IWM and SPY are up – How Come?

Today, Tyler Durden posted the following charts on  Zero Hedge which show the trading volumes for the IWM and SPY ETFs of May 26, 2009.

As Tyler points out, the trades are overwhelmingly dominated by JP Morgan for SPY and Deutsche Bank for IWM.



It is interesting to see how this relates to index development during morning trading. As published by the NYSE, this looks the following way. For convenience I took screenshots of the data this morning. The original data for SPY is here, and for IWM here.


As you can see the SPY moved sideways until a spike in trading volume occurred shortly after 10:00am which together with subsequent lower spikes pushed the price up quite a bit. This seems to have happened within 15min or so of trading.

From the IWM chart we see a first spike shortly after 9:30 and one around 10:00 which pushed the price up quite a bit as well.

From the charts provided by Zero Hedge and the data available at the NYSE Website, we conclude that JPM and DB are mostly responsible for the rises in both indexes.

The question then remains. Is that rise based on real improving data or is it just hype? Hhm, why spoil the surprise. Enjoy this ‘rally’.