Markets
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Luke Kawa

Forget the “Great Unwind.” Meet the “Great Chase”

Stocks are surging, and overall volatility in the equity market is down, adding to the profits of traders who wagered that market angst would be short lived.

But Scott Nations, longtime volatility guru and president of Nations Indexes, flags one place where volatility is actually creeping higher: in bets that the S&P 500, Nasdaq 100, and Russell 2000 will go up over the next seven days and next month (as judged by his CallDex, QQQ CallDex, and IWM CallDex indexes). These track out-of-the-money call options, which benefit from rising stock prices.

Implied volatility is a proxy for how much an option is in demand. Loosely speaking, when implied volatility goes up it means people are willing to pay more for that option because they think the underlying asset has (in this case) more potential room to run to the upside.

In other words, people who were worried last week about a massive unwind of leveraged positions taking the market down are now worried about missing out on another big leg higher as equities rebound with a vengeance.

The chase for more gains is on.

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Nia Warfield

Nike pops on Q1 earnings beat and surprise revenue jump

Nike topped first-quarter estimates after the bell Tuesday.

Adjusted earnings per share came in at $0.49, nearly double the $0.27 expected by Wall Street. Revenue rose to $11.7 billion, also beating analyst forecasts of $11 billion. Wholesale revenues rose 7% to $6.8 billion.

On Friday, the sneaker giant rolled out its first collaboration with Kim Kardashian’s Skims, betting that the brand’s popularity and star power will help expand its female customer base.

Ahead of earnings, Nike shares were down over 5% year to date.

Tasha Matsumoto, Luke Kawa
9h
Stocks end strong quarter higher as investors shrug off an imminent government shutdown

The S&P 500 ticked up 0.4%, the Nasdaq moved up 0.3%, and the Russell 2000 eked out a 0.1% gain.

Sunset Bull
markets
Matt Phillips

Betting stocks slammed on growing pressure from prediction markets

The duopoly that dominates the US online sports betting business — DraftKings and FanDuel parent Flutter Entertainment — dove Tuesday after prediction markets company Kalshi quietly introduced a new feature mimicking the popular parlay-style sports bets that have been an important differentiator for the sportsbooks from fast-growing prediction markets.

Robinhood Markets, which has partnered with prediction markets platform Kalshi to offer event contracts to its users, has surged to record highs in recent days on signs that its prediction markets business is gaining traction as the NFL season unfolds.

(Robinhood Markets Inc. is the parent company of Sherwood Media, an independently operated media company subject to certain legal and regulatory restrictions.)

Market analysts have noted that prediction markets — which in the US are regulated as financial products by the CFTC — have some significant regulatory advantages compared to non-prediction market sports betting activity, which typically operates under state gaming regulators.

“Prediction markets like Kalshi, which is available nationwide to anyone over 18, are... increasingly an alternative to traditional online sportsbooks like DraftKings, which is generally available 21 and up in about half the country,” analyst Edwin Dorsey wrote earlier this month on his newsletter The Bear Cave, which spotlights potential short positions on some stocks.

Separately, Flutter is also under some idiosyncratic pressure amid reports that Rachel Reeves, the UK’s chancellor of the exchequer, is open to raising taxes on the country’s gambling companies in the upcoming budget.

markets
Max Knoblauch

Nio climbs following a more than 60% jump in weekly registrations in China

A host of new Model Y competitors appear to be paying off for Chinese EV maker Nio.

Shares of the company rose more than 5% in Tuesday morning trading, following reports that the company last week logged a record 10,800 vehicle insurance registrations in China, a common proxy for vehicle deliveries.

The figure, which would represent a 62% jump in registrations week over week, was reportedly shared by a Nio executive on Chinese social media. Nio is said to have delivered more than 2,000 of its new three-row electric SUV, the ES8, and 2,600 Onvo L90s (another SUV) in the week ended September 28.

markets
J. Edward Moreno

Pfizer reaches deal with Trump admin on drug pricing

Pfizer rose Tuesday after it was announced that the drugmaker reached a deal with the Trump administration to lower its prices in the US.

Pfizer will sell its drugs through Medicaid at lower prices, according to the White House. In its own press release, Pfizer said it has agreed to take steps to ensure Americans receive “comparable drug prices to those available in other developed countries” and will price “newly launched medicines at parity with other key developed markets.”

Pfizer said it would participate in the administration’s direct-to-consumer platform dubbed “TrumpRx.” Many of the company’s drugs will be available on TrumpRx.gov (the website does not appear to be active yet) at “at savings that will range as high as 85% and on average 50%.”

The specific terms of the agreement are confidential, Pfizer said. President Trump signed an executive order in May demanding drugmakers give the US the best prices on medications, and the deadline to comply with that was Monday.

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