Asian stocks were higher, particularly in Japan where the Nikkei soared nearly 3% and the Topix headed for a new multi-year high as the yen weakened beyond 100 per dollar. Most other Asian benchmarks were weaker with the Hang Seng falling 0.1% and the Kospi down 1.3%, while the ASX rose 0.4%. (Bloomberg)
Yen weakens further beyond 100: The currency touched 101.2 against the dollar in Tokyo morning trade, its weakest level since April 6, 2009. Meanwhile current account data published today shows Japanese investors were net buyers of foreign bonds in the past two weeks, after six straight weeks of sales. Such moves will be a key determinant of the yen’s future direction. The current account surplus for March was Y1.25tn, the highest in a year, boosted by repatriated earnings. (Bloomberg)(Financial Times)
ENRC blasted in Kofi Annan report for costing Congo $725m: Deals cut by the FTSE 100 miner are lambasted for “opaque concession trading” in a report to be published today by the Africa Progress Panel, chaired by Kofi Annan. The report calculates that the Democratic Republic of Congo incurred losses of $1.36bn between 2010 and 2012 as a result of the alleged undervaluation of state assets in five mining deals, three of which involve ENRC. (Financial Times)
Hester wants to lead RBS to reprivatisation: The bank’s CEO signals determination to lead the sell-off, saying he does not regard his job as “time limited by me”. Stephen Hester also said the government had been “Overwhelmingly… very good at treading the balance,” in contrast to the fractiousness of a few months ago when RBS management was clearly furious at the government’s level of interference in its operations. (Financial Times)
UK accounting watchdog has launched two KPMG probes: “The Financial Reporting Council said on Thursday it was investigating whether KPMG was independent when it audited car dealer Pendragon’s financial statements for 2010 and 2011 as well as looking into a “non-timely disposal of a shareholding” in a client by a KPMG member.” It also faces a possible government inquiry over its HBOS audits. (Financial Times)
Vietnam said it would cut interest rates to boost economic growth. The central bank will cutthe refinancing rate to 7% from 85 effective May 13, and the discount rate will be reduced to 5% from 6%. (Bloomberg)
Schäuble warns of central bank stimulus risks: “German Finance Minister Wolfgang Schäuble on Thursday said the wave of stimulus provided by central banks around the world is causing “critical problems,” as it may prompt investors to make bad decisions.” (Wall Street Journal)
Cameron seeks to reassure investors on EU membership: “David Cameron sought to reassure international investors that Britain’s future lay within the European Union on Thursday, denouncing as “pessimists” those in his party demanding an immediate exit.” (Financial Times)
MPs back third Heathrow runway: “The Commons transport select committee rejected the case for a new hub airport in the Thames estuary – as promoted by Boris Johnson, London’s mayor – and instead recommended that Heathrow should get a third and possibly a fourth runway.” (Financial Times)
COMMENT AND CURIOS:
- Gillian Tett: US household debt-to-income ratios are now below Europe’s. (Financial Times)
- Martin Wolf: The time for UK’s decision on EU is now, not 2017. (Financial Times)
- Greece and Portugal make bailout progress but unemployment rises. (Wall Street Journal)
- Swiss watch sales suffering from China graft crackdown. (Bloomberg)
- Lots of central bank cuts, but still not much growth. (Bloomberg)
- Who could really watch over Jamie Dimon? (Financial Times)
- The trouble with Jens Weidmann. (Bloomberg)
OVERNIGHT MARKETS: UP (IN JAPAN)
Asian markets
Nikkei 225 up +419.74 (+2.96%) at 14,611
Topix up +27.73 (+2.35%) at 1,210
Hang Seng down -39.28 (-0.17%) at 23,172
US markets
S&P 500 down -6.02 (-0.37%) at 1,627
DJIA down -22.50 (-0.15%) at 15,083
Nasdaq down -4.10 (-0.12%) at 3,409
European markets
Eurofirst 300 down -0.28 (-0.02%) at 1,229
FTSE100 up +9.26 (+0.14%) at 6,593
CAC 40 down -27.70 (-0.70%) at 3,929
Dax up +12.84 (+0.16%) at 8,263
Currencies
€/$ 1.30 (1.30)
$/¥ 100.93 (100.59)
£/$ 1.54 (1.54)
Commodities ($)
Brent Crude (ICE) down -0.20 at 104.27
Light Crude (Nymex) down -0.25 at 96.14
100 Oz Gold (Comex) down -12.10 at 1,457
Copper (Comex) down -0.70 at 333.45
10-year government bond yields (%)
US 1.84%
UK 1.80%
Germany 1.27%
CDS (closing levels)
Markit iTraxx SovX Western Europe +0.53bps at 90.02bp
Markit iTraxx Europe +1.11bps at 92.86bp
Markit iTraxx Xover +4.61bps at 379.09bp
Markit CDX IG +2.11bps at 70.95bp
Sources: FT, Bloomberg, Markit