A quick one on a real basic in markets. All sorts of markets.
Not financial markets – imagine your favourite pop singer. She is outing on a concert. There are ‘x’ number of tickets. And they are quickly all bought up. Leaving potential buyers empty handed. So scalpers offer tickets they have bought at higher prices. And they have no problem selling at high prices.
Warren Buffet often advises companies that have excess capital sitting around to buy back shares if they don’t have anything else to do with the cash. And guess what, prices go up.
So today, Nomura shares are trading +10%. The company announced a buyback. More buyers. And exacerbating impact in financial markets is good information – the sellers of Nomura shares realise there is a chunk to be bought , so they raise their askngi price. Price goes up.
This is not rocket science.