November, 2009
CDS report: US retailers mixed after same-store sales data
Gavan Nolan of Markit wrote this CDS report
European credit indices recovered late in the session as central bank actions and strong US economic figures reassured investors. The Markit iTraxx Europe finished around 87bp,
[Galleon] Analysts, traders, hedgies, attorneys and other Galleon-accused
In the aftermath of the a fresh series of arrests against individuals allegedly involved in a $20m insider trading ring, the SEC released details of an amended complaint on Thursday.
Those featured in the complaint are a motley crew of hedgies,
Sun shareholders left swinging
At the end of October, FT Alphaville came across some strange goings on in Oracle’s pending $7bn acquisition of Sun Microsystems.
Oracle had withdrawn its Russian antitrust filing, an unexplained move prompting speculation the deal was about to unravel.
Did someone say commission-free ETFs?
Ron Rowland, editor of Invest with an Edge, is very excited. He’s just discovered that Charles Schwab is upping the ante on the exchange-traded fund industry by launching commission free ETFs.
In fact,
[Galleon] Great, sinking ship – more arrests in Galleon case
Early in New York on Thursday morning, CNBC reported that seven people had been arrested in what was described only as “an ongoing insider trading case related to hedge funds.”
It has since become clear that the arrests are linked to the allegations against Raj Rajaratnam and the Galleon hedge fund.
Bove-rred
Outspoken and prolific banking analyst Dick Bove has made a bid for personal victory.
Having been sued in July 2008 by BankAtlantic Bancorp for defamation and negligence over a note written for his previous employer,
US productivity soars, jobless claims fall
Initial jobless claims declined in the week ended Oct 31, falling by 20,000 to 512,000 according to figures released by the Labor Department on Thursday.
The four-week moving average of initial claims showed a decrease to 523,750 compared with a previous reading of 526,750.
FSA fines UBS £8m for unauthorised transactions
This is quite astonishing.
The FSA fined UBS £8m on Thursday for failing to prevent employees carrying out unauthorised transactions with customer money in their wealth management division.
According to the press release,
£25bn more of QE, the analysts react
The market looked rather unimpressed with the Bank of England’s decision to expand QE by £25bn on Thursday.
As of lunchtime in London, the FTSE’s down 24.32 points at 5083.57. Sterling is at $1.6612 against the US dollar.
Lunch Wrap
On FT Alphaville Thursday morning,
- UK QE extended by £25bn.
- A smooth IASB and an impairment change.
- The US debt to GDP balance, and China.
- Japan, Einhorn and `tontine’ fantasies.
- Central bank repos and conflicts of interest.
MPC extends QE by £25bn, holds interest rates
Here it is – the one you’ve all been waiting for.
The Bank of England’s Monetary Policy Committee has voted to hold interest rates at 0.5 per cent. Most importantly though, it also decided to increase its asset-purchasing programme by £25bn,
That scrappage effect
UK October car registrations recorded their biggest monthly gain this year, rising 31.6 per cent on the month, according to figures from the Society of Motor Manufacturers published on Thursday. Here, for interest,
Markets live transcript 5 Nov 2009
Markets live chat transcript for the chat ending at 12:12 on 5 Nov 2009. Participants in this chat were: Neil Hume, FT (NH) Miles Johnson, FT (MJ) NH:Hey there NH:It’s 11.03am
A smooth IASB and an impairment change
Corporate disclosures are about to get even longer if the International Accounting Standards Board gets its way.
The IASB has just published an exposure draft on its proposals to rejig the way impairments are accounted for.
The US debt to GDP balance, and China
The latest report from Radiant Asset Management’s David Ross on the future of the dollar and China makes for a very interesting read.
Ross starts off by making the point that when you adjust the US deficit for growth and spending,
Japan, Einhorn and ‘tontine’ fantasies
Just about “everyone and their uncle” seems to be shorting Japanese government bonds at the moment, notes Louis-Vincent Gave in the latest note from the asset allocation and research house Gavekal.
Friends on trading desks call it the “Einhorn Effect”,
How central bank repos create conflicts of interest
Here’s something to consider ahead of the European Central Bank meeting on Thursday.
While investors will be looking for signs that the ECB may be preparing to wean banks off their liquidity programmes,
Further reading
Elsewhere on Thursday,
- Analysing the Fed statement word for word.
- A video with “one of the most influential and yet least well-known people on Wall Street.”
- In praise of ETFs.
- More caution on leveraged ETFs.
Pink picks
Comment, analysis and other offerings from Thursday’s FT,
John Gapper: Safe signals from Buffett’s train deal
In the annals of double-edged compliments, Warren Buffett’s description of his planned $27bn acquisition of Burlington Northern Santa Fe as an “all-in wager on the economic future of the US”
AV after dark
On FT Alphaville late Wednesday,
- Pimco chief executive Mohamed El-Erian on the Fed’s delicate balancing act.
- EXCLUSIVE! JAILBIRD LUKES BLOGS FROM SLAMMER!
- Chinese takeout: FSA insider trading crackdown continues.
Snap news
Breaking pre-market news on Thursday,
- BNP Paribas reports gross third quarter operating profit of €1.3bn – statement.
- Quintain Estates announces £191.2m fully underwritten rights issue – statement.
Fed spells out stance on rates decisions
The Federal Reserve on Wednesday signalled that it still expected to keep interest rates near zero for at least six months, but for the first time identified factors that could prompt earlier rate rises.
Intel hit with bribery allegation
New York’s attorney-general on Wednesday alleged that Intel, the world’s biggest chipmaker, had used “bribery and coercion” to maintain its dominant market position after a nearly two-year probe into the Silicon Valley company.
Trading bonanza boosts Goldman
Traders at Goldman Sachs recorded only one daily loss in the third quarter, highlighting the trading bonanza sweeping Wall Street as central banks continue to pump billions of dollars into the financial system.
China surplus to fall: World Bank
China’s current account surplus will fall from 9.8% of GDP to 5.6% this year and 4.1% in 2010, according to the latest World Bank estimates. The forecast will potentially bolster Beijing’s resistance to appeals expected from US President Barack Obama for renminbi appreciation.
JPMorgan to settle Alabama case
JPMorgan Chase will pay $75m and forfeit claims on nearly $650m in termination fees to settle US allegations that the bank and two former employees paid friends of officials to win municipal financing business in Alabama.
Germany, Russia furious at Opel blow
Germany and Russia reacted furiously to General Motors’ surprise decision this week to abandon the sale of Opel/Vauxhall to Canada’s Magna and Russia’s Sberbank and set the stage for a fresh confrontation between Germany and GM,
Siguler Guff buys into MDM Bank
Siguler Guff, the US group specialising in emerging markets and distressed debt investments, has made a rare private equity investment in a Russian bank by acquiring a stake in MDM Bank, one of the country’s biggest lenders.
SocGen continues slow recovery
Société Générale, France’s third biggest bank, on Wednesday lowered its profit outlook in the light of the toughening regulatory environment, as it reported Q3 net profits of €426m, continuing its gradual recovery from loss-making territory.
Beijing acts on Panasonic-Sanyo deal
China is forcing Panasonic to sell off assets in Japan to secure approval for its acquisition of Sanyo Electric, the first time Chinese competition authorities have compelled disposals outside of the country in a monopoly review.