Carolyn's Feed
Apr 30, 2012

Insight – London seeks leading role as yuan bond trade goes global

LONDON (Reuters) – Opposite the neoclassical pile of the Bank of England in the heart of the City of London stands an unprepossessing building that houses a Chinese bank.

Bank of China (UK) has been in the City since 1929, the year of the Wall Street Crash, but nobody much noticed the bank, or any Chinese presence in London’s financial markets, until two weeks ago.

Apr 30, 2012

London seeks leading role as yuan bond trade goes global

LONDON, April 30 (Reuters) – Opposite the neoclassical pile
of the Bank of England in the heart of the City of London stands
an unprepossessing building that houses a Chinese bank.

Bank of China (UK) has been in the
City since 1929, the year of the Wall Street Crash, but nobody
much noticed the bank, or any Chinese presence in London’s
financial markets, until two weeks ago.

Apr 27, 2012

Euro dips, German debt rises after Spain downgrade

LONDON (Reuters) – The euro dipped and investors sought safety in German government bonds on Friday as a two-notch downgrade of Spain’s credit rating ahead of a key Italian bond auction increased nervousness about the struggling economies in the euro zone.

European shares stabilized at 1,040.70 points after three straight days of gains following the move by Standard & Poor’s – it cut Spain to BBB plus – and fresh data showing Spain’s jobless rate rising.

Apr 19, 2012
via Global Investing

Dubai banks feeling the heat

Photo

More than two years on from Dubai World, and Dubai is still struggling to sort out its debt.

Investors were shocked when government-owned Dubai World declared a payment standstill on its debts in Nov 2009 — a brutal tarnishing of the  ”sovereign halo”, which investors thought shone even on those borrowers whose debt did not have a solid sovereign guarantee.

Apr 11, 2012
via Global Investing

African stocks fail to shine

Photo

Okay, most emerging stock markets have had a hard time in the last few weeks, but African stocks have failed to shine all year, with lack of liquidity and political uncertainty to blame.

The MSCI global emerging stocks index has fallen six percent in the past six weeks on wobbles over the Chinese and U.S. economies and the euro zone debt crisis.

Mar 22, 2012

Stocks, euro hit by weak Chinese, German manufacturing

LONDON, March 22 (Reuters) – World stocks hit their lowest
level in over a week on Thursday, dropping 1.5 percent from
recent 8-month highs, and the euro fell sharply on concern about
contractions in Chinese and German manufacturing.

The HSBC flash Purchasing Managers’ Index, the earliest
indicator of China’s industrial activity, fell to 48.1 in March
from February’s four-month high of 49.6, with new orders sinking
to a four-month low.

Mar 21, 2012

Foreign guarantors help plug emerging funding gap

LONDON, March 21 (Reuters) – With refinancing becoming a
giant headache for sovereign debtors across the globe, some
struggling emerging economies are securing guarantees from
richer nations or multilateral development banks to bolster
their chances of selling bonds to wary investors.

The guarantee provides the emerging country borrower with
access to otherwise-closed international capital markets, while
the guarantor is extending financial support to a friendly
trading partner at relatively low cost.

Mar 15, 2012
via Global Investing

Greece: crashing out of another index

Photo

Never mind that Fitch  upgraded Greece’s rating to B minus this week from restricted default after the country completed its bond exchange — for the credit default swap market, the exchange is still classed as a default. And for Greece, that meant ejection this week from the closely-tracked Markit iTraxx SovX Western Europe CDS index.

Poor Greece has been trading in somewhat of a market hinterland since problems with its debt first led to ratings downgrades in mid-2010. It got ejected first from the Barclays and Citi developed world bond indices and last year its corporate bonds were thrown out of BoAMerrill Lynch’s bond indices.

Mar 13, 2012
via Global Investing

Betting on a strike on Iran?

Photo

It’s always hard to calculate how to factor political risk into investment decisions, it can feel a bit like taking a punt.

That may be why analysts are starting to look at the bets on Intrade, a Dublin-based online exchange, to measure market expectations of issues like the chances of a U.S. or Israeli strike on Iran.

Mar 12, 2012
via Global Investing

Like Greece, but better?

Photo

It’s a country with one of the highest debt to GDP ratios in the world, it recently launched a debt exchange to avoid a messy default and it is a member of a currency union. Sounds like Greece?

Oh, and its bond documentation already includes collective action clauses (CACs) to force the minority who don’t want to participate in the debt exchange to do so.  So it can’t be Greece, as Greece had to retroactively legislate for CACs.

    • About Carolyn

      "I work in London as part of the Reuters investment strategy editorial team, specialising in emerging and frontier markets. I cover emerging bond, stock and FX markets as well as global market themes, and interview emerging market policy-makers when they attend events in London. I started at Reuters in 1993, writing about foreign exchange, government bonds and Eurobonds before switching to emerging markets."
    • Follow Carolyn