Americas ETP News
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Is USO an actively managed fund now?
April 27, 2020--Exchange traded products that can self-determine whether they trade passively or more actively introduce all sorts of new risks for investors and the wider market.
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Source: FT.com
Markets Diverge in Assessing the Economic Freeze
April 26, 2020--Stocks show anticipation of a quick return to growth, while oil markets price in a longer downturn.
Stocks continue to rise despite an unprecedented freeze in global economic activity and an oil-price crash, a divergence that makes some investors skeptical the gains can continue.
The S&P 500 has baffled many investors by rebounding 27% since March 23 even as job losses have mounted. The broad equity gauge is now only down about 3% in the past year, with recent gains led byAmazon.com Inc. and Netflix Inc.
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Source: wsj.com
NYSE eyes reopening trading floor, but timeline still unclear
April 24, 2020-- The New York Stock Exchange plans to reopen its iconic trading floor, which is shuttered due to coronavirus concerns, as soon as possible, but it has not yet set a date to do so, the NYSE and people familiar with the matter said on Friday.
"The NYSE will reopen its trading floors when we can do so with reduced risk and without adding strain on local healthcare systems," exchange spokesman Farrell Kramer said in a statement, without giving further details. The exchange operator also has an options trading floor in San Francisco that is closed due to the pandemic.
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Source: Reuters
CBO's Current Projections of Output, Employment, and Interest Rates and a Preliminary Look at Federal Deficits for 2020 and 2021
April 24, 2020--CBO has developed preliminary projections of key economic variables through the end of calendar year 2021, based on information about the economy that was available through yesterday and including the effects of an economic boost from legislation recently enacted in response to the pandemic.
In addition, CBO has developed a preliminary assessment of federal budget deficits and debt for fiscal years 2020 and 2021. CBO will provide a comprehensive analysis of that legislation and updated baseline budget projections later this year.
In the second quarter of 2020, the economy will experience a sharp contraction, and CBO's current economic projections include the following:
Inflation-adjusted gross domestic product (real GDP) is expected to decline by about 12 percent during the second quarter, equivalent to a decline at an annual rate of 40 percent for that quarter.
The unemployment rate is expected to average close to 14 percent during the second quarter.
Interest rates on 3-month Treasury bills and 10-year Treasury notes are expected to average 0.1 percent and 0.6 percent, respectively, during that quarter.
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Source: Congressional Budget Office
Pandemic may boost state pension plan debt to $1.7 trillion
April 23, 2020--Recent market declines as a result of the coronavirus pandemic could cause state pension funds to suffer increased losses of $500 billion, which would bring the overall state pension debt to $1.7 trillion and the aggregate funding gap to an all-time high, analysis from Pew Charitable Trusts said.
Greg Mennis, director of Pew Charitable Trusts' public sector retirement systems project, noted in his analysis that most public plans are on track to face fiscal year losses for the first time since 2009 due to equity markets recent decline.
"In the aggregate, they are currently short of annual return targets by 10% to 15%," Mr. Mennis wrote.
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Source: pionline.com
Oil for Less Than Nothing? Here's How That Happened
April 20, 2020--April 20, 2020 will go down in oil-market history as the day when the U.S. benchmark price for crude dropped below zero for the first time--and then kept falling. In a massive and unprecedented swing, the future contracts for May delivery of West Texas Intermediate tumbled to minus $37.63 a barrel.
The jaw-dropping development was in no small measure down to an extreme glitch in the way oil futures operate. But it also revealed a fundamental truth about the oil market in the age of coronavirus and the aftermath of a price war: The world's most important commodity is quickly losing all value as chronic oversupply overwhelms the world’s crude tanks, pipelines and supertankers.
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Source: bloomberg.com
WisdomTree to Close and Liquidate 10 ETFs: Portfolio Products
April 20, 2020--WisdomTree is closing and liquidating 10 of its exchange-traded funds after a review of its fund family, the firm said.
Three ETFs trade on the Cboe: the WisdomTree Dynamic Long/Short U.S. Equity Fund (DYLs), Europe Multifactor Fund (EUMF) and Japan Multifactor Fund (JNMF).
Three trade on the NYSE Arca: Asia Pacific ex-Japan Fund (AXJL), ICBCCS S&P China 500 Fund (WCHN), and Yield Enhanced Global Aggregate Bond Fund (GLBY), and four trade on Nasdaq: Middle East Dividend Fund (GULF), Emerging Markets Consumer Growth Fund (EMCG), Negative Duration High Yield Bond Fund (HYND and Negative Duration U.S. Aggregate Bond Fund (AGND).
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Source: thinkadvisor.com
The Modern Federal Reserve
April 20, 2020--The Federal Reserve is expanding its toolkit to support monetary policy during the pandemic crisis. As the Federal Reserve moved to protect the economy from the damaging impact of the coronavirus, it slashed short term interest rates an additional 100 bps and unleashed an aggressive set of programs.
Stimulus programsincludedbuying $700 billion in U.S. Treasury and Mortgage Backed Securities, aimed at stabilizing the capital markets and helping to prop up the economy. These programs also include the ability to provide lending facilities to certain businesses, cities and states. In addition, the Fed encouraged banks to borrow at the discount window and also provided additional backstop programs for banks. At the time, Fed Chairman Powell indicated the Fed had more firepower and will use it to protect the U.S. economy. This proved to be a prescient statement.
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Source: winthropcm.com
ICE ETF Hub Growth Continues in First Quarter With March Notional Volumes Surging, New Functionality Going Live
April 20, 2020--Intercontinental Exchange, Inc. (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of data and listings services, today announced that creation and redemption activity on ICE ETF Hub continued to increase throughout the first quarter of 2020, supported partly by new ETF Hub community members and functionality.
During the first quarter of 2020, over $136 billion in notional value was processed over ICE ETF Hub. In March alone, Authorized Participants (APs) processed a record $87 billion in notional value through the platform, compared to $27 billion in February, an increase of over 220%. A majority of the activity was in Fixed Income, where APs processed $63 billion in notional value, up 208% from February. For Equities, APs processed $24 billion in notional value in March, up 267% month over month.
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Source: Intercontinental Exchange
3 multifactor ETFs debut from iShares
April 17, 2020--iShares has brought to Cboe Global Markets three exchange-traded funds that screen large-cap, midcap and small-cap stocks for quality, momentum, size, value and low volatility.
The iShares Factors US Blend Style ETF, the iShares Factors US Mid Blend Style ETF and the iShares Factors US Small Blend Style ETF track factor-based subsets of Russell indexes.
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Source: smartbrief.com
