ROUND-UP
FT markets round-up: “Fresh evidence of slowing global growth prompted further falls for industrial commodities, US stocks and the dollar, and gains for Treasury bonds, even as the Federal Reserve backed away from previous hints that the pace of its asset purchase programme might be curbed. Copper fell 3.7 per cent in London to $6,795 a tonne while Brent crude oil settled $2.42 lower at $99.95 a barrel. Gold, meanwhile, fell $20 to $1,456 as it suffered a significant interruption to its rebound from a recent two-year low. Equity trading, was thinned by holiday-related closures in many financial centres, including much of Europe. There also appeared a general reluctance to take on new positions before the European Central Bank announces its decision on interest rates on Thursday. The S&P 500 fell 0.9 per cent from Tuesday’s record high. while the FTSE 100 in London rose 0.3 per cent. The caution on growth triggered a strong session for US government bonds with the yield on the 10-year Treasury down 4 basis points at 1.63 per cent, having earlier touched a six-month low of 1.61 per cent.” (Financial Times)
Apple avoids potential $9bn tax bill: “Apple will avoid a potential tax bill of up to $9bn by using the proceeds from its $17bn blockbuster bond issue to pay shareholders rather than bringing back cash from abroad. The technology group would have paid as much as 35 per cent in tax to bring that amount of cash back into the US, according to lawyers and accountants.” (Financial Times)
Evidence of global slowdown mounts: “Further signs of a slowdown in manufacturing activity and trade clouded the outlook for the global economy on Wednesday after a series of closely watched polls pointed to weakening demand. Disappointing data added to concerns that growth in the second quarter will disappoint, though analysts continue to expect conditions to improve in the latter half of 2013.” (Financial Times)
Fed shifts to neutral stance of future easing: “The US Federal Reserve said that is willing to increase as well as reduce its $85bn-a-month, QE3 programme of asset purchases in a shift to a neutral stance on what to do next. In a new line added to its regular statement, the rate-setting Federal Open Market Committee linked changes in the rate of purchases to prices as well as jobs, in a nod to concerns about the falling rate of inflation.” (Financial Times)
Europe May Day protesters target austerity: “Europe’s anti-austerity activists used May Day demonstrations to rally supporters against eurozone economic policies, arguing that high unemployment and low growth were being exacerbated by leaders’ response to the crisis. Politicians ranging from Greece’s Alexis Tsipras, who nearly forced the collapse of his country’s €173bn bailout when his radical left Syriza party finished a close second in last year’s national elections, to Marine Le Pen, the leader of France’s hard-right National Front, attempted to ride the wave of growing anti-austerity sentiment by denouncing business and government leaders as misguided.” (Financial Times)
FURTHER FURTHER READING
- Austerity is not the only answer to a debt problem.
- Bill meant to make banking boring might actually be kind of fun.
- Why the housing market imploded.
- Miles Kimball on monetary policy and financial stability.
- On the rise of Vitter-Brown.
- How Wall Street defanged Dodd-Frank.