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World Stock Markets Trading Discussion - Dedicated decoupling


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All Ords climbed steadily to finish +0.5%.  Sectors ranged from REITS +1.8%, Utilities +1% down to Gold -0.8%.

Over in Asia, China closed, Hong Kong +1.8%, India currently +0.5%.

 

 

UK/Europe on the rise: FTSE +0.2%, DAX +0.3%, CAC +0.2%.

 

 

 

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I don't know the details but companies can't do stock repurchases around the time of earnings announcements. It was suggested this added to the sharp selloff in late Jan early Feb as the selling negated the usual earnings announcement orgies and there was no stepping in with buybacks because of earnings season.

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Buybacks don't get captured in Lee's liquidity calcs.  $650bn this year it is said.  $5TN since 08

 

RSU offset and in some cases exceed these buybacks as corporate executives have gone grant happy in fact creating excess of dilution of stock.

 

 "And many companies use buybacks to offset the share dilution created by employee stock option grants; the net effect is no reduction in overall share count and of no benefit to investors...and in some cases increase share count"

Fortune 2014

 

 

"The Hidden Purpose Of Share Buybacks------An Offset To Dilution From Massive Stock Option Issuance" Stockman  http://davidstockmanscontracorner.com/the-hidden-purpose-of-share-buybacks-an-offset-to-share-dilution-from-massive-stock-option-issuance/

Would be interesting to get real data would not be surprising net net may actually be a negative liquidity event.

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RSU offset and in some cases exceed these buybacks as corporate executives have gone grant happy in fact creating excess of dilution of stock.

 

 "And many companies use buybacks to offset the share dilution created by employee stock option grants; the net effect is no reduction in overall share count and of no benefit to investors...and in some cases increase share count"

Fortune 2014

 

 

"The Hidden Purpose Of Share Buybacks------An Offset To Dilution From Massive Stock Option Issuance" Stockman  http://davidstockmanscontracorner.com/the-hidden-purpose-of-share-buybacks-an-offset-to-share-dilution-from-massive-stock-option-issuance/

Would be interesting to get real data would not be surprising net net may actually be a negative liquidity event.

The buy backs are demand and money into the markets that would not otherwise be there.  The stocks issued via executive options  do not subtract money from the market. There are some contingencies and what ifs in all that but net net it has to be considered a liquidity source for the markets.

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