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☆ Investors wary of lingering Treasury volatility as US stocks rally
▼ + stars: | 2023-11-10 | by ( Saqib Iqbal Ahmed | ) www.reuters.com time to read: +2 min

The Wall Street sign is pictured at the New York Stock exchange (NYSE) in the Manhattan borough of New York City, New York, U.S., March 9, 2020. REUTERS/Carlo Allegri/File Photo Acquire Licensing RightsNEW YORK, Nov 10 (Reuters) - A still-jittery bond market is clouding the outlook for a rally in U.S. stocks, analysts tracking measures of market volatility said. At the same time, the Cboe Volatility Index, (.VIX), which measures expectations for stock gyrations, has fallen to a seven-week low of 14.13. That could be a problem if Treasury yields - which move inversely to bond prices - resume a climb that has pressured stocks since the summer. A significant drop in Treasury market volatility would be great news for stock market bulls, Purves said.

Persons: Carlo Allegri, Stocks, Alex Kosoglyadov, Michael Purves, Purves, Saqib Iqbal Ahmed, Ira Iosebashvili, Paul Simao Organizations: New York Stock, REUTERS, Treasury, Equity, Nomura, Capital, Thomson Locations: Manhattan, New York City , New York, U.S

☆ Fed meeting comes during historically tough week for US stocks
▼ + stars: | 2023-09-12 | by ( Saqib Iqbal Ahmed | ) www.reuters.com time to read: +2 min

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., September 11, 2023. The so-called "September Effect," the apparent trend where U.S. stock market returns are relatively soft in September, has been especially acute for stocks in the week after options expiration, according to Nomura. In 26 of the last 33 years, the S&P 500 Index (.SPX) fell in the week following the September options expiration, with a median drop of 1%, the analysis showed. This time around, the week will encompass the Federal Reserve's monetary policy meeting, set to conclude on Sep. 20. The S&P 500 is down 0.9% month-to-date, and investors are bracing for a host of market-moving catalysts in coming days, including Wednesday's report on U.S. consumer prices.

Persons: Brendan McDermid, Nomura, Reuters Graphics Nomura, Charlie McElligott, Saqib Iqbal Ahmed, Ira Iosebashvili, Alexandra Hudson Organizations: New York Stock Exchange, REUTERS, Nomura Securities, Reuters Graphics, Mutual, Tallbacken Capital Advisors, Alexandra Hudson Our, Thomson Locations: New York City, U.S

☆ Wall St Week Ahead: Investor hopes for US soft landing ride on inflation data
▼ + stars: | 2023-09-10 | by ( David Randall | ) www.reuters.com time to read: +4 min

Too high a number could fan fears of the Fed leaving interest rates higher for longer or hiking them more in coming months. That would give investors less reason to hold onto stocks after a tech-led drop in which the S&P 500 lost about 5% from summer highs. Reasons for optimism include the relative outperformance of the U.S. economy compared to Europe and China, and signs the so-called profit recession among S&P 500 companies may be over. The S&P 500 Information Technology sector lost more than 2% this week following news that Beijing had ordered central government employees to stop using iPhones for work. Still, much of the bull case for stocks hinges on softer inflation eventually pushing the Fed to lower interest rates.

Persons: Andrew Kelly, Michael Purves, Randy Frederick, Ed Clissold, Ned Davis, Jonathan Golub, David Lefkowitz, David Randall, Ira Iosebashvili, David Gregorio Our Organizations: New York Stock Exchange, REUTERS, Federal Reserve, Tallbacken Capital Advisors, Schwab Center, Financial Research, Technology, Apple, Huawei, Chief, Ned, Ned Davis Research, Credit Suisse Securities, UBS Global Wealth Management, Thomson Locations: Manhattan , New York City, U.S, Europe, China, Beijing

☆ Wall St Week Ahead Investor hopes for US soft landing ride on inflation data
▼ + stars: | 2023-09-08 | by ( David Randall | ) www.reuters.com time to read: +4 min

☆ Funds punished for owning too few Nvidia shares after stunning 230% rally
▼ + stars: | 2023-08-30 | by ( Lewis Krauskopf | ) www.reuters.com time to read: +5 min

Yet many funds hold less of the stock in their portfolios compared with Nvidia's weight in key equity indexes, making it tougher for them to beat their benchmarks. Among those funds that held a below-average weight in Nvidia, 85% underperformed the index so far this year, Morningstar's data showed. Nvidia's valuation has been a primary reason keeping some investors away, while others are wary of buying in after the stock’s mammoth 230% run this year. Nvidia shares marked a record high closing price on Tuesday, in the wake of a strong earnings report last week. "The stock has had an amazing rally, but it would be totally normal for it to correct 20-25%."

Persons: Robert Galbraith, Refinitiv, ”, Chuck Carlson, Dow, Goldman Sachs, Goldman, Morgan Stanley, Robby Greengold, Jeremy Schwartz, Schwartz, Michael Purves, Purves, ” Purves, Lewis Krauskopf, Ira Iosebashvili, Matthew Lewis Organizations: Nvidia, REUTERS, Nasdaq, Horizon Investment Services, Reuters Graphics Reuters, Big, Microsoft, Dow Jones, Apple, U.S, Mutual, Morningstar, Tallbacken Capital Advisors, Thomson Locations: Santa Clara , California, Big Tech, New York

☆ Investors watch for quarter-end rebalancing in US stocks, bonds and options
▼ + stars: | 2023-06-26 | by ( Saqib Iqbal Ahmed | ) www.reuters.com time to read: +2 min

NEW YORK, June 26 (Reuters) - Investors are watching a large hedged-equity fund's quarterly refresh of its options positions and quarter-end rebalancing by portfolio managers to potentially influence U.S. stock moves as the first half of the year winds down this week. The nearly $16 billion JPMorgan Hedged Equity Fund , which holds a basket of S&P 500 (.SPX) stocks along with options on the benchmark index, is expected to roll its options positions on Friday. While the trade is anticipated by many market participants, it can exacerbate or suppress daily stock market moves, especially during times of poor market liquidity, analysts said. For now, the trade may be helping suppress volatility in stocks. That may help curb market volatility, analysts said.

Persons: Brent Kochuba, Michael Purves, Saqib Iqbal Ahmed, Ira Iosebashvili, Matthew Lewis Organizations: YORK, JPMorgan Hedged Equity Fund, Bloomberg, JPMorgan, Tallbacken Capital Advisors, Thomson Locations: U.S, New York

☆ Russia turmoil to fuel market volatility, flight to safety
▼ + stars: | 2023-06-24 | by ( ) www.reuters.com time to read: +5 min

The question is how much and how lasting the reaction will be, much of which depends upon unknowable developments." It is reasonable to expect oil and other key commodity prices to rise. If oil prices rise sharply, that will indeed weigh upon equities and reignite stagflation fears. In theory it should benefit from a flight to safety, but in practice a strong dollar can impede it." “Probably bearish Indian stocks too as the dividend they’ve received from cheap Russian oil likely disappears.

Persons: Wagner, Stringer, STEVE SOSNICK, stagflation, MICHAEL PURVES, DAVID KOTOK, Putin, Orban, ’, GEORGE BOUBOURAS, JAMIE HALSE, “, Tom Westbrook, Megan Davies, Carolina Mandl, Ira Iosebashvili, Lananh Nguyen, Daniel Wallis Organizations: Southern Military District, REUTERS, Moscow, Defense, CUMBERLAND, NATO, MELBOURNE, WHO, SYDNEY, Thomson, & & Locations: Rostov, Don, Russia, Russian, China, SARASOTA , FLORIDA, Belarus, Soviet, EU, Hungary, Turkey, JAPAN, Ukraine, Eastern Europe, Singapore, New York

☆ Wall St Week Ahead Lofty valuations on US stocks a growing worry for investors
▼ + stars: | 2023-06-23 | by ( Lewis Krauskopf | ) www.reuters.com time to read: +4 min

The S&P 500 now trades at 19 times its expected 12-months earnings, well above its historic average of 15.6 times, Refinitiv Datastream showed. WFII recently downgraded the technology sector, which has led this year's S&P 500 rally, to "neutral" from "favorable," citing "unattractive" valuations. Goldman urged investors to consider "downside protection" to their stock portfolios, though they expect the S&P 500 to reach 4,500 by year-end, or about 3.5% above current levels. Valuations are even more stretched for the Nasdaq 100 (.NDX), whose 36% rally this year has dwarfed that of the S&P 500. "From a near-term perspective, investors should expect stocks to just cool a little bit."

Persons: Refinitiv Datastream, Goldman Sachs, Sameer Samana, WFII, Goldman, Refinitiv, Michael Purves, Purves, Anthony Saglimbene, Lewis Krauskopf, Ira Iosebashvili, Richard Chang Organizations: YORK, Wells, Wells Fargo Investment Institute, Federal Reserve, Nasdaq, Tallbacken Capital, Deutsche Bank, Ameriprise, Thomson Locations: Wells Fargo

☆ Wall St Week Ahead: Surging US megacap stocks leave some wondering when to cash out
▼ + stars: | 2023-06-02 | by ( Lewis Krauskopf | ) www.reuters.com time to read: +5 min

The benchmark S&P 500 (.SPX) has risen 11.5% this year and stands at a 10-month high. The S&P 500 rose 1.45%. The recent surge in Nvidia showed how a stock can keep climbing even after posting hefty gains. At the same time, only 20.3% of S&P 500 stocks have outperformed the index on a rolling three-month basis, a record low dating back five decades, according to Ned Davis. Kotok views narrowing breadth as an ominous sign for the broader stock market, saying that equities also look less favorable in certain asset valuation metrics.

Persons: Ned Davis, Peter Tuz, Jay Hatfield, ” Hatfield, “, Brendan McDermid Michael Purves, Purves, Kevin Mahn, Refinitiv, ”, Mahn, Dow, David Kotok, Lewis Krauskopf, Ira Iosebashvili, Nick Zieminski, Diane Craft Organizations: YORK, BofA Global Research, Ned Davis Research, Chase Investment, Nvidia, Apple, Microsoft, Google, Federal Reserve, New York Stock Exchange, REUTERS, Tallbacken Capital Advisors, Nasdaq, Hennion, Walsh Asset Management, Dow Jones, Cumberland Advisors, Thomson Locations: megacap, BofA, New York City, U.S

☆ Wall St Week Ahead Surging US megacap stocks leave some wondering when to cash out
▼ + stars: | 2023-06-02 | by ( Lewis Krauskopf | ) www.reuters.com time to read: +5 min

The benchmark S&P 500 (.SPX) has risen 11% this year and stands at a 10-month high. He is overweight megacaps, including Nvidia, Microsoft and Google-parent Alphabet (GOOGL.O). The recent surge in Nvidia showed how a stock can keep climbing even after posting hefty gains. At the same time, only 20.3% of S&P 500 stocks have outperformed the index on a rolling three-month basis, a record low dating back five decades, according to Ned Davis. In one commonly used valuation metric, the S&P 500 is trading at 18.5 times forward earnings estimates compared to its historic average of 15.6 times, according to Refinitiv Datastream.

Persons: Ned Davis, Peter Tuz, Jay Hatfield, ” Hatfield, “, Michael Purves, Purves, Kevin Mahn, Refinitiv, ”, Mahn, Dow, David Kotok, Lewis Krauskopf, Ira Iosebashvili, Nick Zieminski Organizations: YORK, BofA Global Research, Ned Davis Research, Chase Investment, Nvidia, Apple, Microsoft, Google, Tallbacken Capital Advisors, Nasdaq, Hennion, Walsh Asset Management, Dow Jones, Cumberland Advisors, Thomson Locations: megacap, BofA

☆ Analysis: Gloomy U.S. bank sector could yield payoff for contrarian options bets
▼ + stars: | 2023-04-10 | by ( Saqib Iqbal Ahmed | ) www.reuters.com time to read: +4 min

While the S&P 500 index (.SPX) has advanced 6% since mid-March, when the failure of Silicon Valley Bank (SVB) sparked tumult in the banking sector, investors have been more wary of financial stocks. The S&P 500 Banks Group (.SPXBK) is up just 3% from its March low and remains down 14% for the year. The pervasive gloom around financial stocks has increased the cost for investors betting on more downside while making it relatively inexpensive to bet on a rebound. For investors who believe financial earnings and guidance will come in better than expected, Elevation Securities recommended buying Financial Select Sector SPDR Fund (XLF.P) call options at the 33 strike. "Given how beaten up bank stocks are, buying calls into earnings can make sense," said Michael Purves, chief executive officer at Tallbacken Capital Advisors.

☆ UBS to take over Credit Suisse, central banks act on liquidity
▼ + stars: | 2023-03-19 | by ( Reuters Staff | ) www.reuters.com time to read: +13 min

LONDON/NEW YORK (Reuters) -UBS sealed a deal to buy rival Swiss bank Credit Suisse in an effort to avoid further market-shaking turmoil in global banking, Swiss authorities said on Sunday. FILE PHOTO: The logo of Credit Suisse is pictured in front of the Swiss Parliament Building, in Bern, Switzerland, March 19, 2023. The reports that UBS is acquiring Credit Suisse will likely magnify Credit Suisse’s problems by moving them to UBS... The Credit Suisse issues are not new and needed to be resolved years ago. A legal challenge by Credit Suisse shareholders, who will claim that their property has been illegally confiscated, is guaranteed.

☆ 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.

☆ 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.

WASHINGTON/SINGAPORE, March 13 (Reuters) - U.S. authorities launched emergency measures on Sunday to shore up confidence in the banking system after the failure of Silicon Valley Bank (SIVB.O) threatened to trigger a broader financial crisis. Silicon Valley Bank (SVB), a mainstay for the startup economy, was a product of the decades-long era of cheap money, with unique risks that made it especially vulnerable. With the Fed poised to continue raising interest rates, investors said the financial system may not be fully out of the woods just yet. Goldman Sachs' analysts said they no longer expect it to raise rates at that meeting, amid the stress in the banking sector. A senior U.S. Treasury official said the actions taken would protect depositors, while providing additional support to the broader banking system, but officials and regulators were continuing to monitor financial system stability.

☆ VIEW US intervenes to shore up SVB deposits, stem financial fallout
▼ + stars: | 2023-03-13 | by ( ) www.reuters.com time to read: +10 min

March 13 (Reuters) - The U.S. government announced actions to shore up deposits and stem any broader financial fallout from the sudden collapse of tech startup-focused lender Silicon Valley Bank (SIVB.O) (SVB), sending U.S. stock futures higher. "The market turbulence sparked by SVB has upended rising market expectations on the Fed rate path. The fact that SVB and Signature Bank depositors will be made whole is critical in maintaining trust in the financial system and should help stem contagion fears this week. But it also means that 50 basis points (a possible Fed interest rate hike) is off the table." Given what's happened in the U.S. financial system, a 25 basis point hike is more likely than a 50 basis point hike."

☆ Instant view: US intervenes to shore up SVB deposits, limit financial fallout
▼ + stars: | 2023-03-13 | by ( ) www.reuters.com time to read: +11 min

March 13 (Reuters) - The U.S. government announced actions to shore up deposits and stem any broader financial fallout from the sudden collapse of tech startup-focused lender Silicon Valley Bank (SIVB.O) (SVB), sending U.S. stock futures higher. ALVIN TAN, HEAD OF ASIA FX STRATEGY, RBC CAPITAL MARKETS, SINGAPORE:"Markets remain unsettled from the SVB failure. "The market turbulence sparked by SVB has upended rising market expectations on the Fed rate path. ANTHONY SAGLIMBENE, CHIEF MARKET STRATEGIST, AMERIPRISE FINANCIAL, TROY, MICHIGAN:"It was imperative that regulators stepped in and decisively acted before markets around the world opened for the week. GREG MCBRIDE, CHIEF FINANCIAL ANALYST, BANKRATE:"While the Fed has talked about a lot in the past year, until today it has been in the context of monetary policy.

WASHINGTON (Reuters) - The U.S. administration stepped in on Sunday with a series of emergency measures to shore up confidence in the banking system after the failure of Silicon Valley Bank threatened to trigger a broader systemic crisis. “The American people and American businesses can have confidence that their bank deposits will be there when they need them,” Biden said in a statement. Silicon Valley Bank (SVB), a mainstay for the startup economy, was a product of the decades-long era of cheap money, with unique risks that made it especially vulnerable. With the Fed poised to continue raising interest rates, investors said the financial system may not be fully out of the woods just yet. “Going forward, we will work with Congress and the financial regulators to consider additional actions we could take in the future to strengthen the financial system,” the official said.

The S&P is 10.6% above its Oct. 12 closing low for 2022, though still down 17% for the year. "If you're sitting in cash and the market rallies, you might think you were greedy waiting for a bigger discount." Institutional investors' exposure to stocks was low going into Thursday's inflation report. Last month's fund manager survey from BofA Global Research showed investors' cash levels at their highest since April 2001. Lewis said he had not seen so-called real money – a term for mutual funds, pension funds and other non-leveraged market investors – participating in Thursday's rally, though he saw no evidence of selling from that cohort, either.

☆ Analysis: As U.S. stocks rip higher, investors hunt for signs of market bottom
▼ + stars: | 2022-10-19 | by ( Lewis Krauskopf | ) www.reuters.com time to read: +5 min

The current gain – which has seen the S&P 500 bounce about 6.5% last week's fresh intraday low for 2022 – comes on the heels of several rebounds throughout the year that eventually crumbled. However, the index has not been above that level since March even as the S&P 500 continued making new lows. The put/call ratio is yet to approach a 10-day average of at least 1.2 that has historically indicated that "you are more in the ballpark of panic and fear and close to a market low," he said. The current bear market has also been less severe than many past downturns. The S&P 500 slid as much as 25.4% this year, while bear markets since 1929 have seen an average decline of 35%, according to BofA.

"There will be impacts, there’s correlations ... some market volatility, and then how it weighs in the global growth picture," said Paul Malloy, head of municipals at Vanguard. The wild swings in the pound have ricocheted across currency markets, where volatility was already climbing. According to the widely watched Deutsche Bank Currency Volatility Index , volatility across currencies on Wednesday hit its highest level since the March 2020 COVID-19- induced market meltdown, jumping more than 20% from levels last week. Closely followed indicators of financial stress remain contained. U.S. stock market volatility as measured by the "fear index," the VIX (.VIX), has also climbed in recent days but remains below its 2022 highs.

☆ 4 S&P 500 renews slide, hits near two-year low
▼ + stars: | 2022-09-28 | by ( ) www.reuters.com time to read: +5 min

Register now for FREE unlimited access to Reuters.com Registerread moreMARKET REACTION:STOCKS: The S&P 500 (.SPX) lost 10.94 points, or 0.30%, to stand at 3,644.1, just above the old low at 3,636.87. Even if the inflation data gets better with the next report in mid-October, we won’t know how the Fed will react to it. There is a good case for that to happen if we get some inflation data that is a lot less scary than the last report." "(The support level for the S&P is) "a stretch at 3400, maybe 3200 and the worst case is probably 3000." But in terms of a sustained rally, I think it really takes anticipating the end of Fed rate hikes."

☆ S&P 500 renews slide, hits near two-year low
▼ + stars: | 2022-09-27 | by ( ) www.reuters.com time to read: +4 min

Register now for FREE unlimited access to Reuters.com Registerread moreMARKET REACTION: STOCKS: The S&P 500 (.SPX) lost 22.25 points, or 0.61%, to stand at 3,632.79. Also, no overt catalysts to propel breakout to the upside”“Markets had “fought the Fed” all year, hoping for more dovish tilt soon. (The support level for the S&P is) "a stretch at 3400, maybe 3200 and the worst case is probably 3000." But in terms of a sustained rally, I think it really takes anticipating the end of Fed rate hikes." Register now for FREE unlimited access to Reuters.com RegisterAmericas Economics and Markets Desk; +1-646 223-6300Our Standards: The Thomson Reuters Trust Principles.

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