The Chicago Outlook12.22.2011 By Markets Media
2012 will undoubtedly be an exciting year for New Yorkers as Deutsche Borse aims to finish closing its merger with the New York Stock Exchange and bankers wait anxiously for a clear solution to the Eurozone crisis.
But in Chicago, there’s plenty to worry about. Will open outcry trading be able to survive? Has MF Global struck a mighty blow to other FCMs? Are proprietary traders able to achieve profits like they have in the past?
Equities are expected to trend higher with the S&P surpassing the 1300 level and the Dow Jones Industrial Average could pole vault above 13,000.
“Europe stabilizes and stagnates. US markets trade sideways and then slowly grid higher in summer as Mitt Romney looks more and more certain to be our next President,” said one hyperactive trader in Chicago. “If he wins, expect a RomneyClaus rally that melts plenty of faces and rips the bear tits off shorts.”
Many expect that the Department of Justice will launch an investigation or probe into other FCMs to see how they conduct business and their treatment of customer segregated accounts.
“There will be a dramatic fall in ranges,” noted one floor trader in Chicago. “1300 in S&P but the trip will be way less exciting. The euro should be around 1.20 but story will be Renminbi. It will open up and be used to offset easing policy everywhere. It’ll help tamp the commodity run up that hurt Q1 2011 expansion. Quasi-stability by less hyper opportunity is ‘good’ for the real economy and ‘bad’ for day trading majority.”
The situation in Europe vis-à-vis sovereign debt is expected to continue to worsen. The consensus in late 2011 was essentially that the way these European countries operate is unsustainable. Many even see Europe past the point of repair. “Euro debt still sketches me out – I bet someone defaults by St. Patty’s Day,” said one debt trader.
And interestingly, 2012 is expected to be a killer year for energy. Crude oil in particular is expected to shoot well above $100 a barrel and remain there for the better part of the year as uprisings in the Middle East continue and global demand increases.
The US regulated cryptocurrency exchange has acquired Embed Clearing.
FESE members have been developing and publishing their playbooks on outage protocols.
EFAMA said concerns about rising inflation and monetary policy hit bond funds in the first quarter.
MFA analysis shows that shorting carbon-heavy stocks is an effective mechanism to hedge climate risk.
BMO Capital Markets won Best Sell-Side Trading Desk at the 2022 Markets Choice Awards.