This week on FT Alphaville,
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A snapshot of global equity markets from a few minutes ago:
Remember Friday afternoon RAW? Well, this is most definitely Friday afternoon RAW. Please read the disclaimer carefully.
A few points as we come across them:
— In the household survey, the total number of employed people actually fell by 195,000. As the release notes: Read more
BBVA and Santander reported deposit declines of about 1 per cent in the second quarter. While that represents a notable trend, it’s not yet one that should be called alarming.
Unless, points out Citi on Friday, you turn to the corporate and investment banking component in the deposit trend. Read more
Markets looked askance at the ECB’s promise that it may buy bonds and ‘address’ seniority fears if the eurozone rescue funds are also activated. Mario Draghi told the ECB’s monthly press conference that the central bank could buy up shorter-term debt subject to “strict and effective conditionality” by the EFSF, which requires member states to request market aid. The euro tumbled against the dollar – while Mr Draghi advised markets it was “pointless” to short it – and 10-year Spanish and Italian bond yields rose sharply. An equity market sell-off continued into Asia on Friday, with the Nikkei falling 1.1 per cent (Wall Street Journal).
The ECB president’s ‘guidance’ of ‘outright open market operations’ in planning stages takes it into new territory, possibly including quantitative easing. Despite linking bond-buying to action by fiscal bailout funds, Mr Draghi did not rule out other ‘non-standard measures’ by the central bank (Reuters). He also took the unusual step of naming the Bundesbank’s Jens Weidmann as a bond-buying opponent, but argued that intervention in short-term rates would be ‘classical monetary policy’ (Financial Times). Read more