April, 2009
NYSE chief cautions on March rally
The March stock market rally that fuelled hopes of a broader economic recovery was deceptive because “real money” investors remained on the sidelines, said the chief executive of NYSE Euronext, the world’s largest stock exchange.
TCI’s Asia director resigns
The Children’s Investment Fund, the activist hedge fund, has suffered another setback with the resignation of John Ho, its Asia director. Chris Hohn, TCI founding partner, told investors in a letter this week,
Fiat chief eyes Chrysler top job
Sergio Marchionne, Fiat’s chief executive officer, signalled for the first time on Wednesday his willingness to run troubled US carmaker Chrysler. But Marchionne also said he was prepared to scrap a partnership on which Chrysler’s survival rides if it failed to win needed cost cuts from its unions.
Overnight Markets: Subdued optimism
Asian stocks climbed on Thursday, lifting the regional benchmark index to the highest in more than three months, as a US Federal Reserve survey stoked optimism about prospects for the world’s largest economy.
Optimistically, pessimistic in the US
The Fed’s Beige book is out and it says the speed of the US economy’s contraction is fading amid scattered signs the recession could be nearing an end. So where’s the rally monkey reaction? The DJIA is up about 43 points to 7,963,
Non-Opec decline: the means towards a renewed bull market
As the FT reported earlier this week, North Sea production is being hit critically by the economic crisis. The story quotes findings from a Deloitte report which says the number of exploration wells being drilled in the North Sea has collapsed by 78 per cent in the first quarter of 2009 versus the same period last year.
Quote du jour, Chinese power flex edition
In reference to China slowing the pace of its US Treasury purchases in January and February.
Related links:
Invoice: You ow us RMB – FT Alphaville
China to US: We hate you – FT Alphaville
Lunch Wrap
On FT Alphaville on Wednesday morning,
- A lack of surety: Swiss Re and the trade credit collapse.
- UBS not in Q1 happy bank club.
- The Devil and www.goldmansachs666.com.
- The Vix challenger.
CDS report: Cash credit shows real deal
Credit derivatives indices in Europe have not moved greatly on Wednesday morning, though cash credit spreads declined.
“Indices are not a proxy for the wider market currently, as cash credit is tighter and there is no let up in demand for cash assets,”
Vix challenger
Meet the new measure for investor fear: Credit Suisse’s Fear Barometer. Or, CSFB < Index > Go on the Bloomberg.
This is what it looks like. Click to enlarge.
And this is what it means, according to the Daily Options Report.
A lack of surety: Swiss Re and the trade credit collapse
The front page of Wednesday’s FT runs with the following story – that the UK government’s forthcoming budget is to include a “supply-chain insurance plan”:
The scheme will form a centrepiece of the Budget initiatives to help small to medium-sized businesses cope with the recession.
Markets live transcript 15 Apr 2009
Markets live chat transcript for the chat ending at 12:13 on 15 Apr 2009. Participants in this chat were: Neil Hume, FT (NH) Bryce Elder (BE) NH:hola NH:and welcome to Markets Live
The Devil and www.goldmansachs666.com
Having made something of a name for himself after Goldman Sachs issued a cease and desist order against his website, www.goldmansachs666.com, anti-GS blogger Mike Morgan is now on the offensive, hosting a conference call to discuss the site’s objectives on Wednesday evening.
It’s grim up North
On Tuesday we mocked the FSA’s new website for Northerners. Perhaps harshly. After all, the website itself is a valuable development. And indeed, the economic crisis is hitting hardest north of the Watford gap.
UBS not in Q1 happy bank club
Bucking the trend for good first-quarter news from investment banks is UBS this Wednesday morning.
The Swiss bank has pre-announced its Q1 2009 results, which are due to be published on May 5, warning the markets of a CHF $2bn loss.
Further reading
Elsewhere on Wednesday,
- Cholesterol drugs and the credit crisis – seriously.
- Why Wall Street isn’t necessary.
- Five bailout absurdities.
- Great stock theory.
- Chart of the day – pirate edition (HT Felix Salmon).
Pink picks
Comment, analysis and other offerings from Wednesday’s FT,
Uncertainty bedevils the system
There is still no wide understanding of the benefits that can fairly be credited to capitalism and why these benefits have costs,
Snap news
Breaking pre-market news on Wednesday,
- UBS to post CHF 2bn Q1 2009 loss, plans to increase cost-savings to CHF 4bn — statement.
- Blue Oar posts 2008 underlying loss before tax of £3.26m, cancels dividend — statement.
Goldman amasses $164bn war chest
Goldman Sachs has amassed a war chest of $164bn in cash and liquid assets that could be used to buy distressed securities and loans, Goldman’s chief financial officer said on Tuesday. David Viniar spoke as the bank sold $5bn in common stock – at $123 per share – which it will use to repay some $10bn from the US TARP scheme.
Ebay to spin off Skype
Ebay has announced plans to spin off Skype, its online phone unit, with an IPO next year following the collapse of talks that would have sold Skype back to its founders. The plan amounts to an admission by John Donahoe,
Banks warned on subsidiaries’ assets
International banks will have to hold more assets in their subsidiaries if they want to avoid a repeat of the chaos caused by the fall of Lehman Brothers, according to PwC, the failed bank’s European administrators.
Citi prolongs share ‘squeeze’
Citigroup’s plans to issue billions of new shares will not move forward until at least Friday, potentially prolonging a “short squeeze” that has been inflating the company’s shares, reports the WSJ. The SEC is not expected to approve Citi’s stock-registration statement until some time after the bank announces Q1 earnings on Friday,
Russia eyes overseas funds
Russia is considering borrowing funds on international markets for the first time in a decade, amid a deepening economic recession. The move, revealed on Tuesday by Alexei Kudrin, finance minister, comes as Moscow seeks to plug looming budget deficits and help heavily indebted companies raise funds.
Funds write down European investments
Guy Hands’ Terra Firma private equity house was among the worst performing European leveraged buy-out funds last year, according to figures from investors in the beleagured industry. Some of the biggest buyout firms,
Rio sells $3.5bn of debt
Rio Tinto, the world’s third- largest mining company, on Tuesday sold $3.5bn of debt at interest rates as much as three percentage points higher than its last bond offering amid slumping demand for metals,
TPG allows reduction in Asian stakes
TPG is allowing its investors to reduce commitments to its $4.2bn Asian fund, in a move that reflects the poor performance of the US buyout firm’s investments in regional companies including Japan’s NIS .
US car parts groups seek more aid
US car parts suppliers are set to ask for more government aid, including incentives for more private equity investment in the beleaguered sector. Suppliers also want access to the US Treasury’s term asset-backed securities loan facility (Talf) and similar loans from the Small Business Administration.
Fund gloom returns to Europe
The fragile recovery in fund flows across Europe reversed sharply in February and March, according to data providers Lipper FMI. The downturn followed three months of inflows, as fund managers were hit by stock market falls and rising redemptions.