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from Global Investing:

Buying back into emerging markets

After almost a year of selling emerging markets, investors seem to be returning in force. The latest to turn positive on the asset class is asset and wealth manager Pictet Group (AUM: 265 billion pounds) which said on Tuesday its asset management division (clarifies division of Pictet) was starting to build positions on emerging equities and local currency debt. It has an overweight position on the latter for the first time since it went underweight last July.

Local emerging debt has been out of favour with investors because of how volatile currencies have been since last May, For an investor who is funding an emerging market investments from dollars or euros, a fast-falling rand can wipe out any gains he makes on a South African bond. But the rand and its peers such as the Turkish lira, Indian rupee, Indonesian rupiah and Brazilan real -- at the forefront of last year's selloff --  have stabilised from the lows hit in recent months.  According to Pictet Asset Management:

Valuations of emerging market currencies have fallen to a point where they are now starkly at odds with such economies’ fundamentals. Emerging currencies are, on average, trading at almost two standard deviations below their equilibrium level (which takes into account a country’s net foreign asset holdings, inflation rate and its relative productivity).

What's more, interest rates in all these countries have risen since the selloff kicked off last May, in some cases by hundreds of basis points. That makes running short positions on emerging currencies and local debt too costly, analysts say.  What's also helping is the sharp volatility decline across broader currency markets, with Reuters data showing one-month euro/dollar implied volatility near its lowest since the third quarter of 2007. That has helped revive carry trades -- the practice of selling low-yield currencies in favour of higher-yield assets  Low volatility and high carry - that's a great backdrop for emerging markets. No wonder that last week saw cash return to emerging debt funds after first quarter outflows of over $17 billion. Pictet again:

from Photographers' Blog:

Struggles to survive in the Amazon

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Me Txanava, Brazil

By Lunae Parracho

A day of navigating along the muddy Envira River brought us to a village of the Huni Kui tribe known as Me Txanava, or village of the Singing Birds.

The moon shone bright in the starry sky over the silent village that lies in the municipality of Feijó – part of Brazil’s Acre state, which borders Peru.

from Photographers' Blog:

Tainted paradise

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Rio de Janeiro, Brazil
By Sergio Moraes

Back in the 1960s, when I was just a kid, I remember watching swimmers in Guanabara Bay and seeing dolphins race alongside the ferries that transported people to and from the city of Niteroi and Paqueta Island. Beaches like Icarai in Niteroi and Cocota on Governor’s Island were very popular.

So I felt sad when I took a boat through the bay on an assignment recently and photographed discarded sofas, old children’s toys, rubber tires and a toilet seat among many other objects that littered the filthy water.

from Counterparties:

MORNING BID-All the metal in China

Without a lot of fanfare, the U.S. equity market has worked its way back to a few points of all-time highs, as concerns over emerging markets (largely related to Ukraine) have magnified, as have worries over China's struggling growth.

That's once again produced the "best house in a bad neighborhood" effect for the U.S. stock market; bond yields remain range-bound in the 2.70 to 2.75 percent area, the 10-year still reflects a value that doesn't suggest economic acceleration or worries over massive slowing either.

from Photographers' Blog:

Manhunt for wildcat gold miners

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Jacareacanga, Para (Brazil)

By Lunaé Parracho

"We're asking you not to go," one of the Munduruku Indians said to me while standing in a circle of ten other warriors.

They feared that I would slow them down if I accompanied them on another six-hour hike through the forest to a wildcat gold mine operated by intruders in their territory. This was to be the fifth mine dismantled by the Mundurukus, who live in Brazil’s Amazon rainforest in the western state of Para. This region is rich in natural resources and has been called the country’s new frontier of economic expansion.

from Photographers' Blog:

Football in the land of futebol

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Rio de Janeiro, Brazil

By Sergio Moraes

Sports and I have always had an intense relationship. Ever since I was very young, I played street soccer, here called futebol, with friends. I was influenced by my father, a newspaper photographer who covered a lot of soccer and who made me want to do the same.

In my 33 years of taking all kinds of pictures, my greatest experiences were while covering sports, especially the Olympic Games. The Olympics are special to me because they give me the opportunity to photograph and experience sports that aren't normally played in Brazil. But even after several Olympics, I still haven’t had the chance to cover American sports like NFL football, NBA basketball, and MLB baseball. I’ve watched some of those leagues during visits to the U.S., and that only made me want to photograph them even more. I'm fascinated by their level of organization, their grandeur, and their marketing.

from MacroScope:

Firing up Brazil’s economy

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A hot, dry spell in southeastern Brazil has pushed up energy prices, stretched government finances and raised the threat of water rationing in its largest city, Sao Paulo, just months before it hosts one of the world's largest sport events, the soccer World Cup.

It looks like the last thing Brazil needed as it scrambles to woo investors and avoid a credit downgrade.

from Anatole Kaletsky:

Behind the wave of market anxiety

What has caused the sudden anxiety attack that overwhelmed financial markets after the New Year? We may find out the answer at 8.30 on Friday morning, Eastern Standard Time.

Almost all agree that the market turmoil has been linked to alarming events in several emerging economies -- including Turkey, Thailand, Argentina and Ukraine -- that has spilled over into concerns about more important economies, such as China, Russia, South Africa, Indonesia and Brazil.

from Global Investing:

It’s not end of the world at the Fragile Five

Despite all the doom and gloom surrounding capital-hungry Fragile Five countries, real money managers have not abandoned the ship at all.

Aberdeen Asset Management has overweight equity positions in Indonesia, India, Turkey and Brazil -- that's already 4 of the five countries that have come under market pressure because of their funding deficits.  The fund is also positive on Thailand and the Philippines.

from Photographers' Blog:

World Cup protest – flames and fear

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Sao Paulo, Brazil

By Nacho Doce

I heard a loud scream and turned to see a Volkswagen Beetle on fire just a few meters away. I was covering the year’s first demonstration against the 2014 World Cup in Sao Paulo's Roosevelt Square. The protesters’ slogan was, “The money spent on stadiums could give the country better education and health.” There were more than 2,000 people marching, many of whom belonged to the Black Bloc.

I ran to the burning car along with other colleagues and demonstrators, and inside I saw two woman and a young girl. I managed to shoot four pictures of their expressions of fear and panic while the driver and others helped them to escape from the fire.

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