Fingers point at hedge funds after Japan bond sell-off; Unusual Calm Hangs Over Stock Market

Nov 15, 2019

Lead Stories

Fingers point at hedge funds after Japan bond sell-off
Laurence Fletcher, Tommy Stubbington and Leo Lewis – Financial Times
Hedge funds are taking the blame for a drop in Japanese government bond prices that has reverberated around global debt markets.
Benchmark bonds in the US, Germany and the UK have all taken a tumble in recent weeks, driven by an unusual outbreak of optimism about the global economic outlook that has boosted equities.

Unusual Calm Hangs Over Stock Market
Karen Langley – WSJ
The stock market has been eerily quiet of late.
The Dow Jones Industrial Average’s unchanged close Tuesday was only the most extreme in a series of very slow trading days.
Over the five sessions ending Thursday, the Dow’s average absolute change was 0.08%, the lowest rolling five-day average for the 30-company index since April 2017, according to Dow Jones Market Data.

Dow on the verge of busting above milestone at 28,000
Mark DeCambre – MarketWatch
The Dow Jones Industrial Average was flirting with history on Friday—its first breach of a psychological milestone since mid July, as equity benchmarks mount an assault on records on the back of hope for progress in U.S.-China trade negotiations.
The Dow DJIA, +0.52% was up about 151 points, or 0.6%, at 27,934, at last check, putting the blue-chip index on pace for its 11th record close of 2019 and positioning the index for a chance to log a 1,000-point milestone for the first time since July.

****JB: As I post this (12p CST) the DJIA stands at 27,922.60.

We asked 3 money managers how Trump’s impeachment hearings might impact the stock market. Here’s what they said.
Carmen Reinicke – Markets Insider
Public impeachment hearings against President Donald Trump began Wednesday in Washington D.C. with testimony from two top foreign-service officers.
On Friday, Marie Yovanovitch, the former US ambassador to Ukraine, will be the third official to testify, followed by more key players who will testify later in November. The hearings center on whether or not the president strong-armed Ukraine to look into political rival Joe Biden.

Exchanges and Clearing

MIAX Successful as PTAB Invalidates Sixth and Final Nasdaq Patent; All Asserted Patents Now Invalidated
PR Newswire
Miami International Holdings, Inc. (MIH), the parent holding company of the MIAX Options, MIAX PEARL and MIAX Emerald exchanges (MIAX), today announced that the sixth and final Nasdaq patent asserted against MIAX as part of its infringement complaint has been found invalid by the Patent Trial and Appeal Board (PTAB) of the United States Patent and Trademark Office. The PTAB ruled in its final written decision that all claims of Nasdaq’s U.S. Patent No. 7,933,827 are unpatentable under 35 U.S.C. Section 101.


A subdued VIX is a bullish sign for the stock market
Lawrence G. McMillan – MarketWatch
The S&P 500 Index has been plowing ahead, keeping its chart bullish. Price momentum is strong, as all moving averages continue to advance.
The S&P 500 SPX, +0.55% has closed or traded at a new all-time high on nine of the last 13 trading days. There is tentative support at 3,065 points (this month’s lows) and more important support at 3,025-3,030 (the previous all-time highs).

Here’s What Hedge Funds Pitched at the Sohn London Conference
Chris Bourke – Bloomberg
Hedge fund bears regained a dose of confidence at an annual gathering of industry managers in London on Thursday.
While most of the bets at the Sohn investment conference were long, three were short ideas and one was an arbitrage play. That’s slightly more bearish than last year, when only one speaker braved going short. Those investors that acted on 2018’s stock tips would have been largely rewarded — eight out of 10 are in the money a year later.


The Finance 202: Hedge fund execs risk their bottom lines in fight with Elizabeth Warren
Tory Newmyer – The Washington Post
Hedge fund executives who get paid handsomely to manage risk should consider their own as they continue waging a rhetorical firefight with Sen. Elizabeth Warren (D-Mass.).
Wall Street billionaires are taking the gloves off, even lobbing thinly veiled attacks against Warren over her claims of Native American heritage. Hedge fund CEO Leon Cooperman, back on CNBC, called out the controversy over Warren’s claims to Native American heritage and saying, “We don’t need another fabricator in the White House.”

Reuters/Ipsos poll: 3% support Bloomberg for Democratic nomination
Chris Kahn – Reuters
If former New York City Mayor Michael Bloomberg enters the 2020 Democratic presidential nominating race, he will be the fifth most-popular candidate, and his presence may draw more support away from former Vice President Joe Biden than others, a new Reuters/Ipsos public opinion poll shows.

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