August, 2009
ASX centre of Iress bid speculation
The Australian Securities Exchange on Thursday refused to comment on speculation it was considering a bid for Iress Market Technologies, an Australian-listed market data and trading group in which it has built a 20% stake.
KKR readies Dollar General IPO
Dollar General, a discount retailer owned by buyout firm KKR, registered Thursday to sell stock through an IPO, the first in what is expected to be a wave of buyout-owned companies trying to sell shares into a rallying stock market,
Macquarie in talks for Fox-Pitt Kelton
Australia’s Macquarie Group is in talks about a takeover of Fox-Pitt Kelton, a small UK-based financial services firm partly owned by private equity firm JC Flowers, reports DealJournal. While no deal has been finalised,
Macquarie Infrastructure considers split
Macquarie Infrastructure Group, a leading private owner of toll-roads, is considering splitting into two entities. The move could end the lucrative long-term management contract owned by Macquarie Group,
Korean banks to set up bad bank
Six of South Korea’s leading banks on Thursday signed a preliminary deal to set up a private bad bank, in efforts to spark competition in a market for toxic assets that is monopolised by a state-run bad bank.
Joblessness fuels US housing crisis
More than one in every eight homeowners with a mortgage was behind on home loan payments or in some stage of foreclosure at the end of the second quarter, as mounting unemployment aggravated the housing crisis,
FX could move to two-tier system
Banks that do not settle currency trades through a central system could be shut out of dealing at the best prices, according to Deutsche Bank, one of the three biggest foreign exchange banks. Zar Amrolia,
Central bankers meet at Jackson Hole
Central bankers from around the world on Thursday gathered for the US Federal Reserve’s annual retreat in Jackson Hole, Wyoming, amid intense debate in the markets over prospects for global economic recovery.
Wiedeking involved in VW share probe
German prosecutors are investigating Porsche’s former chief executive Wendelin Wiedeking and others close to the sports carmaker, alleging market manipulation and passing of inside information in their failed takeover attempt of Volkswagen.
Overnight markets: Down
Asian stocks fell back on Friday, led by shipping lines and automakers, as freight rates dropped and the US announced the end of the “cash-for-clunkers” vehicle trade-in scheme. Futures on the S&P500 fell 0.3% after the index added 1.1% on Thursday as AIG said it expects to repay the government.
CDS report: Vacillating traders rediscover risk appetite
Markit’s Gavan Nolan wrote this CDS report
Both credit and equity markets rallied today as investors rediscovered their appetite for risk. The Markit iTraxx Europe index opened tighter and gained strength throughout the day,
Hybrid debt attack – for real, from Fitch
Woosh. That is the sound of a hybrid debt bomb being dropped on the European market, courtesy of ratings agency Fitch:
FITCH DOWNGRADES LLOYDS, RBS, ING, OTHER EU BANKS’ HYBRIDS ON INCREASED RISK OF COUPON DEFERRAL
Fitch Ratings-London-20 August 2009:
Frightful fixed income funds
Standard & Poor’s has just released its mid-year Index vs Active Fund Scorecard (SPIVA), which measures active funds against their passive index benchmarks. And whereas the last SPIVA was rather unequivocal in its findings,
Oh say can you see, US covered bonds
Buried in the Federal Reserve’s updated FAQ on discount window collateral, released on Wednesday, is a bit of a landmark development for the US covered bond market:
5. Do the changes to the collateral
Incredible optimism, AIG edition
AIG’s freshly-installed $7m man Robert Benmosche is confident the insurer can repay its debts to the US government. Cunningly, he doesn’t say when.
Bloomberg reports, emphasis FT Alphaville’s:
“At the end of the day,
Overheard in the Long Room
FT Alphaville’s private forum, the Long Room, was buzzing on Thursday. Here’s a selection of what was being said and posted.
- David Rosenberg has come up with five ways to protect the portfolio in a deflationary backdrop.
The not-so-bullish case for energy prices
The bullish case for oil has been fairly well established by the likes of Goldman Sachs, Barclays, Merrill Lynch at al.
But, as it turns out, there’s a convincing bearish case to be made too — and the man putting it forward most recently is Edward Morse,
Lunch Wrap
On FT Alphaville Thursday morning,
- A floppy gilt auction.
- Introducing Über-QE.
- The shape of things to come is probably not ‘V’.
- China’s Treasury confidential.
- A natgas storm in a tea-cup.
A bit of a floppy gilt auction
Oopsy daisy – Thursday saw another lacklustre gilt sale from the UK Debt Management Office.
This time it came in the form of a 2032 index-linked issue, the sale of which was only 1.75 times covered.
The shape of things to come is probably not ‘V’
So say Bank of America Merrill Lynch economists — and it’s all because of those debt-ridden US consumers.
For years US consumers have binged on cheap credit and provided the demand needed to match China’s furious supply.
Markets live transcript 20 Aug 2009
Markets live chat transcript for the chat ending at 11:54 on 20 Aug 2009. Participants in this chat were: Paul Murphy (PM) Bryce Elder (BE) Masa Serdarevic, FT (MS) PM:Good morning.
China’s Treasury confidential
Brad Setser is no longer around to blog about China’s holdings of US Treasuries, so we are stepping in. For today, anyway.
On Monday, the latest TIC data was released. It officially showed that China became a net seller of US Treasuries in June.
Indonesia’s year of living safely
Even in Asian investment circles, it can come as a surprise to learn that the world’s second-best performing stock market this year has been Indonesia’s.
Bloomberg did its bit on Thursday to publicise the fact,
Über-QE
We are going to call this über-quantitative easing, although someone else will surely come up with a suitably boring technical name for it in due course.
It is mentioned in a 32-page discussion note by RBC Capital Markets economist Russell Jones on the subject of QE.
People DO go to the cinema during recessions
UK-listed cinema-operator Cineworld reported a relatively plump set of first-half figures on Thursday — an indication perhaps that when hard times hit, people will still splash out on the little luxuries that offer a bit of escapism from the daily grind of the recession.
‘Teflon’ Mac Bank — onwards and outwards
Australia’s amazing Teflon-coated Macquarie Group is metamorphosing as we write – heading speedily down the path of funds management as it discreetly winds back its listed infrastructure funds business.
The commercial real estate time lag
Hot on the heels of its review of US banks’ exposure to commercial real estate, ratings agency Fitch has also announced that it will be looking into the European market.
So far, so predictable. But,
Further reading
Elsewhere on Thursday,
- 12 things to know before you invest again.
- Robert Rubin in hell.
- Why China is the next big oil play.
- What (John) Paulson and Krawchek see in BofA .
-Metaphor watch:
Pink picks
Comment, analysis and other offerings from Thursday’s FT,
Cost control not coverage is the key to health reform
Mort Zuckerman, chairman and editor in chief of US News & World Report, writes: virtually every expert agrees that the root of our runaway health inflation is the fee-for-service system.