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Tag: Traders
Bond Traders Warn of Inflation Shock as US Yield Curve Flattens
(Bloomberg) — US bond markets are flashing a warning to US President Donald Trump that his move to unleash tariffs on top trading partners risks fueling inflation and stymieing growth.
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Short-end Treasury yields rose as much as eight basis points to 4.28% on Monday as longer-dated rates held steady, flattening the curve by the most since November.
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Such moves are typically associated with stagflation — when inflation and elevated interest rates harm bonds in the short term, only for subsequently weaker growth to make longer-term debt more appealing.
Traders have pared bets on the extent of easing from the Federal Reserve this year and now see a 50% chance of two quarter-point rate cuts this year, down from 90% on Friday.
Over the weekend, Trump followed through on his threat to impose levies on the exports of Canada, Mexico and China, while reiterating a warning to the European Union that tariffs “will definitely happen.” Goldman Sachs Group Inc. is positioning for further curve flattening, and firms including BNP Paribas SA, Singapore’s DBS Bank Ltd. and Japan’s SMBC Nikko Securities Inc. said this puts the US economy at risk of falling into stagflation.
“Trump’s policy mix has increased stagflationary risks in the economy,” Calvin Tse, head of Americas macro strategy and US economics at BNP in New York, wrote in a note. That implies the Fed will keep rates on hold for the next couple of meetings while it judges whether growth or inflation risks are “more serious,” Tse added.
With gasoline and food not excluded from tariffs, the BNP strategists said long-term inflation expectations could keep rising, favoring 10-year inflation-linked Treasuries.
“If this does indeed materialize, we think that rate hikes become a real possibility from the Fed this year, even in the face of lower growth,” they added.
Euro-area bonds diverged sharply with US peers, rallying amid a broad flight to safety. The two-year German yield dropped eight basis points to 2.05%, more than 220 basis points lower than the US equivalent, the wides gap since late December.
“In terms of the strategic implications of this dramatic opening salvo on the trade war front, we would be firmly biased in favor of a wider Atlantic spread,” Rabobank strategists wrote in a note. They recommend positioning for that move via shorter-dated tenors given longer-dated Treasuries may gain on the view that trade frictions will weigh on future US growth.
Bond traders are sounding the alarm as the US yield curve continues to flatten, with some warning of a potential inflation shock on the horizon. The yield curve, which measures the difference between short-term and long-term bond yields, has been narrowing in recent months, a trend that is typically seen as a signal of economic uncertainty.Traders are concerned that this flattening yield curve could be a precursor to rising inflation, as historically low interest rates and massive government stimulus measures have the potential to drive up prices. Inflation erodes the purchasing power of fixed-income investments like bonds, leading to lower returns for investors.
The warning from bond traders comes as the Federal Reserve continues to keep interest rates near zero and has signaled that it is willing to tolerate higher inflation in the short term. While some economists believe that any increase in inflation will be transitory, others fear that the combination of loose monetary policy and fiscal stimulus could lead to sustained inflationary pressures.
Investors are being urged to closely monitor the yield curve and be prepared for potential shifts in the market that could impact their investment portfolios. As the debate over inflation and interest rates continues to unfold, bond traders are advising caution and vigilance in navigating the uncertain economic landscape.
Tags:
- Bond traders
- Inflation shock
- US yield curve
- Flattening yield curve
- Bond market
- Interest rates
- Economic indicators
- Financial markets
- Federal Reserve
- Investment strategies
#Bond #Traders #Warn #Inflation #Shock #Yield #Curve #Flattens
Wall Street Traders Take GDP Report in Stride: Markets Wrap
(Bloomberg) — Stock futures remained higher after the latest snapshot on the world’s largest economy did little to alter bets on the Federal Reserve rate path.
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S&P 500 futures rose 0.3%. The yield on 10-year Treasuries declined two basis points to 4.51%. The Bloomberg Dollar Spot Index fell 0.1%.
The US economy ended 2024 with solid, yet softer growth as a strike at Boeing Co. and leaner inventories diminished a generous tailwind from consumer spending. Inflation-adjusted gross domestic product increased an annualized 2.3% in the fourth quarter after rising 3.1% in the prior three-month period, according to the government’s initial estimate published Thursday. The median forecast in a Bloomberg survey of economists called for a 2.6% growth.
Corporate Highlights:
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The collision between an American Airlines Group Inc. regional jet and a military helicopter near Ronald Reagan airport in Washington left no survivors on board the two aircraft, authorities said, making it one of the most deadly US air disasters in decades.
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Tesla Inc. plans to launch a long-promised robotaxi business and get back to growing vehicle sales after a year of decline in both deliveries and earnings.
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Microsoft Corp. said its cloud-computing business will continue to grow slowly in the current quarter as the company struggles to build enough data centers to handle demand for its artificial intelligence products.
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Meta Platforms Inc. Chief Executive Officer Mark Zuckerberg exuded confidence in his company’s artificial intelligence strategy, saying 2025 will be a “really big year” in which its AI assistant will become the most widely used in the industry.
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Caterpillar Inc. warned that revenues will be “slightly lower” in 2025 as demand concerns weigh on the outlook of the heavy equipment maker.
Key events this week:
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US personal income & spending, PCE inflation, employment cost index, Friday
Some of the main moves in markets:
Stocks
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S&P 500 futures rose 0.3% as of 8:30 a.m. New York time
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Nasdaq 100 futures rose 0.5%
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Futures on the Dow Jones Industrial Average fell 0.1%
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The Stoxx Europe 600 rose 0.6%
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The MSCI World Index rose 0.1%
Currencies
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The Bloomberg Dollar Spot Index fell 0.1%
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The euro fell 0.1% to $1.0410
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The British pound fell 0.1% to $1.2438
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The Japanese yen rose 0.7% to 154.11 per dollar
In a recent turn of events, Wall Street traders have taken the latest GDP report in stride, as markets remain relatively stable amidst economic uncertainty. The report, which showed a slight decrease in GDP growth, did not seem to faze investors who remain optimistic about the overall state of the economy.Despite concerns about inflation and supply chain disruptions, traders on Wall Street are staying calm and focused on the long-term prospects of the market. With the Federal Reserve expected to maintain its accommodative stance on monetary policy, investors are confident that the economy will continue to recover and grow.
As the trading day comes to a close, major indices are holding steady, with some even posting modest gains. It seems that Wall Street traders are unfazed by the latest economic data and are choosing to focus on the bigger picture. Only time will tell how the markets will ultimately react to ongoing economic challenges, but for now, traders seem to be taking it all in stride.
Tags:
- Wall Street traders
- GDP report
- Markets wrap
- Stock market news
- Economic indicators
- Financial markets
- Wall Street update
- Market analysis
- Trading trends
- Investment insights.
#Wall #Street #Traders #GDP #Report #Stride #Markets #Wrap
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Stocks Selloff Returns as Traders Lose Their Nerve: Markets Wrap
(Bloomberg) — An early rally in equities collapsed and major US benchmarks looked poised to extend a selloff that shaved more than a trillion dollars from share prices over the last four sessions. Tesla Inc.’s post-Christmas slump swelled to nearly 20% after its annual vehicle sales dropped.
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Treasury yields steadied. The rate on the benchmark 10-year was nearly 20 basis points above the level prior to Jerome Powell’s hawkish turn at a Dec. 18 Federal Reserve meeting. Big moves have proliferated across asset classes after Powell’s board expressed waning enthusiasm for interest-rate cuts. The Cboe Volatility Index climbed for the fourth time in five days.
Tesla sagged after the electronic vehicle-marker’s fourth-quarter deliveries missed estimates and annual sales dropped for the first time in over a decade. The stock was on track for its worst five-day drop in more than two years.
This year will be a “show-me year” for corporate earnings, according to Lisa Shalett at Morgan Stanley Wealth Management. As for the grim end to 2024, it’s “too soon to call it a bad omen,” she told Bloomberg Television.
Treasuries erased an early advance after a reading of weekly jobless claims fell to an eight-month low. A Bloomberg gauge of the dollar’s strength traded at a more than two-year peak.
Goldman Sachs economists led by Jan Hatzius noted that “seasonal adjustment challenges can make jobless claims readings particularly volatile around the holiday season.”
US stocks had been straining to snap a losing streak that took some shine off the S&P 500’s best two-year run dating back to the late 1990s. The index has surged more than 50% since the start of 2023, driven by gains in the tech megacaps amid enthusiasm about the boost to profits from artificial intelligence.
Meanwhile, an attack on revelers celebrating New Year’s in New Orleans thrust US domestic security back into the spotlight less than a month before Donald Trump is sworn in as president. The Federal Bureau of Investigation is probing that incident as well as the deadly explosion of a Tesla Cybertruck outside of Trump’s hotel in Las Vegas.
A shooting overnight at a nightclub in New York City only added to the anxiety, while authorities said it wasn’t related to terrorism.
Stocks Selloff Returns as Traders Lose Their Nerve: Markets WrapThe stock market saw a sharp selloff today as traders lost their nerve amid growing concerns about inflation, rising interest rates, and geopolitical tensions. Major indices tumbled, with the S&P 500, Dow Jones Industrial Average, and Nasdaq all posting significant losses.
Investors were spooked by a combination of factors, including the Federal Reserve’s plans to raise interest rates sooner than expected, surging inflation data, and escalating tensions between Russia and Ukraine. These uncertainties led to a broad-based selloff across sectors, with technology, financials, and energy stocks leading the decline.
The VIX, a measure of market volatility, spiked higher as investors rushed to hedge their positions and protect against further downside risk. Safe-haven assets such as gold and Treasury bonds saw a surge in demand, while riskier assets like cryptocurrencies and meme stocks took a hit.
As the market sell-off intensified, some analysts warned that the recent bout of volatility could be a sign of more turbulence ahead. The lack of a clear catalyst for the selloff added to investors’ anxiety, with many questioning whether this is the start of a larger correction in the market.
Despite today’s sharp decline, some investors remained optimistic about the long-term outlook for stocks, citing strong corporate earnings, robust economic growth, and supportive fiscal and monetary policy. However, the current environment of heightened uncertainty and volatility is likely to keep investors on edge in the days ahead.
In conclusion, the stock market selloff today serves as a stark reminder of the fragility of investor sentiment and the potential for sudden shifts in market dynamics. As traders navigate these uncertain times, it will be crucial to stay informed, remain disciplined, and be prepared for further volatility in the days and weeks to come.
Tags:
- Stocks selloff
- Traders
- Market wrap
- Market news
- Stock market update
- Market volatility
- Investor sentiment
- Stock market analysis
- Trading trends
- Market fluctuations
#Stocks #Selloff #Returns #Traders #Lose #Nerve #Markets #Wrap
ALGO TRADING CHEAT CODES: Techniques For Traders To Quickly And Efficiently Develop Better Algorithmic Trading Systems (Essential Algo Trading Package)
Price: $7.99
(as of Dec 24,2024 19:16:34 UTC – Details)
ASIN : B0948FFC58
Publisher : Independently published (May 7, 2021)
Language : English
Paperback : 189 pages
ISBN-13 : 979-8500391773
Item Weight : 9.3 ounces
Dimensions : 6 x 0.43 x 9 inchesCustomers say
Customers find the book provides useful knowledge and high-level concepts for trading strategies. They appreciate the practical approach and clear explanations of code. The book includes plain English codes and tips that are easy to understand. Readers mention it’s a time-saving resource that develops strategies that work in real time.
AI-generated from the text of customer reviews
Are you looking to take your algo trading game to the next level? Look no further – our ALGO TRADING CHEAT CODES: Techniques For Traders To Quickly And Efficiently Develop Better Algorithmic Trading Systems (Essential Algo Trading Package) is here to help!In this comprehensive guide, we provide you with the essential tips and tricks to develop better algorithmic trading systems quickly and efficiently. Whether you’re a beginner or an experienced trader, these cheat codes will give you the edge you need to succeed in the fast-paced world of algo trading.
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Dumb Money: The GameStop Short Squeeze and the Ragtag Group of Amateur Traders That Brought Wall Street to Its Knees
Price: $0.99
(as of Dec 03,2024 12:49:10 UTC – Details)
Customers say
Customers find the book fun, outstanding, and enjoyable. They also appreciate the cool way of telling the story. Opinions are mixed on the pacing, with some finding it readable enough, while others say the narratives are hard to follow and the style is maddening.
AI-generated from the text of customer reviews
The GameStop short squeeze saga has captivated the financial world in recent weeks, as a group of amateur traders on Reddit’s r/WallStreetBets forum banded together to drive up the stock price of the struggling video game retailer, causing massive losses for hedge funds who had bet against the company.Dubbed “Dumb Money” by some on Wall Street, these amateur traders have upended the traditional power dynamics of the market, showing that a ragtag group of internet users armed with smartphones and Robinhood accounts can have a significant impact on the financial world.
The GameStop short squeeze has highlighted the growing influence of retail investors in the stock market, as social media platforms like Reddit and Twitter have democratized access to information and trading tools. While some see this as a positive development that empowers individual investors, others warn of the dangers of market manipulation and excessive risk-taking.
As the dust settles on the GameStop saga, one thing is clear: the power dynamics of Wall Street are shifting, and the old guard is being forced to reckon with the rise of “Dumb Money” traders who are unafraid to challenge the status quo. Love them or hate them, these amateur traders have proven that they can bring even the most powerful financial institutions to their knees.
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