Leading Off
Good morning.
Markets continue to selloff after Friday’s drop as we enter the last trading week of the third quarter. US futures and markets in Europe are all lower this morning, and overnight the NIKKEI lost 2.66%, while the Hang Seng and CSI lost just over 0.50%. Gold and oil are also lower, but Treasury yields continue to rise.
- Friday saw the Dow lose 1.62%, the S&P 1.72%, and the NASDAQ 1.8%. The Dow actually hit a new intraday low for the year, and the S&P went below its most recent low back in June, before rallying into the close. We are watching the S&P 500, as its intraday low for the year is 3,636.87, and we could trade below that this morning.
- The British pound dropped to a record low on Monday against the US dollar. At one point it was down 4% to $1.0382, it is now around $1.08 as of 8:00am ET. The euro is also trading at a record low versus the dollar. A combination of US rate hikes and massive tax cuts in the UK have sent the foreign currency market into freefall, with so much of it transacted versus the strong US dollar.
- Overnight, the 2-year US Treasury hit 4.3%, as it continues to set new record highs. It is now trading around 4.25%, the 5-year is around 4% and the 10-year 3.7%. All are around their record highs for the past decade or more.
- As we head into the final week of trading for September, the Dow and S&P are down 6%, and the NASDAQ is down 8%. The only thing we have to look forward to is that, historically, September is the worst month for US markets and October one of its best. September and February are the only months that the S&P 500 has an average return in the red over the past 75 years.
- This week we have US durable goods and consumer confidence numbers on Tuesday, US pending home sales on Wednesday, the US GDP number on Thursday, along with the Porsche IPO. Friday is the US personal income and spending figures, along with the University of Michigan consumer sentiment report.
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In ETFs
- Volatility brings volume, and Friday was no different, as we saw the second biggest day of the past month. Only last Friday was higher, and that was triple-witching Friday. It was also the second busiest day going all the way back to the end of the second quarter. SPY traded 122 million shares, one of its busiest days of the quarter, QQQ 74 million, XLF 56 million, FXI 53.9 million and HYG 53 million.
- Schwab saw a jump in trading in FNDA and FNDX, along with FNDC and SCHK.
- Invesco saw PXJ, PDN, PRF, and PXH trade many multiples above average.
- I read this over the weekend: Intel is the worst-performing stock of the Dow this year, down nearly 50%. It's even worse for AMD and Nvidia as they are down over 50%. Year-to-date SMH is down 37%.
- On Friday, VIX products, tail risk and short funds were the outperformers. Oil services, energy and MLPs were the underperformers. Also underperforming were single country ETFs, like Germany and UK. Except for Brazil and India, all single country ETFs are hitting fresh lows for the year.
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And Finally.
Jupiter will make its closest approach to Earth in 59 years today. The largest planet in our solar system will be at opposition, meaning Earth is directly between it and the sun.
How close will it be? Not that close. There will be about 367 million miles between Earth and Jupiter, according to NASA. Jupiter is about 600 million miles away from our home planet at its farthest point.
If the weather is clear, you will be able to see the planet’s bands with just some binoculars. And you might even see a few of its moons. Also in the sky will be Saturn and Mars.
Not to be forgotten, Happy Rosh Hashanah.
Have a great Monday.
http://www.oldmissioncapital.com/institutional-services/
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ETF Sales and Trading
646-817-2942
sales@oldmissioncapital.com
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Old Mission is a global, multi-asset market-making firm that specializes in trading the hardest-to-price and most illiquid ETFs. Old Mission is trusted by many of the world’s largest institutions, providing trillions of dollars in on-screen liquidity in ETFs for over a decade. Because our collaborative and approachable team understands the importance of the human element of the business, we provide institutional clients with a level of service and willingness to problem-solve that is unmatched.
For more information, visit www.oldmissioncapital.com.
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