A pre-jobs data bet may have have netted trader $10 million profit, report says


A big fed-funds futures bet placed just before the release of what turned out to be a blowout U.S. January jobs report may have netted a trader a profit north of $10 million, Bloomberg reported Friday.

The trader sold the January 2024 fed-funds futures contract
the report said, with the trade completed through a block sale of 13,996 contracts. That carried an approximate risk of $580,000 of profit or loss per each basis point move in the contract.

The trade was placed around 8:15 a.m. Eastern, Bloomberg said, citing traders familiar with the flow, with the contract priced at 95.59, implying expectations for an average fed-funds rate of 4.41% next January. The contract fell to a low around 95.37 in afternoon trade, implying a fed funds rate of 4.63%.

The short futures position appeared to remain in place Friday afternoon, the report said.

Fed-funds futures sold off after the much stronger-than-expected January jobs report and a sharp rebound in the Institute for Supply Management’s January service sector activity index.

Fed-funds futures on Friday afternoon reflected a 99.6% probability the Fed would raise the rate by 25 basis points to a range of 4.75% to 5% at the conclusion of its next policy meeting on March 22, up from an 82.7% probability on Thursday, according to the CME FedWatch tool.

For May, investors now see a 61.3% chance of another quarter-point rise to 5% to 5.25%, the level which the Fed has signaled is its expectation for a peak. On Thursday, investors saw just a 30% chance of a quarter-point rise in May.

The Dow Jones Industrial Average

was 182 points, or 0.5%, ahead of the closing bell, while the S&P 500

slumped 1.1% and the Nasdaq Composite

shed 1.7%.


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Jacob Keiter is a husband, a writer, a journalist, a musician, and a business owner. His journey to becoming a writer was one that was paved with challenges, but ultimately led him to find his true calling. Jacob's early years were marked by a strong desire for creative expression. He was always drawn to music, and in his youth, he played in several bands, chasing the elusive promise of fame and success. However, despite his best efforts, Jacob struggled to find the recognition he craved. It wasn't until he hit a low point in his life that Jacob discovered his love for writing. He turned to writing as a form of therapy during a particularly difficult time, and found that it not only helped him to cope with his struggles, but also allowed him to express himself in a way that he had never been able to before. Jacob's writing skills quickly caught the attention of others, and he soon found himself working as a journalist for The Sun out of Hummelstown. From there, he went on to contribute to a variety of publications, including the American Bee Journal and Referee Magazine. Jacob's writing style is reflective of traditional journalism, but he also infuses his work with a unique voice that sets him apart from others in his field. Despite his success as a writer, Jacob also owns another business, JJ Auto & Home, which specializes in cleaning. Jacob's commitment to excellence is evident in all of his endeavors, whether it be in his writing or in his business ventures. Today, Jacob is the author of two books and continues to inspire others through his writing. His journey to becoming a writer serves as a reminder that sometimes our darkest moments can lead us to our greatest achievements.

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