Investment strategy Correspondent
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Nov 17, 2014

Euro zone deflation is threat to euro, ECB must act – ING IM

LONDON (Reuters) – A failure by the European Central Bank to act in time to prevent euro zone deflation could trigger a euro collapse in the long term, the CIO of a major European investment house said on Monday.

Hans Stoter of ING Investment Management, which runs $237 billion, is cautious on European equities and debt. While he expected the ECB to start full-fledged sovereign bond buying in the next six months, he said political resistance was stiff.

Nov 13, 2014

Western banks weather post-sanctions slump in Russian dealmaking

LONDON, Nov 13 (Reuters) – Western banks have seen their
fees from Russian deals collapse as sanctions squeeze
once-lucrative bond and equity business, but buoyant demand
elsewhere has already pushed fees from emerging market clients
10 percent higher than 2013′s levels.

A tit for tat round of sanctions between the United States
and Europe and Moscow over Russia’s involvement in eastern
Ukraine has seen capital raising by Russian companies forced to
a virtual halt. Just $10 billion was issued in new debt for
instance, a fraction of what was sold last year.

Nov 10, 2014

Falling rouble creates debt payment headache for Russian companies

LONDON, Nov 10 (Reuters) – In Aug 2010, when a dollar
fetched 30 roubles, oil prices were on the rise, and Russia was
in high favour with investors, Gazprombank went to global bond
markets to borrow $1 billion.

Now as the debt comes up for repayment, Gazprombank
, like many of its Russian peers, is
shut out of global capital markets by Western sanctions imposed
over Moscow’s role in the Ukraine crisis. Oil, mainstay of the
Russian economy, has fallen to $84 per barrel and the rouble is
down 25 percent this year to 45 per dollar.

Nov 6, 2014

Falling rouble may still be overvalued

LONDON, Nov 6 (Reuters) – The rouble may have plunged 25
percent against the dollar so far this year, but some currency
traders are betting on a further 10 percent drop in 2015 on the
grounds that the currency is still expensive once trade and
inflation are factored in.

Russia’s currency is on course for its biggest weekly
loss since early 2009 after the central bank decided to cap
daily dollar sales at $350 million – and investors interpreted
that to mean it would not shore up the rouble.

Nov 6, 2014

Rouble crashes to new low, lags stable emerging markets

LONDON, Nov 6 (Reuters) – The rouble crashed to new record
lows on Thursday after the central bank stepped back from its
daily multi-billion dollar currency interventions, with Russian
assets generally bucking a more stable emerging markets trend.

The central bank announced on Wednesday that it would limit
daily interventions to $350 million, a fraction of the amounts
it has been selling for many weeks to support the rouble, a
decision investors have interpreted as an effective move to a
floating exchange rate.

Nov 5, 2014

Oil price tumble highlights performance divide in emerging markets

LONDON, Nov 5 (Reuters) – Oil’s tumble to new four-year lows
on Wednesday prompted a heavy selloff of stocks and bonds in
energy-producing emerging markets from the Middle East to
Russia, while importer countries like India enjoyed the prospect
of cheaper fuel.

Expectations that the oil price will remain weak is creating
a sharp divergence between emerging markets that export energy
and those that import, with asset managers starting to shift
investments to the latter.

Nov 4, 2014

Emerging energy exporters’ bonds tumble as oil hits 4-yr lows

LONDON, Nov 4 (Reuters) – Tumbling oil prices fuelled a
heavy fall in the dollar bonds of energy exporting emerging
nations on Tuesday, with Venezuela and Ecuador leading the pack
as investors fretted about their ability to repay debt.

Ecuador’s yield spreads over U.S. Treasuries – a measure of
the premium investors demand to hold a credit relative to
safe-haven U.S. Treasuries blew out 33 basis points on the EMBI
Global bond index of emerging debt to 523 bps

Nov 3, 2014

Emerging stocks off 5-wk highs on China data, firmer dollar

LONDON, Nov 3 (Reuters) – Emerging equities and currencies
started the week on a sour note on Monday, hit by the dollar at
four-year highs, lacklustre Chinese data and a possible fresh
flare-up in tensions over Ukraine.

Russian stocks fell in a holiday-thinned trading session,
while the rouble slipped another 0.8 percent versus the dollar
as a controversial poll in Eastern Ukraine added to
pressure from domestic factors.

Oct 31, 2014

Rouble volatility jumps to record 20 pct after rate rise

LONDON, Oct 31 (Reuters) – One-month implied volatility on
the rouble – a gauge of expected swings in a currency – surged
to new record highs on Friday, as the spot exchange rate
shrugged off an outsize 150 basis-point interest rate rise to
resume its slide.

The Russian currency’s relentless depreciation in recent
weeks was abruptly halted on Thursday and it rallied more than
3 percent ahead of the central bank decision. But the
rouble resumed its slide after Friday’s rate rise.

Oct 31, 2014

Investors pull back from stocks in October as Fed money-printing ends

LONDON (Reuters) – Equity holdings in global portfolios dipped to the lowest in more than a year in October as lingering caution about world growth and central bank policies prompted European, U.S. and British funds to trim allocations.

A monthly survey of 46 investment houses from the United States, Japan, continental Europe and Britain showed on Friday that the average recommended allocation to equities in global balanced portfolios had slipped to 49.5 percent, more than one percentage point lower than in September.