Brazil
Burns Pimco to Investec as $134 Billion Bond Bet Unravels - (www.bloomberg.com) For
the foreign investors who’ve been pouring money into Brazilian bonds, their
timing could hardly have been worse. Lured by interest rates north of 12
percent, they boosted holdings of the nation’s local-currency debt to a record
432 billion reais ($134 billion) in January. That’s an increase of 29 percent
from the year earlier, the government said last month. Pacific Investment
Management Co. and Investec Plc are the two biggest overseas investors in
Brazil’s fixed-rate bonds, data compiled by Bloomberg show. The investment has
so far backfired. The notes have lost 17 percent in dollars this year -- more
than triple that of emerging markets tracked by JPMorgan Chase & Co. -- as
the real sinks, the economy stalls and a graft investigation erodes confidence
in the government. Even if overseas investors hedged the currency’s 18 percent
plunge in 2015, they would have still lost money.
No
Risk Too Big as Traders Plot Escape From Negative Yields - (www.bloomberg.com) In the negative-yield vortex that is the
European bond market, investors are discovering just what lengths they’re
willing to go to generate returns. Norway’s $870 billion sovereign wealth fund
said this month that it added Nigeria and lifted its share of lower-rated
company debt to the highest since at least 2006. Allianz SE, Europe’s biggest
insurer, is shifting from German bunds to bulk up on mortgages. JPMorgan Asset
Management is buying speculative-grade corporate debt to boost returns. With
the European Central Bank’s fight against deflation pushing yields on almost a
third of the euro area’s $6.26 trillion of government bonds below zero, even
the most risk-averse investors are taking chances on assets and regions that
few would have considered just months ago. That’s exposing more clients to the
inevitable trade-off that comes with the lure of higher returns: the likelihood
of deeper losses.
Oil
Sands Tested as Today’s Rout Is Far Cry From Wildcat Years - (www.bloomberg.com) The
collapse in the market for Canada’s heavy crude below $30 a barrel last week is
hammering home a harsh reality for the nation’s oil-sands producers: There’s no
one to save them this time. Unlike previous market crashes that were relatively
short-lived, the combination of persistent oversupplies and weakening demand
are dealing a severe setback to what’s been one of the biggest growth stories
in global energy markets. Oil-sands companies such as Suncor Energy Inc.
already have been rethinking major developments that can require more than C$10
billion ($8 billion) in investment. Now even existing projects are barely
covering costs or in a losing position. “This is a major test of the industry,”
said John Stephenson, chief executive officer of Stephenson & Co. in
Toronto, a money management firm. “It’s going to be sustained, it’s going to be
ugly and it’s going to go on longer than people think.” Long a resource
investor, Stephenson is right now shorting energy stocks as he bets on more
price pain.
Norway
on Bubble Watch as Anxiety Over Oil Plunge Recedes - (www.bloomberg.com) The
central bank governor of western Europe’s biggest crude producer is becoming
less concerned over the plunge in oil prices. Threats from Norway’s hot housing
market have trumped anxiety that forced Governor Oeystein Olsen, 63, to deliver
a surprise rate cut in December, when oil sank to about $63. That rate
reduction has helped mitigate risks of an oil-induced crisis, as evidence in
the real economy shows, he said. “We could now be characterized as leaning
slightly against the wind,” he said in a March 20 interview in his Oslo office,
a day after unexpectedly keeping rates unchanged. “The former risk hasn’t
disappeared, but a few months have passed and we have not seen a more severe
downturn.” Olsen’s decision to keep rates unchanged stunned markets, and sent
the krone down as much as 3 percent. It was particularly surprising since oil
as slid 14 percent since the December meeting and as central banks across
Europe have kick-started massive stimulus programs.
Texas
Landmen Left Out of Work as Oil Patch Boom Times Go Bust - (www.bloomberg.com) Thousands
of Texans who prowled county courthouses, poring over dusty deeds and maps to
cash in on the biggest oil boom in decades, are seeing their work go bust. Land
managers, or landmen as they’re known, are part of a once dying oil patch
profession resurrected when production soared. With the price of crude close to
a six-year low at about $47 a barrel, less than half what it was nine months
ago, they’re among the first to be hit by an energy-industry rout cascading through
the economy. “Almost all the landmen I know have had to take either a serious
pay cut, or are working part time or laid off,” said Gates Mueller, 29, an
independent landman in San Antonio who lost his job in December.
Noyer Suggests ECB Can Allow More Emergency Liquidity for Greece - (www.bloomberg.com)
Yemen foes square off as fears of war, Saudi-Iran rivalry grow - (www.reuters.com)
Greek PM wrote to Merkel warning of 'impossible' debt obligation - (www.reuters.com)
Sales of Existing U.S. Homes Fall Short of 5 Million Pace - (www.bloomberg.com)
China Internet Company Yielding 18% Shows Default Risks Brewing - (www.bloomberg.com)
Dizzying Pre-IPO Tech Values Spurred by Rush of Hedge-Fund Money - (www.bloomberg.com)
Why China Wants its Yuan to Be the World’s 5th Reserve Currency - (www.bloomberg.com)
Brazil Analysts Boost 2015 CPI, Cut GDP for 12th Straight Week - (www.bloomberg.com)
No comments:
Post a Comment