Sunday 15 December 2013
A pretty damning bitcoin chart
For Bitcoin enthusiasts this is not a an encouraging chart. Any other legitimate currencies where less than 50 people hold over a quarter of the entire circulation? http://www.marctomarket.com/2013/12/great-graphic-bitcoin-concentration.html
Sunday 8 December 2013
Market Update takes a break
I will be taking a break from the market updates for the winter holidays but will still be posting any articles I find interesting.
Thursday 5 December 2013
Market Update 05/12/13
One line- Risk off moves ahead of non farm payrolls report on Friday.
- Global stocks are selling off ahead of the non-farm payroll report on Friday which investors are fearing may make the case for an earlier tapering than expected. The S&P lost 0.1% while the Nikkei lost 1.5% overnight. Treasury yields are trending higher closing overnight at a near two month high of 2.84%. Commodities are broadly flat, in FX the dollar is down against its major crosses. Positive news in India rallied the Sensex rallied 1.1% along with the rupee. The Hindu nationalist party has been making gains in the polls ahead of next years election. http://www.ft.com/cms/s/0/30ccc034-5d5d-11e3-81bd-00144feabdc0.html?siteedition=uk#axzz2mUvBwAtP
- Joe Biden told Chinese president Ji Xinping that the US does not recognise their air defence identification zone and that China needs to "take steps to reduce the risk of accidental conflict and miscalculation". He stopped short though of telling the Chinese to abolish the zone. He also brought up the maltreatment of journalists of the Times and Bloomberg, who following a report on the build up of wealth of those in power in China have been refused visas. http://www.ft.com/cms/s/0/4ddf36ae-5d5b-11e3-a558-00144feabdc0.html#axzz2mUvBwAtP
- In a speech in one of the poorer districts of Washington Barack Obama said inequality is the defining issue of our time and called for a rise in the federal minimum wage. In the 50 minute speech he chronicled the decline in relative incomes since the 1970s and defended the role of government in alleviating the problems. http://www.ft.com/cms/s/0/0cf55624-5d0f-11e3-a558-00144feabdc0.html#axzz2mUvBwAtP
- In Ukraine the prime minister said late on Wednesday his government was prepared to discuss snap elections in a move designed to bring an end to the ongoing protests. The comments come after the opposition leaders appealed to European powers to intervene as the stand-off threatens to cause a financial crisis. The Ukrainian hryvnia is down to a 2009 low while its bond yields have soared. http://www.ft.com/cms/s/0/3d2630cc-5d0d-11e3-a558-00144feabdc0.html#axzz2mUvBwAtP
Data
S&P 1792.81 0.13%
S&P 1792.81 0.13%
FTSE 6510.33 0.01%
Nikkei 15,177.49 1.50%
Nikkei 15,177.49 1.50%
EUR/USD- 1.3598 0.04%
USD/JPY- 102.07 0.28%
GBP/USD- 1.6351 0.20%
USD/JPY- 102.07 0.28%
GBP/USD- 1.6351 0.20%
Gold- 1233.10 0.86%
Oil (Brent)- 111.98 0.09%
Oil (Brent)- 111.98 0.09%
Copper- 323.45 0.45%
10 year yields
US- 2.84 (0bps)
UK- 2.89 (-1bps)
Japan- 0.62 (0bps)
UK- 2.89 (-1bps)
Japan- 0.62 (0bps)
Wednesday 4 December 2013
Brazilian economy has worst quarter in 5 years
Contracting 0.5% in the third quarter http://www.ft.com/cms/s/0/95c2ef90-5c3b-11e3-b4f3-00144feabdc0.html#axzz2mUvBwAtP
Market Update 04/12/13
One line- Momentum continues to slow in the markets ahead of data releases later in the week.
- Trading is cautious this morning following a mixed session in Asia and a minor sell off in America. The yen continued to weaken but comments by Takehiro Sato, a BoJ board member, that further easing would be counter-productive caused the Nikkei to sell off 2.2%. European stocks have opened up this morning following their biggest decline in three months yesterday as the rally of the last few weeks begins to lose momentum. Currencies are quiet while commodities are mixed. WTI is up 1.3%, gold is off 0.6% while copper is up 0.2%. Rates are trending higher following a better than expected US manufacturing survey on Monday boosting tapering expectations. Ahead today we have Eurozone GDP figures and the US Federal Reserve Beige Book release. http://www.ft.com/cms/s/0/7f406126-5c95-11e3-b4f3-00144feabdc0.html?siteedition=uk#axzz2mUvBwAtP
- China's HSBC services PMI showed a figure of 52.5 in November indicating steady growth for the sector. The figure signalled the third consecutive month of employment expansion but growth in new orders fell from October's seven month peak. The services industry accounted for 45% of China's GDP in 2012 and overtook manufacturing to become the country's largest employer in 2011. http://www.reuters.com/article/2013/12/04/us-china-economy-pmi-idUSBRE9B304420131204
- Shinzo Abe is forming a $182 billion stimulus package to be approved by the government this week that will not require the government to sell any more debt. The bulk of the package is aimed at dampening the blow from the sales tax hike which is coming in in April. The measures include steps to boost competitiveness, assist women, build infrastructure for Tokyo 2020 and accelerate reconstruction from the 2011 tsunami. http://www.reuters.com/article/2013/12/04/us-japan-economy-stimulus-idUSBRE9B21AI20131204
- Ukrainian prime minister Azarov survived a vote of no-confidence yesterday as mass demonstrations continue over the withdrawal of Ukraine from a pact to bring it closer to Europe. The vote which required 226 politicians to support the motion received only 186 in support. Opposition leaders are now calling on the president Yanukovich to fire the prime minister and hold snap parliamentary and presidential elections. http://www.ft.com/cms/s/0/d1f11bf8-5c0f-11e3-931e-00144feabdc0.html#axzz2mUvBwAtP
- Australia's economy grew at a disappointing 2.3% in the third quarter (yoy) missing forecasts and the slowest figure this year. The country is continuing to come to grips with the loss in demand for commodities from China and the subsequent slump in prices. http://on.ft.com/1g4qmeb
Data
S&P 1795.15 0.32%
- Trading is cautious this morning following a mixed session in Asia and a minor sell off in America. The yen continued to weaken but comments by Takehiro Sato, a BoJ board member, that further easing would be counter-productive caused the Nikkei to sell off 2.2%. European stocks have opened up this morning following their biggest decline in three months yesterday as the rally of the last few weeks begins to lose momentum. Currencies are quiet while commodities are mixed. WTI is up 1.3%, gold is off 0.6% while copper is up 0.2%. Rates are trending higher following a better than expected US manufacturing survey on Monday boosting tapering expectations. Ahead today we have Eurozone GDP figures and the US Federal Reserve Beige Book release. http://www.ft.com/cms/s/0/7f406126-5c95-11e3-b4f3-00144feabdc0.html?siteedition=uk#axzz2mUvBwAtP
- China's HSBC services PMI showed a figure of 52.5 in November indicating steady growth for the sector. The figure signalled the third consecutive month of employment expansion but growth in new orders fell from October's seven month peak. The services industry accounted for 45% of China's GDP in 2012 and overtook manufacturing to become the country's largest employer in 2011. http://www.reuters.com/article/2013/12/04/us-china-economy-pmi-idUSBRE9B304420131204
- Shinzo Abe is forming a $182 billion stimulus package to be approved by the government this week that will not require the government to sell any more debt. The bulk of the package is aimed at dampening the blow from the sales tax hike which is coming in in April. The measures include steps to boost competitiveness, assist women, build infrastructure for Tokyo 2020 and accelerate reconstruction from the 2011 tsunami. http://www.reuters.com/article/2013/12/04/us-japan-economy-stimulus-idUSBRE9B21AI20131204
- Ukrainian prime minister Azarov survived a vote of no-confidence yesterday as mass demonstrations continue over the withdrawal of Ukraine from a pact to bring it closer to Europe. The vote which required 226 politicians to support the motion received only 186 in support. Opposition leaders are now calling on the president Yanukovich to fire the prime minister and hold snap parliamentary and presidential elections. http://www.ft.com/cms/s/0/d1f11bf8-5c0f-11e3-931e-00144feabdc0.html#axzz2mUvBwAtP
- Australia's economy grew at a disappointing 2.3% in the third quarter (yoy) missing forecasts and the slowest figure this year. The country is continuing to come to grips with the loss in demand for commodities from China and the subsequent slump in prices. http://on.ft.com/1g4qmeb
Data
S&P 1795.15 0.32%
FTSE 6534.27 0.03%
Nikkei 15,407.94 2.17%
Nikkei 15,407.94 2.17%
EUR/USD- 1.3591 0.02%
USD/JPY- 102.62 0.11%
GBP/USD- 1.6360 0.19%
USD/JPY- 102.62 0.11%
GBP/USD- 1.6360 0.19%
Gold- 1215.72 0.63%
Oil (Brent)- 112.36 0.23%
Oil (Brent)- 112.36 0.23%
Copper- 317.85 0.35%
10 year yields
US- 2.80 (+1bps)
UK- 2.83 (+2bps)
Japan- 0.62 (0bps)
UK- 2.83 (+2bps)
Japan- 0.62 (0bps)
Tuesday 3 December 2013
Market Update 03/12/13
One line- Rally begins to show signs of slowing momentum as investors take profits.
- Global equities have broadly sold off while bonds and gold are gaining. The current moves potentially point to slowing down of the pace we have seen over the last 8 record gaining weeks on Wall Street. The Nikkei added 0.6% on talk of further easing by the JGB while the Hang Seng lost 0.5% and the ASX 200 lost 0.4%. The S&P finished down 0.3% while the FTSE is down 0.2% this morning. The dollar and industrial commodities are flat. Treasury yields hit an 11 week high of 2.81 for the ten year before easing to 2.79. The euro is stronger vs the dollar up to $1.3554 while the continued prospect of tapering helped to weaken emerging currencies. http://www.ft.com/cms/s/0/83def222-5bc5-11e3-848e-00144feabdc0.html#axzz2mJ6HA6Em
- China's yuan overtook the euro as the second most used trade finance currency. The move indicates the pace which China is seeking to liberalise its financial markets although there is still a very long way to go. The yuan accounted for 8.66% of letters and credit collection in October compared with the dollar's 81% share. The currency has appreciated 2.3% vs the dollar this year, the most of any Asian currency. http://www.bloomberg.com/news/2013-12-03/yuan-passes-euro-to-be-second-most-used-trade-finance-currency.html
- As Joe Biden is beginning a week of meetings with leaders in northeast Asia the US has called on China to renege on its implemented air defence zone. They argued that the air zone makes accidents far more likely and that procedures should change. The US has deployed spy air craft to Japan to monitor submarine activity around the disputed areas. The Obama administration has been accused of a confused response to the situation by first sending two bombers through the zone and then telling commercial airlines to respect the Chinese orders. Biden meets Japanese leaders today and then travels to Beijing tomorrow. http://www.ft.com/cms/s/0/2e8fda9c-5bc1-11e3-a2ba-00144feabdc0.html?siteedition=uk#axzz2mJ6HA6Em
- Thai police have stepped aside ending clashes with protesters who have now taken over a number of state buildings. The move has ended violence on the streets and allowed the protesters to enter and leave the Government House peacefully. Prime minister Yingluck is strongly supported by the poor and would win an election called today, her opposition are the upper middle class and the ruling elite- generals, bureaucrats and wealthy conservatives. The Thai financial markets showed relief yesterday with the currency and its equities rallying on the news. http://uk.reuters.com/article/2013/12/03/uk-thailand-protest-idUKBRE9AS02120131203
- As turmoil continues in the Ukraine its bond yields have soared along with its corresponding CDS. Ukraines already fragile economy is likely to be hurt as 10 000's of people take to the streets. The price of insuring against Ukrainian government default over the next 5 years increased by over 10%. Putin again stuck himself into affairs condemning the protesters calling them "pogroms". Opposition lawmakers are looking to hold a vote of no confidence against Yanukovich's party which may pass as some of his members are defecting. http://www.ft.com/cms/s/0/e8b86a86-5b28-11e3-848e-00144feabdc0.html#axzz2mJ6HA6Em
Data
S&P 1800.90 0.27%
- Global equities have broadly sold off while bonds and gold are gaining. The current moves potentially point to slowing down of the pace we have seen over the last 8 record gaining weeks on Wall Street. The Nikkei added 0.6% on talk of further easing by the JGB while the Hang Seng lost 0.5% and the ASX 200 lost 0.4%. The S&P finished down 0.3% while the FTSE is down 0.2% this morning. The dollar and industrial commodities are flat. Treasury yields hit an 11 week high of 2.81 for the ten year before easing to 2.79. The euro is stronger vs the dollar up to $1.3554 while the continued prospect of tapering helped to weaken emerging currencies. http://www.ft.com/cms/s/0/83def222-5bc5-11e3-848e-00144feabdc0.html#axzz2mJ6HA6Em
- China's yuan overtook the euro as the second most used trade finance currency. The move indicates the pace which China is seeking to liberalise its financial markets although there is still a very long way to go. The yuan accounted for 8.66% of letters and credit collection in October compared with the dollar's 81% share. The currency has appreciated 2.3% vs the dollar this year, the most of any Asian currency. http://www.bloomberg.com/news/2013-12-03/yuan-passes-euro-to-be-second-most-used-trade-finance-currency.html
- As Joe Biden is beginning a week of meetings with leaders in northeast Asia the US has called on China to renege on its implemented air defence zone. They argued that the air zone makes accidents far more likely and that procedures should change. The US has deployed spy air craft to Japan to monitor submarine activity around the disputed areas. The Obama administration has been accused of a confused response to the situation by first sending two bombers through the zone and then telling commercial airlines to respect the Chinese orders. Biden meets Japanese leaders today and then travels to Beijing tomorrow. http://www.ft.com/cms/s/0/2e8fda9c-5bc1-11e3-a2ba-00144feabdc0.html?siteedition=uk#axzz2mJ6HA6Em
- Thai police have stepped aside ending clashes with protesters who have now taken over a number of state buildings. The move has ended violence on the streets and allowed the protesters to enter and leave the Government House peacefully. Prime minister Yingluck is strongly supported by the poor and would win an election called today, her opposition are the upper middle class and the ruling elite- generals, bureaucrats and wealthy conservatives. The Thai financial markets showed relief yesterday with the currency and its equities rallying on the news. http://uk.reuters.com/article/2013/12/03/uk-thailand-protest-idUKBRE9AS02120131203
- As turmoil continues in the Ukraine its bond yields have soared along with its corresponding CDS. Ukraines already fragile economy is likely to be hurt as 10 000's of people take to the streets. The price of insuring against Ukrainian government default over the next 5 years increased by over 10%. Putin again stuck himself into affairs condemning the protesters calling them "pogroms". Opposition lawmakers are looking to hold a vote of no confidence against Yanukovich's party which may pass as some of his members are defecting. http://www.ft.com/cms/s/0/e8b86a86-5b28-11e3-848e-00144feabdc0.html#axzz2mJ6HA6Em
Data
S&P 1800.90 0.27%
FTSE 6568.22 0.41%
Nikkei 15,749.66 0.60%
Nikkei 15,749.66 0.60%
EUR/USD- 1.3570 0.21%
USD/JPY- 102.99 0.05%
GBP/USD- 1.6408 0.30%
USD/JPY- 102.99 0.05%
GBP/USD- 1.6408 0.30%
Gold- 1222.42 0.21%
Oil (Brent)- 111.52 0.06%
Oil (Brent)- 111.52 0.06%
Copper- 316.95 0.41%
10 year yields
US- 2.79 (0bps)
UK- 2.84 (0bps)
Japan- 0.62 (+2bps)
UK- 2.84 (0bps)
Japan- 0.62 (+2bps)
Monday 2 December 2013
Market Update 02/12/13
One line- Stronger than expected Chinese PMI kicks off December rates sell off while risk on currencies gain.
- An improving Chinese PMI has kicked off December with a measure of 50.8, beating the forecasts of 50.4. The Nikkei was flat overnight as the yen stabilised at 102.49 while European stocks have sold off this morning. The pound rose for a fifth day adding 0.3% along with the kiwi dollar and the aussie dollar who gained 1% and 0.5% on the Chinese data. The dollar continued its weakening supporting industrial commodity prices while US yields continue to tick up adding 3bp to the ten year rate at 2.78% while the UK ten year added 6bp to 2.83%. Gold fell 0.8% as the Chinese report added to optimism about the global economy. http://www.bloomberg.com/news/2013-12-01/yen-holds-drop-asian-futures-mixed-before-factory-data.html http://www.ft.com/cms/s/0/5d06d500-5aff-11e3-942a-00144feabdc0.html?siteedition=uk#axzz2mJ6HA6Em
- David Cameron is pushing for a free trade deal to be developed between China and the EU but he understands he is likely to meet resistance within the bloc. The idea was proposed by the Chinese government and could help to raise bilateral trade to $1tn by 2020. Cameron's comments come at the beginning of a three day trip to China where he will meet the Premier Li Keqiang to discuss the deal as well reductions in tariffs for key sectors. http://www.ft.com/cms/s/0/d152cade-5a7f-11e3-b255-00144feabdc0.html#axzz2mJ6HA6Em
- Thai prime minister Yingluck Shinawatra has rejected calls to step down while protesters clash with police for a second day in Bangkok. She has stated she will seek to "open every door" for peaceful negotiations with the opposition who issued an ultimatum for her to step down in two days. Protesters are besieging the Government House and have already overran the state television station. At least three people have died while 58 are injured as clashes have gone on through the night causing the government to call for a voluntary curfew between 10pm and 5am. The Thai baht is down 0.7% this morning. http://www.ft.com/cms/s/0/b147d052-5b08-11e3-b255-00144feabdc0.html#axzz2mJ6HA6Em
- The biggest demonstrations in the Ukraine since the 2004 Orange Revolution have been sparked by the government's decision to back away from a deal to strengthen ties with the EU under pressure from Putin. Protesters occupy two floors of a government building using it as headquarters and hundreds of protestors remained in the Maidan square in Kiev overnight. Most of the estimated 350 000 protesters have been non violent as we move into the 11th day of protests. http://www.ft.com/cms/s/0/e8b86a86-5b28-11e3-848e-00144feabdc0.html#axzz2mJ6HA6Em
Data
S&P 1805.81 0.08%
- An improving Chinese PMI has kicked off December with a measure of 50.8, beating the forecasts of 50.4. The Nikkei was flat overnight as the yen stabilised at 102.49 while European stocks have sold off this morning. The pound rose for a fifth day adding 0.3% along with the kiwi dollar and the aussie dollar who gained 1% and 0.5% on the Chinese data. The dollar continued its weakening supporting industrial commodity prices while US yields continue to tick up adding 3bp to the ten year rate at 2.78% while the UK ten year added 6bp to 2.83%. Gold fell 0.8% as the Chinese report added to optimism about the global economy. http://www.bloomberg.com/news/2013-12-01/yen-holds-drop-asian-futures-mixed-before-factory-data.html http://www.ft.com/cms/s/0/5d06d500-5aff-11e3-942a-00144feabdc0.html?siteedition=uk#axzz2mJ6HA6Em
- David Cameron is pushing for a free trade deal to be developed between China and the EU but he understands he is likely to meet resistance within the bloc. The idea was proposed by the Chinese government and could help to raise bilateral trade to $1tn by 2020. Cameron's comments come at the beginning of a three day trip to China where he will meet the Premier Li Keqiang to discuss the deal as well reductions in tariffs for key sectors. http://www.ft.com/cms/s/0/d152cade-5a7f-11e3-b255-00144feabdc0.html#axzz2mJ6HA6Em
- Thai prime minister Yingluck Shinawatra has rejected calls to step down while protesters clash with police for a second day in Bangkok. She has stated she will seek to "open every door" for peaceful negotiations with the opposition who issued an ultimatum for her to step down in two days. Protesters are besieging the Government House and have already overran the state television station. At least three people have died while 58 are injured as clashes have gone on through the night causing the government to call for a voluntary curfew between 10pm and 5am. The Thai baht is down 0.7% this morning. http://www.ft.com/cms/s/0/b147d052-5b08-11e3-b255-00144feabdc0.html#axzz2mJ6HA6Em
- The biggest demonstrations in the Ukraine since the 2004 Orange Revolution have been sparked by the government's decision to back away from a deal to strengthen ties with the EU under pressure from Putin. Protesters occupy two floors of a government building using it as headquarters and hundreds of protestors remained in the Maidan square in Kiev overnight. Most of the estimated 350 000 protesters have been non violent as we move into the 11th day of protests. http://www.ft.com/cms/s/0/e8b86a86-5b28-11e3-848e-00144feabdc0.html#axzz2mJ6HA6Em
Data
S&P 1805.81 0.08%
FTSE 6636.23 0.22%
Nikkei 15,655.07 0.04%
Nikkei 15,655.07 0.04%
EUR/USD- 1.3550 0.31%
USD/JPY- 102.79 0.34%
GBP/USD- 1.6409 0.24%
USD/JPY- 102.79 0.34%
GBP/USD- 1.6409 0.24%
Gold- 1239.33 1.12%
Oil (Brent)- 109.99 0.27%
Oil (Brent)- 109.99 0.27%
Copper- 318.95 0.48%
10 year yields
US- 2.79 (+4bps)
UK- 2.83 (+6bps)
Japan- 0.61 (+1bps)
UK- 2.83 (+6bps)
Japan- 0.61 (+1bps)
Friday 29 November 2013
Reading list
A list of the blogs I am reading at the moment most are economic/finance focussed.
Sober look- interesting analysis of macro and market trends updated very regularly http://soberlook.com/
Reformed Broker- light stock market commentary from one of the most prominent financial bloggers http://www.thereformedbroker.com/
FT Alphaville- Up to date bulletins, market updates and reports from the team at the Financial Times http://ftalphaville.ft.com/
Deus ex Macchiato- Super interesting and broad blog that takes ideas from a number of academic disciplines and applies them to finance, economics and complex systems in general http://blog.rivast.com/
Zero Hedge- a non conventional view point from another heavyweight blogger http://www.zerohedge.com/
Epicurean Dealmaker- M&A banker of two decades discusses any topic which takes his fancy http://epicureandealmaker.blogspot.co.uk/
Locklin on Science- broad blog on science and markets by a former physicist working in quantitative finance http://scottlocklin.wordpress.com/
Sober look- interesting analysis of macro and market trends updated very regularly http://soberlook.com/
Reformed Broker- light stock market commentary from one of the most prominent financial bloggers http://www.thereformedbroker.com/
FT Alphaville- Up to date bulletins, market updates and reports from the team at the Financial Times http://ftalphaville.ft.com/
Deus ex Macchiato- Super interesting and broad blog that takes ideas from a number of academic disciplines and applies them to finance, economics and complex systems in general http://blog.rivast.com/
Zero Hedge- a non conventional view point from another heavyweight blogger http://www.zerohedge.com/
Epicurean Dealmaker- M&A banker of two decades discusses any topic which takes his fancy http://epicureandealmaker.blogspot.co.uk/
Locklin on Science- broad blog on science and markets by a former physicist working in quantitative finance http://scottlocklin.wordpress.com/
Market Update 29/11/13
One line- Equity markets mixed while rates move up and dollar weakness supports commodity prices.
- US markets were closed yesterday for Thanksgiving while Asian markets were mixed overnight. The FTSE has opened up 0.2% this morning. The Nikkei lost 0.4% yesterday coming off a near six year high as Japanese industrial figures disappointed on the downside showing just 0.5% growth month on month compared with a 2% estimate. The dollar sold off slightly while the euro is in the spotlight today ahead of the areas inflation data released today. The weaker dollar is supporting commodity prices with gold advancing with industrial metals and oil. Yields edged higher as the markets look forward to potential tapering. http://www.ft.com/cms/s/0/7c5057a8-58a5-11e3-9da6-00144feabdc0.html#axzz2lvuZmraP
- The Japanese CPI measured 0.9% for the month of October in line with expectations. The measure without energy costs comes in at 0.3% the highest since 1998. The news is positive at a time when some Japanese central bankers are concerned about the achievability of their 2% inflation target. Two bankers have raised concern that the figure is driven mostly by a weakening yen and that the lack of basic wage increases is worrying. http://www.ft.com/cms/s/0/4712e182-588c-11e3-9da6-00144feabdc0.html#axzz2lvuZmraP
- In continuing aggravation the Chinese flew fighter jets through the disputed air zones in the East China Sea. Colonel Shen Jinke said several fighter planes and an early warning aircraft have been deployed as a "defensive measure and in line with international common practices". Joe Biden on a trip to China next week is expected to put pressure on the authorities to step down the hostility. http://www.ft.com/cms/s/0/08c78be0-5809-11e3-a2ed-00144feabdc0.html#axzz2lvuZmraP
- Euro area unemployment unexpectedly dropped in October from 12.2% to 12.1% while inflation quickened to 0.9%. While the news is good recent growth figures have been disappointing with third quarter growth down at 0.1% from 0.3% in the second quarter. Italy's youth unemployment rose to 41.2% while Spain's reached a record 57.4%. http://www.bloomberg.com/news/2013-11-29/euro-area-unemployment-unexpectedly-drops-amid-recovery.html
- UK house prices have gained at their fastest rate in more than three years for this month according to mortgage lender Nationwide. The growth year on year has been 6.5% at a time when the Bank of England is looking to slow down its inflation of the housing market by ending its Funding for Lending Scheme. http://uk.reuters.com/article/2013/11/29/uk-britain-property-nationwide-idUKBRE9AS04R20131129
Data
S&P closed
S&P closed
FTSE 6668.37 0.21%
Nikkei 15,661.87 0.41%
Nikkei 15,661.87 0.41%
EUR/USD- 1.3612 0.04%
USD/JPY- 102.25 0.08%
GBP/USD- 1.6326 0.10%
USD/JPY- 102.25 0.08%
GBP/USD- 1.6326 0.10%
Gold- 1246.62 0.16%
Oil (Brent)- 110.94 0.07%
Oil (Brent)- 110.94 0.07%
Copper- 321.40 0.74%
10 year yields
US- 2.75 (+2bps)
UK- 2.74 (+1bps)
Japan- 0.60 (+1bps)
UK- 2.74 (+1bps)
Japan- 0.60 (+1bps)
Thursday 28 November 2013
Market Update 28/11/13
One line- Market moves risk on on the back of positive US data.
- US stocks rose yesterday reaching record highs as jobless claims fell unexpectedly and consumer confidence beat estimates, Treasuries sold off as did crude oil on increased supply. The yen continued to weaken helping push the Nikkei up 1.8% while European stocks are up this morning with the FTSE adding 0.4%. Gold is under pressure as investors move to riskier assets. The dollar is little changed. http://www.bloomberg.com/news/2013-11-26/nikkei-futures-fall-on-yen-rebound-as-crude-extends-drop.html http://www.ft.com/cms/s/0/8a26a34e-57df-11e3-b615-00144feabdc0.html#axzz2lvuZmraP
- German unemployment rose for a fourth month in November hitting 2.985 million with a rise of 10 000 unemployed. The jobless rate remains unchanged at 6.9%. Sluggish third quarter growth of 0.3% was driven entirely by domestic demand while 0.4% growth is predicted for for the last quarter. The figures support the ECB decision to reduce rates and make the case that perhaps more dynamic measures need to be introduced to the region. http://www.bloomberg.com/news/2013-11-28/german-unemployment-rises-for-a-fourth-month-in-uneven-recovery.html
- Brazil has been forced to increase its benchmark rate by 50 basis points to 10% as the country grapples with inflation as well as declining growth. The move is part of what is currently the worlds biggest tightening cycle with rates having risen 275 basis points since April this year. Inflation stands at 5.8% down from 6.5% in June but still ahead of the 4.5% target the central bank has. http://www.ft.com/cms/s/0/fb86cf18-57bd-11e3-b615-00144feabdc0.html#axzz2lvuZmraP
- Silvio Berlusconi has been ejected from the Italian Senate as a result of his conviction of tax fraud. Still defiant Berlusconi proclaimed "a day of mourning for democracy". His conviction of tax fraud forces him to spend one year under house arrest or through community service. He is banned from public office for 6 years following an anti corruption law passed in 2012. http://www.ft.com/cms/s/0/a029ba7e-5757-11e3-9624-00144feabdc0.html#axzz2lvuZmraP
- Japanese and South Korean planes have been flying through the Chinese new defence zone over the disputed islands in the East China Sea, without informing China. Earlier in the week the Chinese government stated that it would take defensive action against any unidentified planes flying over the area. The move by Japan and South Korea follows the American lack of recognition for the Chinese claim when they fly two B52 bombers over the area. http://uk.reuters.com/article/2013/11/28/uk-japan-china-idUKBRE9AR0AF20131128
Data
S&P 1807.23 0.25%
- US stocks rose yesterday reaching record highs as jobless claims fell unexpectedly and consumer confidence beat estimates, Treasuries sold off as did crude oil on increased supply. The yen continued to weaken helping push the Nikkei up 1.8% while European stocks are up this morning with the FTSE adding 0.4%. Gold is under pressure as investors move to riskier assets. The dollar is little changed. http://www.bloomberg.com/news/2013-11-26/nikkei-futures-fall-on-yen-rebound-as-crude-extends-drop.html http://www.ft.com/cms/s/0/8a26a34e-57df-11e3-b615-00144feabdc0.html#axzz2lvuZmraP
- German unemployment rose for a fourth month in November hitting 2.985 million with a rise of 10 000 unemployed. The jobless rate remains unchanged at 6.9%. Sluggish third quarter growth of 0.3% was driven entirely by domestic demand while 0.4% growth is predicted for for the last quarter. The figures support the ECB decision to reduce rates and make the case that perhaps more dynamic measures need to be introduced to the region. http://www.bloomberg.com/news/2013-11-28/german-unemployment-rises-for-a-fourth-month-in-uneven-recovery.html
- Brazil has been forced to increase its benchmark rate by 50 basis points to 10% as the country grapples with inflation as well as declining growth. The move is part of what is currently the worlds biggest tightening cycle with rates having risen 275 basis points since April this year. Inflation stands at 5.8% down from 6.5% in June but still ahead of the 4.5% target the central bank has. http://www.ft.com/cms/s/0/fb86cf18-57bd-11e3-b615-00144feabdc0.html#axzz2lvuZmraP
- Silvio Berlusconi has been ejected from the Italian Senate as a result of his conviction of tax fraud. Still defiant Berlusconi proclaimed "a day of mourning for democracy". His conviction of tax fraud forces him to spend one year under house arrest or through community service. He is banned from public office for 6 years following an anti corruption law passed in 2012. http://www.ft.com/cms/s/0/a029ba7e-5757-11e3-9624-00144feabdc0.html#axzz2lvuZmraP
- Japanese and South Korean planes have been flying through the Chinese new defence zone over the disputed islands in the East China Sea, without informing China. Earlier in the week the Chinese government stated that it would take defensive action against any unidentified planes flying over the area. The move by Japan and South Korea follows the American lack of recognition for the Chinese claim when they fly two B52 bombers over the area. http://uk.reuters.com/article/2013/11/28/uk-japan-china-idUKBRE9AR0AF20131128
Data
S&P 1807.23 0.25%
FTSE 6678.30 0.43%
Nikkei 15,727.12 1.80%
Nikkei 15,727.12 1.80%
EUR/USD- 1.3600 0.15%
USD/JPY- 102.19 0.03%
GBP/USD- 1.6317 0.18%
USD/JPY- 102.19 0.03%
GBP/USD- 1.6317 0.18%
Gold- 1242.31 0.36%
Oil (Brent)- 111.00 0.28%
Oil (Brent)- 111.00 0.28%
Copper- 319.25 0.06%
10 year yields
US- 2.74 (0bps)
UK- 2.77 (0bps)
Japan- 0.60 (0bps)
UK- 2.77 (0bps)
Japan- 0.60 (0bps)
Wednesday 27 November 2013
Market Update 27/11/13
One line- Another slow trading day ahead of further US data releases and the Thanksgiving break.
- US stocks were flat yesterday and Asian shares were mixed with the Nikkei losing 0.4% while the Hang Seng added 0.5%. Trading is muted ahead of the Thanksgiving break and further US economic data releases. European stocks this morning are up as UK economic growth of 0.8% in the second quarter grew on housing and investment. Rates are slightly higher with the US ten year adding 2 bp to 2.72% which is helping to firm the dollar vs the yen which weakened 0.4%. Commodities are generally up with gold adding 0.46% and brent adding 0.35%. http://www.ft.com/cms/s/0/12b8579a-5716-11e3-ab12-00144feabdc0.html?siteedition=uk#axzz2leBNNo3r http://www.bloomberg.com/news/2013-11-27/u-k-economic-growth-accelerates-on-investment-housebuilding.html
- The US made a statement to China yesterday by flying two B52 bombers across the disputed islands in the East China Sea. China has recently said it would establish an air zone over the islands to protect its territorial rights. Beijing has said it would take "defensive emergency measures" against any unidentified aircraft flying over the zone. The US insists the flights were a long planned training mission and that it would not change its operations in response to the Chinese's stance. http://www.ft.com/cms/s/0/b2a6c054-56c9-11e3-ab12-00144feabdc0.html#axzz2leBNNo3r
- Angela Merkel's Christian Democrats and the Social Democrats have agreed to a deal that looks to create a new government by Christmas. The deal spelled out in an 185 page document will not be final until approved by a postal ballot of 475000 SPD members. European leaders are relieved at the agreement as the lengthy talks have hampered reforms of the euro area including creating a banking union. http://uk.reuters.com/article/2013/11/27/uk-germany-coalition-idUKBRE9AQ04G20131127
- Iran's oil ministry is opening talks with contacts in major western companies as they look to the future to prepare for potential further lifting of sanctions. The oil minister Bijan Zanganeh is looking to reattract the kind of investment he managed in the 90's when in spite of sanctions he managed to persuade the likes of Total, Shell, Eni and Statoil to pump money into the region. http://www.ft.com/cms/s/2/2e341574-56ab-11e3-ab12-00144feabdc0.html#axzz2leBNNo3r
- Private equity has $789bn of dry powder on its balance sheets an increase of 12% since December 2012. Increased funding along with a decreased number of deals done is driving the figure which suggests possible over capacity in the industry. http://www.ft.com/cms/s/0/c6b67414-5691-11e3-8cca-00144feabdc0.html?siteedition=uk#axzz2leBNNo3r
Data
S&P 1802.75 0.13%
- US stocks were flat yesterday and Asian shares were mixed with the Nikkei losing 0.4% while the Hang Seng added 0.5%. Trading is muted ahead of the Thanksgiving break and further US economic data releases. European stocks this morning are up as UK economic growth of 0.8% in the second quarter grew on housing and investment. Rates are slightly higher with the US ten year adding 2 bp to 2.72% which is helping to firm the dollar vs the yen which weakened 0.4%. Commodities are generally up with gold adding 0.46% and brent adding 0.35%. http://www.ft.com/cms/s/0/12b8579a-5716-11e3-ab12-00144feabdc0.html?siteedition=uk#axzz2leBNNo3r http://www.bloomberg.com/news/2013-11-27/u-k-economic-growth-accelerates-on-investment-housebuilding.html
- The US made a statement to China yesterday by flying two B52 bombers across the disputed islands in the East China Sea. China has recently said it would establish an air zone over the islands to protect its territorial rights. Beijing has said it would take "defensive emergency measures" against any unidentified aircraft flying over the zone. The US insists the flights were a long planned training mission and that it would not change its operations in response to the Chinese's stance. http://www.ft.com/cms/s/0/b2a6c054-56c9-11e3-ab12-00144feabdc0.html#axzz2leBNNo3r
- Angela Merkel's Christian Democrats and the Social Democrats have agreed to a deal that looks to create a new government by Christmas. The deal spelled out in an 185 page document will not be final until approved by a postal ballot of 475000 SPD members. European leaders are relieved at the agreement as the lengthy talks have hampered reforms of the euro area including creating a banking union. http://uk.reuters.com/article/2013/11/27/uk-germany-coalition-idUKBRE9AQ04G20131127
- Iran's oil ministry is opening talks with contacts in major western companies as they look to the future to prepare for potential further lifting of sanctions. The oil minister Bijan Zanganeh is looking to reattract the kind of investment he managed in the 90's when in spite of sanctions he managed to persuade the likes of Total, Shell, Eni and Statoil to pump money into the region. http://www.ft.com/cms/s/2/2e341574-56ab-11e3-ab12-00144feabdc0.html#axzz2leBNNo3r
- Private equity has $789bn of dry powder on its balance sheets an increase of 12% since December 2012. Increased funding along with a decreased number of deals done is driving the figure which suggests possible over capacity in the industry. http://www.ft.com/cms/s/0/c6b67414-5691-11e3-8cca-00144feabdc0.html?siteedition=uk#axzz2leBNNo3r
Data
S&P 1802.75 0.13%
FTSE 6647.34 0.17%
Nikkei 15,449.63 0.42%
Nikkei 15,449.63 0.42%
EUR/USD- 1.3605 0.24%
USD/JPY- 101.80 0.49%
GBP/USD- 1.6286 0.43%
USD/JPY- 101.80 0.49%
GBP/USD- 1.6286 0.43%
Gold- 1251.12 0.67%
Oil (Brent)- 111.30 0.38%
Oil (Brent)- 111.30 0.38%
Copper- 323.15 0.39%
10 year yields
US- 2.72 (+1bps)
UK- 2.74 (+1bps)
Japan- 0.60 (-1bps)
UK- 2.74 (+1bps)
Japan- 0.60 (-1bps)
Tuesday 26 November 2013
Market Update 26/11/13
One line- Slow day trading as markets pause following Iranian deal rally.
- US stocks were flat yesterday, Asian stocks were mixed overnight and European stocks are down this morning. A softer dollar caused the Nikkei to sell off 0.7% while oil recovered most of its losses following the Iranian deal. Bonds rallied slightly higher with the US ten year down 1bp to 2.73. The 0.2% decline in the dollar index is supporting metal prices with gold up 0.8% and copper up 0.25%. US economic data released later today will be looked at closely for its impact on potential tapering. http://www.ft.com/cms/s/0/674fa1dc-5649-11e3-96f5-00144feabdc0.html#axzz2leBNNo3r
- Minutes released by the BoJ for its last meeting showed uneasiness between members who are beginning to worry that they will not achieve their 2% by 2015 inflation target. Two of the members wanted to change how the goal was worded using less precise language given that they feel the aim is too ambitious. Inflation is showing signs of peaking at 1.0% and some analysts believe further loosening of policy is to come. http://on.ft.com/19XG4PZ
- Senior members of both parties are calling for increased sanctions on Iran in a move that will put Barack Obama to the test. At a time when his reputation has taken repeated knocks on the turn around with Syria to the problems with the launch of the healthcare he may face a formidable challenge.Obama will need the support of Senate leader Harry Reid who initially lent his support to a new set of sanctions for Iran but has since moved into a uncertain position. The current lift on sanctions will remain in place for 6 months in which time it is hoped a new more comprehensive deal will be reached. http://www.ft.com/cms/s/0/280f8146-5652-11e3-96f5-00144feabdc0.html#axzz2leBNNo3r
- China is looking to crack down on banks that evade its lending limits by assets between each other. The new rules will impose restrictions on interbank lending and looks to try and curb some of the riskier activity Chinese banks are engaged in. In order to circumvent lending limits banks sell each other assets and buy them back later at a higher agreed price. Increasing dependence on the interbank market meant that overnight rates rates reached a record this year on the 20th June. http://www.bloomberg.com/news/2013-11-26/china-said-to-plan-crackdown-on-banks-evasion-of-lending-limits.html
Data
S&P 1802.48 0.13%
- US stocks were flat yesterday, Asian stocks were mixed overnight and European stocks are down this morning. A softer dollar caused the Nikkei to sell off 0.7% while oil recovered most of its losses following the Iranian deal. Bonds rallied slightly higher with the US ten year down 1bp to 2.73. The 0.2% decline in the dollar index is supporting metal prices with gold up 0.8% and copper up 0.25%. US economic data released later today will be looked at closely for its impact on potential tapering. http://www.ft.com/cms/s/0/674fa1dc-5649-11e3-96f5-00144feabdc0.html#axzz2leBNNo3r
- Minutes released by the BoJ for its last meeting showed uneasiness between members who are beginning to worry that they will not achieve their 2% by 2015 inflation target. Two of the members wanted to change how the goal was worded using less precise language given that they feel the aim is too ambitious. Inflation is showing signs of peaking at 1.0% and some analysts believe further loosening of policy is to come. http://on.ft.com/19XG4PZ
- Senior members of both parties are calling for increased sanctions on Iran in a move that will put Barack Obama to the test. At a time when his reputation has taken repeated knocks on the turn around with Syria to the problems with the launch of the healthcare he may face a formidable challenge.Obama will need the support of Senate leader Harry Reid who initially lent his support to a new set of sanctions for Iran but has since moved into a uncertain position. The current lift on sanctions will remain in place for 6 months in which time it is hoped a new more comprehensive deal will be reached. http://www.ft.com/cms/s/0/280f8146-5652-11e3-96f5-00144feabdc0.html#axzz2leBNNo3r
- China is looking to crack down on banks that evade its lending limits by assets between each other. The new rules will impose restrictions on interbank lending and looks to try and curb some of the riskier activity Chinese banks are engaged in. In order to circumvent lending limits banks sell each other assets and buy them back later at a higher agreed price. Increasing dependence on the interbank market meant that overnight rates rates reached a record this year on the 20th June. http://www.bloomberg.com/news/2013-11-26/china-said-to-plan-crackdown-on-banks-evasion-of-lending-limits.html
Data
S&P 1802.48 0.13%
FTSE 6674.58 0.30%
Nikkei 15,515.24 0.67%
Nikkei 15,515.24 0.67%
EUR/USD- 1.3558 0.30%
USD/JPY- 101.36 0.30%
GBP/USD- 1.6190 0.21%
USD/JPY- 101.36 0.30%
GBP/USD- 1.6190 0.21%
Gold- 1253.40 0.16%
Oil (Brent)- 110.65 0.32%
Oil (Brent)- 110.65 0.32%
Copper- 323.40 0.12%
10 year yields
US- 2.72 (-1bps)
UK- 2.76 (0bps)
Japan- 0.61 (-3bps)
UK- 2.76 (0bps)
Japan- 0.61 (-3bps)
Monday 25 November 2013
Interview with one of the greatest managers ever
Charlie Rose interviews Alex Ferguson for an hour, arguably the most successful football manager ever - http://www.charlierose.com/watch/60274655
Market Update 25/11/13
One line- Iranian deal sparks risk on moves while oil sells off and the dollar continues to strengthen.
- A deal was made with Iran yesterday that trades a reduction in sanctions for a slowdown in the country's nuclear programme. The Iranian economy is struggling with high inflation, unemployment and a continuing recession. Its currency has lost 50% of its value over the last two years while the deal helped the rial rally 2%. While the US, Britain, France, Germany, China and Russia hailed the deal as a great success Israel and Saudi Arabia did not lend their support worrying that the deal gives Iran too much freedom to continue enriching uranium. http://www.ft.com/cms/s/0/a1769f46-5518-11e3-a321-00144feabdc0.html?siteedition=uk#axzz2leBNNo3r
- The Iranian deal is causing broad risk on moves in the market with equities rallying while Treasuries, the yen and gold sell off. The Nikkei added 1.5% overnight while the FTSE is up 0.5% this morning. Brent and WTI took a beating on the news losing 2% and 1.34% respectively. The dollar is showing continued strength as the yen reaches 101.73 and the euro slips to $1.3532. http://www.ft.com/cms/s/0/2647abca-5582-11e3-86bc-00144feabdc0.html?siteedition=uk#axzz2leBNNo3r
- The lack of a deal to create a "grand coalition" in Germany is beginning to weigh on the country as Merkel is unable to move on urgent European policy decisions. Both parties have been under fire more making policy concessions in an effort to form a working government. The expectation is that this week they will reach some agreement as they look to assign cabinet posts. http://uk.reuters.com/article/2013/11/24/uk-germany-coalition-idUKBRE9AN0GP20131124
- Data released this week is expected to back up Draghi's case to reduce intereste rates for the Eurozone. Inflation is expected to be close to 0.8% while the jobless rate is likely to still be at record highs of 12.2%. http://www.bloomberg.com/news/2013-11-25/europe-twin-woes-fester-in-draghi-job-to-inflation-fight.html
- After two years of continuous decline in the polls for Spanish prime minister Mariano Rajoy a turn around in sentiment is taking place. Confidence on the Spanish economy as well as that Rajoy will retain power in two years is growing. Spain's recession is finally over while bond yields have stabilised on the other hand unemployment is stubbornly high at 26.6%. http://www.ft.com/cms/s/0/ba115508-5362-11e3-b425-00144feabdc0.html#axzz2leBNNo3r
Data
S&P 1804.76 0.50%
- A deal was made with Iran yesterday that trades a reduction in sanctions for a slowdown in the country's nuclear programme. The Iranian economy is struggling with high inflation, unemployment and a continuing recession. Its currency has lost 50% of its value over the last two years while the deal helped the rial rally 2%. While the US, Britain, France, Germany, China and Russia hailed the deal as a great success Israel and Saudi Arabia did not lend their support worrying that the deal gives Iran too much freedom to continue enriching uranium. http://www.ft.com/cms/s/0/a1769f46-5518-11e3-a321-00144feabdc0.html?siteedition=uk#axzz2leBNNo3r
- The Iranian deal is causing broad risk on moves in the market with equities rallying while Treasuries, the yen and gold sell off. The Nikkei added 1.5% overnight while the FTSE is up 0.5% this morning. Brent and WTI took a beating on the news losing 2% and 1.34% respectively. The dollar is showing continued strength as the yen reaches 101.73 and the euro slips to $1.3532. http://www.ft.com/cms/s/0/2647abca-5582-11e3-86bc-00144feabdc0.html?siteedition=uk#axzz2leBNNo3r
- The lack of a deal to create a "grand coalition" in Germany is beginning to weigh on the country as Merkel is unable to move on urgent European policy decisions. Both parties have been under fire more making policy concessions in an effort to form a working government. The expectation is that this week they will reach some agreement as they look to assign cabinet posts. http://uk.reuters.com/article/2013/11/24/uk-germany-coalition-idUKBRE9AN0GP20131124
- Data released this week is expected to back up Draghi's case to reduce intereste rates for the Eurozone. Inflation is expected to be close to 0.8% while the jobless rate is likely to still be at record highs of 12.2%. http://www.bloomberg.com/news/2013-11-25/europe-twin-woes-fester-in-draghi-job-to-inflation-fight.html
- After two years of continuous decline in the polls for Spanish prime minister Mariano Rajoy a turn around in sentiment is taking place. Confidence on the Spanish economy as well as that Rajoy will retain power in two years is growing. Spain's recession is finally over while bond yields have stabilised on the other hand unemployment is stubbornly high at 26.6%. http://www.ft.com/cms/s/0/ba115508-5362-11e3-b425-00144feabdc0.html#axzz2leBNNo3r
Data
S&P 1804.76 0.50%
FTSE 6702.82 0.43%
Nikkei 15,619.13 1.54%
Nikkei 15,619.13 1.54%
EUR/USD- 1.3515 0.32%
USD/JPY- 101.73 0.46%
GBP/USD- 1.6194 0.20%
USD/JPY- 101.73 0.46%
GBP/USD- 1.6194 0.20%
Gold- 1230.79 1.05%
Oil (Brent)- 108.91 1.93%
Oil (Brent)- 108.91 1.93%
Copper- 321.55 0.09%
10 year yields
US- 2.75 (+1bps)
UK- 2.78 (-1bps)
Japan- 0.63 (+1bps)
UK- 2.78 (-1bps)
Japan- 0.63 (+1bps)
Friday 22 November 2013
Market Update 22/11/13
One line- Global stocks rally sparked by positive US economic data, rates halt their sell off while commodities are mixed.
- US equity markets rallied yesterday on encouraging inflation and labour market figures and the momentum continued through Asia. The S&P added 0.8% and the Nikkei added 0.1%. The yen continued to sell off falling to a 6 month low of 101.33 vs the dollar. In Australia the S&P/ASX added 1% as the aussie dollar slid to a two month low of $0.9164. European stocks are up this morning ahead of expectations that data released today will show German business confidence increased. Metals are marginally higher while Brent has sold off 0.34%. Rates are virtually unchanged following the sell off on the Fed minutes. http://www.ft.com/cms/s/0/0f92c230-5329-11e3-8586-00144feabdc0.html#axzz2lB9GOvWf
- RBA governor Glenn Stevens has said he is open minded about currency intervention but that the currency would have to be "seriously overvalued" for him to consider it. The RBA has cut rates by 2.25% in the last two years to 2.5% as it looked to boost industries hurt by the currencies strength. The IMF believes the Aussie dollar is about 10% overvalued. http://www.bloomberg.com/news/2013-11-21/stevens-says-rba-open-minded-on-fx-intervention-after-inaction.html
- Germany showed a 0.3% expansion in the third quarter helped by strong domestic demand that overshadowed weak export performance.The European Commission is currently reviewing Germany's persistently high current account surplus amid concerns that it relies too heavily on exports, but figures released today showed that trade had a 0.4% net negative effect on growth. http://uk.reuters.com/article/2013/11/22/uk-germany-economy-idUKBRE9AL07M20131122
- The WTO is on the verge of sealing the first global trade pact in more than ten years as the US, China and India put aside differences they have on agriculture. The deal could potentially add $1 trillion in trade to the current $18 trillion per year figure. The deal makes progress on bureaucratic barriers at borders, agricultural and developmental issues. http://www.ft.com/cms/s/0/34eef340-52da-11e3-a73e-00144feabdc0.html#axzz2lB9GOvWf
- Italy and Spain will face questioning over their 2014 budget plans at meeting of finance ministers today. Following the easing of bond market pressure over the last 18 months concern is growing that peripheral country's are beginning to become complacent. This comes at a time when European growth was just 0.1% for the third quarter down from 0.3% in the second. Unemployment is at a record high of 12.2%. While the EU doesn't have the power to veto a country's budget the European Commission hopes to pressure finance ministers into prudent choices. http://www.bloomberg.com/news/2013-11-22/italy-spain-face-budget-scrutiny-as-euro-finance-ministers-meet.html
Data
S&P 1795.85 0.81%
- US equity markets rallied yesterday on encouraging inflation and labour market figures and the momentum continued through Asia. The S&P added 0.8% and the Nikkei added 0.1%. The yen continued to sell off falling to a 6 month low of 101.33 vs the dollar. In Australia the S&P/ASX added 1% as the aussie dollar slid to a two month low of $0.9164. European stocks are up this morning ahead of expectations that data released today will show German business confidence increased. Metals are marginally higher while Brent has sold off 0.34%. Rates are virtually unchanged following the sell off on the Fed minutes. http://www.ft.com/cms/s/0/0f92c230-5329-11e3-8586-00144feabdc0.html#axzz2lB9GOvWf
- RBA governor Glenn Stevens has said he is open minded about currency intervention but that the currency would have to be "seriously overvalued" for him to consider it. The RBA has cut rates by 2.25% in the last two years to 2.5% as it looked to boost industries hurt by the currencies strength. The IMF believes the Aussie dollar is about 10% overvalued. http://www.bloomberg.com/news/2013-11-21/stevens-says-rba-open-minded-on-fx-intervention-after-inaction.html
- Germany showed a 0.3% expansion in the third quarter helped by strong domestic demand that overshadowed weak export performance.The European Commission is currently reviewing Germany's persistently high current account surplus amid concerns that it relies too heavily on exports, but figures released today showed that trade had a 0.4% net negative effect on growth. http://uk.reuters.com/article/2013/11/22/uk-germany-economy-idUKBRE9AL07M20131122
- The WTO is on the verge of sealing the first global trade pact in more than ten years as the US, China and India put aside differences they have on agriculture. The deal could potentially add $1 trillion in trade to the current $18 trillion per year figure. The deal makes progress on bureaucratic barriers at borders, agricultural and developmental issues. http://www.ft.com/cms/s/0/34eef340-52da-11e3-a73e-00144feabdc0.html#axzz2lB9GOvWf
- Italy and Spain will face questioning over their 2014 budget plans at meeting of finance ministers today. Following the easing of bond market pressure over the last 18 months concern is growing that peripheral country's are beginning to become complacent. This comes at a time when European growth was just 0.1% for the third quarter down from 0.3% in the second. Unemployment is at a record high of 12.2%. While the EU doesn't have the power to veto a country's budget the European Commission hopes to pressure finance ministers into prudent choices. http://www.bloomberg.com/news/2013-11-22/italy-spain-face-budget-scrutiny-as-euro-finance-ministers-meet.html
Data
S&P 1795.85 0.81%
FTSE 6689.86 0.13%
Nikkei 15,381.72 0.10%
Nikkei 15,381.72 0.10%
EUR/USD- 1.3515 0.24%
USD/JPY- 101.13 0.03%
GBP/USD- 1.6195 0.03%
USD/JPY- 101.13 0.03%
GBP/USD- 1.6195 0.03%
Gold- 1244.14 0.10%
Oil (Brent)- 109.78 0.27%
Oil (Brent)- 109.78 0.27%
Copper- 321.85 0.61%
10 year yields
US- 2.79 (0bps)
UK- 2.83 (+1bps)
Japan- 0.62 (0bps)
UK- 2.83 (+1bps)
Japan- 0.62 (0bps)
Thursday 21 November 2013
Market Update 21/11/13
One line- Markets sell off as the prospect of early tapering becomes more likely, dollar shows strength.
- Federal reserve minutes released yesterday indicated that tapering was likely in the coming months if the economy improves as anticipated. While the Fed moves closer to scaling back stimulus central bankers in Europe and Japan are under pressure to combat deflationary risks.The Fed's forward guidance that rates will remain low until unemployment goes under 6.5% was being debated in the meeting also with some members wishing to lower that threshold. http://www.bloomberg.com/news/2013-11-21/fed-qe-taper-likely-in-coming-months-on-better-data-minutes-say.html
- Gold fell 1.7% overnight on the Fed minutes while the dollar strengthened adding 0.9% in the previous two sessions. US and Asia ex Japan shares fell while the yen decline against the dollar helped push the Nikkei up 1.9%. In Europe an unexpectedly weak PMI means stocks are down this morning. Yields rose on the tapering news with the US ten year adding 10 basis points to 2.78%. http://www.ft.com/cms/s/0/a284b704-525e-11e3-adfa-00144feabdc0.html?siteedition=uk#axzz2lB9GOvWf
- Activity in China's factory sector grew at a slower pace in November as export orders shrank. The HSBC PMI fell to 50.4 from Octobers reading of 50.9. The data pushed the Aussie dollar down by a quarter of a cent while China's CSI 300 (an index of the leading Shanghai and Shenzhen listed companies) lost 1.14% in the first 30 minutes of trading. http://uk.reuters.com/uk.reuters.com/article/2013/11/21/uk-china-economy-pmi-idUKBRE9AK0CJ20131121
- US budget talks are making progress with a deal in sight that would prevent some sequestration cuts with new revenues. The deal would set spending levels for one or two years while ensuring the government will not be shut down in January. Paul Ryan Republican chairman of the House budget committee and Patty Murray the Democratic chair of the Senate budget committee are leading the talks. http://www.ft.com/cms/s/0/cc41bc5e-523b-11e3-8c42-00144feabdc0.html#axzz2lB9GOvWf
Data
S&P 1781.37 0.36%
- Federal reserve minutes released yesterday indicated that tapering was likely in the coming months if the economy improves as anticipated. While the Fed moves closer to scaling back stimulus central bankers in Europe and Japan are under pressure to combat deflationary risks.The Fed's forward guidance that rates will remain low until unemployment goes under 6.5% was being debated in the meeting also with some members wishing to lower that threshold. http://www.bloomberg.com/news/2013-11-21/fed-qe-taper-likely-in-coming-months-on-better-data-minutes-say.html
- Gold fell 1.7% overnight on the Fed minutes while the dollar strengthened adding 0.9% in the previous two sessions. US and Asia ex Japan shares fell while the yen decline against the dollar helped push the Nikkei up 1.9%. In Europe an unexpectedly weak PMI means stocks are down this morning. Yields rose on the tapering news with the US ten year adding 10 basis points to 2.78%. http://www.ft.com/cms/s/0/a284b704-525e-11e3-adfa-00144feabdc0.html?siteedition=uk#axzz2lB9GOvWf
- Activity in China's factory sector grew at a slower pace in November as export orders shrank. The HSBC PMI fell to 50.4 from Octobers reading of 50.9. The data pushed the Aussie dollar down by a quarter of a cent while China's CSI 300 (an index of the leading Shanghai and Shenzhen listed companies) lost 1.14% in the first 30 minutes of trading. http://uk.reuters.com/uk.reuters.com/article/2013/11/21/uk-china-economy-pmi-idUKBRE9AK0CJ20131121
- US budget talks are making progress with a deal in sight that would prevent some sequestration cuts with new revenues. The deal would set spending levels for one or two years while ensuring the government will not be shut down in January. Paul Ryan Republican chairman of the House budget committee and Patty Murray the Democratic chair of the Senate budget committee are leading the talks. http://www.ft.com/cms/s/0/cc41bc5e-523b-11e3-8c42-00144feabdc0.html#axzz2lB9GOvWf
Data
S&P 1781.37 0.36%
FTSE 6685.36 0.06%
Nikkei 15,365.60 1.92%
Nikkei 15,365.60 1.92%
EUR/USD- 1.3440 0.01%
USD/JPY- 100.87 0.84%
GBP/USD- 1.6109 0.02%
USD/JPY- 100.87 0.84%
GBP/USD- 1.6109 0.02%
Gold- 1247.71 0.27%
Oil (Brent)- 108.09 0.03%
Oil (Brent)- 108.09 0.03%
Copper- 317.25 0.13%
10 year yields
US- 2.79 (-1bps)
UK- 2.80 (+7bps)
Japan- 0.62 (+2bps)
UK- 2.80 (+7bps)
Japan- 0.62 (+2bps)
Wednesday 20 November 2013
Market Update 20/11/13
One line- Rally takes a pause ahead of Fed minutes today, equities, bonds and commodities sell off.
- The market rally spurred last week by Yellen's dovish comments has run out of steam as investors look to the Fed minutes today for clues about a potential tapering. Global equities are softer as are emerging market currencies and bonds. The S&P was off 0.2%, the Nikkei 0.3% and the FTSE is down 0.1% this morning. The yen hit a 4 year low against the euro as Japan published data that showed its trade deficit had unexpectedly expanded. Metals and energy are broadly lower. http://www.ft.com/cms/s/0/d976fb8e-5194-11e3-9651-00144feabdc0.html?siteedition=uk#axzz2lB9GOvWf
- The Bank of England minutes released today showed members believe the country is in a sustained recovery, with no major inflation risks. The minutes also showed that policy makers were in no hurry to increase rates. The Bank of England last week lowered its forecasts for inflation and said that unemployment could fall more quickly below its cited 7% level than they had previously thought. http://uk.reuters.com/article/2013/11/20/uk-britain-boe-idUKBRE9AJ0ES20131120
- Bernanke in an effort to allow tapering to occur without raising interest rates has said that the federal funds rate will likely remain low for a long time. Bernanke pointed to meaningful improvement in the jobs market but added that recent reports have been somewhat disappointing. He also said that interest rates rose too high over summer in part due to a perceived reduction of the Fed's commitment to meet its objectives. http://www.bloomberg.com/news/2013-11-20/bernanke-signals-fed-target-rate-to-stay-low-long-after-qe-ends.html
- China's central bank is looking to liberalise its financial services sector under Zhou Xiaochuan who promised on Saturday to "pull out all stops to deepen financial sector reform". The comments came with no timetable and the PBOC still intervenes heavily in the currency markets to prevent the yuan from appreciating. This though may be set to change if Zhou can enact his vision for a more freely floating exchange rate. http://uk.reuters.com/article/2013/11/20/uk-china-reform-idUKBRE9AJ09Z20131120
- Obama made a personal plea on Tuesday to leading senators to postpone new sanctions on Iran. The plea comes just ahead of the continuation of talks with Iran about its nuclear programme. The president however faces fierce opposition to the initiative from Republicans in the House. http://www.ft.com/cms/s/0/585195a2-516f-11e3-9651-00144feabdc0.html#axzz2lB9GOvWf
Data
S&P 1787.87 0.20%
- The market rally spurred last week by Yellen's dovish comments has run out of steam as investors look to the Fed minutes today for clues about a potential tapering. Global equities are softer as are emerging market currencies and bonds. The S&P was off 0.2%, the Nikkei 0.3% and the FTSE is down 0.1% this morning. The yen hit a 4 year low against the euro as Japan published data that showed its trade deficit had unexpectedly expanded. Metals and energy are broadly lower. http://www.ft.com/cms/s/0/d976fb8e-5194-11e3-9651-00144feabdc0.html?siteedition=uk#axzz2lB9GOvWf
- The Bank of England minutes released today showed members believe the country is in a sustained recovery, with no major inflation risks. The minutes also showed that policy makers were in no hurry to increase rates. The Bank of England last week lowered its forecasts for inflation and said that unemployment could fall more quickly below its cited 7% level than they had previously thought. http://uk.reuters.com/article/2013/11/20/uk-britain-boe-idUKBRE9AJ0ES20131120
- Bernanke in an effort to allow tapering to occur without raising interest rates has said that the federal funds rate will likely remain low for a long time. Bernanke pointed to meaningful improvement in the jobs market but added that recent reports have been somewhat disappointing. He also said that interest rates rose too high over summer in part due to a perceived reduction of the Fed's commitment to meet its objectives. http://www.bloomberg.com/news/2013-11-20/bernanke-signals-fed-target-rate-to-stay-low-long-after-qe-ends.html
- China's central bank is looking to liberalise its financial services sector under Zhou Xiaochuan who promised on Saturday to "pull out all stops to deepen financial sector reform". The comments came with no timetable and the PBOC still intervenes heavily in the currency markets to prevent the yuan from appreciating. This though may be set to change if Zhou can enact his vision for a more freely floating exchange rate. http://uk.reuters.com/article/2013/11/20/uk-china-reform-idUKBRE9AJ09Z20131120
- Obama made a personal plea on Tuesday to leading senators to postpone new sanctions on Iran. The plea comes just ahead of the continuation of talks with Iran about its nuclear programme. The president however faces fierce opposition to the initiative from Republicans in the House. http://www.ft.com/cms/s/0/585195a2-516f-11e3-9651-00144feabdc0.html#axzz2lB9GOvWf
Data
S&P 1787.87 0.20%
FTSE 6678.13 0.30%
Nikkei 15,076.08 0.33%
Nikkei 15,076.08 0.33%
EUR/USD- 1.3530 0.06%
USD/JPY- 99.96 0.18%
GBP/USD- 1.6151 0.19%
USD/JPY- 99.96 0.18%
GBP/USD- 1.6151 0.19%
Gold- 1275.66 0.02%
Oil (Brent)- 108.10 0.34%
Oil (Brent)- 108.10 0.34%
Copper- 315.60 0.14%
10 year yields
US- 2.71 (+1bps)
UK- 2.75 (+3bps)
Japan- 0.61 (-1bps)
UK- 2.75 (+3bps)
Japan- 0.61 (-1bps)
Tuesday 19 November 2013
Market Update 19/11/13
One line- Markets mixed as investors take profits in developed markets while emerging markets continue to rally.
- The Chinese pledge for reform is driving Asia ex Japan markets as the Hang Seng added 0.7%. Profit taking in Japan was seen as the Nikkei lost 0.25% having rallied 7.7% last week. Wall Street posted fresh new highs before selling off with the S&P touching 1800 and the Dow Jones exceeding 16000. http://www.ft.com/cms/s/0/38a01804-50c6-11e3-9f0d-00144feabdc0.html#axzz2kzQ4lqxa
- European shares opened sharply down this morning as investors show caution following the Stoxx 600 reaching record highs. The FTSE is down 0.6% this morning. Energy and metals are broadly down this morning while the dollar is selling off ahead of a speech later today by Bernanke. Bernanke is expected to make the case for the continuation of current monetary policy. In the past month the dollar has climbed 1.9% while the euro has gained 0.5%. http://www.bloomberg.com/news/2013-11-19/european-stock-index-futures-drop-kbc-groep-may-move.html http://www.bloomberg.com/news/2013-11-19/dollar-near-two-week-low-versus-euro-as-fed-delays-taper-hopes.html
- The Iranian embassy in Beirut has been rocked by two explosions with a death toll of 18. There is no word on who is behind the blasts but Syrian rebels have threatened action in Lebanon against Assad's allies. Iran supports Hezbollah that has a stronghold in the area as well as the Syrian government with military and economic support. http://uk.reuters.com/article/2013/11/19/uk-lebanon-blast-idUKBRE9AI08E20131119
- Emerging stocks rose for a fourth day as consumer and technology companies rallied, the won and the rupee strengthened. China's plans for reform has rallied the MSCI Emerging markets index by 5% in the last 4 days. The index has lost 2.5% this year and trades at 10.8 times projected earnings. http://www.bloomberg.com/news/2013-11-19/emerging-stocks-rise-for-fourth-day-as-won-reaches-two-year-high.html
- Figures close to the matter say JP Morgan has agreed to settle the $13 billion over Washington Mutuals past indiscretions, the biggest settlement in history by a single company for the department of justice. Washington Mutuals miss-selling of mortgage securities is what has caused the settlement. JP Morgan has reserved the right to try and recover the costs in two recent deals with the Federal Finance Agency and with 21 private investors. http://www.ft.com/cms/s/0/f11b2e2e-507f-11e3-9f0d-00144feabdc0.html#axzz2kzQ4lqxa
Data
S&P 1791.53 0.37%
S&P 1791.53 0.37%
FTSE 6687.98 0.53%
Nikkei 15,126.56 0.25%
Nikkei 15,126.56 0.25%
EUR/USD- 1.3514 0.06%
USD/JPY- 99.75 0.24%
GBP/USD- 1.6093 0.10%
USD/JPY- 99.75 0.24%
GBP/USD- 1.6093 0.10%
Gold- 1275.66 0.02%
Oil (Brent)- 108.10 0.34%
Oil (Brent)- 108.10 0.34%
Copper- 315.60 0.14%
10 year yields
US- 2.68 (+2bps)
UK- 2.74 (+2bps)
Japan- 0.62 (0bps)
UK- 2.74 (+2bps)
Japan- 0.62 (0bps)
Monday 18 November 2013
Market Update 18/11/13
One line- Slow day in the markets generally except for China where the announcement of upcoming social reform is causing strong positive sentiment.
- Chinese equities are pushing higher in reaction to the Chinese Communist Party's pledge to loosen social controls and to phase out state-controlled prices. The FTSE all world index is trading at a high not seen since late 2007. The Hang Seng added 2.9% while other equity markets are broadly flat. Commodities are broadly lower while FX markets are generally quiet. Asian currencies have experienced a boost from the China news with the yen and aussie dollar strengthening 0.2% and 0.5% against the dollar respectively. http://www.ft.com/cms/s/0/2e62edf2-4fff-11e3-8e99-00144feabdc0.html?siteedition=uk#axzz2kzQ4lqxa
- While the BOJ is expected to keep its monetary stimulus constant on Thursday weak exports and an inability to create meaningful inflation is creating speculation over further monetary easing in 2014. Analysts will be looking very closely at this meeting for any hints of further monetary easing. http://uk.reuters.com/article/2013/11/18/uk-japan-economy-boj-idUKBRE9AH04520131118
- The Federal Reserve is considering allowing another year for banks to implement changes to comply with the Volcker rule. Banks currently have to comply by July 2014 but regulators are still making changes to the proposal which is expected to be released at the earliest in December, giving banks less than a year to make changes. The Volcker rule includes provisions that banks cannot make any proprietary trades and looks to curb overall risk taking in banks. http://www.ft.com/cms/s/0/6454dae4-4fad-11e3-b06e-00144feabdc0.html#axzz2kzQ4lqxa
- Netanyahu is rallying against a proposed Iranian deal to lift sanctions dependent on restrictions being imposed on the country's nuclear programme. France's Hollande has pledged his support for Netanyahu's position that the restrictions on the nuclear programme do not do enough to prevent the country from creating a nuclear bomb. Relations between Obama and Netanyahu have always been strained and their inability to see eye to eye on this issue further extends the rift which has been developing. http://uk.reuters.com/article/2013/11/17/us-iran-nuclear-idUKBRE9AG0DP20131117
Data
S&P 1798.18 0.42%
S&P 1798.18 0.42%
FTSE 6704.48 0.16%
Nikkei 15,164.30 0.01%
Nikkei 15,164.30 0.01%
EUR/USD- 1.3512 0.12%
USD/JPY- 99.94 0.25%
GBP/USD- 1.6114 0.02%
USD/JPY- 99.94 0.25%
GBP/USD- 1.6114 0.02%
Gold- 1283.92 0.49%
Oil (Brent)- 108.10 0.37%
Oil (Brent)- 108.10 0.37%
Copper- 317.50 0.22%
10 year yields
US- 2.70 (0bps)
UK- 2.76 (+2bps)
Japan- 0.64 (+1bps)
UK- 2.76 (+2bps)
Japan- 0.64 (+1bps)
Friday 15 November 2013
Market Update 15/11/13
One line- Yellen's dovish tone drives markets upwards.
- Japanese equities hit a 6 month high and global stocks are up as Yellen struck a dovish tone emphasizing that the dual mandate of the Fed is her first concern and that she sees no evidence of asset price bubbles at the moment. Any change in QE would be economic data dependent. Sovereign bond markets eased after rallying earlier in the weeks metals slid also. In the currency markets the yen slid beyond 100 yen to the dollar while the dollar is showing strength vs most of its main counterparts. http://www.ft.com/cms/s/0/00b69e86-4da1-11e3-bf32-00144feabdc0.html#axzz2ki7LAIra
- Disappointing growth figures have ruined hopes of a pick up in the recovery for the second half of the year. Growth in the eurozone for the third quarter was just 0.1% while in Japan the annualized growth rate halved to 1.9% on the back of weak consumption and export data. Question marks are beginning to be raised about Abe's ability to get the Japanese economy firing again. http://www.ft.com/cms/s/0/8f178ee0-4c81-11e3-958f-00144feabdc0.html#axzz2ki7LAIra
- China's benchmark money rate jumped the most in 5 months as the People's Bank of China withdrew $2.5 billion in the last few days. The Shanghai Inter bank rate was at 4.71% for a three month deposit while the seven day repo rate rose 116 basis points to 5.45%. http://www.bloomberg.com/news/2013-11-15/china-s-money-rate-jumps-most-since-june-after-pboc-drains-funds.html
- A gauge of the Brazilian economy unexpectedly contracted in September adding to speculation that central bankers will limit increases to borrowing costs. Policy makers extended the maturity on swaps pushing the real up 0.9% vs the dollar. Policy makers are grappling with the problems of high inflation, an overly weak currency and slowing growth. http://www.bloomberg.com/news/2013-11-14/brazil-swap-rates-drop-as-economic-activity-falls-real-climbs.html
- Highlights of Yellen hearing. http://www.ft.com/cms/s/0/4f429554-4d75-11e3-a220-00144feabdc0.html#axzz2ki7LAIra
Data
S&P 1790.62 0.48%
- Japanese equities hit a 6 month high and global stocks are up as Yellen struck a dovish tone emphasizing that the dual mandate of the Fed is her first concern and that she sees no evidence of asset price bubbles at the moment. Any change in QE would be economic data dependent. Sovereign bond markets eased after rallying earlier in the weeks metals slid also. In the currency markets the yen slid beyond 100 yen to the dollar while the dollar is showing strength vs most of its main counterparts. http://www.ft.com/cms/s/0/00b69e86-4da1-11e3-bf32-00144feabdc0.html#axzz2ki7LAIra
- Disappointing growth figures have ruined hopes of a pick up in the recovery for the second half of the year. Growth in the eurozone for the third quarter was just 0.1% while in Japan the annualized growth rate halved to 1.9% on the back of weak consumption and export data. Question marks are beginning to be raised about Abe's ability to get the Japanese economy firing again. http://www.ft.com/cms/s/0/8f178ee0-4c81-11e3-958f-00144feabdc0.html#axzz2ki7LAIra
- China's benchmark money rate jumped the most in 5 months as the People's Bank of China withdrew $2.5 billion in the last few days. The Shanghai Inter bank rate was at 4.71% for a three month deposit while the seven day repo rate rose 116 basis points to 5.45%. http://www.bloomberg.com/news/2013-11-15/china-s-money-rate-jumps-most-since-june-after-pboc-drains-funds.html
- A gauge of the Brazilian economy unexpectedly contracted in September adding to speculation that central bankers will limit increases to borrowing costs. Policy makers extended the maturity on swaps pushing the real up 0.9% vs the dollar. Policy makers are grappling with the problems of high inflation, an overly weak currency and slowing growth. http://www.bloomberg.com/news/2013-11-14/brazil-swap-rates-drop-as-economic-activity-falls-real-climbs.html
- Highlights of Yellen hearing. http://www.ft.com/cms/s/0/4f429554-4d75-11e3-a220-00144feabdc0.html#axzz2ki7LAIra
Data
S&P 1790.62 0.48%
FTSE 6695.00 0.43%
Nikkei 14,165.92 1.95%
Nikkei 14,165.92 1.95%
EUR/USD- 1.3449 0.09%
USD/JPY- 100.42 0.41%
GBP/USD- 1.6075 0.06%
USD/JPY- 100.42 0.41%
GBP/USD- 1.6075 0.06%
Gold- 1282.86 0.34%
Oil (Brent)- 108.54 1.33%
Oil (Brent)- 108.54 1.33%
Copper- 316.15 0.33%
10 year yields
US- 2.71 (+2bps)
UK- 2.75 (0bps)
Japan- 0.62 (+3bps)
UK- 2.75 (0bps)
Japan- 0.62 (+3bps)
Wednesday 13 November 2013
Tuesday 12 November 2013
Market Update 12/11/13
One line- Slow day in markets with dollar strength continuing and equities mixed/flat.
- US and European shares were broadly flat yesterday while Asian shares were mixed overnight. Monetary conditions in China tightened in October with new loans at 1/3 less than the previous month. The Nikkei added 2.23% as the yen softened to 99.49 and the dollar remained at a near 8 week high. The Hang Seng sold off 0.3%. Government bonds sold off with the US ten year yield adding 4 basis points to 2.79%. http://www.ft.com/cms/s/0/8ea91542-4b40-11e3-8c4c-00144feabdc0.html?siteedition=uk#axzz2kKbaClVS
- The recent dollar strength is expected to abate say analysts from BNY Mellon as the market has underestimated how dovish the Fed is likely to be under Yellen. Chief currency strategist Simon Derrick believes that EUR/USD will test $1.38 in the next three months and 93 yen in the next 5 months. http://www.bloomberg.com/news/2013-11-12/dovish-fed-to-sap-dollar-in-surprise-to-market-bny-mellon-says.html
- The US and Britain have sent warships to to assist the relief effort in the Philippines. 660000 people have been displaced and the current death toll of 10 000 is expected to rise sharply in the coming days. In many areas the only branch of government working is the military. The US sent the USS George Washington a ship with a crew of 5000 and more than 80 aircraft. http://uk.reuters.com/article/2013/11/12/uk-philippines-typhoon-idUKBRE9A701120131112
- The Iranian foreign minister Mohammad Zarif has stated the reason for the breakdown in nuclear talks was division amongst Western powers. Responding to remarks by John Kerry Zarif said that blaming Iran only served to undermine confidence in talks beginning on the 20th of November. http://uk.reuters.com/article/2013/11/12/uk-iran-nuclear-idUKBRE9A70DD20131112
- The Industrial and Commercial Bank of China has been added by regulators to a list of banks that need to raise their capital requirements in order to counter the risk they pose to the financial system. The ICBC is the biggest bank in the world by market capitalisation. JP Morgan and HSBC have been told by the regulator that they have to hold 9.5% equity to risk weighted assets the highest of any banks. http://www.ft.com/cms/s/0/9fb7992e-4b01-11e3-ac3d-00144feabdc0.html#axzz2kKbaClVS
- David Cameron's pursuit of trade deals with countries that have questionable human rights records is beginning to cause diplomatic and political unrest. Cameron met with the family of a Greenpeace protestor that had been arrested in Russia and has expressed his unhappiness to Putin at the same time Vince Cable attempts to draw up a trade agreement with the country. The PM argues that the biggest threat facing Britain today is economic. http://www.ft.com/cms/s/0/93420836-4aee-11e3-8c4c-00144feabdc0.html#axzz2kKbaClVS
Data
S&P 1771.89 0.07%
- US and European shares were broadly flat yesterday while Asian shares were mixed overnight. Monetary conditions in China tightened in October with new loans at 1/3 less than the previous month. The Nikkei added 2.23% as the yen softened to 99.49 and the dollar remained at a near 8 week high. The Hang Seng sold off 0.3%. Government bonds sold off with the US ten year yield adding 4 basis points to 2.79%. http://www.ft.com/cms/s/0/8ea91542-4b40-11e3-8c4c-00144feabdc0.html?siteedition=uk#axzz2kKbaClVS
- The recent dollar strength is expected to abate say analysts from BNY Mellon as the market has underestimated how dovish the Fed is likely to be under Yellen. Chief currency strategist Simon Derrick believes that EUR/USD will test $1.38 in the next three months and 93 yen in the next 5 months. http://www.bloomberg.com/news/2013-11-12/dovish-fed-to-sap-dollar-in-surprise-to-market-bny-mellon-says.html
- The US and Britain have sent warships to to assist the relief effort in the Philippines. 660000 people have been displaced and the current death toll of 10 000 is expected to rise sharply in the coming days. In many areas the only branch of government working is the military. The US sent the USS George Washington a ship with a crew of 5000 and more than 80 aircraft. http://uk.reuters.com/article/2013/11/12/uk-philippines-typhoon-idUKBRE9A701120131112
- The Iranian foreign minister Mohammad Zarif has stated the reason for the breakdown in nuclear talks was division amongst Western powers. Responding to remarks by John Kerry Zarif said that blaming Iran only served to undermine confidence in talks beginning on the 20th of November. http://uk.reuters.com/article/2013/11/12/uk-iran-nuclear-idUKBRE9A70DD20131112
- The Industrial and Commercial Bank of China has been added by regulators to a list of banks that need to raise their capital requirements in order to counter the risk they pose to the financial system. The ICBC is the biggest bank in the world by market capitalisation. JP Morgan and HSBC have been told by the regulator that they have to hold 9.5% equity to risk weighted assets the highest of any banks. http://www.ft.com/cms/s/0/9fb7992e-4b01-11e3-ac3d-00144feabdc0.html#axzz2kKbaClVS
- David Cameron's pursuit of trade deals with countries that have questionable human rights records is beginning to cause diplomatic and political unrest. Cameron met with the family of a Greenpeace protestor that had been arrested in Russia and has expressed his unhappiness to Putin at the same time Vince Cable attempts to draw up a trade agreement with the country. The PM argues that the biggest threat facing Britain today is economic. http://www.ft.com/cms/s/0/93420836-4aee-11e3-8c4c-00144feabdc0.html#axzz2kKbaClVS
Data
S&P 1771.89 0.07%
FTSE 6720.72 0.11%
Nikkei 14,588.68 2.23%
Nikkei 14,588.68 2.23%
EUR/USD- 1.3382 0.19%
USD/JPY- 99.75 0.60%
GBP/USD- 1.5948 0.26%
USD/JPY- 99.75 0.60%
GBP/USD- 1.5948 0.26%
Gold- 1281.32 0.12%
Oil (Brent)- 106.15 0.23%
Oil (Brent)- 106.15 0.23%
Copper- 324.50 0.44%
10 year yields
US- 2.79 (+4bps)
UK- 2.84 (+3bps)
Japan- 0.59 (+1bps)
UK- 2.84 (+3bps)
Japan- 0.59 (+1bps)
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