Global Surge in Rates Continues Amid Dwindling Demand for Equity Leverage

From Investing.com: 2025-01-09 02:28:00

The S&P 500 closed flat, testing a crucial level at 5870 that could lead to a significant decline if breached. Market makers adjusted hedges ahead of the anticipated jobs report, causing implied volatility to drop and put values to decrease. Options activity focused on downside protection with significant volume in puts at various levels. Global rates are rising, with UK and Japan seeing increases while US yields decline. Concerns arise over the Chinese yuan’s upper limit and Bitcoin’s potential decline. Equity financing costs have significantly dropped, reflecting reduced demand for leverage.

Source: Bloomberg

Global rates are on the rise, notably in the UK and Japan, with significant increases in yields. The Chinese yuan nears a key level, raising concerns over global market stability. A potential head-and-shoulders pattern in Bitcoin adds to worries about a possible retracement. Equity financing costs have decreased sharply, indicating a reduced interest in leverage. Understanding technical terms like ascending triangles and implied volatility is crucial for navigating these market movements.

Source: Mott Capital Management



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