The Market Structure Map
June 26, 2024
Why are the Nasdaq and the Dow Jones Industrial Average diverging wildly? It might resolve in the next few days. But it’s not small. Back up to June 20 and performance was aligned. At one point Monday, five-day divergence was more than 4%. The DJIA...
June 19, 2024
One of our customers at EDGE calculated that 82% of Demand in the S&P 500 is from three stocks (NVDA – now the largest – AAPL, MSFT). Ramifications? Reminds me of what the former head of investor relations at United Health Group, John Penshorn, said...
June 12, 2024
High-frequency traders are data-dependent. The Federal Reserve ought not be. I’ll explain. The U.S. central bank today concludes its open-market (FOMC) meeting. Jay Powell speaks. Before I go further: join the ModernIR webinar today on Leveraging your Treasury for Sellside Coverage. It’s genius. Not because...
June 5, 2024
Somebody pulled a pin and dropped a grenade in the stock market and nobody noticed. Let me explain: Now, there were explanations. Index options on the SPX expired at month-end as they do every last trading day of the month, and MSCI indices rebalanced. But...
May 29, 2024
Size matters. Does trade-size matter? The average trade in S&P 500 stocks is 87 shares this week (five-day average). Think about that. Quotes are in 100-share increments but the trades average less than the quote. It can fluctuate around month-ends, index-rebalances, options-expirations. NVDA’s average is...
May 22, 2024
It’s tough being a market strategist. Mike Wilson, chief equity strategist for Morgan Stanley, has thrown his bear towel on the laundry pile and lifted his year-end target for the S&P 500 to 5,400 from 4,500. He’ll be braining himself with a brick if the...