June, 2010
Further reading
Elsewhere on Monday,
- DOUBLE-DIP! DOUBLE-DIP! Or not.
- The days of Dow 1,000.
- Have derivatives been unfairly vilified?
- $1 trillion of household muni bonds.
- Attention, shareholders: greed isn’t good.
Pink picks
Comment, analysis and other offerings from Monday’s FT,
Wolfgang Münchau: The eurozone’s tragic small-country mindset
The European Union is a tyranny of small countries, and this has served it well.
Snap news
Breaking pre-market news on Monday,
- BP captures 15,000 barrels of oil from Gulf of Mexico spill – statement.
- Resolution in talks to acquire majority of Axa UK’s life business; shares suspended – statement and statement.
FTfm on AV
Some highlights from Monday’s FTfm.
Big banks face contest in research
Independent research houses are elbowing aside the big banks to gain a foothold in the lucrative market for investment analysis.
[South Africa 2010] Introducing the Soccer Power Index
After an inconclusive World Cup opener on Friday, we’re still on the look-out for decent prediction models for who’s going to win.
This one’s looking good, even if (horror!) market quants didn’t design it:
US retail sales surprise — on the downside
Disappointing data on May’s US retail sales gave markets a nasty shock on Friday.
Flashes via Reuters:
RTRS-US MAY RETAIL SALES -1.2 PCT (CONSENSUS +0.2 PCT) VS APRIL +0.6 PCT (PREV +o.4 PCT)
RTRS-US
European SPV, meet Russian playwright
Reflection time on Europe’s sovereign debt crisis: we now have a European Financial Stability Facility. So will we see it used?
Er… pass for now, says Barclays Capital’s Aziz Sunderji and team:
There is not enough clarity in government bond markets to be able to credibly answer this question.
Expecting inflation like it’s August 2008
Here’s a datapoint to ponder as market commentators veer between predicting deflation and inflation.
The Bank of England’s latest quarterly inflation attitudes survey comes down firmly on the inflationary side of things — at least for the UK.
Markets Live transcript 11 Jun 2010
Markets Live chat transcript for the chat ending at 11:12 on 11 Jun 2010. Participants in this chat were: Bryce Elder Neil Hume, FT
BEGood morning
BEAnd welcome to Mary Celeste Live
One almighty decoupling
From Credit Suisse’s latest global strategy note — one almighty decoupling in bonds and equities:
Since the beginning of the year, US and German bond yields are down 70 basis points and 80bps — but cyclicals have outperformed defensives by 3 per cent and 5 per cent in the US and Europe,
China overheating?
Here’s a pop-quiz for China-watchers on Friday:
Does this:
Chinese inflation exceeds 3% target
Chinese inflation has exceeded the 3 per cent target set by the government for the year, at a time when wage pressures in the economy are intensifying,
Rally round the (BP) flag
Rule Britannia, Britannia rule the horrifically polluted waves!
Shares in BP were up by over 5 per cent in early London trading on Friday:
Which has stabilised the collapse of recent days.
That’s despite more political pressure in the US over the energy giant’s oil spill response,
Super-confusion on Australia’s mining super-tax
A possibly tiresome — but still important — update on the Australian government’s much-villified plan to impose a 40 per cent “resources super-profits tax” on mining companies:
Confusion reigns on Friday.
Moody’s says everything is just FINE in European banks
Well here’s something to make the rally monkey jump for joy.
Ratings agency Moody’s has done its own stress test/survey of European banks — checking their ability to withstand “severe losses” on exposure to PIGS Greek,
Germany’s rebalancing act
And you thought China was bad.
As Germany pushes for fiscal austerity amongst its eurozone brethren, it’s worth keeping in mind just how conservative die Deutschen themselves have been, in one sense.
The bursting of a bubble, scientifically deconstructed
How’s this for some Friday irony?
The BBC reports physicists have just discovered that, under certain (liquid, ahem) conditions, bursting bubbles don’t just disappear. No, instead they create lots of smaller ‘daughter’ bubbles,
Further reading
Elsewhere on Friday,
- Hedge funds vote for deflation.
- Toxic assets and toxic oil.
- BP’s underperformance, charted.
- Trading based on lunar cycles is risky. No kidding.
- Still bear-watching.
Pink picks
Comment, analysis and other offerings from Friday’s FT,
Philip Stephens: Some home truths on oil for the president
BP’s Deepwater Horizon crisis is a reminder that politicians can handle only one challenge at a time,
Snap news
Breaking pre-market news on Friday,
- BP’s Hayward ‘considering all options’ on dividend – WSJ.
- BHP Billiton says no consultation so far on Australia mining tax – statement.
- Punch Taverns sells four pubs to Greene King for £5.3m – statement.
[Abacus] Goldman’s shares hit 52-week low
On a day when the S&P 500 index closed 3 per cent higher, Goldman Sachs’ shares touched a 52-week low of $131.30, a level not seen since May 14 2009.
And as the YTD chart below (via Google Finance) illustrates,
SEC busts alleged $300m gilded Ponzi scheme
Fraudulent goldbugs?
The Securities and Exchange Commission today charged four Canadian men and two others living in Florida with perpetrating a $300 million international Ponzi scheme on investors in a purportedly successful gold mining operation.
CDS report: Waiting for Trichet
A late sell-off in the US had the predictable dampening effect on European markets. The Markit iTraxx Europe opened 3.5bp wider at 140bp (+3.5) while the Markit iTraxx Crossover opened at 620bp, 6bp wider.
Short ARM tactics
Could a short sqeeze explain the 30 per cent spike in the share price of chip designer ARM Holdings on Thursday?
Click to enlarge:
This chart from from Data Explorers suggest it might have played a part,
The equity underwriting fat cats
So which banks have the most to lose from the UK Office of Fair Trading market study into equity underwriting fees and associated services?
Over the past ten and a half years the biggest fee earners have been JP Morgan (including Cazenove),
Send for the rally monkey
The Dow is back at 10,000.
The reason (ahem) is Chinese export data, which was leaked on Wednesday and confirmed on Thursday. Apparently this is reassuring because its shows China has not been affected by the sovereign debt crisis in the eurozone.
Japan’s no-playboy bonds
Presented without comment, from RBS on Thursday:
…our colleague Bill O’Donnell reports that a new Japanese Ministry of Finance advert says that Japanese women prefer men who invest in government bonds,
Beyond patriotism
Britain’s Prime Minister David Cameron tried to draw the sting from recent US attacks on BP on Thursday — a sign that the company’s tanking stock is being watched with concern in Whitehall.
Or in this case,
Of Taunus and Tier 1
Here is a lovely picture of the Taunus mountain range, near Frankfurt:
And here is a not-so-lovely snapshot of the Tier 1 capital of a certain Taunus Corp, Deutsche Bank’s bank holding company in the US.
Extend and pretend in US housing is reeeaaally extended
What’s this? A sudden wave of US housing optimism?
From HousingWire:
Serious delinquencies among US Alt-A residential mortgage-backed securities (RMBS) declined in April for the first time in four years,