A rally in global risk that started during last night's first presidential debate on the market's take that Hillary came out on top fizzled, following news that the DOJ is assessing how big a criminal fine it can extract from Volkswagen (-3.8%) over emissions-cheating "without putting the German carmaker out of business", while Iran's oil minister Zanganeh told reporters Iran is ununwilling to freeze output at current levels. Deutsche Bank dropped to a new all time low while its default risk hit fresh record highs.
The highly-anticipated first presidential debate of 2016 is finally upon us and here are all the things that you need to know but are likely too lazy or simply not interested enough to track down on your own
For the first time in history, yesterday saw VXX (the VIX ETF) traded more volume than the most-traded stock in the S&P 500. With speculative positioning at record shorts (extreme levered long stocks) and volume soaring beyond Aug 2015's previous record, we suspect this will not end well...
Goldman has been using the proceeds from the new deposits to directly fund speculative activity such as trading and investments, as well as more conventional activity such as creating looans. Goldman Sachs built up its consumer bank, led by 40-year-old Goldman partner and credit trading veteran Gerald Ouderkirk, whose job is to use consumer deposits and other types of funding for trades, investments and loans.
Price swings in financial markets have become increasingly muted as investors mull the outlook for monetary policy in the world’s biggest economies, but with a little turbulence starting to creep into markets, this record-breaking collapse in risk perceptions (and record levels of leveraged speculation) is a recipe for disaster.
European stocks, Asian shares and U.S. equity index futures decline. Selloff in global stocks and bonds deepened after signs central banks in Europe and Japan are starting to question the benefits of further monetary easing. North Korea nuclear test weakens the won.
"The impact of the BOJ’s stimulus is that the bond markets worldwide are becoming one market. If there’s a reversal of policy, you can’t rule out that it would roil global debt" said SMBC Nikko Securities. "It would definitely see some pain" added Old Mutual Global.
Until recently, home loans generally covered two types of properties: primary residences or investments. That was before services like Airbnb allowed anyone with an extra room to make a bit of extra money by renting it out for short periods of time. This blurred line between “my house” and “my investment” is causing trouble for some homeowners when they go to refinance their mortgages.
"Over the past 2 months the S&P 500 has been trading in a dead zone. Now this is all about to change as a number of important catalysts materialize this month, seasonals push market volatility higher, and leverage in systematic strategies and option positioning provide fuel for volatility. We expect a significant increase in realized volatility, correlations and tail risk in September and October."
The return from summer holidays has started in much the same way as we left off August, with another subdued session that has seen European stocks little changed, Asian shares advance and S&P futures are modestly in the green amid a flurry of M&A. The US dollar weakened, with the Bloomberg Dollar Index down 0.2% for the 2nd day in a row as prospects for a U.S. interest-rate hike this month remained subdued.