REITs

REITs

So Who Is Buying? Selling Continues With $2.6 Billion In Equity Outflows, Stocks Sold In 10 Of Past 12 Weeks

The fund flow paradox continues: US stocks trade just shy of all time highs as global outflows from equity funds continue with another $2.6 billion yanked in the past week; this represents 10 weekly outflows in the past 12 weeks. More confusing is that just in the US, $2 billion was withdrawn leading to outflows in 5 of the past 6 weeks. So who is buying? That is the implied question in the last fund flow note from BofA's Michael Hartnett...

These Are The Bonds The ECB Is Now Buying

Today is a historic day for the corporate bond market: with the launch of the ECB's CSPP, Mario Draghi is now directly buying European investment grade non-financial bonds. This means that no longer will European corporate bonds trade based on their fundamentals, but purely on expectations of frontrunning future ECB purchases, such as the following...

Futures Flat Ahead Of Strike-Impacted Jobs Report; Commodities Approach Bull Market

After yesterday's two key events, the ECB and OPEC meetings, ended up being major duds, the market is looking at the week's final and perhaps most important event of the week: the May payrolls report to generate some upward volatility and help stocks finally break out of the range they have been caught in for over a year.

Mizuho CEO Warns Japan Sales Tax Delay Is "Admission Abenomics Has Failed"

Yasuhiro Sato, president of Mizuho, Japan's second-largest bank by assets, said Abe's framing of the sales tax delay would determine whether it sparked concerns about the government's credibility regarding its plans for fiscal consolidation. "The worst scenario is [the government] will just announce a delay in the tax increase.  That could send a message that Abenomics has failed or Japan is heading for a fiscal danger zone and then it will harm Japanese government bonds' credit ratings."

Myopic Markets & The Looming Mall REITs Massacre

While markets are myopically co-moving to the siren songs of Fed hawks and doves, deteriorating fundamentals are becoming harder to ignore. Like wildfires, it’s hard to predict how quickly and where market panic will spread to next. However, the chain-reaction of peak consumer credit growth, softening retail sales, and tightening credit conditions does not bode well for REITs going forward.

"Shanghai Accord Flows Reverse" - Retail Investors Pull Money From Stocks For 6 Straight Weeks

BofA summarizes the latest flow as a "reversal in Shanghai Accord flows" noting the "1st outflows from EM debt funds in 13 weeks; largest Japan inflows in 10 weeks; and 1st outflows from TIPS funds in 14 weeks; 1st" and adds that EPFR reports another week of risk-off flows: $5.8bn equity redemptions vs $2.8bn bond inflows & $1.8bn precious metals inflows (= largest in 11 weeks).

Everyone Is Still Selling: Biggest Monthly Outflow From Global Stocks Since US Downgrade

One recurring question over the past few weeks has been "who is buying" stocks in a world in which not only the smart money, but everyone else too is selling. The latest Lipper data will not provide the answer because as BofA reports, in the latest week there was another $7.4bn in outflows (the 5th straight week) driven by $4.8bn in mutual fund outflows and $2.7bn ETF outflows, leading to a $44bn equity exodus past 5 weeks, which as Michael Hartnett points out is the "largest redemption period since Aug’11", or when the US downgrade sent US stocks into a bear market tailspin.

The Bank Of Japan Begins Selling ¥1.3 Trillion In Stocks Acquired Over The Years

In a stark reminder, that what central banks buy they eventually have to sell, Japan's Nikkei writes that the Bank of Japan has begun selling equities it bought from commercial banks in the previous decade to ease anxiety over the financial sector. But before some interpret the move as a risk to Japan's stock "market" as the biggest equity backstopper now becomes a seller, concurrent with the BOJ's liquidations Kuroda will offset these divestments with extra purchases of exchange-traded funds, in effect netting out selling with even more stock buying.

"If..."

If the world’s economies were really out of intensive care, why would ultra-radical monetary policies like helicopter money be increasingly debated at the highest level of governments? Also, how come 70% of Americans believe the US economy is on the wrong course? And why do almost half of US citizens admit they couldn’t come up with $400 to meet an unexpected need? Yes, I know why ask why? And it is what is, and a bunch of other clichés. But this isn’t normal, it isn’t healthy, and - at least in the opinion of this author—it isn’t going to end well.

In Shocking Finding, The Bank Of Japan Is Now A Top 10 Holder In 90% Of Japanese Stocks

The latest shocking example of just how intertwined central banks have become in all capital markets, comes courtesy of the Bank of Japan which days ahead of a move which may see it double its ETF purchases from the current run rate of JPY3.3 trillion to JPY7 trillion or more (if Goldman is correct), is revealed to be a top 10 holder in about 90% of all Japanese stocks. Crazier still, if as Goldman predicts the BOJ doubles its purchases of ETFs, the central bank could become the No. 1 shareholder in about 40 of the Nikkei 225’s companies by the end of 2017,