Good morning New York,
ALPHAVILLE Read more
Tbh, we thought this one would just go away.
But no, on November 30 there’s to be a vote in Switzerland which, if won, would shackle the Swiss National Bank by forcing it, amongst other things, to hold at least 20 per cent of its assets in gold; to repatriate any gold stored abroad; and to refrain from selling any gold in future.
From SocGen’s Sebastian Galy:
Markets: Most Asian markets declined, with caution evident ahead of a crucial meeting where the US Federal Reserve is expected to end the quantitative easing programme that has supported global asset prices for half a decade. The S&P 500 finished the New York session 0.2 per cent lower. While the move was not more pronounced because the end of QE has been widely trailed, analysts warned that investors would probably steer away from riskier assets for now. In commodities markets, the price of Brent crude oil fell 0.7 per cent to $85.25 a barrel. The global oil marker has declined almost 25 per cent so far this year. (FT’s Global Markets Overview) Read more
Some perspective amidst the angst:
Think main takeaway from this weekend's AQR / stress test data dump-fest is that it's gonna be over and people can get on with their lives.
— Five Minute Macro (@5_min_macro) October 24, 2014
And proving perspective and angst aren’t mutually exclusive, some words from Alberto Gallo of RBS (our emphasis): Read more
Markets: Bourses in Asia-Pacific were buoyed by Wall Street’s rally even as property data from China painted a dreary picture of the region’s largest economy. New home prices fell across the country in September with prices falling in 69 of 70 cities surveyed in September, compared with 68 in August and 64 in July. The overall price decline was 1.3 per cent compared to last September, according to a Reuters analysis of the data released by the National Bureau of Statistics. The S&P 500 equity index closed 1.2 per cent higher at 1,950, leaving it 7.1 per cent up from the six-month intraday low struck during last week’s bout of market turbulence. (FT’s Global Markts Overview) Read more
By Camilla Hall and Stephen Foley
The Treasury market melt-up earlier today does not mean that everyone who believed higher rates are coming have stopped believing. Some investors just wanted to cut their losses, not willing to wait any longer. Read more
UK unemployment falls to near 6-year low of 6% || Aldermore scraps IPO as listing markets sour || BG Group poaches Statoil’s chief executive || Amazon launches same-day delivery service in the UK || UniCredit turning to private equity to enable loan detox regime || Cameron signals inheritance tax cut | Markets Read more
Markets: Asian markets were in the red as concerns about a eurozone slowdown and the effect on equities once the US central bank concludes its monetary stimulus this month continued to bite. As investors retreated from risk the US dollar dropped, the price of oil fell and demand rose for haven assets such as gold and the Japanese yen. Japanese markets were closed for a public holiday. (FT’s Global Markets Overview) Read more
From the opening to Mario Draghi’s speech at the Brookings Institution on Thursday:
As I was preparing these comments, I happened to re-read John Maynard Keynes’ open letter to President Franklin D. Roosevelt, published in the New York Times in December 1933. In it, Keynes tells President Roosevelt that the administration is engaged simultaneously in recovery and reform, and identifies a tension between the two. He worries especially about the risk that over-hasty reform impedes recovery. Read more
Rio turned down Glencore merger idea: “Rio Tinto said Glencore put forward the idea of a potential merger of the two companies to create the world’s largest miner and commodities trader, before Rio’s board rejected the idea. Glencore approached Rio in July regarding a potential tie-up but Rio’s board concluded unanimously that a “combination was not in the best interests of Rio Tinto’s shareholders”.” (Financial Times)
Brussels targets Amazon’s Luxembourg tax deal: “Brussels is confronting Luxembourg over an unorthodox Amazon tax deal, alleging it allowed the online retail giant to reap potentially illegal state subsidies for its European operations for almost a decade. The European Commission is poised to launch a formal in-depth probe into its serious concerns over improper state aid, dragging Amazon into a multi-pronged clampdown on sweetheart tax deals that has already ensnared Apple in Ireland and Starbucks in the Netherlands.” (Financial Times) Read more
Hilton Worldwide Holdings Inc. (“Hilton Worldwide”) today announced it has entered into an agreement with Anbang Insurance Group Co. Ltd. (“Anbang”), under which Anbang has agreed to purchase the Waldorf Astoria New York for $1.95 billion. As part of this long-term strategic partnership, Anbang will grant Hilton Worldwide a management agreement to continue to operate the property for the next 100 years, and the hotel will undergo a major renovation to restore the property to its historic grandeur… Read more
The Bank of England is going from twiddling bank capital to also twiddling mortgages themselves to try and stop risk in the UK’s housing market.
That’s big and part of an international trend among central banks. Interestingly, the Financial Policy Committee on Thursday sought direct powers to cap loan to value or debt to income ratios, versus leaving them to the PRA. Read more
In the light of the foregoing considerations, the Commission’s preliminary view is that the tax ruling of 1990 (effectively agreed in 1991) and of 2007 in favour of the Apple group constitute State aid according to Article 107(1) TFEU. The Commission has doubts about the compatibility of such State aid with the internal market. The Commission has therefore decided to initiate the procedure laid down in Article 108(2) TFEU with respect to the measures in question.
Click for the full document laying out the case.