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’The Asian fuel-oil indicator
A particular grade of Asian fuel oil has, for want of another word, skyrocketed in price over the last few weeks.
The grade in question is called 380-centistoke, and its cash differential (versus the benchmark grade) has performed as follows:
Don’t even look at China for help
Chinese premier Wen Jaibao threw some shade on the eurozone on Wednesday, and the US too — insisting they get their own fiscal and monetary houses in order and recognise China as a market economy if they really want to see some investment.
Another commodities crash layer – the $100bn intervention
Tracking the causes of the commodities crash is starting to feel like peeling an onion.
One layer gets pulled back only to reveal another, and then another — and then you start to cry. Last week we had UBS analysts blaming “extreme positioning short the dollar and long commodities.”
So peeling back another layer,
QE as ‘shock therapy’
Most of the world’s focus is on Libya-related contagion spreading into other Middle Eastern countries and kingdoms.
But, suggests a report from Standard & Poor’s research arm on Tuesday, it may be time to start looking a little further afield.
Libya, the Asian fall-out
The tidal wave of analysis centring on Libya-related concerns about the soaring oil price has become an overnight growth-industry, fuelling further jitters about the fall-out from Middle East turmoil on everything from Korean construction stocks to transport companies.
[Wilmot's PMI tour] Asia sign-off
One other encouraging sign from the Asian data: export orders are up around the region, mostly by several points. Not surprisingly perhaps, Japan is the one exception.
One less encouraging sign from Asia:
The other currencies matter too
Econbrowser recently posted an interesting guest article by Willem Thorbecke, a research fellow at the Asian Development Bank Institute.
Thorbecke argues that the US shouldn’t ignore the exchange rates of other East Asian countries as it pressures China to let the RMB appreciate.
The three risks to global growth, from Barclays Wealth
Three regions, three problems.
According to strategists at Barclays Wealth on Monday, the global economy is facing three big risks in three big regions:
The risks are that U.S. consumers do not increasing spending,
Taiwan makes it harder to prosecute insider trading
Would-be insider traders located in either London or New York — both have which have been aggressively prosecuting alleged securities misdemeanors — may want to consider moving to Taipei.
According to a report by the China Economic News Service (and a similar story in the China Post),
Dispatch from the Milken Global Conference: Thailand’s SMEs
Dr Vachara Phanchet, Thailand’s trade representative and an engineer by training, has a wry sense of humour that is rare among his peer group.
But at the Milken Institute’s Global Conference in Los Angeles on Monday,
Sterilising Chinese inflows
Standard Chartered analysts have put out a note on Monday stressing their concerns about hot money flows into emerging markets.
As they observe:
A problem is brewing across much of the emerging world.
From CDOs to EMs – what could go wrong?
File this under ‘looking bubblicious’: according to a Reuters report on Monday, “displaced credit experts” have shifted their focus away from CDOs and other structured products to emerging markets in South America and Asia.
A dark shadow sweeps over Asia…
Dark pools of liquidity could be on their way to the Hong Kong mainstream, and one of those pools is potentially being set up in Singapore this year. Is Asia catching up to the US and Europe in this shadowy arena?
Risk magazine has the story on an intriguing arms race in Asian equities innovation:
Releasing the renminbi for Asia
Nomura has an ambitious big-think analysis paper out on getting Asia’s strident recovery through the medium term, particularly via capital markets reform. Check the Long Room for the full report, by John Lllewellyn and Lavinia Santovetti.
Sino-Russian finance
A date for Asian diaries:
Event: Russia – Capital Raising and Investment Summit – Hong Kong
When: April 12 – 14
Where: The Four Seasons, HK
Keynote Speaker: Ronald Joseph Arculli, chairman of Hong Kong Exchanges and Clearing Ltd.
Around the world in 22 CDSs
For your amusement/unease/perusal — a collection of sovereign CDS, courtesy of CMA.
Interesting to note that the cost of protecting British or Japanese sovereign debt against default, is now higher than the cost of protecting government bonds from,
Shanghai surprise, Tokyo nightmare
We briefly mentioned Tokyo’s shiny new Arrowhead stock trading platform in our earlier post on the JAL share-trading frenzy.
For the Tokyo Stock Exchange, the launch of Arrowhead at the start of the year was the culmination of four intensive years of lobbying and testing.
That extra 4.04bps in China
Europe is waking up to falling shares across Asia this Thursday morning:
The reason?
From the central bank of China’s website:
Those are the offered terms of a 60bn yuan ($8.8bn) auction of three-month Chinese bills.
‘US consumption engine of growth for Asia,’ Merrill says
Bank of America Merrill Lynch analyst Ethan Harris is not convinced that the plight of the US consumer — real as it is — will derail an economic recovery.
His clients, on the other hand, have been worried about just that:
UBS, the bubble-talk bashers
Want some reassuring commentary that all is well and good in the world of equity valuations?
Well, here’s a pretty bullish bubble-bashing view from UBS, suggesting arguments for a big imminent correction are unwarranted.
Why Asia may shake off an S&P correction
The risk of the biggest US equities correction since the March low on the S&P500 has increased over the past week — but Asian economies, after a comparatively resilient year, are better placed than usual to resist an S&P-correlated correction,
Asia’s booming bond markets
What did Pimco say last week?
You have to have a keen eye for the next big (bond-related) buck to keep up with the world’s largest bond fund manager, which is moving to set up an Asian bond fund just as the region is seeing a surge of activity in fixed-income markets — both in dollar-denominated and local currency debt.
Pimco looks to Asian bonds
When Pimco moves in, you know there’s money to be made.
Amid signs of both currency appreciation and economic recovery among various Asian countries, Bloomberg reports on Friday that Pacific Investment Management Co.,
Shanghai turndown
The Asian sell-off is one of the dominating market stories on Monday. In particular, attention is focusing on the spill-over from China’s recent equity slide and into more open markets like Hong Kong.
The chart below,
Apres le rally, look to Asia and to gold
Hold on equity investors – and look to Asia, if some are to be believed. There is general unease among investors ahead of this week’s FOMC meeting. But that amounts to mere surface jitters compared to more substantial concerns about the approaching end of the “bear market rally”
Moody’s warns on Asian banks
Ratings agencies continue to aggressively review their ratings on global banks, as exemplified by a slew of announcements coming out of Moody’s on Wednesday.
Here are some of the headlines, with extracts from the accompanying statements (emphasis ours):
The invoicing crunch
There’s a hidden credit crunch going, according to UBS economists Paul Donovan and Larry Hatheway — a crunch relatively unreported because it is occurring within the more opaque realms of inter-company credit.
Plunging assets cost $50,000bn
Falls in the value of financial assets worldwide might have reached more than $50,000bn, equivalent to a year’s global economic output, the Asian Development Bank will warn on Monday. Asia has been hit disproportionately hard,
Shipping tides are turning — for now
We were waiting to see if it was a one-day phenomenon, but no – Wednesday’s 15 per cent rise in the Baltic Dry Index has been sustained through another day.
Wednesday’s move to 1,316 points was in fact the biggest daily increase in almost 25 years and came reportedly on signs of a recovery in raw materials trade. On Thursday the index,