“…Futures were having a nice morning till around 5:45AM, when almost $1.4B printed in DAX and ESTOXX futures – knocking the DAX off almost 2%, and taking US futures down 50bp. No headlines associated, but no recovery when Germany’s Factory Orders printed better (despite bearish chatter). We “Hear” that a heavy buyer of DAX futures between 7800 and 7850 on Monday got stopped out at 7800, and lighter single stock volumes could not support the weight. There was nothing in Credit or FX to correspond to the move…”
Comments »BRIC Index Slips Again, Now Down 10% From Recent Peak Highs
“Emerging-market stocks sank to a four-month low, sending the MSCI BRIC Index (MXBRIC)down 10 percent from this year’s peak as bird flu concerns sparked a slump in Chinese airlines and capital outflows from South Korea accelerated.
China Southern Airlines Co. (1055) fell 8.5 percent in Hong Kong on concern the widening bird flu infections may curb travel. Hyundai Motor Co. (005380), which competes with Japan’sToyota Motor (7203) Corp. selling cars abroad, slid to a 17-month low in Seoul as the yen traded near its weakest level since August 2009. Foreign funds unloaded a net $1.2 billion of Kospi index (KOSPI) shares this week, stock exchange data show, as the risk of conflict with North Korea spurred outflows. OAO MegaFon fell by a record in Moscow after JP Morgan Chase & Co. cut the stock’s rating.
The MSCI Emerging Markets Index slipped 1 percent to 1,006.88 at 5 p.m. in Hong Kong, its fifth day of declines. The gauge has dropped 2.7 percent this week. The MSCI BRIC Index retreated 10 percent from its Feb. 1 high, heading for the threshold that some investors identify as a correction. Six people have died from a new strain of bird flu in China. North Korea said yesterday it passed a law authorizing “counter- actions” against U.S. aggression including a nuclear strike. Data today may show U.S. payrolls growth slowed after weekly jobless claims rose.
“Global funds are skeptical in investing in the emerging markets amid the political and health concerns,” Aneesh Srivastava, chief investment officer at IDBI Federal Life Insurance Co. in Mumbai, said in a phone interview today. “Markets will start factoring in the fundamentals once the current headwinds disappear.”
Kospi Drops….”
Comments »The Nikkei Adds to its Gains While Asia is Mostly Flat, Europe and U.S. Futures Tank
Yields for Italy, Spain, France, and Germany …
Comments »Market Update
European Stocks are Mixed as the ECB Keeps Rates Unchanged
“European stocks were little changed, following yesterday’s biggest drop in five weeks, as theEuropean Central Bank kept interest rates at a record low, and investors awaited an update on monetary policy from ECB President Mario Draghi.
Banca Generali (BGN) SpA lost 5.1 percent after Assicurazioni Generali SpA sold part of its stake in the lender. European Aeronautic, Defence & Space Co. dropped 1.3 percent as an investor offered to sell shares worth 384 million euros ($492 million) in the owner of Airbus SAS.BTG Plc (BTG) gained 1.1 percent after increasing its sales forecast for 2013.
The Stoxx Europe 600 Index (SXXP) fell less than 0.1 percent to 294.67 at 1.01 p.m. in London, paring a drop of as much as 0.3 percent. The equity benchmark slid 0.9 percent yesterday and the Standard & Poor’s 500 Index retreated from a record high in New York as U.S. services and jobs data missed forecasts.
“I don’t expect any new things from Draghi today; his comments are usually very general and there will be no big change from what he’s said before regarding the ECB being there as a support if needed,” Michael Kapler, an equities portfolio manager at Mittelbrandenburgische Sparkasse in Potsdam, Germany, said by phone. “With the recent weaker economic data from the U.S., the focus is more on expectations coming down.”
Asian shares pared losses today after the Bank of Japan (8301) said it will double its purchases of bonds in an attempt to stimulate economic growth. The BOJ will buy 7 trillion yen ($73 billion) of securities a month.
National benchmark indexes advanced in 10 of the 18 western European markets. Germany’s DAX rose 0.4 percent, the U.K.’s FTSE 100 slipped 0.3 percent, and France’s CAC 40 added 0.7 percent.
ECB Decision…”
Comments »The Nikkei Blasts Off as the BoJ Decides to Double Cocaine Distribution
“Japan’s Topix Index (TPX) jumped the most in eight weeks as the yen slumped after the Bank of Japan (8301) doubled monthly bond purchases in its first policy decision since Haruhiko Kuroda took over as governor.
The Topix climbed 2.7 percent to close at 1,037.76 in Tokyo, the biggest gain since Feb. 6. The gauge reversed a 2 percent loss after the decision, with more than seven stocks rising for each that fell. The Nikkei 225 Stock Average (NKY) added 2.2 percent to 12,634.54. Volume was 42 percent above the 30-day average. The yield on the country’s 10-year government bonds slumped 12.5 basis points to a record low of 0.425 percent.
“We’re getting a sea change in monetary policy and it’s happening fast, said Kazuyuki Terao, Tokyo-based chief investment officer at Allianz Global Investors Japan Co. ‘‘That was what markets had expected, but it’s still positive.”
Sumitomo Realty & Development Co. surged 10 percent to pace gains among property companies, which rose the most among the 33 Topix industry groups. Honda Motor Co. (7267), a carmaker that gets 81 percent of its revenue outside Japan, climbed 3.4 percent, bouncing back from a 3 percent decline. Fujifilm Holdings Corp., which has a bird flu treatment under regulatory review, rose 5.7 percent after the disease took a third life in China.
The Topix has rallied 44 percent since mid-November amid optimism Prime Minister Shinzo Abe’s new government and the Bank of Japan would take more steps to beat deflation. Thegauge traded at 15.6 times estimated earnings on average, compared with 14 for the Standard & Poor’s 500 Index and 12.6 for the Stoxx Europe 600 Index.
Kuroda Stimulus…”
[youtube://http://www.youtube.com/watch?v=6ihPOTDxMfE 450 300] Comments »South Korea’s Market and Currency Tank As North Korea Spews More Idiocy of Nuclear Conflict
“South Korea’s stocks tumbled the most in more than four months and the won sank to a half-year low as the risk of conflict with North Korea curbed demand for the nation’s assets. The cost of protecting sovereign bonds against default climbed to the highest since September.
North Korea ratified a law this week authorizing plans for “counter-actions” against U.S. aggression including a nuclear strike, official media reported today. The communist nation in the past week said that a “state of war” exists with the South, announced plans to restart a mothballed nuclear plant and prevented South Korean workers from entering a jointly run industrial park at Gaeseong, on its side of the border.
“North Korea is heightening its threats day by day and that risk factor is having a negative impact on South Korean financial markets,” said Jeon Seung Ji, an analyst at Samsung Futures Inc. in Seoul. “Rising tension is prompting foreign investors to sell more Korean stocks, weakening the currency. In the meantime, exporters are likely to look for a point to sell dollars.”
The Kospi index fell 1.2 percent to 1,959.45 at the close in Seoul, its steepest loss since Nov. 15. The won dropped 0.5 percent to 1,123.71 per dollar, after touching 1,125.50 earlier, the weakest since Sept. 13. The currency slumped 5.3 percent in the past three months, Asia’s second-worst performer, as tensions with North Korea escalated.
Bond Risk…”
Comments »Global Markets Trade Mixed, U.S. Futures are Hopeful to Erase Yesterday’s Losses
Yields for Italy, Spain, France, and Germany …
Comments »Hedge Funds Uptick Bullish Commodity Bets
“Investors are boosting wagers on higher commodity prices at the fastest pace in almost four years, rebounding from the least bullish position since 2009, on signs that the U.S. is accelerating and Europe’s debt crisis is easing.
Hedge funds and other large speculators increased net-long positions across 18 U.S. futures and options by 10 percent to 679,191 contracts in the week ended March 26, data from the Commodity Futures Trading Commission show. The bets surged 67 percent in three weeks, the biggest advance since May 2009. Wagers on higher oil prices climbed the most this year, while those for cattle are at a six-week high.
The Standard & Poor’s GSCI Spot Index of 24 raw materials rebounded 2.1 percent from a 10-week low on March 4 as contracts outstanding jumped 10 percent last quarter, the most in a year. The U.S. economy grew at a faster pace than previously estimated in the fourth quarter, the Commerce Department said March 28. Cypriot President Nicos Anastasiades vowed to keep his nation in the euro on March 29 after it became the fifth country to seek a rescue since the region’s crisis began in 2009.
“Over the last quarter, we’ve seen an improvement in U.S. economic activity far above expectations,” said Chad Morganlander, a Florham Park, New Jersey-based fund manager at Stifel Nicolaus & Co., which oversees about $130 billion of assets. “That has ginned up demand expectations.”
American Spending…”
Comments »Asia Trades Lower, European Markets are Closed for Holiday, and U.S. Futures are Unch
Yields for Italy, Spain, France, and Germany …
Comments »Market Update
U.S. markets fought off negativity at the open to be up marginally by lunch time.
The S&P has managed to hit intra day all time highs; bulls wait for closing confirmation.
It is the last day of the quarter so some selling into strength is expected.
Interesting note here is that we have never had a down year when Q1 produces 8% or more.
Still one has to wonder why we rally two days before the Cyprus event and such a meager rally on the day we find out things are not so crazy or troublesome as Cyprus reopens banks.
Currently the DOW is up 23 points, S&P is up 2.3, NASDAQ up 1.6, WTI is flat, and metals across the board are down.
Comments »European Markets Rise on a Calm Cyprus and an Uptick in German Retail Sales
“European stocks climbed, extending their third consecutive quarterly gain, as a report showed retail sales unexpectedly increased in Germany last month. U.S. index futures were little changed, while Asian shares declined.
D.E Master Blenders 1753 NV surged the most since its initial public offering last June after the coffee and tea company spun off by Sara Lee Corp. said Joh. A. Benckiser has held talks to take it over. Ziggo NV rose to its highest price in two weeks as Liberty Global Inc. bought a 12.65 percent stake in the Dutch cable-television operator.
The Stoxx Europe 600 Index added 0.5 percent to 293.76 at 10:52 a.m. in London. The equity benchmark has still dropped 0.1 percent this week, paring its gain in March to 1.3 percent. The Stoxx 600 is heading toward a quarterly advance of 5 percent. Futures on the Standard & Poor’s 500 Index added 0.1 percent today, while the MSCI Asia Pacific Index slid 0.6 percent.
“German retail sales are a positive for market participants ahead of the Easter break,” said Norman Villamin, who helps oversee about $44 billion as European (SXXP) chief investment officer at Coutts & Co. “But they just reinforce the idea that Europe is running a two-speed economy. In Cyprus, banks open for the first time since the onset of its crisis today, and we will focus not on what are likely to be long lines, but rather whether the capital controls are extended beyond the four days proposed.”
Germany’s Economy…”
Comments »Asia Trades Mixed, Europe Makes a Move Higher, and U.S. Futures are Flat to Slightly Higher
NOTHING CAN TAKE U.S. MARKETS DOWN
U.S. equities opened the day to the downside. The DOW was off as much as 128 bones. Slowly, but surely U.S. equities climbed out of a hole to earn the coveted title of the Teflon Don. Within 15 minutes to the close the NASDAQ was positive, despite $AAPL being down, the DOW was nearly flat, and the S&P was one or two ticks away from unch.
Unfortunately, a sell side imbalance coupled with all eyes on Cyprus took the markets down in the last 8 minutes of trade.
DOW down 33
S&P down 0.86
NASDAQ up 4
WTI up $0.14
Gold up $9.3
The Fed has ‘All the Money in the World.’ They do what they want with it and you must grin an bear it.
[youtube://http://www.youtube.com/watch?v=GvCi4eU1C8o 450 300]
Comments »
Market Update
U.S. equities have managed to pare half their losses from this morning’s session. Lead the way higher is technology while the banking sector is trying to get out of reverse.
Essentially markets are waiting to see what happens in Cyprus tomorrow when banks finally open up for potential bank runs. Currently the ECB is trying to provide liquidity for depositors expected to remove some cash from the system.
European markets managed to not close on their lows.
Oil remains lower while gold has gone into green territory.
[youtube://http://www.youtube.com/watch?v=3jF9ZFDLvm8 450 300] Comments »
FLASH: Europe Falls Off a Cliff, Euro Below 1.28
Italy re-emerges as a new worry
[youtube://http://www.youtube.com/watch?v=otdHbA4GlSI 450 300] Comments »Municipal Bond Markets Experiences Exodus
“March has seen a fairly brisk Exodus from municipal bonds in what could be the first signs that investors are beginning to worry about fixed income.
The popular government finance instruments have seen fund outflows of more than $500 million—just a fraction of the $608 billion asset class but a move that caught some bond pros by surprise. The most recent week saw $261 million come out of the market, according to Thomson Reuters.
While munis often see investors take profits in the springtime as they raise cash to pay taxes, the selling this year came a bit sooner than usual and appeared at least in part unrelated to the normal ebb and flow of fixed income trading.
“Some observers have attributed the sharp outflows over the past few weeks to seasonal patterns … but we disagree,” George Friedlander, Citigroup’s chief municipal strategist, said in a note to clients. “There is a real risk the negative pull of seasonality is yet to be felt.”
If the trend continues for munis, it could provide the first signal that the much-anticipated “Great Rotation” of money from bonds into equities has begun. Stock market bulls cite the prospects for the paradigm shift in investor behavior for their belief the equity market will keep rising….”
Comments »U.S. Data Helps Asia to Rally Overnight
“Asian shares rose after U.S. home prices climbed the most since 2006 and orders for durable goods beat estimates. Gains by Japanese shares were limited as about 80 percent of the companies in the Topix (TPX) Index traded without rights to a dividend today….”
Comments »Asia Rallies, Europe Tanks, and U.S. Futures Look to Give Back Yesterday’s Gains
Yields for Italy, Spain, France, and Germany …
Comments »Emerging Asian Markets Rise on Calls to Accumulate Shares by Money Managers
“Emerging-market stocks rose for a second day as brokerages advised buying shares in South Korea and Thailand, offsetting concern that Chinese efforts to cool property prices will curb economic growth.
Samsung Electronics Co. (005930), South Korea’s biggest company, climbed to its highest level in more than a week after Credit Suisse Group AG said the nation’s stocks are under-owned by overseas investors. Kasikornbank Pcl (KBANK) gained 2.4 percent in Bangkok as Deutsche Bank AG said a drop in Thai shares is an opportunity to buy. Agile Property Holdings Ltd. (3383) slid 1.3 percent in Hong Kong after a report banks have started to control the scale of loans for real estate development.
The MSCI Emerging Markets Index rose 0.4 percent to 1,025.98 as of 4:27 p.m. in Hong Kong. South Korea’s economy expanded last quarter at the slowest pace since the global recession, a report showed, underscoring the case for stimulus. Equities in Europe and the U.S. fell yesterday amid concern that Cyprus’s bailout plan will be used as a model in other euro-area nations.
“Concerns that Cyprus’s bailout plan will be used as a template for others are overdone,” Chu Moon Sung, fund manager at Shinhan BNP Paribas Asset Management Co., which oversees about $29 billion, said by phone in Seoul. “Recovery signals in the U.S. make me hold a positive view on emerging markets. News flow on China’s property curbs could weigh on sentiment in the short term.”
