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📈 All the latest updates on the Stock Market: signals, news, and everything that might move the narrative — all in one place. 😉 We keep an eye on the price; you can just watch us do it. Buy Ads: @JamesCookTg
⚡️AMD Introduced A New Chip That Will Compete With Nvidia's Blackwell
⏺A new development is graphics processing units for data centers, known as GPUs. Production of the Instinct MI325X, as the chip is called, will begin before the end of 2024. If developers and cloud giants view AMD's AI chips as close replacements for Nvidia's products, it could put pricing pressure on the latter, whose GPUs were in high demand last year.
⏺Advanced generative AI such as OpenAI's ChatGPT requires huge data centers equipped with GPUs to perform the necessary processing, which has led to increased demand for AI chips from more companies.
⏺Nvidia has dominated most of the data center GPU markets over the past few years, but AMD has historically been in second place. Now AMD is aiming to ta inke share from its Silicon Valley rival, or at least grab a larger slice of a market it says will be worth $500 billion by 2028.
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⚡️Tesla lost 8% After Disappointing Robotaxi Presentation
⏺Shares of electric car maker Tesla fell after investors were underwhelmed by its long-awaited robotaxi unveiling. Musk unveiled the Tesla Cybercab concept car - a low, silver two-seater without a steering wheel or pedals - on Thursday evening. It is planned that the car will be able to be driven autonomously.
⏺Tesla's boss said the company hopes to produce the Cybercab until 2027, but did not provide details on where the vehicles would be built. Consumers will be able to buy a Tesla Cybercab for less than $30,000, he said. He also expects Tesla to launch "unsupervised" driver assistance (FSD) in Texas and California in its Model 3 and Model Y electric vehicles next year. So far, the technology requires the presence of a human driver behind the wheel, ready to steer or brake at any time.
⏺Following the event, analysts said the announcements failed to highlight any near-term opportunities for Tesla, instead prioritizing Musk's vision for a fully autonomous driving future. It is expected that it will be several more years before self-driving cars become an accepted reality on public roads, as regulators are concerned about the safety features built into such vehicles. Among the few companies that have successfully launched self-driving cars on public roads is Google's Waymo, which has offered its robotaxi service to the general public since June.
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⚡️Canadian Bank TD Bank Will Pay Colossal Fines Worth $3 Billion To US Authorities
⏺Canadian bank TD Bank has pleaded guilty to money laundering and will pay $3 billion in fines. According to the court decision, the US Department of Justice and federal financial regulators will receive money. The bank failed to control money laundering by drug traffickers and other criminals, a judge ruled.
⏺As part of the deal, TD Bank, whose U.S. unit is the 10th largest U.S. bank by assets, is accepting limits on its growth, the Office of the Comptroller of the Currency said Thursday. The combined assets of TD Bank's two U.S. subsidiaries will not exceed $434 billion.
⏺Attorney General Merrick Garland said will monitor the bank's compliance with anti-money laundering practices for three years as part of a settlement with the Justice Department that will receive $1.8 billion due to the bank's guilty plea in federal court
⏺Garland said that over a six-year period ending last October, TD Bank failed to track a staggering $18.3 trillion in customer activity, allowing three money laundering networks to move more than $670 million through bank accounts.
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⚡️Fed Suffers Split Over The Level Of Rate Cuts
⏺Federal Reserve Chairman Jerome Powell received some pushback over a half-point rate cut in September, with some officials favoring a smaller quarter-point cut at the meeting. Such information is provided in the Fed minutes.
⏺“Several participants indicated that they would prefer a 25 basis point reduction in the target range at this meeting, and several others indicated that they might support such a decision,” notes the minutes of the Sept. 17-18 meeting. All participants said it would make sense to reduce borrowing costs.
⏺US Federal Reserve cut its benchmark rate by 0.5 percentage points last month, a decisive move to protect economic growth as inflation weakens and risks to the labor market rise. Despite the debate, the minutes noted that a “substantial majority” supported a massive rate cut.
⏺One problem for some officials was that such a large change was inconsistent with their intention to gradually lower interest rates. Although Fed board member Michelle Bowman was the lone dissenting voice against the move, the minutes revealed a deeper rift among officials than the near-unanimous decision suggested. This suggests that Powell has led the committee to take a larger step.
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☄️Chinese Market Plunges 10% After Rally In Absence Of New Stimulus
⏺Chinese stock market crashed in trading on October 8 after a massive rally over the past few weeks. Hang Seng Index (HSI) fell 9.56% to its low of 20,891.98 points. Hang Seng China Enterprises, which includes Chinese shares traded in Hong Kong, fell 10.9% to 7,421.3 points. CSI 300 index began the first day of trading after the holidays with an upward gap of almost 11%, but immediately began to lose ground.
⏺Shares in Chinese stock market suffered a sharp decline today after a recent rally, due to the lack of additional economic stimulus measures from the Chinese government. Over nine trading sessions, up to and including September 30, the CSI 300 index grew by 27.8% and reached 4038.7 points at its peak. Previously, the indicator lost more than 45% from its 2021 maximum to mid-September.
⏺Today's decline Chinese stock market is associated with growing doubts among investors about the government's readiness to further stimulate the economy. This followed a press conference by the National Development and Reform Commission (NDRC) held on October 8. At the press conference, officials confirmed their intentions to increase spending and support low-wage groups of the population, but specific steps to stimulate the economy were not named. This created an atmosphere of uncertainty among investors, who expected more decisive action from the government.
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☄️Saudi Arabia Is Ready To Invest Billions In Hydrogen Production
⏺The country's sovereign wealth fund, led by Crown Prince Mohammed bin Salman, has created Energy Solutions Co. to finance the production of so-called “green” hydrogen. Investment in the new project is expected to be at least $10 billion, and this amount could rise significantly depending on demand for hydrogen. Part of the investment will be carried out jointly with state oil producer Saudi Aramco.
⏺Saudi Arabia is aiming to become one of the world's largest hydrogen producers, wanting to reduce its dependence on oil sales while remaining a global energy supplier. Green hydrogen is made from water and renewable energy and is an attractive solution for countries looking to reduce emissions from energy-intensive industries.
⏺However, green hydrogen remains expensive to produce and the infrastructure to transport it is costly. Saudi Arabia is building one of the world's few large-scale green hydrogen projects, costing $8 billion. Aramco is also interested in producing blue hydrogen using fossil fuels and capturing emissions.
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⚡️After The US dockers Strike, It Will Take Up To A Week For The Supply Chain To Normalize
⏺Union dockworkers suspended their strike at East Coast and Gulf Coast ports Thursday night, Oct. 3, until mid-January. But it will take some time for the affected ports to return to normal operations due to the problems that have accumulated during the strike.
⏺The International Longshoremen's Association (ILA) and about 45,000 longshore workers went on strike for about three days before reaching a tentative agreement with the United States Maritime Alliance (USMX), which represents the interests of port employers. The deal, which must be ratified by both sides by January 15, includes a 62% wage increase for dockers.
⏺While negotiations are ongoing, port operators and dockworkers will begin the process of clearing the impact of the strike at East Coast and Gulf Coast ports as they work through delayed cargo, which will likely take several weeks before the supply chain returns to normal.
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☄️Analysts At JPMorgan And BofA Have Changed Their Forecasts For The Fed Rate
⏺Economists at the American banks JPMorgan and Bank of America changed their forecasts for easing the monetary policy of the US Federal Reserve after the published data on the labor market in the country for September.
⏺Analysts at both banks believe that the Fed will cut interest rates by 0.25 percentage points at its next meeting in November, not 0.5 percentage points as they previously expected. Michael Feroli, chief U.S. economist at JPMorgan, and Bank of America economist Aditya Bhave pointed to Friday's jobs report as a boost to temper expectations about the path to rate cuts.
⏺At the end of September, the number of jobs in the non-farm sector increased by 254,000. At the same time, the consensus forecast was at 140,000. Experts believe that these data indicate the stability of the US economy, and a reduction of half a point looks inappropriate.
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⚡️Ubisoft Shares Soared 33% o
On Announcement Of Possible Buyout
⏺Tencent Holdings Ltd. and the founding family of Ubisoft Entertainment SA Guillemot are considering options including a possible buyout of the French video game developer after it lost more than half its market value this year
⏺Chinese technology company and Guillemot Brothers Ltd. spoke with consultants to explore ways to stabilize Ubisoft and increase its value, the sources said. One possibility being discussed, they said, is to merge to privatize the company.
⏺Ubisoft shares have fallen about 40% this year, giving the company a market capitalization of about 1.8 billion euros. Tencent owned 9.2% of Ubisoft's voting shares as of the end of April, while the Guillemot family owned about 20.5%, according to the company's latest annual report.
⏺Some minority shareholders, including AJ Investments, have pushed for either privatization or the sale of Ubisoft to a strategic investor amid falling share prices. The consideration is at an early stage and there is no certainty that it will lead to a deal. Tencent and the Guillemot family are also considering other alternatives
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⚡️Goldman Expert Expects Rally In US Market From The End Of October
⏺U.S. stocks are likely headed for a year-end rally that could push the S&P 500 above 6,000, said Scott Rubner of Goldman Sachs Group Inc.
He's bullish on U.S. equities for the year-end rally that begins Oct. 28 and is concerned his 6,000-point target is too low
⏺The expert pointed to seasonal factors - as his calculations show, since 1928, the S&P 500 has tended to grow by an average of about 4% from October 27 to the end of the year. On top of this, stocks tend to rise after US presidential elections as investors switch from cash to stocks after the risks associated with the vote fade.
⏺The bank's tactical specialist Rubner's year-end target differs from the 5,600 estimate from Goldman Sachs chief U.S. equity strategist David Kostin. On Wednesday, the index was trading at around 5,700
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⚡️US Companies Are Creating More Jobs Than Expected
⏺Private sector payrolls increased by 143,000 in September, following an upwardly revised gain of 103,000 in August, according to the ADP Research Institute in collaboration with the Stanford Digital Economy Lab. Economists had forecast growth of 125,000 jobs.
⏺This represents a recovery from five straight months of slow growth, especially compared to the previous month's performance, which was the weakest since March 2023. However, the three-month average fell to 119,000, one of the lowest levels since 2020.
⏺Most other data points to a slowing labor market. Unemployment has risen steadily in recent months and some measures of job growth have slowed, prompting the Federal Reserve to cut interest rates more than usual in September to stem further weakness.
⏺Fed Chairman Jerome Powell on Monday described the labor market as strong but said conditions have "clearly cooled over the past year." The ADP data comes ahead of the government's monthly jobs report on Friday, which is forecast to show a second month of modest wage growth in September. It is assumed that unemployment will remain at 4.2%.
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⚡️There Is A Sharp Rise In The Popularity Of Buyback In The USA
⏺In the US, buybacks have surged in popularity in 2024, despite growing concerns about a potential increase in the buyback tax to 1%. Companies are frantically announcing plans to buy back their own shares this year, despite a 20% rise in the S&P 500 index to a record high and a 1% tax on stock buybacks.
⏺The volume of announced buybacks this year has already exceeded $1 billion. This figure by the end of the year may exceed the previous record of $1.2 billion, set in 2022. According to analysts, this level could be reached as early as October or by the end of November.
⏺The 1% tax does not apply to large, large companies pursuing large-scale stock buyback plans. They likely concluded that market conditions now look favorable for stocks, especially after the Fed's first four-year rates. Chairman of the regulator Jerome Powell said yesterday that the economy remains in good shape and the central bank wants to avoid consequences on the labor market.
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EU Indices Face Serious Risks, Including From US Elections
⏺Goldman Sachs and BlackRock warn that the rally in European stocks faces serious headwinds. Fund managers are feeling pressure from worsening earnings forecasts and the upcoming US election. But the opinion on the impact of China's stimulating policies on economic growth is ambiguous
⏺European stocks face a number of headwinds to continued gains in 2024 after hitting another record high last week.
⏺Investors should be prepared for increasing risks associated with the region's weak economy and its impact on corporate earnings. The US elections add an additional layer of uncertainty, warn financial managers at Goldman Sachs Group Inc. and BlackRock Inc.
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☄️Japanese Stocks May Fall On Monday
⏺Japanese stocks are likely to fall on Monday after Shigeru Ishiba's surprise victory in the ruling party leadership race fueled expectations of higher interest rates.
⏺Nikkei 225 Stock Average futures fell 6% in Osaka after Ishiba's election. The Nikkei 225 jumped 2.3% ahead of the final result as traders bet on a win by Sanae Takaichi, who opposes higher bets. Analysts say the stock market is likely to see big swings in the near future until there is more clarity on Ishiba's policies.
⏺The yen rose sharply after Ishiba's victory. A stronger currency is likely to drag down exporters, while banks are likely to be supported by optimism that their profits will increase amid higher rates.
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⚡️China Announced New Economic Stimulus, But Has Not Yet Detailed Its Plan
⏺China has announced new stimulus plans, promising to soon introduce a package of additional fiscal policy measures to support economic development. It is reported that the package includes a significant increase in public debt, measures to support consumers, local authorities, subsidies for the poor, recapitalization of banks, measures to stabilize real estate markets.
⏺However, during Saturday's press conference, specific details of the plan and, most importantly, numbers were not yet announced, which is likely to prolong nervousness in the markets in anticipation of a clearer policy roadmap of the Chinese authorities. China's legislature is expected to meet in the coming weeks to approve additional debt issuance.
⏺A wide range of economic data in recent months has fallen short of forecasts, raising fears among economists and investors that the government's goal of growing the economy by about 5% this year is in jeopardy and that a longer-term structural decline could occur. Data for September, due out next week, is expected to show a further decline, but officials said they were "fully confident" the 2024 target would be met.
⏺New fiscal stimulus was the subject of intense speculation in global financial markets after a September meeting of the Communist Party's Central Committee Politburo signaled a heightened sense of economic urgency.
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⚡️BlackRock Hits Record $11.5 Trillion In Assets Amid Market Rally And ETF Surge
⏺BlackRock's assets under management hit a record high for the third quarter in a row, helped by rising inflows into the company's exchange-traded funds and soaring stock gains that have boosted the value of its clients' investments.
⏺Stock markets reversed the August sell-off and extended gains in the third quarter, driven by renewed hopes for a soft landing for the U.S. economy following encouraging inflation data. Broad market equities ended the third quarter higher, with the S&P 500 index up 5.4% and the MSCI Worldwide Stock Index rising 6.2%.
⏺Assets managed by BlackRock rose to $11.48 trillion in the third quarter, up from $9.10 trillion a year earlier and $10.65 trillion in the second quarter. The world's largest asset manager recorded $160 billion in long-term net flows in the third quarter. Total net flows hit a quarterly record of $221.18 billion, up from $2.57 billion a year earlier. Most of the inflows came from ETFs, at $97.41 billion. Meanwhile, clients poured $62.74 billion into BlackRock's fixed income products
⏺With Fed finally beginning its long-awaited easing cycle, asset managers are poised to benefit as huge cash reserves move into riskier assets such as fixed income products.
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⚡️Huawei Has Overtaken Apple In China Sales For The First Time In 46 Months
⏺Chinese company, under US sanctions, continues to build on the success of last year's 5G smartphone. That's consistent with findings from government think tank China Academy of Information and Communications Technology, which reported a 12.7% year-on-year decline in smartphone shipments abroad, including Apple's iPhone, in the same month. Those shipments fell to 1.87 million units in August from 2.14 million a year earlier as domestic smartphone shipments rose 26.7% to 24.05 million over the same period.
⏺The competition between Huawei and Apple in the world's biggest smartphone market has taken on new significance as the Shenzhen-based telecom equipment giant experiences a revival in its mobile phone business amid the US tech giant's recent troubles on the mainland.
⏺Strong demand for Huawei's high-end phone models such as the Mate and Pura series, as well as foldable smartphones such as the recently introduced Mate XT, helped push the company's average selling price and wholesale revenue to record highs in the second quarter, according to TechInsights. It said China remains Huawei's main market, accounting for 89% of global smartphone shipments.
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⚡️S&P Puts Boeing's Rating Under Review
⏺Global ratings agency S&P yesterday placed Boeing on CreditWatch with a negative rating due to a strike by 33,000 of the planemaker's US workers, which is halting production of its best-selling planes. The union, whose members have been on strike for 26 days, is seeking a 40% pay rise over four years and the restoration of a defined benefit pension that was eliminated in the contract a decade ago.
⏺The rating agency estimates Boeing will face cash outflows of about $10 billion in 2024 and will likely require additional financing. S&P's inclusion on CreditWatch reflects the increased likelihood of a rating downgrade if the strike continues, which would increase costs and delay the company's return to aircraft production and cash flow generation.
⏺Last month, all three major ratings , including S&P, warned that a prolonged strike at Boeing's West Coast plants could lead to ratings downgrades, a headache for the heavily indebted planemaker. At the same time, the company itself announced that it was stopping negotiations with the union of striking workers. She also withdrew her salary offer.
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⚡️Japan Records Highest Number Of Bankruptcies In A Decade
⏺Japan recorded its highest number of bankruptcies since 2013 in February-September this year as the country's companies increasingly struggled due to rising costs.
⏺According to a Teikoku Databank report, about 4,990 firms went bankrupt during the period under review, an increase of 18.6% compared to the same period last year. It is noted that the number of bankrupt firms in Japan has continued to grow since the second half of the fiscal year ending in March 2022.
⏺The sharp rise in bankruptcies partly reflects the impact of high prices, especially for smaller companies. A record 472 of 4,990 firms cited inflation as the main reason for their failure, the report said. What's more, the weak yen has driven up the cost of importing everything from food to energy.
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⚡️Brent Oil Exceeded $80
⏺Oil prices rose above last week's high on Monday as concerns about conflict in the Middle East mounted. Brent, the global oil benchmark, rose 2.8% to $80.33 a barrel amid Hamas rocket attacks on Israel and Israeli retaliatory strikes on targets in Gaza and Lebanon. Investors fear possible attacks on the region's energy infrastructure, which could disrupt oil supplies, or disruptions in the Strait of Hormuz.
⏺There are signs that hedge funds are starting to rethink their positions, trimming large short bets against Brent and increasing long positions early last week, according to ICE data. However, computer-managed funds that tried to track market trends were still likely betting against oil as of Thursday, according to a model portfolio compiled by Société Générale.
⏺Goldman Sachs analyst Dan Stravin predicts that a six-month supply disruption of about 1 million barrels per day could push Brent prices to $85 if OPEC makes up the shortfall. Without compensation, prices may exceed $90. Investors are concerned about a possible escalation of the conflict between Israel and Iran.
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🗓 Coming Up Next Week
Monday 07.10
⏺China Markets Closed
⏺Eurozone Retail Sales
Tuesday 08.10
⏺US Trade Balance
⏺Germany Industrial Production
Wednesday 09.10
⏺FOMC Minutes
Thursday 10.10
⏺Japan PPI
⏺US CPI
⏺US Initial Jobless Claims
⏺Earnings report - Delta Airlines
Friday 11.10
⏺Germany CPI
⏺US PPI
⏺Earnings report: JPMorgan, Wells Fargo, BlackRock
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☄️EU Will Impose Duties Of Up To 45% On Electric Cars From China
⏺EU member states agreed on Friday to impose tariffs on imports of electric vehicles from China. The decision was the biggest trade dispute between economic superpowers in a decade.
⏺Despite active opposition from Germany and Hungary, the European Commission's proposal to establish anti-subsidy duties of up to 35.3% was supported by the majority of countries. Ten member states voted in favor of the tariffs, five voted against and 12 abstained, two of the sources said.
⏺EU tariffs will be in place for five years and will range from 7.8% for Tesla to 35.3% for SAIC, which owns the MG brand. Chinese automakers have proposed curbing sales and raising prices to avoid tariffs, but the proposal has been rejected by the EU. Brussels said it would continue talks aimed at a negotiated settlement to curb rising imports of Chinese electric vehicles.
⏺China has already retaliated by threatening to impose tariffs on EU brandy imports and has also launched investigations into pork and dairy products.
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⚡️Brent Crude Rose Almost 10% Amid Escalation In The Middle East
⏺Brent, the global oil benchmark, traded just below $79 a barrel on Friday, up nearly 10% from the previous Friday on a strong four-day rally. The rise in prices comes as conflict in the Middle East escalates, raising concerns about the stability of supplies from a region that produces a third of the world's oil.
⏺Concerns about disruptions in oil supplies from Iran and through the Strait of Hormuz contributed to Brent's biggest weekly rise since October 2022. Analysts and traders fear that Israel could strike oil infrastructure, and Iran and its allies would retaliate with attacks on energy facilities in the region.
⏺OPEC+ holds more than 5 million barrels per day outside the market, which could be used in case of disruptions. The most significant supply disruption could occur if Iran decides to block tanker traffic through the Strait of Hormuz, through which about a fifth of the world's oil supplies pass.
⏺A complete blockage of the strait could lead to "unmanageable oil prices" of $150 a barrel or higher. This could have a significant impact on the global economy, analysts warn
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💸Chinese Shares In Hong Kong Snapped 13-Day Gains On Bubble Fears
⏺Hang Seng China Enterprises Index, which shows their dynamics, fell by 4.9% to its minimum on October 3. By the end of the trading day, the fall slowed to 1.6%, Hang Seng China Enterprises stood at 7914.16 points.
⏺Investors are optimistic that the current rally in Chinese stocks is different from previous short-lived surges, with global money managers increasingly betting on growth in a once-shunned market. However, brisk trading last week had traders wary of a bubble forming while equity benchmarks reached overbought levels. Thus, the Hang Seng China relative strength index reached a record level of 91 points, while traders consider the 70 point mark as a signal of overbought.
⏺Following the rise in Chinese stocks, it is normal to see profit taking ahead of the weekend, as well as before mainland Chinese markets open next week. Investors may not attach much importance to the current decline in shares, considering it a temporary phenomenon. Continued growth will depend on whether Beijing takes concrete measures after the holidays.
⏺The rally in Chinese stocks was facilitated by the fact that the Chinese authorities introduced a number of measures aimed at supporting the real estate sector and the stock market. Cities in China have relaxed home buying rules, and the People's Bank has lowered mortgage rates. The stimulus package also included lowering interest rates, supporting stock liquidity and easing reserve requirements for banks.
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⚡️Hurricane Helen Drew The Attention Of Chip Makers To Quartz Supplies
⏺Global semiconductor makers are closely monitoring supplies of high-purity quartz, a critical material for the industry, after Hurricane Helen shut down production at two North Carolina mines that supply much of the world's supply.
⏺Taiwan Semiconductor Manufacturing Co., the world's largest chipmaker, and Germany's Infineon Technologies AG said they were monitoring the situation but did not expect significant impacts on their operations. South Korean Samsung Electronics Co. and SK Hynix Inc. they also do not predict serious consequences. TSMC's supplier, Topco Scientific Co., a quartz processor, is conducting inventory reviews and is in close contact with all suppliers.
⏺Production from the mines of Sibelco and Quartz Corp. was suspended on September 26. The hurricane severely damaged the cluster, causing flooding and power and communications outages. The storm killed at least 166 people in six states. The mines, located near Spruce Pine in northern North Carolina, provide more than 80% of the world's supply of high-purity quartz. According to BloombergNEF, the mines produce about 20,000 tons of this mineral annually.
⏺The impact of this event on the global chip manufacturing sector is unclear, as semiconductor companies typically have inventories of critical components and production in North Carolina is expected to resume.
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⚡️US Port Strike Adds Uncertainty For Fed
⏺A strike by port workers on the US East Coast and Gulf Coast that began on Tuesday adds to the uncertainty for the Fed. The regulator is preparing to make a decision on the rate at its next meeting on November 6-7.
⏺David Altig, executive vice president and chief economic adviser at the Atlanta Federal Reserve Bank, noted that one factor helping to curb inflation now is falling commodity prices, which could be at risk if the flow of imports is stopped for long during the dockers' strike.
⏺Ports from Maine to Texas were closed after the International Longshoremen's Association called its first strike since 1977. Many analysts expect the strike to be short-lived as it could seriously impact trade, putting pressure on both sides to reach an agreement.
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⚡️Powell Indicated Further, Smaller Rate Cuts
⏺Fed Chairman Jerome Powell pointed to a further, more minor rate cut and called for attention to the fact that the regulator is not adhering to any given course. The Fed chairman also stressed that the recent half-percentage-point interest rate cut should not be interpreted as a sign that further steps will be as aggressive. In fact, this indicates that the next steps will be smaller, the head of the US Central Bank assured.
⏺At the same time, Powell expressed confidence in the strength of the US economy and believes that inflation continues to decline. He stressed that he and his colleagues will seek to balance lower inflation with support for the labor market and will allow data to guide future actions.
⏺He said that if economic data remains stable, there will likely be two more rate cuts this year, but in smaller increments of a quarter of a percentage point. This contradicts market expectations for more aggressive easing.
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🗓 Coming Up Next Week
Monday 30.09
⏺China Composite PMI
⏺UK GDP
⏺Germany CPI
⏺FED Powell Speech
Tuesday 01.10
⏺China - Markets Closed
⏺US, Japan, Germany, UK, Eurozone PMIs
⏺Eurozone CPI
Wednesday 02.10
⏺China - Markets Closed
⏺US ADP Nonfarm Employment
Thursday 03.10
⏺China - Markets Closed
⏺Japan, Australia, Germany, UK, Eurozone PMIs
⏺US Services PMI
Friday 04.10
⏺China - Markets Closed
⏺US Nonfarm Payrolls
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☄️Quant Hedge Funds Trapped in Short Squeeze After China Glitch
⏺Some firms suffered heavy losses because they shorted index futures for their so-called Direct Market Access strategies, said the people. Some saw their losses exacerbated by a Shanghai Stock Exchange glitch that left them unable to sell holdings to meet margin requirements.
⏺The losses come as many quants are still recovering from record drawdowns suffered during China’s stock market meltdown in February, when their favored small-cap stocks crashed, prompting regulators to push for the DMA products to be phased out. Now they have been caught wrongfooted again after China’s latest economic stimulus measures sparked the biggest weekly equity rally since 2008.
⏺Still, Friday’s drawdowns in the DMA products were smaller than the losses seen in February, and any forced liquidations should be rare, said the people. Some brokerages have agreed to extend deadlines for the quant clients to add margins for bets on index futures
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