond (JGB) market," Kuroda told a news conference. Following its two-day policy meeting, the BOJ kept intact its yield curve control (YCC) targets, set at -0.1% for short-term interest rates and around 0% for the 10-year yield, by a unanimous vote. Reuters Graphics Reuters GraphicsThe central bank also made no change to its guidance that allows the 10-year bond yield to move 50 basis points either side of its 0% target. "By showing its resolve to use market tools more flexibly, the BOJ wanted to signal to markets it won't make big monetary policy changes under Kuroda." Market attention is already shifting toward monetary policy under Kuroda's successor, who will need to steer an orderly exit from decades of ultra-low rates.

The surprise decision sent the yen skidding against other currencies and bond yields tumbling the most in decades, as investors unwound bets they made anticipating the central bank would overhaul its yield control policy. At a two-day policy meeting, the BOJ kept intact its yield curve control (YCC) targets, set at -0.1% for short-term interest rates and around 0% for the 10-year yield, by a unanimous vote. The central bank also made no change to its guidance that allows the 10-year bond yield to move 50 basis points either side of its 0% target. Underscoring its resolve to keep defending the cap, the BOJ beefed up a key market operation tool to more effectively curb rises in long-term interest rates. "By showing its resolve to use market tools more flexibly, the BOJ wanted to signal to markets it won't make big monetary policy changes under Kuroda."

☆ Here's what top executives at Davos are saying about a recession. Many can see silver linings.
▼ + stars: | 2023-01-18 | by ( Ryan Hogg | Cadie Thompson | ) www.businessinsider.com time to read: +5 min

Executives at Davos weighed in on the likelihood and severity of a recession in 2023. Most expect the US to have a shallow recession, but Europe and elsewhere could be hit harder. I think there's going to be a lot of uncertainty. "And that means it's time to really think about hunkering down and focusing on what's important, and really focusing on the fundamentals, which is what we are doing within the company." We will do better if there's a recession – at least if there's a recession with unemployment."

☆ VIEW U.S. consumer prices fall in December
▼ + stars: | 2023-01-12 | by ( ) www.reuters.com time to read: +5 min

NEW YORK, Jan 12 (Reuters) - U.S consumer prices unexpectedly fell for the first time in more than 2-1/2 years in December amid declining prices for gasoline and other goods, suggesting that inflation was now on a sustained downward trend. The consumer price index dipped 0.1% last month after gaining 0.1% in November, the Labor Department said on Thursday. MARKET REACTION:STOCKS: U.S. stock index futures fall after the inflation data BONDS: U.S. Treasury yields slid across the board. But I will note that it is an especially volatile period, which is not atypical for inflection points in market expectations and the broader macro outlook." BRIAN KLIMKE, INVESTMENT DIRECTOR, CETERA INVESTMENT MANAGEMENT LLC, LOS ANGELES"It (the report) came in as expected, but investors were somewhat optimistic leading into this reading, so that they were buying the rumor and selling the new.

☆ Instant View: U.S. consumer prices fall in December
▼ + stars: | 2023-01-12 | by ( ) www.reuters.com time to read: +5 min

NEW YORK, Jan 12 (Reuters) - U.S consumer prices unexpectedly fell for the first time in more than 2-1/2 years in December amid declining prices for gasoline and other goods, suggesting that inflation was now on a sustained downward trend. The consumer price index dipped 0.1% last month after gaining 0.1% in November, the Labor Department said on Thursday. MARKET REACTION:STOCKS: U.S. stock index futures fall after the inflation dataBONDS: U.S. Treasury yields slid across the board.FOREX: The dollar fell against the euro and yen. But I will note that it is an especially volatile period, which is not atypical for inflection points in market expectations and the broader macro outlook." BRIAN KLIMKE, INVESTMENT DIRECTOR, CETERA INVESTMENT MANAGEMENT LLC, LOS ANGELES"It (the report) came in as expected, but investors were somewhat optimistic leading into this reading, so that they were buying the rumor and selling the new.

☆ Asian stocks enter bull market as investors bet on China
▼ + stars: | 2023-01-10 | by ( Anna Cooban | ) edition.cnn.com time to read: +2 min

London CNN —Stocks in Asia are starting 2023 in a bull market. The rally has been driven by a rebound in investor sentiment towards Chinese stocks. The MSCI China index rose 2.4% on Tuesday to stand 50% above its low on October 31. Nasdaq’s Golden Dragon China index — which tracks Chinese companies listed in the United States — rose 0.72% on Monday, putting it 71.3% above where it was trading in late October. Investors have snapped up Chinese stocks as the country rapidly unwound its strict zero-Covid policy.

☆ Encouraging inflation news: Online prices keep dropping
▼ + stars: | 2023-01-10 | by ( Matt Egan | ) edition.cnn.com time to read: +3 min

For many years, online prices did nothing but fall as e-commerce was immune to inflationary pressures. That changed following the start of the Covid-19 pandemic as strong demand and supply chain trouble lifted online prices. “When online prices began dropping over the summer, our thinking was that one month could be a fluke, but two months could be a trend,” Pandya said. Although online prices fell on an annual basis, Adobe said they increased by 1.1% between November and December. Asked if online prices are getting back to their normal pre-Covid trends, Pandya said prices for some categories like groceries and apparel remain hot, while others such as electronics are experiencing consistent price drops.

☆ Oil prices up as U.S. crude stocks seen falling, dollar eases
▼ + stars: | 2022-12-21 | by ( Laila Kearney | ) www.reuters.com time to read: +2 min

SummarySummary Companies API shows U.S. crude stocks down, fuel inventories up -sourcesU.S. dollar easesSurging COVID-19 cases in China limit gainsDec 21 (Reuters) - Oil prices rose in early Asian trade on Wednesday as U.S. crude stocks were seen falling last week, while the dollar weakened, making oil less expensive for non-American buyers. Brent crude futures rose 8 cents to $80.07 per barrel by 0126 GMT, while U.S. West Texas Intermediate (WTI) crude futures gained 6 cents to $76.29. U.S. crude oil inventories fell by about 3.1 million barrels in the week ended Dec. 16, according to market sources citing American Petroleum Institute figures. Gasoline inventories rose by about 4.5 million barrels, while distillate stocks rose by 828,000 barrels, according to the sources, who spoke on condition of anonymity. Oil prices, which came close to the all-time high of $147 a barrel in March after Russia invaded Ukraine, have unwound most of their 2022 gains.

China, the world's top crude oil importer, is experiencing its first of three expected waves of COVID-19 cases after Beijing relaxed mobility restrictions but said it plans to step up support for the economy in 2023. Brent crude gained 76 cents to settle at $79.80 a barrel, while U.S. West Texas Intermediate crude rose 90 cents to $75.19. Oil surged toward its record high of $147 a barrel earlier in the year after Russia invaded Ukraine in February. It has since unwound most of this year's gains as supply concerns were edged out by recession fears. "The prospect of further rate rises will hit economic growth in the new year and in doing so curb demand for oil," said Stephen Brennock of oil broker PVM.

☆ Oil rises on hopes for China's economy
▼ + stars: | 2022-12-19 | by ( Alex Lawler | ) www.reuters.com time to read: +2 min

China, the world's top crude oil importer, is experiencing its first of three expected waves of COVID-19 cases after Beijing relaxed mobility restrictions but said it plans to step up support for the economy in 2023. "There is no doubt that demand is being adversely influenced," said Naeem Aslam, analyst at brokerage Avatrade. Brent crude gained 65 cents, or 0.8%, to $79.69 a barrel by 1248 GMT while U.S. West Texas Intermediate crude rose 85 cents, or 1.1%, to $75.14. Oil surged towards its record high of $147 a barrel earlier in the year after Russia invaded Ukraine in February. "The prospect of further rate rises will hit economic growth in the new year and in doing so curb demand for oil," said Stephen Brennock of oil broker PVM.

☆ Oil bounces as China demand hopes offset recession fears
▼ + stars: | 2022-12-19 | by ( Alex Lawler | ) www.reuters.com time to read: +2 min

China, the world's top crude oil importer, is experiencing its first of three expected waves of COVID-19 cases after Beijing relaxed mobility restrictions but plans to step up support for the economy in 2023. Brent crude gained 37 cents, or 0.5%, to $79.41 a barrel by 1100 GMT while U.S. West Texas Intermediate crude rose 30 cents, or 0.4%, to $74.59. Oil surged towards its record high of $147 a barrel earlier in the year after Russia invaded Ukraine. It has since unwound most of this year's gains as supply concerns were edged out by recession fears, which remain a drag on prices. "The prospect of further rate rises will hit economic growth in the new year and in doing so curb demand for oil," said Stephen Brennock of oil broker PVM.

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