Institutional Investors

US Futures; Euro Stocks Slide On Deutsche Bank Liquidity Fears; Bonds Bid

Following yesterday's paradoxical US stock surge catalyzed by a bevy of bad macroeonomic news, the overnight session has seen some good old "risk off" mood which hit European shares as a result of the previously reported $14 billion DOJ claim against Deutsche Bank, which sent Europe's biggest bank tumbling, dragging the banking sector lower, while a continued drop in the price of oil pushed energy companies lower.

"No Panic" - Why For Once, It Makes Sense To Watch What Isn’t Moving

Markets are certainly on the move. For the first time in a long time, traders are relearning that location really does matter -- if you want to survive the trade. Suddenly, “extend duration” isn’t the answer to every question. Especially when the greater fool takes a holiday. 

Is This The Simple Reason Why FX Traders Are Getting Out Of The Market

"Why beat your head against the wall trying to make sense of some stretched argument about how the Russian ruble will fare against the South African rand when simply buying gold has been the alternative? The former has multiple, opaque and rapidly changing parts galore. The latter only requires evaluating if the world will stay as messed up as it’s become."

The Swiss Begin To Hoard Cash

"Because of the low interest rate level, we note increasing demand for insurance solutions for the storage of cash," said Philipp Surholt at Zurich Insurance Group AG, among underwriters reporting a surge in such requests. "We’re seeing demand for coverage for sums ranging from 100 million to 500 million francs."

Fear Spreads Of A Housing Crash In Canada

In Vancouver’s once white-hot commercial real estate market, the hunt is now on for Chinese buyers as big institutional investors are trying to unload.

In Historic Event, China Sells First World Bank SDR-Denominated Bonds In Decades

In one of the most closely followed bond issues in recent history, overnight the IBRD, one of the five member-institutions of the World Bank Group, sold 500 million SDR-denominated three-year bonds carrying a coupon of 0.49% at an auction in China's interbank market on Wednesday. This was the first SDR denominated offering in three decades, with the issuance symbolically taking place in Shanghai one month before the official inclusion of China's currency in the SDR basket. 

Frontrunning: August 25

  • Stock futures lower as countdown to Yellen speech begins (Reuters)
  • Italy quake death toll nears 250 as rescuers search demolished towns (Reuters)
  • Central bankers eye public spending to plug $1 trillion investment gap (Reuters)
  • Chelsea Clinton Plans to Stay on Board of Family Foundation (WSJ)
  • Bond Traders Are Desperate for Direction From Yellen in Jackson Hole (BBG)

One Trader's Advice If The "Ultimate Breakdown Is Likely To Be Sudden, Intense And Large"

When it’s clear the game has become rigged, it’s easier and less risky to stop playing that game, and go play a different game somewhere else... There is a huge disincentive to step boldly in the direction of sanity... which serves as a dangerous feedback loop to reinforce a false narrative that everything is awesome and under control.

The Illusion Behind Stock Buybacks - A Simple Test

Investors may be dazzled by the earnings-per-share gains that buybacks can achieve, but who really wants to own a company in the process of liquidating itself? Maybe it’s time to ask harder questions of corporate executives about why their companies aren’t deploying their precious resources more effectively elsewhere.

The Bank of Japan Will Be The Top Shareholder Of 55 Companies By The End Of 2017

With the BOJ already a top-five owner of 81 companies in Japan’s Nikkei 225 Stock Average, the BOJ is on course to become the No. 1 shareholder in 55 of those firms by the end of next year. Just as insane, the central bank owned about 60% of Japan’s domestic ETFs at the end of June. This is up from just over half as of a few months ago suggesting that the BOJ is gobbling up equities at an unprecedented pace.