KeNo's Housing and Economic Portal: Tuesday February 23 2016 Housing and Economic stories

Monday, February 22, 2016

Tuesday February 23 2016 Housing and Economic stories

Portugal's 10-Year Yield Reaches Highest Since End of Bailout - (www.bloomberg.com) Portugal’s 10-year bonds plunged, pushing the yield to the highest level since the country exited its bailout program in May 2014 and adding pressure on Prime Minister Antonio Costa less than three months after his minority Socialist government took office. The security fell for a sixth day Thursday, pushing the yield up to 4.53 percent, the highest since March 2014. It was at 2.30 percent just before an inconclusive Oct. 4 general election and peaked at 18 percent in 2012 at the height of the euro region’s debt crisis.

PJT's Taubman Sees Investors Exiting Hedge Funds in Market Rout - (www.bloomberg.com) Paul Taubman, whose PJT Partners Inc.’s advisory business has helped hedge funds raise $25 billion over the past decade, said market turbulence may spur investors to flee such bets. “In the hedge fund world there’s no doubt that with all this volatility, you’re seeing either a slowing of net inflows or outright outflows,” Taubman said Thursday on a fourth-quarter conference call. “What that does, it creates more of a flight to quality.” Hedge funds recorded net investor capital outflows for the first time since 2011 in the fourth quarter amid market volatility even though industry assets rose during 2015 to $2.9 trillion, according to data provider Hedge Fund Research Inc. Those outflows may represent only a fraction of investor activity since some redemption requests submitted in the fourth quarter haven’t yet shown up in the data.

Music stops for buyers of Bank Coco debt - (www.ft.com) Last year, investors who braved the riskiest class of bank debt were rewarded. So-called coco bonds, which convert to equity or are written down when banks run into trouble, returned almost 7 per cent over 2015. Already this year, the music has stopped. A Bank of America index for the asset class is down 8 per cent so far. More startling moves have occurred for specific European banks. A €1.75bn Deutsche coco fell below 71 cents on the euro on Thursday, an all-time low after weeks of declines, while securities sold by UniCredit and Banco Popular are trading below 75 cents.

Credit Suisse Slides to 27-Year Low Amid Selloff - (www.bloomberg.com) Credit Suisse Group AG plunged to a 27-year low as a selloff across the industry compounded doubts about Chief Executive Officer Tidjane Thiam’s restructuring plans. A rout in bank stocks deepened on Thursday after France’s Societe Generale SA missed fourth-quarter profit estimates, with earnings declining 35 percent at the investment bank. Credit Suisse shares closed at 12.31 Swiss francs, down 8.4 percent, bringing losses to about 43 percent this year. That’s more than the 41 percent drop in 2011, at the height of Europe’s fiscal crisis. “It’s a lack in trust in the ability of banks to earn as much as they once did,” said Benno Galliker, a trader at Luzerner Kantonalbank AG. “There’s still decent money but not as much as they once did. They can’t take as much risk as they once did.”

Europe Bank Selloff Deepens as Traders Locked in `No Man's Land' - (www.bloomberg.com) It’s been a bad seven weeks for European banks -- worse even than during the 2008 financial crisis, by one measure. Societe Generale SA was the latest on Thursday to report earnings that missed estimates, tumbling the most since 2011 and dragging the whole sector down. Credit Suisse Group AG joined Deutsche Bank AG and Italian and Greek counterparts trading at or near record lows. A technical measure of market momentum has shown market stress more times than even during the latter part of 2008.

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