NYSE Tick & the Dow's 1k Point Resurgence

(Screenshot from Investing.com)

Google recently recommended an article discussing some recent record-setting trades as measured by the NYSE Tick Index. In short, Zerohedge noted that three ticks of record-size (1631 or higher) in the course of ten minutes on December 27th (the day of the Dow's resurgence).

That week, Reuters reported the Dow having the worst week since 2008, and then reported a 1,000 point single-day surge, the first in its history.

Wells Fargo equities derivative strat Pravit Chintawongvanich was being quoted frequently for positing that the rally came from $60 bn in orders from pension funds looking to profit on the Dow's down-swing.

But back to the NYSE Tick - I had not heard of the index before, so I did some minor reading and here is simply how it works:

The NYSE Tick takes the approximately 2,800 equities listed and simply sums the number of "upticks" (stocks which had a price increase) and "downticks" (stocks which had a price decrease) in a given time interval, and then prints the sum.

Not to quote Investopedia too much, but they claim being either +1,000 or -1,000 ticks are considered extreme moves.

I think this would be a data point which would be well worth revisiting, but it's the holidays and I'm just looking to take a brief look and some notes.

Yield Inversion, Dow down, May loses votes, & more

A couple pieces of news over the past 48 hours:

- A number of news outlets noted that the 3 year & 5 year T-bill yields inverted on Monday morning, an occurrence which last occurred in 2007. While this is less significant than the 10 year - 2 year curve, it affected trading today.

- The Dow is reported down 800 points (about 3%) this morning and the markets are poised to close day trading each down between 3.1% - 3.8%

- British PM lost three votes in Parliament today. A vote is set to take place next Tuesday (December 12th) on the deal May reached with the EU. If the vote does not pass, the Brexit process will be taken over by Parliament.

- In related news, May is being charged as in contempt of Parliament (interfering with law makers), as she had not published the full legal advice for her Brexit deal.

- Republican thought-leaders Lindsey Graham and Bob Corker asserted that Saudi Prince MBS was certainly complicit in the murder of Khashoggi. This came as they left a briefing by the CIA. Graham went so far to say that he no longer supported arm sales to Saudi Arabia.

US - China 90 Day Trade Ceasefire

Some notes on the 90-Day Trade Ceasefire between the US & China

(Photo Carlos Barria / Reuters)

I defer to this excellent write-up by SCMP, but have summarized a few points:

- Xi will be happy to meet Trump's demands because he knows China can find all sorts of ways to come out on-top

- It furthers a US-China power coalition in Asia which favors Chinese interests  (a la Trump's attitude over Saudi Arabia)

Other interesting points:

- Fentanyl will be viewed more strictly under PRC law, stemming its flow out of Asia (pharma interest?)

- A major semiconductor merger will be allowed

- This seems to play into Xi's interest in strengthening China's presence in Asia by taking advantage of Trump's soft understanding of foreign policy (i.e. I'd have a hard time imagining Mattis would be ok getting closer to China as they increasing look to reclaim HK and Taiwan)

I think it be worth reading further into coverage from Taiwan in the coming days. My understanding is that news coverage there is relatively split between the Democratic Progressive Party -leaning China Times and Kuomintang -leaning Liberty Times.

Further, there has been recent reporting on a new 200-page report published by the Hoover Institution covering US-China relations. I've been meaning to get to that report, and feel that it would be interesting as it would provide in-depth analysis after the 19th National Congress of the Communist Party of China aimed to remove term limits on Prime Minister Xi.