Equity Fatigue and Triple-Witching:

Welcome to Friday.

1. Signs of fatigue are emerging in the equities market after a rally to all-time highs. US stocks retreated, and Asian trading also saw losses. Today’s options expiration, known as the ‘triple-witching,’ may lead to short-term market swings. The investors we met were generally positive on equities but worried about the concentration of US/global stock market returns from Big Tech and the possibility of a US recession in the next 6-12 months.

2. Market Performance:

   The Dow Jones Industrial Average rose 300 points (0.8%), outperforming the S&P 500 and Nasdaq Composite. The Bank of England kept interest rates steady, following the Fed’s lead.

3. US Economic Data:

   Weekly US jobless claims declined but remained slightly higher than expected. New home construction slumped by 5.5% in May, with single-family housing starts at their lowest level since last year.

4. Inflation and Purchasing Power:

   Grocery prices increased only 1% over the past year, while average hourly earnings rose 4.1%. Americans’ purchasing power improved, taking 3.6 hours of work to buy a basket of staples compared to 3.7 hours in May 2023. Major grocery chains have announced price cuts not yet reflected in the data.

5. Lael Brainard’s Remarks:

   National Economic Advisor Lael Brainard emphasized the need for corporations to further reduce prices, and the Biden administration will maintain pressure.

6. The Bank of England has kept interest rates on hold at 5.25 per cent in a finely balanced decision that dented Conservative hopes of a boost to personal finances just two weeks before the UK’s July 4 election.

7. The Swiss central bank has cut interest rates for the second consecutive meeting this year in response to falling inflation while signalling it is ready to intervene in currency markets to stem gains in the franc.

DJIA: +0.77% to 39,134.76

S&P 500: -0.25% to 5,473.17

Nasdaq: -0.79 to 17,721.59

Stocks lose steam as investors brace for the so-called triple-witching later today, while the yen attracts more attention. Here’s what people are talking about.

Standard expiration

Today June Exp (Standard expiration date for equity, equity index, ETF & ETN Options).

$NVIDIA Corp(NVDA)$ $Apple(AAPL)$ $Tesla Motors(TSLA)$ $Microsoft(MSFT)$

• Total Gamma LONG 54.37 Bn per 1% $S&P 500(.SPX)$ move.

• LGEX: 5300PUT; 5350CALL PUT; 5400CALL ; 5450CALL;

• 5500 : CALL WALL

• GEXFlip : 5436

Yesterday

Total gamma decreased by $ 17.78 Bn.

Gamma

• Today Gamma Exposure

Gamma

Open Interest

S&P500 Open Interest by strike price. Imortant levels to monitor.

Key level to monitor : 5400 as support -5500 as resistance

Open Interest

Market conditions can change rapidly, and past performance is not indicative of future results. Investors should conduct their own research and consider consulting a financial advisor before making investment decisions.

Thanks for reading, supporting. You’re welcome.

@TigerStars @CaptainTiger @Tiger_SG