Posts from Wednesday Jun 6 2012

The Closer


Today’s markets overview from the FT: “Equities, the euro and commodities rallied amid increasing hopes for another potential round of stimulus measures by the world’s largest central banks to stimulate the failing global economy. Benchmark stocks indexes in the US posted their biggest gains for the year as Brent crude oil regained the $100-a-barrel level and the euro held steady above $1.25.” (Financial TimesRead more

The euro and the “hope” trade

One other thing from Wednesday’s SocGen Hedge Fund Watch that’s worth noting, especially given the ECB’s decision to hold rates steady earlier today:

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Record bond ETP inflows last month (shocking, we know)

From “The LTROs have saved Europe and US jobs are coming back!” to “Never mind, we might be even closer to econo-tastrophe than we were last year” in just five months — via Credit Suisse Trading Strategy:

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Hedgies reposition on the long bond

From the latest SocGen Hedge Fund Watch, this is new:

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This one is for you, sports fans

The tension in Europe is unbearable. Everyone is afraid of the outcome amid scandal, upset and intrigue. This week, after months of summits, meetings and planning — it’s finally going down. We are, of course, talking about the 2012 European Championship.

With so much at stake, it’s only natural that bank analysts have a thing or two to say (because they’re the true football experts, obviously). Read more

Let’s all play a game of “Soros says”

(Alternate Game of Thrones title: A Storm of Soros)

It’s got a lot of attention so we thought we should throw it up so… here, in its summarised glory, is George Soros’ speech from the Festival of Economics at Trento, Italy. Read more

When strategy is mistaken for stupidity, the curious case of eurozone politicians

Have you ever ridden a bike to work in a major metropolitan city? If so, you’ll understand the importance of predictability. It’s best to stick to the cycle lanes, signal when turning, obey traffic signals, and not stop or swerve suddenly.

FT Alphaville wonders how many European politicians commute to the office this way. It would seem to be a good lesson on how predictability leads to positive outcomes and the importance of deciding which direction to go and then sticking to it. Read more

Markets Live transcript 6 Jun 2012

Live markets commentary from 

The (early) Lunch Wrap

Good morning, New York…


Debt jubilee for one and all — love, the Queen

Did the Queen miss a bit of a trick this weekend?

The origins of a jubilee celebration, after all, come from the festivities that follow the completion of a 50-year debt forgiveness cycle, as referenced in scripture and ancient Babylonian tradition. Read more

How to think about… reprofiling Italian debt

All right. Imagine you’re a sovereign debt manager…

Picture yourself back in the pre-LTRO days of late 2011. Two-year Italian bonds yield 7 per cent, buyers are gone, foreign holders are rushing to sell. Read more

Rejoice! Or something…

Welcome back, UK readers!

So the weekend that some folk were predicting things would have to get real for the eurozone came and… nothing much happened. Except that Spain really came out and said its banks need help, by which it most definitely did not mean the kind of help that might be construed as a ‘bail-out’. Oh and G7 finance ministers had a chat on the phone and… nothing much happened. Read more

Further reading

Elsewhere on Wednesday,

– Seasonality, jobs and what the Fed should do. Read more

The 6am Cut London

Spain explicitly called for aid recapitalising its banks, with prime minister Mariano Rajoy warning on Tuesday that the country was in a situation of “extreme difficulty”, reports the FT. The ECB  meanwhile saw demand for seven-day liquidity surge on Tuesday to €120bn – more than double the previous week’s figure.

The G7 finance ministers’ conference call yielded little in the way of firm action on the eurozone crisis, reports ReutersRead more

Overnight markets: Up

Asian stocks gained for a second day and oil climbed, while the Australian dollar rallied after higher than expected GDP data and positive US services data, reports Bloomberg. Aluminum rose as metals in London resumed trading after a holiday.

The MSCI Asia Pacific was 1.1% higher at 12:55pm in Tokyo. Standard & Poor’s 500 Index futures advanced 0.7%. The Australian dollar rose 1.2% against the US dollar and the euro rose 0.4%. Read more

Fed(wire) to the rescue

From the WSJ’s Jon Hilsenrath:

Disappointing U.S. economic data, new strains in financial markets and deepening worries about Europe’s fiscal crisis have prompted a shift at the Federal Reserve, putting back on the table the possibility of action to spur the recovery.

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