|Bid||173.15 x 800|
|Ask||172.00 x 1000|
|Day's range||164.16 - 178.29|
|52-week range||131.80 - 225.36|
|Beta (5Y monthly)||0.19|
|PE ratio (TTM)||28.99|
|Earnings date||28 Apr 2020|
|Forward dividend & yield||3.40 (1.94%)|
|Ex-dividend date||08 Mar 2020|
|1y target est||209.13|
(Bloomberg) -- The gold market is creaking, in the latest sign of how the coronavirus pandemic is causing chaos across financial markets.Just as demand for the metal soars with investors seeking a safe haven from unprecedented economic turmoil, a glitch has appeared in the global market. The price of gold in New York and London has diverged by the most in four decades after lockdowns and grounded planes strangled the supply routes that allow physical gold to move around the globe.The strains have rippled through gold trading, with liquidity at some points running thin in a vast market that’s dominated by the world’s biggest banks and watched by millions of mom-and-pop investors.Banks and traders typically ship gold around the world on commercial flights, linking the trading hubs of London and New York with vaults and refineries in Switzerland, Hong Kong and Singapore. But as the coronavirus grounds flights and refineries shut down, it’s becoming harder to trade between global markets. Silver and other precious metal markets are also being disrupted by the logistics lockdown.“This isn’t anything that we’ve seen in a generation because refiners never had to shutdown – not in war, not in the great financial crisis, not in natural disasters,” Tai Wong, the head of metals derivatives trading at BMO Capital Markets, said by phone. “It’s never happened. And it happened astonishingly rapidly.”At issue is whether there will be enough gold in New York to deliver against futures contracts traded on the Comex, which is owned by CME Group Inc. While the larger spot market in London is dominated by 400-ounce bars of gold, only 100-ounce and kilobars are deliverable on the Comex contract. CME has taken some steps to try to address the squeeze.Record HighsGold futures on the Comex in New York shot to the highest premium to the London spot price in four decades on Tuesday. By midday on Wednesday, the difference had dropped to around $15 an ounce. The skyrocketing spread between New York and London gold price underscores how desperate investors are to find a safe haven amid the market tumult brought on by the virus.The last time the New York-London spread was this massive was in 1980 -- when the precious metals markets had been roiled by an oil shock and the Iranian revolution, as well as the Hunt brothers’ attempted corner of the silver market.Late on Tuesday, CME Group said it would rush the launch of a new gold futures contract under which 400-ounce bars would also be deliverable. The move offers a way to address the squeeze, if holders of Comex futures are willing to exchange for the new contract.“This new contract will provide customers with maximum flexibility in managing physical delivery,” said Derek Sammann, senior managing director and global head of commodity and options products at CME, citing “unprecedented market conditions.”As of Tuesday, open interest in the April gold contract stood at 152,000 contracts, equivalent to 15.2 million ounces, but total deliverable stocks in Comex warehouses were just over half that.Gold futures for June delivery climbed as much as 7.7% in New York on Tuesday and at their peak had a $67.57 an ounce premium over spot prices in London. Based on closing prices going back to the mid-1970s, the biggest spread between a most-active contract and spot gold was $67 in 1980, data compiled by Bloomberg show.On Wednesday, most-active futures for June delivery were down 1.6% at $1,637 an ounce at midday in New York.On Tuesday, the spread between the April and June contracts on the Comex traded as high as $20 an ounce -- an indication of the level of the squeeze. By Wednesday afternoon, the April contract was trading at a slight discount, suggesting that the peak tightness may have eased for now.Ordinarily, banks and traders would ship supplies from refineries in Switzerland or Asia, which manufacture 100-ounce and kilobars for their investor clients, to New York in response to such a large Comex premium. But because of the outbreak, some have been reluctant to take advantage of the arbitrage out of fear that flights and truck deliveries will be canceled and trap their supplies, according to one senior trader, who asked not to be identified because the information isn’t public.Peter Thomas, a senior vice president at Chicago-based broker Zaner Group, said that a similar dynamic was playing out in other precious metals markets such as silver.“This hasn’t happened before, and this is very unique: We have a situation where there is silver available but no one will deliver it,” he said. “They won’t load the trucks. They won’t load the planes because the coronavirus. Even though there is product around they won’t pick it up.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Regulators will continue to cooperate closely to keep financial markets orderly and open during disruptions caused by the impact of coronavirus on the global economy, global securities watchdog IOSCO on Wednesday. "The fundamental purpose of equity, credit and hedging markets is to support the real economy, and the IOSCO Board is absolutely determined to ensure that they will remain open and functional throughout this difficult period," Ashley Alder, chair of the International Organization of Securities Commissions said in a statement.
Keeping markets open in the United States during the coronavirus epidemic is critical for maintaining investor confidence, exchanges and market industry bodies said in a joint statement on Friday. "Keeping all U.S. financial markets open is essential to the well-being of the general economy and vital to maintaining and bolstering investor confidence, particularly once the economy recovers from the effects of this pandemic," the statement said. Signatories to the statement included the American Bankers Association, CBOE, Nasdaq, CME, the Institute of International Finance and the International Swaps and Derivatives Association.
U.S. Treasury Secretary Steven Mnuchin has sparked a global debate by suggesting New York's trading day could be shortened for a time to help calm stock markets rocked by coronavirus. Greece shut its stock market for nearly five weeks in 2015 at the height of its debt crisis.
(Bloomberg) -- The Trump administration plans to keep U.S. stock markets open despite volatility, though trading hours may be shortened, Treasury Secretary Steven Mnuchin said.“We absolutely believe in keeping the markets open,” Mnuchin said at a Tuesday news conference at the White House. “Americans need to know they have access to their money.”Mnuchin said he has spoken to banks and the New York Stock Exchange, and they agree on the need to keep markets operating. The possibility of shorter hours caught some executives by surprise.“Shorter hours make no sense,” Terry Duffy, the CEO of CME Group Inc., the world’s largest futures exchange, said Tuesday in a statement. “We were quite surprised to hear Secretary Mnuchin say he is coordinating with the New York Stock Exchange on possible shortened trading hours, even though he has not reached out to all cash equity and futures markets including CME Group and Nasdaq.”The New York Stock Exchange said in an emailed statement Tuesday that it’s in constant dialogue with the U.S. government and regulators, and has “no current plans to shorten the trading day.” NYSE’s parent company, Intercontinental Exchange Inc., said in a separate statement that all of its platforms were operating normally.Wild swings in equity markets and thousands in the financial industry working from home have led to questions about whether stock exchanges should remain open. But top regulators and executives of exchange firms have come out in favor of keeping markets open.“We certainly would not be in favor of closing the market, we certainly wouldn’t be in favor of shortening the trading day,” Tal Cohen, Nasdaq Inc.’s head of North American market services, said in an interview Tuesday on Bloomberg Television. “That might just increase the intensity.”U.S. indexes climbed on Tuesday, a day after declines triggered circuit breakers that halted trading before the major indexes plunged to their biggest drop since 1987.Jim Toes, chief executive officer of the Security Traders Association, an industry group, said on Tuesday that markets need to remain open to “deal with the economy.”“They can’t close the markets,” Toes said. “They’re functioning, they’re working. Unless something breaks, why?”Spokespeople for the Securities and Exchange Commission, the Commodity Futures Trading Commission and the Financial Industry Regulatory Authority -- the main U.S. market regulators -- didn’t immediately respond to e-mailed requests for comment on Mnuchin’s remarks.SEC Chairman Jay Clayton said Monday that stock markets should continue to operate. Clayton said the current environment differs from previous market shocks, such as the 2008 credit crisis or the terrorist attacks of September 11, 2001, partly because of steps that have been taken to bolster the financial industry since then.“I think our banks are in a much stronger position today than they were then,” Clayton said on CNBC. “This is a demand and supply shock,” he said, adding that he’s concerned businesses might not have access to all the credit they need.Exchanges have largely held up amid surges in volume. That has helped most exchange operators’ stocks outperform the broader market amid the declines.In a Bloomberg Television interview Monday, Nasdaq CEO Adena Friedman said trading should continue for the sake of investors and to allow companies to raise needed capital. Closing markets would create more market anxiety, NYSE President Stacey Cunningham said in a tweet on Monday.(Updates with CME and NYSE comments starting in fourth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
The London Stock Exchange said it has no plans to suspend trading that has become volatile as investors dump shares in response to the coronavirus epidemic. "London Stock Exchange continues to operate as normal and there are no plans to suspend trading on our market," a spokeswoman for the exchange said in a statement. "It is important that markets remain open to support companies who will continue to need access to capital and to ensure pricing is conducted in a fair and transparent manner for retail and institutional investors who need ongoing access to liquidity."
Oil settled up about 1% or more on Friday, ending up with its worst week since the financial crisis, as investors braced for a recession amid declaration of a U.S. emergency by President Donald Trump to deal with the coronavirus crisis. Trump, speaking from the White House Rose Garden, said that his administration intended to stock up the U.S. Strategic Petroleum Reserve, with prices being so low. "We're buying it at the right price and that's something that would have not been possible a week ago," Trump said.
(Bloomberg) -- CME Group Inc. will close its trading floor at the end of the week as exchanges alter their operations to control the spread of the coronavirus.CME Group said all products will continue to be available to trade on its Globex electronic system, according to a statement released Wednesday. The move by the Chicago-based market operator follows the New York Stock Exchange, which on Wednesday restricted access to its iconic trading floor in downtown Manhattan.CME will rely on medical guidance as to when the floor operations resume. The only floor traders left at the Chicago location work in options on futures pits and some equity futures.No coronavirus cases have been reported at the exchange, and the main offices will remain open, the company said. (Updates with absence of virus cases in fourth paragraph. A previous version of this story was corrected to show that CME plans to close its trading floor.)To contact the reporter on this story: Matthew Leising in Los Angeles at email@example.comTo contact the editors responsible for this story: Michael J. Moore at firstname.lastname@example.org, Dan ReichlFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Amid frenzied selling in financial markets this week, there was a silver lining for banks and trading platforms which attracted a rush of business as investors scrambled to protect portfolios from the volatility. European stock trading volumes swelled on Monday to more than three times their 90-day daily average, according to Refinitiv data, as share prices suffered their biggest one-day drop since the 2008 financial crisis and oil prices plunged 25%. Ten days into March, European share trading volumes have already hit more than half their February total, Refinitiv data shows.
Exchange operators in Chicago and London are making contingency plans and stepping up cleaning for open-outcry futures and options trading floors as the global spread of the new coronavirus spooks markets. CME Group Inc told customers that no one who had recently visited Asia or Italy, which have been hit hard by the virus, should be on its Chicago trading floor, according to a notice sent to clients on Monday. The company, which owns the Chicago Board of Trade and Chicago Mercantile Exchange, asked employees and clients to test their ability to connect to its systems remotely.
(Bloomberg Opinion) -- If I had to summarize this past week in the $100 trillion global bond market, it’d be fairly straightforward: Traders are enormously fearful of what the coronavirus outbreak will mean for the world economy and adjusting their positions accordingly.Yet somehow, that feels like a vast understatement. From U.S. Treasuries to leveraged loans, and municipal debt to Austria’s century bond, the last several trading sessions have resulted in a blizzard of headlines proclaiming broken records and the wildest market swings in years. It’s anyone’s guess whether such extremes can continue. That’s because so much is uncertain when it comes to the coronavirus, its potential spread, and what monetary and fiscal authorities will need do to mitigate the economic fallout. Bond markets, even more than stocks, are pessimistic about the outlook. Here are 13 charts that show some of the creeping doom-and-gloom and the overall mayhem across Wall Street trading desks in the last several days.The trip across bond markets has to start with 30-year Treasuries:The “long bond,” as it’s known, captivated traders throughout the week, but it reached a crescendo on Friday. While U.S.-based investors slept, the yield plunged by 28 basis points in one of the steepest declines since around the financial crisis. Even a blowout jobs report did nothing to stop the relentless buying — the yield touched as low as 1.1846%, down almost 40 basis points in the span of 24 hours and half of what it was at the start of 2020. The rally was reportedly so intense that CME Group Inc.’s circuit breakers were triggered four times on 30-year bond futures.The insatiable demand for Treasuries was hardly limited to the longest-duration assets. Five-year Treasuries yielded about 1.4% on Feb. 19 when the S&P 500 set a record high. By week’s end, the yield fell below 0.5%:How extreme was this rally? According to relative strength index analysis, the five-year note has been “overbought” for 10 consecutive trading days, the longest stretch for the maturity since 2000. It reached the most extreme overbought level since 1998 on March 3 after the Federal Reserve’s emergency interest-rate cut of 50 basis points.Those dynamics in short- and long-term debt combined to create a wild ride for any trader betting on the shape of the yield curve: The Fed’s rate cut initially caused the curve to steepen, with the spread between five-year and 30-year Treasuries reaching the widest since October 2017. But then the mad dash for duration took hold toward week’s end, flattening the yield curve by 19 basis points, the most for a single day since September 2011.The stock market’s fear gauge, known as the VIX, gets a lot of attention. But it has a lesser-known bond-market cousin: The Chicago Board Option Exchange’s 10-year U.S. Treasury Note Volatility Index, known by the ticker TYVIX. Like its better-known counterpart, the TYVIX surged last week to the highest level since 2011, in the wake of S&P Global Ratings taking the unprecedented step of downgrading America’s credit rating:The massive rally in U.S. Treasuries has ripple effects across all bond markets. One that’s particularly sensitive to the level of benchmark yields is the $3.8 trillion municipal market. Investors in state and local government debt like to measure the ratio of tax-exempt muni yields to the taxable Treasury rates as a gauge of relative value. Since Donald Trump was sworn in as president, that ratio has been reliably below 100 for two-year, five-year and 10-year maturities. That snapped this past week as munis couldn’t keep up with the flood of cash coming into Treasuries:Top-rated 10-year munis now yield 0.9% tax-free, which is equivalent to 1.44% on a taxable basis for those in the top federal tax bracket — or double the going rate on a 10-year Treasury note. That apparently wasn’t a strong enough pitch, as investors pulled money out of muni mutual funds for the first time in more than a year.It could be worse for muni money managers — they could oversee funds that buy U.S. corporate bonds and loans. Overall, investors yanked the most cash from U.S. credit funds in a decade in the week through March 4, according to Refinitiv Lipper data. Investment-grade funds lost $4.8 billion, those buying junk bonds saw $5.1 billion of withdrawals and leveraged-loan portfolios had a $2.3 billion exodus.At first glance, that might seem like a hasty decision. After all, Bloomberg Barclays indexes tracking high-yield and investment-grade corporate bonds posted positive returns last week. But that was more a reflection of the overall drop in Treasury yields. The Markit CDX North American Investment Grade Index tells a different story. The index, which measures the perceived overall risk of corporate credit, jumped on Friday by the most since at least 2011 in a sign that investors are starting to get anxious about potential defaults after years of tranquility: These fears are obvious when looking at the spread between double-B and triple-B corporate bond yields. I wrote about this gauge, used by DoubleLine Capital Chief Investment Officer Jeffrey Gundlach, in a Feb. 26 column. The difference blew out to 181 basis points just two days later, marking the biggest gap since mid-2016:For most of 2019, traders didn’t seem to notice a difference between the two ratings tiers, even though double-B is considered junk and triple-B is investment grade. Now that the prospect of a global downturn is top-of-mind, they’re starting to get picky again and prioritizing debt from more creditworthy companies.Leveraged loans look just as bad, if not worse. The price of leveraged loans, as measured by the S&P/LSTA Leveraged Loan Index, tumbled to 94 cents by week’s end, from 96.75 cents as recently as Feb. 23. That’s the lowest since the tail end of the December 2018 sell-off in risky assets:The floating-rate debt had steadily gained heading into 2020 on the expectation that the Fed would hold interest rates steady this year. Obviously, that’s not the case anymore. Those losses are starting to show up in the price of the double-B tranches of collateralized loan obligations, too. A Palmer Square Capital Management Index shows prices are at a three-month low.The credit markets are just as dicey over Europe. The Markit iTraxx Europe index spiked higher on Friday to 80 basis points, capping a massive surge from a record-low 41 basis points on Feb. 17. It was higher in early 2019 before coming down to Earth. But like other metrics, it reflects how widespread complacency about credit risk was easily shattered in just a couple of weeks.Bond traders in Europe are also turning to another favorite form of protection against recession, Bloomberg News’s John Ainger and Stephen Spratt noted on Friday. They’re buying short-dated German bonds versus interest-rate swaps, since the former benefit from haven demand while the latter carry credit risk. The gap between them reached the widest in more than a year. This kind of extreme move happened in 2017 when it looked like the far-right Marine Le Pen had a chance to win the French election in 2017 and during Italy’s budget dispute in 2018. No matter where you go across the world, even outside the direct gravitational pull of the European Central Bank, it’s getting harder to find sovereign debt with yields exceeding 1%:In Canada, after its central bank followed the Fed by cutting interest rates by 50 basis points, the 10-year yield tumbled to 0.7%. In Australia, its 10-year debt yielded in excess of 1% on Feb. 20; it’s 0.68% now. It took until Friday in New Zealand, but its 10-year sovereign yield dropped to 0.96%. U.K. gilts haven’t yielded more than 1% since May — but they dropped to an all-time low 0.24%.Finally, there’s Austria’s century bond, a favorite in some circles to gauge market sentiment. The debt, which matures in 2117, yields a record-low 0.475%:My Bloomberg Opinion colleague Marcus Ashworth asked “what madness is this?” when the bond yielded 1.2%. Now it offers less than half that. Bond traders were left asking the same thing after this past week.To contact the author of this story: Brian Chappatta at email@example.comTo contact the editor responsible for this story: Beth Williams at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Brian Chappatta is a Bloomberg Opinion columnist covering debt markets. He previously covered bonds for Bloomberg News. He is also a CFA charterholder.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- The Treasuries rally Friday was so ferocious amid coronavirus fear that CME Group Inc. repeatedly halted futures on 30-year bonds.The surge in Ultra U.S. Treasury Bond contracts four times triggered CME circuit breakers designed to ensure prices on its exchanges don’t spiral out of control. The futures, which debuted in 2010 and reference a Treasury security with at least 25 years left to maturity, rose as much as 14 1/2 points as the benchmark 30-year yield tumbled nearly 34 basis points to a record low 1.204%.CME halts trading in most Treasury futures contracts in the event of large price changes, except during critical windows near their expiration dates.The pause was first activated Friday when the June contract rose 3 points, then repeated at 6, 9 and 12 points. The last time circuit breakers were triggered for the product was on Feb. 24, when the Ultra Bond contract rose more than 3 points, CME spokesman Chris Grams said. According to Bloomberg data, the contract has gained more than 6 points in a day only one other time, on June 24, 2016, after the U.K. Brexit vote, and has never fallen that much.To contact the reporter on this story: Elizabeth Stanton in New York at email@example.comTo contact the editors responsible for this story: Benjamin Purvis at firstname.lastname@example.org, Mark Tannenbaum, Nick BakerFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
The Zacks Analyst Blog Highlights: Walmart, Pfizer, Charter Communications, Lockheed Martin and CME
Cboe Global's (CBOE) Options, Futures U.S. Equities and global forex volume reflect year-over-year increase in February. However, European Equities decline.
Readers hoping to buy CME Group Inc. (NASDAQ:CME) for its dividend will need to make their move shortly, as the stock...