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’Europe’s FICC woes
The reporting season for Europe’s investment banks starts this week and expectations are not high…
From Monday’s FT:
European investment banks are expected to reveal sliding revenues from one of their core businesses when Deutsche Bank kicks off the earnings season this week,
An investment banking horror, from UBS
“Pretty horrific.”
That’s the reaction of one City analyst to Tuesday’s third-quarter results from UBS.
And it’s hard to disagree.
We all know the third quarter has been a tough one for investment banks but this set of figures really does put things in perspective.
WSJ vs Bloomberg on credit investors’ risk appetites
Both Bloomberg and the Wall Street Journal ran interesting — if ostensibly contradictory — pieces on the bond market on Monday.
First the news wire on the appetite for step-up bonds:
Bond Buyers Demand Record Downgrade Protection:
JP Morgan’s fixed fixed income
Here’s an interesting footnote to JP Morgan’s consensus-crushing earnings released on Wednesday.
Net revenue was $7.5 billion, an increase of $3.4 billion, or 85%, from the prior year. Investment banking fees were up 4% to $1.7 billion,
Adventures in hybrid debt, fixed income fund edition
So who buys banks’ hybrid, or subordinated, debt?
Fixed income funds (FIFs), for a start. And S&P’s just-released report into UK FIFs makes for an interesting illustration of what’s been going on in the sector.
Treasury investors take “sell in May” adage to heart
From Reuters:
30-YR TREASURY BOND FALLS OVER FULL POINT, 10-YR OVER HALF POINT, AS SELLOFF DEEPENS
BENCHMARK 10-YR TREASURY YIELDS NOW AT SIX MONTH HIGH OF 3.43 PERCENT, UP 23 BPS IN TWO DAYS
Okay,
Treasuries bubble danger
As noted, the flight to safety is taking on epic proportions. With that in mind our thoughts are going to what may happen next, or specifically, the implications of a Treasuries bubble. Here’s one view from Monument Securities (our emphasis):