May, 2010
FT Alphaville’s Bank Holiday break
Due to the Spring Bank Holiday in the UK and Memorial Day in the US, not to mention a public holiday in Castilla La Mancha and some other parts of the world, we’re taking a break on Monday. However, FT Alphaville’s London and New York “Cut”
FTfm on AV
Some highlights from Monday’s FTfm.
Doubt rises over regular bond indices
Broad government bond indices typically weight country exposure by bond issuance. Indebted nations issue the most bonds, with the result that highly indebted countries make up the biggest proportion of these indices.
Finra probing subprime RMBS offerings
Finra, a regulator with an impressive track record of investigatory failures, is looking into the accuracy of disclosures linked to subprime RMBS offerings, according to a Reuters report on Thursday.
According to the Reuters report,
Calming down on bank credit risk
Three-month dollar Libor fell just a bit on Friday, breaking with its unsettling rise over recent days, a trend which may have been related to fears over US financial reform and European sovereign exposure.
CDS report: Looking to fundamentals
The week ended with a whimper rather than the bang we have become accustomed to. Indeed, the last few days have been untypical of what has been one of the most turbulent months in recent memory. The impending long weekend in the UK and UK is no doubt contributing to the tepid denouement.
Why is the ECB shooting the Greek debt messengers?
European Central Bank board member Lorenzo Bini Smaghi dislikes the analyst ‘herd leaders’ who have doubted recent ECB policy on Europe’s sovereign debt crisis.
And when it comes to the prospect of a Greek sovereign default,
Market upheaval should not be the new black, SEC says
Volatility might be the new black, but regulators are none too impressed with market upheaval of the May 6 flash crash persuasion.
In a speech on May 24, SEC commissioner Luis Aguilar deplored “the perils of fragmented regulation”
Euro tea-leaves
It’s been a relatively dull week for the Drachmark. EUR/USD shifted a bit from 1.25 at the start, to 1.24 at pixel time — with few of the vertiginous falls that had attended the worst of Europe’s sovereign debt crisis.
FASB’s mark-to-mayhem
Tremble US financial institutions, for FASB is about to fair value your assets.
The US Financial Accounting Standards Board has published a proposal that would require banks to report the fair value of most of the loans on their books,
Ageas goes where China fears to tread
Chinese officials were busy on Thursday wheeling out a raft of semi-positive, if not lukewarm remarks about their confidence in eurozone investments, after denying an FT report that they were reviewing their holdings of eurozone debt.
Markets Live transcript 28 May 2010
Markets Live chat transcript for the chat ending at 11:31 on 28 May 2010. Participants in this chat were: Neil Hume, FT Bryce Elder NHHola NHit’s 11.03am NHand time for…
Morgan Stanley turns bullish on UK equities
As the London market looks to record its third consecutive session of gains, Morgan Stanley has made a very bold call on Friday morning: the broker has increased its year-end target for the FTSE 100 to 5,800 from 5,000.
Pru/AIA – It’s alive
Shares in Prudential are strangely becalmed following Friday’s news of talks to renegotiate the $35.5bn price tag for the Asian business of AIG:
The markets seems to have no idea whether the deal will go ahead,
Friday’s ‘interessant’ eurozone bond trade
Waiting for that €9.5bn Friday Italian bond auction?
Here are some charts to mull over ahead of (another) litmus-test of demand for peripheral eurozone debt. Italy will be selling three- and 10-year BTPs plus seven-year CCTs.
[South Africa 2010] Two very different quant models say Brazil will win World Cup
Continuing our recent theme of financial analysts-turned-football-experts, we bring you a Friday edition of 2010 World Cup predictions. This time the conjectures come from two different financial outfits,
Further reading
Elsewhere on Friday,
- ‘I would recommend you panic’.
- Libor loan scepticism.
- Putting the BS into RBS.
- US recovery: It’s all about the GDI.
- Dave’s well annoyed about equities, again.
Pink picks
Comment, analysis and other offerings from Friday’s FT,
Martin Wolf: Spare Britain the policy hair-shirt
The UK should tighten fiscal and monetary policy now, in the depths of a slump. That, in essence,
Snap news
Breaking pre-market news on Friday,
- Prudential says discussions regarding current status of the AIA transaction are continuing; could lead to changed deal terms – statement.
- Royal Dutch Shell to acquire East Resources for $4.7bn – statement.
Watch this space: Pru halts Friday HK trading (updated)
All eyes on Prudential and its planned $35.5bn takeover of AIA, the Asian business of US insurer AIG, on Friday.
Here’s the Pru’s Friday statement to the Hong Kong stock exchange:
Suspension of Trading
At the request of Prudential plc (the “Company”),
The pictorial, speculative, yen carry trade
Academics have been busy figuring out ways to plug the gaps in pre-crisis financial data.
In a BIS working paper, Stephen Cecchetti, Ingo Fender and Patrick McGuire identify and analyse two data sets that they think were lacking in the run-up to the financial crisis.
Martin Wolf v Stephen Roach on US-China relations
Who’s more opinionated? Tough call, when it’s Morgan Stanley’s Stephen Roach up against the FT’s Martin “Two Brains” Wolf on the small matter of US-China relations and the outlook for China’s currency policy.
Governments just don’t understand…speculators
Reuters on Thursday published snippets of the discussions taking place at its Global Energy Summit, including some forthright commentary from the heads of various commodity exchanges.
The subject? Government and regulators v evil speculators.
Pru tries to renegotiate AIA price
Prudential is trying to renegotiate the $35.5bn price tag on the Asian businesses of AIG in a last-ditch attempt to win the support of some of its biggest investors and head off a disastrous “no” vote on its planned takeover of AIA,
Kerviel speaks: traders, know thyselves
Roguish trader turned novelist – ‘L’Engrenage, Mémoires d’un trader’ – Jérôme Kerviel has some advice for his peers on the all-important annual review.
In an extract from his book featured on eFinancialCareers on Thursday,
CDS report: Grinding tighter
Markit’s Gavan Nolan wrote this CDS report
News vacuum helping spreads to tighten
Euro rallying, supporting risky assets
Peripheral sovereigns lagging broader market – Greece 680bp, Italy 215bp (+1),
SEC Charges Pequot Capital and CEO Samberg with insider trading
It’s been a busy week for financial regulators, and a mixed one — at best — for hedge funds.
On Thursday, the SEC said it had charged Pequot Capital Management and its chairman and chief exec Arthur Samberg with insider trading in Microsoft shares.
Get liquid
It’s “Caps Lock” time again. Bob ‘The Bear’ Janjuah has followed Monday’s missive, AN ÜBER BEAR EARLY WARNING ALERT, with a tactical update.
And the message is simple – use any bull trap to OFFLOAD risk and get liquid.
Ken Starr, advisor to the stars, accused of $30m Ponzi
On Thursday, the US Department of Justice issued a curious one-liner:
A press conference will be held today to announce the unsealing of charges against financial advisor Kenneth Starr for allegedly perpetrating a $30 million fraud against his clients.