Housekeeping: Good Morning. We will be doing a breakdown on Swap dealer risk and roles tomorrow on this program
Today:
Premium Analysis: Citi analysis
Discussion: Swap Dealers are Unhedged Bookies Now
Premium Analysis: Swap Dealers are Unhedged Bookies Now
Quick note: Gold and Silver margins were raised by Comex last night. This is intended to dampen speculative volatility.
Comex raises margins Gc to 11k from 10.5 Si to 11.5k from 11k No real shorts left to cover… now nibbling away at ROI for newer entrants. Room for more hikes for sure.
US equities rallied on Thursday, with the S&P 500 closing at a record high after positive US economic data. Large caps and small caps advanced: S&P 500 (+0.40%) vs. Russell 2000 (+0.57%). MSCI Emerging Markets (EEM) and MSCI EAFE (EFA) rose 3.66% and 2.20% respectively.
Market News:
"China’s leaders have vowed to intensify fiscal support for the world’s second-largest economy, fuelling markets with hopes of more intervention just days after the central bank announced the biggest monetary stimulus since the pandemic. The politburo, led by President Xi Jinping, pledged on Thursday to “issue and use” government bonds to better implement “the driving role of government investment”, in comments that come as analysts warn that China is in danger of missing its official economic growth target this year." Source: FT
"Costco posted higher-than-expected profit as moderating prices fueled consumer spending and store traffic climbed... As inflation cools, shoppers are purchasing more non-foods items, Chief Financial Officer Gary Millerchip said Thursday on a call with analysts. Home furnishings and tires sold particularly well, while some products, such as consumer electronics and appliances, are getting cheaper." Source: Bloomberg
"Global companies have stepped off the sidelines in recent months to pursue blockbuster takeovers of rivals, emboldening hopes of a comeback in mergers and acquisitions even as the overall number of deals sank to a nine-year low. Some $2.3tn-worth of deals were announced in the first nine months of the year, according to data compiled by LSEG, up 17 per cent from the same period last year." Source: FT
"DirecTV is in advanced talks to acquire its satellite-TV rival Dish... in a deal that could create one of the country’s largest pay-TV distributors after decades of aborted attempts to combine... The deal, if secured, would give DirecTV’s owners—the telecom giant AT&T and private-equity firm TPG—a way to dramatically cut costs. It would give Dish’s publicly traded owner, EchoStar, a vital lifeline ahead of looming debt payments." Source: WSJ
"Saudi Arabia is ready to abandon its unofficial price target of $100 a barrel for crude as it prepares to increase output, in a sign that the kingdom is resigned to a period of lower oil prices." Source: FT
"Super Micro Computer, the server maker that saw its business take off with the artificial-intelligence boom, is being probed by the Justice Department following a critical report by an activist short-selling firm." Source: WSJ
"The Food and Drug Administration approved Bristol Myers Squibb’s highly anticipated schizophrenia drug, the first novel type of treatment for the debilitating, chronic mental disorder in more than seven decades. The company expects the twice-daily pill, which will be sold under the brand name Cobenfy, to be available in late October. Cobenfy will cost $1,850 for a month’s supply or $22,500 annually before insurance and other rebates, according to Bristol Myers Squibb executives." Source: CNBC
Politics/Geopolitics:
"Jordanian army announces the downing of a drone that tried to infiltrate Jordanian territory in the southern military region", according to Sky News Arabia
"IRNA: Iran's foreign minister said Tehran will not remain idle towards all-out war in Lebanon", according to Al Arabiya.
"Syrian News Agency: 5 soldiers were killed in an Israeli aggression targeting a military site on the Syrian-Lebanese border", according to Al Jazeera
"An informed source for Sky News Arabia: The truce initiative has not yet been rejected and the effort continues to reach a truce for 21 days", according to Sky News Arabia.
Israeli PM Netanyahu said he had a meeting on Thursday to discuss the US ceasefire initiative and that they will continue these discussions in the coming days, according to Reuters.
Lebanese Parliament Speaker Nabih Berri told L'Orient Le Jour newspaper that Israeli PM Netanyahu lies to everyone and retracted his approval of the initiative, while Berri said that they adhere to the revival of the demand for a ceasefire in Gaza as in Lebanon.
US and Israeli officials held talks on Lebanon in New York on Thursday and discussions continued for a 21-day ceasefire, according to the White House. It was later reported that Secretary of State Blinken and Israeli Minister of Strategic Affairs Dermer emphasised the need for a ceasefire and Blinken underscored that further escalation of the conflict will only make that objective more difficult.
French President Macron said the US has to increase pressure on Israeli PM Netanyahu to agree to the 21-day ceasefire, while he added Israel cannot invade Lebanon today and it would be a huge mistake, according to an interview with CBC
Former US President Trump responded that he would do that when asked if he would make a deal with Iran if he is elected, while he also commented that the war in the Middle East has to end.
Israeli Walla website stated the Israeli army attacked 1,600 targets in Lebanon during the past day, according to Al Jazeera.
Israeli Air Force Chief said they will stop any arms transfer by Iran to Hezbollah and are preparing to assist troops in ground operations against Hezbollah.
Israeli army said missiles were fired from Yemen and the interceptor was launched, while it added that the 'Arrow' aerial defence system made a successful interception.
Former US President Trump said he will meet with Ukrainian President Zelensky on Friday and that he has some disagreements with Zelensky, while he responded "We'll see what happens" when asked if Ukraine should hand over some land to Russia to end the war.
Romanian Defence Ministry said it is possible one Russian drone from the overnight attack on Ukraine entered Romanian air space for under three minutes.
Data on Deck: Revisionist GDP on Deck
Now that the cuts are in and the recession debate will become academic as stocks have their restored liquidity, focus will again return to inflation risks
MONDAY, SEPT. 23 PMI Sept
TUESDAY, SEPT. 24 Case-Shiller home price index/ Consumer confidence
