• Is a Beat in Store for Discover Financial (DFS) Q3 Earnings?
    Zacks

    Is a Beat in Store for Discover Financial (DFS) Q3 Earnings?

    Discover Financial's (DFS) third-quarter earnings are likely to have grown on the back of solid revenues.

  • Bloomberg

    Analysts Have a Few Problems With Trump ‘Chaos Trades’ Article

    (Bloomberg) -- While the idea Donald Trump’s White House might have leaked market-moving news isn’t crazy, a new magazine story suggesting traders made billions of dollars front-running geopolitical events failed to pass the smell test among Wall Street professionals.Analysts and investors who spoke to Bloomberg News were mostly skeptical of a Vanity Fair article titled “The Fantastically Profitable Mystery of the Trump Chaos Trades” that raises the possibility traders did more than get lucky buying S&P 500 futures right before big market swings. While nothing is impossible, experts who examined the story said any implication that people traded on inside information fell short of being proven.“I don’t see where the dots are connected,” said Michael O’Rourke, JonesTrading’s chief market strategist. “Unless you have the trading records, which you don’t, you can’t tie one and one together to make two the way this story is laid out.”The story’s author, William D. Cohan, said “of course I’m standing by my reports,” which reflected the accounts of sources in Chicago trading pits. The one-time Bloomberg Opinion columnist said he was alerted to trading patterns that caught the attention of professionals with decades of experience, and that alternate explanations could exist.“I don’t make any allegations, I don’t know what really happened. I was just being reportorial about what traders in the pit were seeing,” he said. “Do I trust my sources? Absolutely. Are they vastly experienced? Absolutely. Does everybody see things differently? Probably. What I’m saying is ‘Hey, there are regulators whose job it is to see these things and investigate them.’”The article describes five big trades in S&P 500 e-mini futures from June 28 to Sept. 13, ranging from 55,000 to 420,000 contracts. It said each position was taken shortly before market-moving news -- three times involving the U.S.-China trade war, once the bombing of Saudi oil fields and once Hong Kong politics. Thanks to market reactions, the magazine said, people involved in the transactions could’ve booked gains of $82.5 million on the smallest to $1.8 billion on the biggest.But attributing sinister intent to a handful of trades that quickly became money-makers ignores how common such large trades are in the futures market, said industry pros. Given how often people move tens of thousands of futures contracts at once -- and how often people like President Donald Trump send stocks reeling -- someone looking for suspicious timing is guaranteed to find it.“Typically these stories focus on the times you’re right. No one writes about people buying a couple hundred million of e-minis and the market doesn’t do anything,” said Max Gokhman, the head of asset allocation for Pacific Life Fund Advisors. “Volume spikes happen all the time.”Anita Liskey, a spokeswoman for CME Group Inc., the exchange where S&P 500 futures trade, declined to comment. The Vanity Fair article cited a spokeswoman for the CME saying the trades in question didn't originate from a single source and they were of no concern.One trading expert, the chief executive officer of a major quantitative shop who asked not to be identified, said an analysis by his firm suggests no giant trades like the ones the article described appear to have happened. The story says that in the last 10 minutes of trading on Aug. 23, someone bought 386,000 of the September S&P 500 contracts. That number is close to the total volume for September e-minis from 3:50 p.m. to 4 p.m. New York time, spread over thousands of trades -- unlikely to be the work of a single person.Moreover, CME rules prohibit anyone from owning more than 60,000 e-minis at a time. And such a trade would’ve been gargantuan: worth nearly $60 billion. That’s big enough to send the stock market sharply higher and probably trigger trading halts, according to the CEO. That didn’t happen.The Vanity Fair story described Chicago pit traders concerned that people got inside information on “Trump or Beijing’s latest thinking” before taking the positions. Others saw coincidence. In a world where the president sends markets up and down multiple times a day, they said, it’s possible to depict virtually all trading as a reaction to something he does.“Every time stocks move after some crazy Donald Trump news -- which, again, is every time stocks move -- half the people who traded futures ahead of the move will look smart (and the other half will look dumb), and you can, if you want, build a conspiracy theory out of that,” Bloomberg Opinion columnist Matt Levine wrote Thursday.While the majority of trades at CME are for a few hundred contracts apiece, blocks of 20,000 or more frequently move. Since the start of October, for instance, Bloomberg data shows 50 transactions of greater than 40,000 contracts, or nearly four a day. Cross that many big blocks in a stock market where 1% moves in the benchmark index are standard and you’re sure to find some fortuitous timing.“Millions of futures contracts trade a day, billions of dollars trade a day, so to make a connection, I feel like it’s very hard to do,” said JonesTrading’s O’Rourke. “To me the article just speaks more about the national sentiment about the office of the president.”To contact the reporters on this story: Sarah Ponczek in New York at sponczek2@bloomberg.net;Nick Baker in Chicago at nbaker7@bloomberg.netTo contact the editors responsible for this story: Chris Nagi at chrisnagi@bloomberg.net;Jeremy Herron at jherron8@bloomberg.netFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Looking for a Glimpse of the Future...In the Past
    Zacks

    Looking for a Glimpse of the Future...In the Past

    Looking for a Glimpse of the Future...In the Past

  • Analysts Estimate BGC Partners (BGCP) to Report a Decline in Earnings: What to Look Out for
    Zacks

    Analysts Estimate BGC Partners (BGCP) to Report a Decline in Earnings: What to Look Out for

    BGC Partners (BGCP) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

  • Does BGC Partners, Inc.'s (NASDAQ:BGCP) CEO Pay Reflect Performance?
    Simply Wall St.

    Does BGC Partners, Inc.'s (NASDAQ:BGCP) CEO Pay Reflect Performance?

    In 1999 Howard Lutnick was appointed CEO of BGC Partners, Inc. (NASDAQ:BGCP). This report will, first, examine the CEO...

  • Financial Times

    IMF: alternative worries

    Alternative assets are so hot right now. Whether it be venture capital, private equity, real estate, hedge funds, art, jewellery, infrastructure, classic cars or music royalties, pension funds have never been more exposed to this cohort of financial assets. Very low rates have prompted institutional investors like insurance companies, pension funds, and asset managers to reach for yield and take on riskier and less liquid securities to generate targeted returns.

  • Financial Times

    Norwegian krone and Swedish krona sink in nervous markets

    Scandinavian currencies have been weighed down by rising trade tensions, but analysts are still puzzled by the krone’s weakness given the health of the domestic economy and the fact that the central bank has been raising interest rates at a time when most other central banks have been cutting.

  • Synchrony Financial (SYF) to Post Q3 Earnings: What to Expect
    Zacks

    Synchrony Financial (SYF) to Post Q3 Earnings: What to Expect

    Synchrony Financial's (SYF) third-quarter earnings are likely to have grown on the back of higher card sales.

  • Nasdaq (NDAQ) Earnings Expected to Grow: Should You Buy?
    Zacks

    Nasdaq (NDAQ) Earnings Expected to Grow: Should You Buy?

    Nasdaq (NDAQ) possesses the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

  • MarketAxess (MKTX) Earnings Expected to Grow: What to Know Ahead of Next Week's Release
    Zacks

    MarketAxess (MKTX) Earnings Expected to Grow: What to Know Ahead of Next Week's Release

    MarketAxess (MKTX) possesses the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

  • Interactive Brokers (IBKR) Q3 Earnings Down, Revenues Up Y/Y
    Zacks

    Interactive Brokers (IBKR) Q3 Earnings Down, Revenues Up Y/Y

    Higher expenses hurt Interactive Brokers' (IBKR) Q3 earnings. However, increase in revenues offers some support.

  • How Does Virtu Financial, Inc. (NASDAQ:VIRT) Fare As A Dividend Stock?
    Simply Wall St.

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    Could Virtu Financial, Inc. (NASDAQ:VIRT) be an attractive dividend share to own for the long haul? Investors are...

  • Financial Times

    HKEX’s failed bid for LSE exposes a whole new realm of risk

    The failed attempt by Hong Kong Exchanges and Clearing to buy the London Stock Exchange Group highlights the tensions between Asia and the west and the challenges facing any attempt to harmonise economic and political interests between the two.

  • Financial Times

    Pound surges on hopes for a last-minute Brexit deal

    Sterling shot to its highest level in five months on Tuesday while banking and building stocks jumped as hopes of a last-minute Brexit deal rose. The pound rose 1.2 per cent against the US dollar to $1.2750, its highest since May. A similar gain against the euro left the pound above €1.15. The UK currency has ripped higher in recent days, buoyed by a flash of optimism that an exit deal is still possible.

  • Did Nasdaq, Inc. (NASDAQ:NDAQ) Insiders Sell Shares?
    Simply Wall St.

    Did Nasdaq, Inc. (NASDAQ:NDAQ) Insiders Sell Shares?

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  • Financial Times

    FirstFT: Today’s top stories 

    The proposed deal would give SoftBank more than a 50 per cent stake in the company, but it was unclear if the group — which is WeWork’s largest backer — would repurchase all of its outstanding stock.

  • Financial Times

    China bucks the trend with solid activity growth

    The advanced economies have been hit by major shocks in their trade and manufacturing sectors, and the impact is beginning to permeate the service sectors and labour markets. According to the latest Fulcrum nowcasts, overall activity growth in these major economies is running at only 0.8 per cent, less than half its trend rate. that China has bucked the pattern of below-trend growth.

  • How do brokerage firms make money: Yahoo U
    Yahoo Finance

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  • The Zacks Analyst Blog Highlights: JPMorgan, CME, Chubb, S&P Global and Ford
    Zacks

    The Zacks Analyst Blog Highlights: JPMorgan, CME, Chubb, S&P Global and Ford

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  • MarketAxess (MKTX) is an Incredible Growth Stock: 3 Reasons Why
    Zacks

    MarketAxess (MKTX) is an Incredible Growth Stock: 3 Reasons Why

    MarketAxess (MKTX) possesses solid growth attributes, which could help it handily outperform the market.

  • Financial Times

    GMO: on the comeback trail

    Gallons of ink has been spilled on the question of when value-investing -- the practice of buying treasure priced like trash -- will begin to outperform the market after a torrid decade of returns. To add to the literature is Grantham Mayo van Otterloo’s (GMO) Ben Inker, Head of Asset Allocation at the storied investment firm, who addressed the potential for a reversal in its third quarter letter, released Thursday.

  • Top Analyst Reports for JPMorgan, CME Group & Chubb
    Zacks

    Top Analyst Reports for JPMorgan, CME Group & Chubb

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