Morning trading took a reverse course sending major US indexes back to flat levels after the SP500 shoot up to a new historic high at the opening. WTI crude prices fell more than 4 percent after the U.S. government stunned the market with a raft of bearish inventory data that added to concerns over a global glut of oil.
Here is the current market situation from CNN Money
North and South American markets are lower today with shares in Mexico off the most. The IPC is down 0.37% while Brazil's Bovespa is off 0.28% and U.S.'s S&P 500 is lower by 0.02%.
$NYA200R chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% - 55%. Following a major market correction, the conditions for safe re-entry are when:
a) Daily $OEXA200R rises above 65%
Secondary Bullish Indicators:
a) RSI is POSITIVE (above 50)
b) Slow STO is POSITIVE (black line above red line)
c) MACD is POSITIVE (black line above red line)
NEW YORK/TEL AVIV (Reuters) - Teva Pharmaceutical Industries Ltd said on Wednesday it expected its $40 billion deal to buy Allergan Plc's generics business to close "at any time," even as the companies extended the deadline for completing the transaction to October to allow more time for the U.S. antitrust review.
LONDON (Reuters) - Hailed by investors as a weapon to fight off recession but slammed by critics for fuelling inequality, quantitative easing looks set for a comeback in Britain as the Bank of England tries to shield the economy from the fallout of Brexit.
HOUSTON (Reuters) - Global headwinds are undercutting the Federal Reserve's efforts to boost the U.S. economy, making low interest rates not nearly as stimulative as they were when the rest of the world economy was growing faster, a top Fed official said on Wednesday.
NEW YORK (Reuters) - Oil prices fell more than 4 percent on Wednesday after the U.S. government stunned the market with a raft of bearish inventory data that added to concerns over a global glut of oil.
WASHINGTON (Reuters) - The top U.S. securities regulator on Wednesday took another step toward tightening its oversight of security-based swaps by proposing new reporting requirements for transactions, nearly six years after Congress directed it to build a regulatory regime for the derivatives.
NEW YORK (Reuters) - In a blow to General Motors Co , a federal appeals court on Wednesday reversed part of a bankruptcy court ruling that protected the automaker from some lawsuits over an ignition switch defect that prompted the recall of 2.6 vehicles in 2014.
Heading into today's 30Y auction, Stone McCarthy said that "specials galore", noting that "though pressure might have eased up on the 3-year and 10-year, it has tightened on the 5-year and 2-year notes. Both issues are trading special at zero basis points this morning. Most off the run issues are still trading near GC, though the old 30-year bond is a bit tight at 25 basis points."
That hinted to us that there may be a small short squeeze as the US sells $12 billion in 30Y bonds today, helping the auction following this week's disastrous 3 and 10Y auctions, and sure enough moments ago the high yield on the 30Y printed at 2.172%, stopping through the 2.176% When Issued.
However, the high yield was just the beginning for this spectacular auction.
The bid to cover jumped from 2.423 to 2.485, the highest since last September's 2.536.
But the real story was the internals, where 68.5% was allotted to Indirect Bidders - this was the biggest allottment to foreign central banks and official buyers on record. Directs took down 8.4% of the auction and Dealers were left with 23.1%, the lowest on record as well.
So while demand may have been lacking for shorter maturities, when it comes to longer durations, 2.17% is seemingly a tremendous bogey and everyone wants a piece.
Back in November, when we last recounted the story of Michael Coscia, who was the first ever criminally convicted spoofer, we said that HFTs (and Citadel) have officially issued a warning "Outsmart Us, And You Go To Jail."
Here is a quick reminder for those who are unfamiliar with Mike Coscia's story:
He grew up in Brooklyn. His father was a subway token clerk and he was the first in his family to go to college. During the day he was a mail carrier and went to Brooklyn College at night and graduated with a business management degree in 1986. He has been married for 25 years and his son attends the University of Michigan.
He testified that he first became interested in the markets after his father bet on a horse race and turned a $2 bet into a $55,000 winner. His father put the profit in the market and Coscia tracked his father's investments, sparking his interest in finance. Coscia had a cousin who worked on the floor of the New York Mercantile Exchange and that's how he got started on the floor, beginning as a clerk. He was a trader for 27 years.
What happened then is the same thing that happened with the other two notorious "spoofers" who have gained prominence in the recent year, Nav Sarao and Igor Oystacher: they got too good. So good in fact the HFTs - mostly Citadel - were consistently losing money to them. As a result, Coscia et al had to be punished. He was accused of entering large orders into futures markets in 2011 that he never intended to ...
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