[Fujitomi] Calculation of Special Quadratic (SQ) for Stock Price Index Options and Mini Nikkei 225 Futures May Contract

Today’s Nikkei stock average shows a heavy upside? outlook. With a pause in the yen’s weakness, declines in U.S. stocks, and no standout supportive材料, the market environment lends itself to position adjustments toward the end of the week. A point to watch is the opening’s supply-demand dynamics tied to the settlement value calculations for May stock index options. In the afternoon of the previous day, foreign buying, centered on European players, into major banks that had not yet released earnings was interesting, and attention should be paid to the supply-demand dynamics of banking stocks as well.

https://www.fujitomi.co.jp/?p=15077

[Buying材料]

- Euro area growth rate raised to 1.7% this year, according to the European Commission

- NY crude oil futures continue to rise; consensus that OPEC will maintain production cuts for six months

- Expectations for supply-demand support from BOJ ETF purchases

[Selling材料]

- U.S. stock market falls; department store stocks under pressure on weak earnings

- Major department stores plunge on earnings; Macy’s down 17.01%, Kohl’s down 7.8%

- Dollar/yen gains pause; bullish outlook persists amid expectations of June U.S. rate hikes

- European stock market declines; Spain’s stocks slump to their largest drop in six months

- North Korea asserts it has the right to punish detained U.S. citizens

- North Korea geopolitical risk

- Trump administration’s policy management opaque

- Continued U.S. dollar strength plan

[Other notable points]

○ Special settlement index (SQ) calculation for stock index options and May mini-Nikkei futures

○ G7 finance ministers and central bank chiefs meeting in Bari, Italy (until the 13th)

- U.S. bond market: yields flat; stock declines offset by solid indicators and weak auction results

- U.S. 30-year bond auction weak; bid-to-cover ratio at multi-month low

- NY gold futures: impact of the Treasury Secretary’s dismissal continues; stocks fall and gold rises

- London stock market: largely flat; weak earnings and lowered investment judgments weigh on prices

- U.S. April PPI (MoM) +0.5% [expected +0.2%] (previous -0.1%)

- U.S. April PPI and core PPI (MoM) +0.4% [expected +0.2%] (previous +0.0%); U.S. initial jobless claims 236k [expected 245k] (previous 238k)

- Concerns over Kaspersky software in Russia; U.S. intelligence agencies conducting investigations

- President Trump criticizes Comey again, calling him a "show-off"

- U.S. Senate approves Raul Labrador? No, Lighthizer as trade representative; NAFTA renegotiation to begin

- Senate requests DOJ to provide information on Comey investigation funding expansion

- Proposal for U.S. mobile carrier industry consolidation

- U.S. Federal Reserve: weekly liquidity provision under swap facilities at $35 million

- April 18: $11 billion 10-year TIPS reopening auction by U.S. Treasury

- China’s semiconductor industry fostering investments seen as potential future threat, says U.S. Commerce Secretary

- Euro Area and IMF to discuss Greece debt relief on the morning of the 12th, per officials

- Negative interest rates not ideal, but necessary to curb franc appreciation, says Swiss National Bank

- Philippine central bank leaves policy rate unchanged

- Bank of England keeps policy rate at 0.25% and leaves gilt purchase program unchanged

- South Korea’s new president speaks by phone with Chinese leader, exchanges views on North Korea and THAAD

《Schedule》

08:50 M2 money stock for April (expected year-on-year +4.3%)

10:00 BoJ’s daily business report (as of May 10)

13:15 Harada, BoJ Policy Board member, to give a lecture

17:00 BoJ’s holdings of government bonds by issue

17:00 BoJ’s purchases of government short-term securities by issue

15:00 Germany Q1 GDP flash estimate (expected: -0.6% QoQ, +1.7% YoY)

15:00 German April CPI revised (expected: flat MoM)

15:45 France Q1 non-farm payrolls flash (expected: +0.2% QoQ)

17:30 Hong Kong Q1 GDP (expected: +0.2% QoQ)

18:00 Euro-area March industrial production (expected: +0.3% MoM)

21:30 U.S. April CPI (expected: +0.2% MoM)

Core CPI excluding energy and food (expected: +0.2% MoM)

21:30 U.S. April retail sales (expected: +0.6% MoM; ex-auto +0.5% MoM)

22:00 Evans, President of the Federal Reserve Bank of Chicago, to speak

23:00 U.S. May consumer sentiment index (University of Michigan, flash, expected: 97.0)

23:00 U.S. March business inventories (expected: +0.1% MoM)

January 13 01:30 Harjager? Haraker, Philadelphia Fed president, to speak

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