FT markets round-up: “Investor appetite for risk was generally firmer across asset classes before US equities lost their initial steam late in New York. Confirmation of a possible $12.8bn deal in the US telecom sector and a big pop for the IPO of Realogy are also helping sentiment. The dollar index, a gauge of broader market sentiment which often falls when sentiment improves, retreated 0.2 per cent. US Treasury yields have turned lower, with 10-year yields down 3 basis points to 1.67 per cent. The US Treasury concluded this week’s $66bn government debt offerings with the sale of $13bn in 30-year bonds. A measure of demand, the bid-to-cover ratio, came at 2.49 versus 2.68 in the previous auction of the securities. The weaker buck helped gold add $5 to $1,767 a troy ounce. The FTSE All-World index recovered early losses and traded up 0.3 per cent as the FTSE Eurofirst 300 closed 0.8 per cent higher. In Asia, stocks slipped 0.2 per cent. The S&P 500 ended the session nearly flat at 1,432, but still snapped a four-day losing streak that began after the benchmark hit a near five-year intraday high above 1,470 last Friday.” Read more
We saw some funny and half-mocking tweets in response to this op-ed by Roger Altman, mostly because “A housing boom will lift the US economy” sounds like a headline that was found inside a time capsule packed a decade ago, maybe one you’re not supposed to open because it houses evil spirits, like the Dybbuk box in the new Sam Raimi flick.
Whatever, given our own ruminations on the topic (see the related links below), we think Altman deserves to be taken seriously. Read more
Something to distract from earnings season and perhaps unsettle you a bit:
We provide new insights into earnings quality from a survey of 169 CFOs of public companies and in-depth interviews of 12 CFOs and two standard setters. Our key findings include… Read more
It’s mobile merger mania in the US.
We recently got confirmation that T-Mobile wanted to buy second-tier American carrier MetroPCS. Read more
This is just a lovely chart from the FX team at HSBC (click in to see — tis just too big for an excerpt to handle):
What it, and its fellow soon to be introduced below, do is call further into question the US dollar’s status as a haven currency; one which will benefit in periods of risk aversion. They do so by looking at the performance of G10 currencies against the S&P500. It’s a timely query considering the approaching fiscal cliff… and, well, lots of other stuff. Read more
Call it can-kicking at the highest European level. Call it inevitable. Both statements are probably true.
Nevertheless, banking stock across Europe were racing higher on Thursday on the back of this: Read more
Christine Lagarde has urged countries to put a brake on austerity measures amid signs that the IMF is becoming increasingly concerned about the impact of government cutbacks on growth. Ms Lagarde, IMF managing director, cautioned against countries front-loading spending cuts and tax increases. “It’s sometimes better to have a bit more time,” she said at the annual meetings of the IMF and the World Bank on Thursday.
The fund warned earlier this week that governments around the world had systematically underestimated the damage done to growth by austerity. Read more
Greek unemployment hit a new record high of 25.1 per cent in July, having climbed for 35 straight months. It’s now more than double the eurozone average of 11.4 per cent and youth unemployment — between 15 and 24 years old — has hit 54.2 per cent. That’s scary and pretty hard to argue with but there is always a bit of context available.
Live markets commentary from FT.com
Those who argue for a further relaxation of the LSE’s listing rules may want to note the following announcement:
Rangers, the Scottish football club, today announces its intention to seek Admission to the AIM market of the London Stock Exchange. Read more
Lagarde calls for brake on austerity: Christine Lagarde has urged countries to put a brake on austerity measures amid signs that the IMF is becoming increasingly concerned about the impact of government cutbacks on growth, the FT reports. The IMF managing director also cautioned against countries front-loading spending cuts and tax increases. “It’s sometimes better to have a bit more time,” she said at the annual meetings of the IMF and the World Bank on Thursday. Read more
Elsewhere on Thursday,
- On the unsustainability of Austrian business-cycle theory.
- Credit funds are creating a big hole through the Volcker Rule.
- Our kids and grandkids won’t pay for our budget deficits. Read more
The possibility of a BAE-EADS tie-up has collapsed, starting a blame game among officials in London, Paris and Berlin. BAE shares fell 1.4 per cent, while shares in EADS climbed 5.3 per cent. (Financial Times)
S&P cut Spain’s credit rating by two notches to the lowest investment-grade rating, and left the country with a negative outlook. (Financial Times) Read more