WASHINGTON (AP) — US Supreme Court clears way for extradition of father, son accused of sneaking ex-Nissan boss Carlos Ghosn out of Japan.
WASHINGTON (AP) — US Supreme Court clears way for extradition of father, son accused of sneaking ex-Nissan boss Carlos Ghosn out of Japan.
A single large sell order appears to have sent prices for trading contracts on polkadot tumbling from about $33 to 25 cents in less than a minute.
(Bloomberg) -- It may turn out that five new special purpose acquisition companies per day was too many.SPAC mania is showing signs of hitting a stock-market saturation point, with an index tracking blank-check flyers suddenly down about 20% from its peak. The craze is being clipped as quickly as it whipped up, with sentiment souring on growth stocks amid a runup in interest rates and rotation into beaten-down names. Before the selloff, SPACs had almost doubled since October.“When the price is moving up way faster than fundamentals can justify, that screams risk to us, and people who have those exposures are experiencing that risk today,” said Matt Stucky, portfolio manager at Northwestern Mutual Wealth Management Co. “It’s an awfully risky proposition to have a lot of capital invested in an exposure that is pretty volatile.”The group’s meteoric growth has come to symbolize speculative behavior in equities. SPACs surged as famous executives, athletes, private-equity giants and venture-capital firms alike rushed to raise money for yet-to-be identified future investments, tapping appetite for early-stage companies. In the first two months of 2021, 175 SPACs sold initial public offerings, or roughly five deals per trading day, according to data compiled by Goldman Sachs Group Inc.In February alone, 90 SPACs raised $32 billion, a monthly record. Should the current pace of issuance persist, this year’s offerings will surpass the full-year total of 2020 before the end of this month, Goldman Sachs strategists led by David Kostin estimate.“The blistering pace of issuance is likely unsustainable,” they wrote in a note this week.The pace of money raising from SPACs has far exceeded the heydays of traditional IPOs during the dot-com era. In terms of dollars, SPAC issuance has been running at a clip of $28 billion a month, Goldman data show. In 1999 and 2000, companies raked in an average $5.4 billion a month through initial offerings, according to data compiled by Jay Ritter, professor of finance at the University of Florida’s Warrington College of Business.Riskier areas of the market have sold off in recent days amid a bout of Treasury market volatility. The IPOX SPAC Index, which tracks the performance of a broad group of special purpose acquisition companies, has fallen toward a bear market, down about 20% since a mid-February peak. It’s on track for its second-worst week ever relative to the S&P 500.Meanwhile, the Defiance Next Gen SPAC Derived ETF (ticker SPAK), is also down about 20% from its February top, with the fund on pace for its worst week of outflows on record.While it isn’t crazy that SPACs became popular given their structure and relatively loose listing requirements, according to Marketfield Asset Management’s Michael Shaoul and Timothy Brackett, any frenzy of this magnitude tends to result in “a long and expensive period of regret.”Outsize returns for buyers look “much less likely (on average) today than it did six months ago, given the bloat of size and number of deals and the ramp-up of negotiated valuations,” they wrote in a note. “Of course this is not a coincidence, since it is the massive expansion of market cap caused by SPAC issuance that is helping undermine its prior success.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Saudi Arabia just made a high-stakes wager that the glory days of U.S. shale, which transformed the global energy map in the last decade, are never coming back.By keeping a tight grip on supply at Thursday’s meeting of the OPEC+ alliance of oil producers, Saudi Energy Minister Prince Abdulaziz bin Salman showed he’s focused on boosting prices -- and confident that this time around it won’t encourage American producers to surge back and steal market share.“‘Drill, baby, drill’ is gone for ever,” said Prince Abdulaziz, who’s orchestrated the revival of the oil market after last year’s catastrophic collapse.His swagger comes mixed with a good dose of diplomatic tension: Russia, Saudi Arabia’s most important OPEC+ partner, has tried to convince Riyadh for several months to increase output, fearing that rising oil prices would ultimately awaken rival shale producers. The Saudis are certain the American industry has reformed itself.If the prince is right, OPEC+ will be able to both push prices higher now and recover market share later without worrying that rivals in Texas, Oklahoma and North Dakota will flood the market. But if Riyadh has miscalculated -- and it’s got shale wrong before -- the danger will be lower prices and production down the line.The Saudis have so far convinced their allies the strategy will work. After a quick virtual meeting on Thursday, OPEC+ agreed to prolong its production cuts, defying expectations of an output hike. Russia, however, secured an exemption for itself and Kazakhstan, and will increase output marginally in April.Brent crude jumped 5% to a one-year high of almost $68 a barrel after the decision. Front-month futures extended gains on Friday and a raft of banks updated their price forecasts, including Goldman Sachs Group Inc., which increased its estimates by $5 -- to $75 next quarter and $80 in the following three months.“This is an incredibly bold move on the part of OPEC+ to extend the oil price rally,” said KPMG Global Energy Sector Leader Regina Mayor.If history is a guide, however, trouble may be brewing. The OPEC+ coalition, which groups Saudi Arabia, Russia and almost two dozen other oil producers, has in the past underestimated its American rivals, who year after year produced more than most expected. From a low point of less than 7 million barrels a day in 2007, the U.S.’s total petroleum output more than doubled to hit an all-time high of almost 18 million barrels a day by early 2020, forcing the cartel to cede market share.Risky Move“This is a risky take,” Amrita Sen, chief oil analyst at consultant Energy Aspects Ltd., said Friday in a Bloomberg Television interview. While U.S. oil companies probably won’t raise output this year, in 2022 “there’s nothing really stopping them, especially the small and mid-cap producers.”Sen sees prices hitting $70 a barrel as soon as next week, $80 by the end of the year and a possible climb to $100 in 2022.For now, U.S. total oil output remains constrained, hovering at 16 million barrels due to the impact of last year’s slump, which briefly saw benchmark prices trade below zero.Under pressure from shareholders, shale producers have promised restraint, putting profits before the growth they relentlessly pursued during the boom years. Although drilling has risen from the lows of 2020, it’s well below previous levels. In addition, President Joe Biden is trying to temper the worst excesses of the industry, including the indiscriminate natural gas flaring that’s a byproduct of shale’s success.Under a different oil minister, Saudi Arabia attacked shale producers in 2014 and 2015, flooding the market and forcing prices lower -- a strategy that ultimately failed. Prince Abdulaziz is doing the opposite, because oil higher prices will eventually benefit shale producers. Yet, he’s convinced the industry won’t repeat its past excesses.“Shale companies are now more focused on dividends,” Prince Abdulaziz told Bloomberg News in an interview after the OPEC+ meeting, saying that the kingdom wished the American industry well. “We’ve never had any issue with shale oil. It’s the shale companies which are themselves changing. They have had their fair share of adventure and now they are listening to the call of their shareholders.”Shale executives agree with him -- at least for now.“A couple years ago it was ‘drill, baby, drill,’” John Hess, the head of Hess Corp., said in Houston earlier this week. “Now, it’s ‘show me the money.’”Ryan Lance, the chief executive officer of ConocoPhillips, echoed the sentiment: “I hope there’s discipline in the system. The worst thing that can happen right now is U.S. producers start growing rapidly again.”As the industry cuts spending to pay shareholders fatter dividends, there’s not much left to finance increased production. Even Big Oil is scaling down its ambitions in shale. Exxon Mobil Corp. had been running 55 oil rigs in the Permian basin that straddles West Texas and southeast New Mexico, part of an effort to boost output to 1 million barrels a day by 2025. After tightening its belt, the U.S. oil giant is running just 10 rigs, and has cut its 2025 output target by nearly a third to 700,000 barrels a day.Yet, there are also signs that higher oil prices may ultimately reactivate the U.S. shale industry. With benchmark West Texas Intermediate now changing hands above $60 a barrel, some companies believe they may be able to both grow and keep shareholders happy. EOG Resources Inc., the largest producer in the Permian, has announced a big spending increase for next year. And others are following suit.But the reaction of the stock market made Prince Abdulaziz’s case: investors punished EOG for spending more on drilling, marking down its shares relative to more disciplined rivals.(Updates with comments from Energy Aspects in 10th, 11th paragraphs.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Chinese Premier Li Keqiang pledged on Friday to promote business ties with the United States based on "mutual respect" that benefit both countries. The world's two largest economies have been at odds over trade and economic policy, especially when it comes to U.S. efforts to restrict tech exports to China and tariffs both have put on each others goods. This week, President Joe Biden singled out a "growing rivalry with China" as a key challenge facing the United States, with his top diplomat describing the Asian country as "the biggest geopolitical test" of this century.
Stocks turned negative after the Labor Department's February jobs report handily exceeded expectations, reaffirming the building momentum in the economic recovery, but also stoking a rise in Treasury yields and concerns over an economic overheating.
A firm hired to monitor Texas' power markets says the region's grid manager overpriced electricity over two days during last month's energy crisis, resulting in $16 billion in overcharges.
(Bloomberg) -- China plans to step up oversight of financial holding companies and the nation’s booming fintech industry, Premier Li Keqiang said, setting the tone for closer scrutiny over the next five years of behemoths including Jack Ma’s Ant Group Co.The authorities will also expand an anti-monopoly crackdown and prevent the “unregulated” expansion of capital to create fair competition, Li said Friday at the opening of the National People’s Congress. The fintech sector should be developed in a “prudent” manner and China aims to create a “deviation correction” mechanism to fix and suspend innovative financial products when needed, according to a separate plan covering policies for 2021 to 2025.China’s policymakers are walking a fine line of trying to curb risks at home while encouraging local champions as the economy opens wider to foreign capital. Fintech has become the latest target of scrutiny since the nation’s leaders pledged in 2017 to clean up threats to its $53 trillion financial industry, tackling property loans, opaque wealth management products and fraud-riddled peer-to-peer lending.“We will improve the mechanism for managing financial risks, see responsibilities are fulfilled by all the stakeholders, and ensure that no systemic risks arise,” Li said. “Financial institutions must serve the real economy.”All three financial watchdogs have made it their primary goal this year to curb the push of technology firms into finance, taking aim at a sector where loose oversight fueled breakneck growth for firms such as Ant and Tencent Holdings Ltd.’s Wechat Pay.Regulators has introduced a raft of measures to curb fintech’s growing influence over China’s financial plumbing since late last year, targeting monopolistic practices and tightening scrutiny in areas from credit scoring to payments. New rules on online microlending and financial holding companies have hit billionaire Ma’s Ant particularly hard, derailing its $35 billion initial public offering abruptly and forcing the firm to restructure its sprawling businesses.Ant is in talks with regulators to restructure into a financial holding company, people familiar with the matter said earlier, a move that will subject it to more capital restrictions and ownership scrutiny.Meanwhile, China will balance its derisking campaign with efforts to revive economic growth. The government plans to extend policies allowing small businesses to delay repayments and have financial institutions further reduce lending rates and forgo profits to help the economy. Big banks should boost their small business loans by 30% this year, Li said.The lenders were put on the front-line in helping millions of struggling businesses during the pandemic and required to forgo a combined 1.5 trillion ($232 billion) in earnings by reducing borrowing costs and allowing delayed repayments. That helped China become the only major economy to achieve economic growth last year.The banking industry reported a 3% decline in combined profit in 2020, the worst performance in at least a decade, according to official data. Lenders disposed of a record 3 trillion yuan of non-performing loans last year and are under pressure to carve out more soured credit in 2021 as a payment holiday ends at the end of March. The pandemic’s extraordinary relief measures hid the true state of asset quality in the banking sector, which reported an unexpected decline in its bad loan ratio last year.(Adds details from the 14th five-year plan in the second paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Australia wants to leverage off its position as a top mineral producer by boosting processing and manufacturing, part of a plan to challenge China’s dominance in the supply of products key to the clean-energy transition.The government unveiled a 10-year road map on Thursday that includes A$1.3 billion ($1 billion) of funding to help businesses capitalize on the country’s abundant natural resources and exploit opportunities in a de-carbonizing world. It encourages growth in high-value products like batteries and solar cells, as well as technologies and equipment that make mining safer and more efficient.The Modern Manufacturing Initiative comes as the U.S. and Japan look to cut their dependence on China for minerals that are vital to many manufacturing sectors. Australia is the top exporter of lithium, a key component in batteries, and is also a major source of rare earths. Beijing is reviewing its rare earths policy and there are signs it may ban the export of refining technology to nations or firms that it deems are a threat to state security.See also: Biden’s Hopes for Rare Earth Independence at Least a Decade Away“It’s a sovereign and strategic priority for Australia to ensure that we are hard-wired into this supply chain around the world,” Prime Minister Scott Morrison said at a media briefing following the announcement. It has to be “a supply chain that Australia and our partners can rely on, because these rare earths and critical minerals are what pull together the technology that we will be relying on into the future,” he said.Lynas Rare Earths Ltd. currently sends rare earths from its operations in Australia to Malaysia for processing, but has plans to build a facility close to its Mt. Weld mine in the country’s west. Lynas’ rival Iluka Resources Ltd. is also assessing options to build processing capacity. Energy Renaissance, meanwhile, and other companies are looking to establish a domestic battery manufacturing industry on Australia’s east coast.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Back in 2017, when Turkey’s economy was booming faster than China’s, Renaissance Capital’s Charles Robertson predicted that it would not end well. Less than a year later, the lira crashed under an overheating economy and ballooning debt.Now, Robertson expects a repeat of that cycle within the next two years.The rally in Turkish assets made the lira the best-performing currency since a shakeup at the central bank and finance ministry in November. The gains were backed by some investors betting that President Recep Tayyip Erdogan would allow the new team to pursue conventional monetary policy after several years of failed attempts to suppress inflation while keeping interest rates low. The lira halted three days of declines on Friday, climbing after central bank Governor Naci Agbal pledged policies to permanently tame price growth.Robertson, the London-based global chief economist at Renaissance, is not convinced. Here are some of his views from an interview on Wednesday:Boom-and-Bust Cycle“My current scenario is that we go back to another boom-and-bust cycle, with interest-rate cuts in the second half of this year leading to strong credit growth in 2022, just ahead of the presidential election in 2023, and then we get another crash.”Is This Time Different?“We have seen so many times that Erdogan was persuaded that he has to do something. Each time, the cost has become higher and the gains have become more short-lived. You look at interest rates globally today and look where Turkey is. Every other mainstream emerging market has interest rates below 5% now, except Turkey.“I don’t have high trust that Erdogan has learned his lesson. His comments just a week ago again suggests that, yes, he is being responsible for now, but as soon as he gets the chance and certainly ahead of the elections in 2023, you would expect Turkey to go on the credit-growth model again.”Facing Choices“Once again Turkey has got a choice. It still has a very cheap currency; it can go down an export-led model that will support its current account and bring in the dollars and euros that can be used for investment. I’d love to see the central bank be able to take inflation under control permanently through a long period of high interest rates and at the same time a cheap currency helping exports and helping re-balance Turkey’s economy away from consumption. That would be the better long term story for Turkey, but less exciting for growth. It is kind of a growth scenario of probably 3% or 4% a year, not 6% or 7% for a few years and then a crash.”Controlling Inflation“The markets will have to see the proof in sustained positive real interest rates over time. Right now, we don’t even have positive interest rates: the central-bank rate is roughly the same as inflation. The markets can accept that inflation is going to calm down thanks to the hikes we have seen. But what the central bank has to do is to keep real rates on a forward-looking base high, and the only way they can prove to the market that they are doing that is by doing it.”Shorter Cycles“I suspect that the boom and bust cycles have to be short now, like a year or two. They can’t do a five-year boom. Yes you can borrow for a bit but you blow up yourself pretty quickly. (In the past) banks had sufficient deposits to lend out, but now they don’t. If they want to lend, a great deal of money is borrowed from abroad, and that then starts to ramp up the external debt quickly and then markets get worried (and) the lira starts to come under pressure quite quickly.”Hawkish Talk“I don’t think there is anything they can do now. There is nothing verbal they can say, and actually hiking rates too much would be a mistake because it is not necessary for the economy. I think inflation is going to come down; it would be silly to hike rates more now. The best they can do is to show over years the model has changed.”Outlook for the Lira“My guess is that the lira is going to be around 7 per dollar by June because the central bank will continue to be responsible throughout the first half of 2021, and my assumption is that by December we’ll see pressure from Erdogan to cut rates. And we will be at the beginning of the market losing faith again in the central bank’s credibility.”Developing-World Models“Egypt is still paying really high real rates today because it has taken so long to prove to the market that Egypt is changing. It has been costly for Egypt, and it will be quite costly for Turkey to prove this too. Turkey has to provide to foreign and domestic investors a good positive real return on bonds at least for two to three years before the markets will believe the model has changed.”What to Buy“For bond investors, I think it has been a decent trade since November but you put your money there for a few months. It is a bit like riding Bitcoin; a few months in you make a decent return and you get out because you can’t have that much confidence in the longer term. I think the Turkish lira bonds are good value now, but I would be selling them perhaps first half of next year. The question I would have in the second half of this year: when do I sell?”To Be Sure“I’d love to be wrong, for the sake of the Turks and their savings and their relative standing in the world. Turkey has an opportunity to change. Turkey is a well-developed industrial economy with a good, educated work force. It could be a solid -- perhaps the best -- growth story in the European time zone for the next 10 years with the right policies.”(Updates with lira and central bank comments in third paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- As the leader of crypto exchange Kraken, Jesse Powell is bound to be bullish on Bitcoin. Yet he’s projecting a disruptive future that would stretch the imagination of even the most ardent crypto fans.In a Bloomberg Television interview, Powell said Bitcoin could reach $1 million in the next decade, adding that supporters say it could eventually replace all of the major fiat currencies.“We can only speculate, but when you measure it in terms of dollars, you have to think it’s going to infinity,” he said. “The true believers will tell you that it’s going all the way to the moon, to Mars and eventually, will be the world’s currency.”The CEO also said San Francisco-based Kraken is considering going public, possibly next year.Extreme predictions are nothing new in the world of Bitcoin, where adherents stand to profit from convincing a wider audience that crypto is a legitimate asset class, rather than a speculative fad. The dollar remains the world’s reserve currency and is the benchmark for global trade, though its value has softened in the past year.Powell said Bitcoin bulls see it one day exceeding the combined market cap of the dollar, euro and other currencies.The dollar “is only 50 years old and it’s already showing extreme signs of weakness, and I think people will start measuring the price of things in terms of Bitcoin,” he said.The digital currency slipped 3% in early U.S. trading on Thursday, hovering around $49,000. Prices have surged almost 600% since the start of 2020 on the back of wider mainstream adoption, with bulls seeing it as both an inflation hedge and speculative asset.Critics argue that Bitcoin is in a giant, stimulus-fueled bubble destined to burst like the 2017 boom and bust cycle.Kraken benefits from higher prices as it reaps fees from increased trading. Bloomberg reported last month that the exchange was in talks to raise new funding, which would double the company’s valuation to more than $10 billion.“Personally, I think $10 billion is a low valuation,” Powell said. “I wouldn’t be interested in selling shares at that price.”The CEO did acknowledge the potential for wild market swings, saying prices can “move up or down 50% on any given day.” That kind of volatility has long been one of the negatives of Bitcoin, relegating the market to one of speculation, rather than a means of doing business.“If you are buying into Bitcoin out of speculation, you should be committed to holding for five years,” Powell said. “You have to have strong convictions to hold.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Gold starts the session on the bearish side of the 50% to 61.8% retracement zone of last year’s trading range.
It appears the breakdown is underway, and this could turn into an outright collapse into mid-March.
The chief executive of newly-created Stellantis said he does not rule out M&A operations for the carmaker, although he signalled that the company is now focused on implementing its merger, daily Il Sole 24 Ore reported on Thursday. Stellantis, which is home to 14 brands, including Opel, Jeep, Ram and Maserati, was forged from the merger of Fiat Chrysler and Peugeot-owner PSA. The long-awaited $52 billion merger between the Italian-American and French companies was completed in mid-January.
(Bloomberg) -- Dip buyers drove a rebound in stocks after an earlier bout of selling pushed the Nasdaq 100 down 10% from a record.All major groups in the S&P 500 advanced, while the tech-heavy gauge climbed more than 1.5% as giants Amazon.com Inc. and Apple Inc. erased their losses. Robinhood Markets Inc., the trading platform behind the boom-and-bust swing in GameStop Corp.’s shares, has chosen the Nasdaq for its eventual initial public offering, according to a news report. Earlier Friday, equities retreated as U.S. jobs data topped estimates, fueling anxiety the economy could run too hot and kick up inflation. Benchmark 10-year yields stabilized after hitting 1.6%.Friday’s turnaround in financial markets wiped out the S&P 500’s drop for the week. The intense volatility of the past few days was a test to stock bulls who see the recent spike in Treasury yields as an indication of brighter prospects for the economy and corporate profits. While concern over equity valuations have emerged, several analysts say that as long as data continue to improve, any selloff would present dip-buying opportunities.“Many investors are going to be buying these dips here, capital continues to be pouring into equities,” said Tony Bedikian, head of global markets at Citizens Bank. Bond yields are still “incredibly low, so equity yields are still very attractive to investors,” he added.U.S. Treasury yields have been rising because of a much stronger economic outlook and are not a cause for worry -- or a call to policy action -- said Federal Reserve Bank of St. Louis President James Bullard. His remarks follow Chairman Jerome Powell’s Thursday caution that rising yields had caught his eye and he would be “concerned by disorderly conditions in markets or persistent tightening in financial conditions.”“As a central banker I am always concerned if there is disorderly trading or something that looks panicky,” Bullard said Friday in an interview with Wharton Business Radio. “That would catch my attention. But I think we are not at that point.”These are some of the main moves in markets:StocksThe S&P 500 rose 1.9% at 4 p.m. New York time.The Stoxx Europe 600 Index slid 0.8%.The MSCI Asia Pacific Index fell 0.6%.The MSCI Emerging Market Index decreased 0.6%.CurrenciesThe Bloomberg Dollar Spot Index increased 0.4%.The euro dipped 0.4% to $1.1917.The Japanese yen depreciated 0.4% to 108.36 per dollar.BondsThe yield on 10-year Treasuries rose less than one basis point to 1.57%.Germany’s 10-year yield climbed one basis point to -0.30%.Britain’s 10-year yield increased three basis points to 0.756%.CommoditiesWest Texas Intermediate crude climbed 3.9% to $66.29 a barrel.Gold rose 0.1% to $1,698.65 an ounce.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Bitcoin’s appeal as a hedge against inflation is being put to the test, with the largest cryptocurrency slumping along with other risk assets after Jerome Powell failed to ease investor concern about rising price pressures.The digital token fell as much as 6.7% and traded at about $47,900 as of 2:38 p.m. in New York, after the Federal Reserve chairman said he is monitoring financial conditions and would be “concerned” by disorderly markets, but stopped short of offering specific steps -- which sent Treasury yields higher and stocks lower.“Once it feels like the market is in risk-off mode, which it clearly is, because if you’re selling everything except for energy, that’s very risk-off,” said Arthur Hogan, chief market strategist at National Securities Corp. “It really doesn’t matter whether you are Bitcoin or Ark or semis or banks -- every thing’s being thrown over the transom.”Bitcoin surged to more than $58,000 last month, with advocates such as MicroStrategy Inc. Chief Executive Officer Michael Saylor touting the token as alternative to cash because of the risk of rising inflation from government and central bank stimulus. Shares of the enterprise software maker, which has purchased over 90,000 Bitcoins, tumbled as much as 17% on Thursday. Critics say Bitcoin is in a giant, stimulus-fueled bubble that’s destined to burst like the 2017 boom and bust cycle. Bitcoin slid 21% last week but is still up more than fivefold in the past year. For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
The rollercoster ride in bitcoin since the start of the year has not dampened wealth manager Jim Paulsen's enthusiasm for the cryptocurrency. Yet Paulsen, chief investment officer for Leuthold Group, which manages $1 billion, cannot own bitcoin in client portfolios due to regulatory constraints. The promise of an asset class that behaves differently than stocks or bonds is leaving portfolio and wealth managers scrambling own cryptocurrencies if they can.
Stocks don't only go up, and that includes one red-hot ETF manned by a star manager.
A wave of electric vehicle related companies are flooding the public markets this year. This follows a slew of companies which went public last year.
With over $195 billion in cash, Apple is more than capable of matching Tesla's bet on bitcoin.
(Bloomberg) -- Concern is mounting in corporate credit markets globally as longer-term Treasury yields continue to rise, leading borrowers from New York to Tokyo to delay bond sales and strategists to warn of trouble ahead.Gauges of credit fear jumped in Europe for investment-grade and high yield debt on Friday. Two borrowers that had expected to sell bonds in the U.S. opted to push their offerings into next week, after a stronger-than-expected jobs report brought fresh inflation concerns and lifted the 10 year Treasury rate briefly above 1.6%. The extra yield that investors demanded to own U.S. corporate bonds increased 4 basis points on Friday to 96 basis points, the biggest jump since Nov. 12, Bloomberg Barclays index data show.In the U.S. junk market, Ronald Perelman’s Vericast Corp. withdrew a $1.775 billion bond offering after failing to reach an agreement with investors on terms. And in Asia, two state-owned firms in India withdrew planned rupee note sales on Thursday and at least three Japanese companies have put off yen debt offerings in recent days.Still, there are signs that the party isn’t over just yet for corporate bonds. In the U.S. credit derivatives market, the Markit CDX North American Investment Grade Index, which investors use to hedge against defaults on company notes, fell from a four-month high, signaling that firms trading that instrument are a bit less concerned about credit risk. Dealers expect as much as $50 billion of bond sales next week, after more than $65 billion of sales this week.But market sentiment may be shifting. On Thursday, companies selling bonds in the U.S. got orders for just 1.8 times the amount of debt for sale, far below the average of 3.2 times for this year or four times for all of last year, according to data compiled by Bloomberg.Strategists are starting to sound alarms. Bank of America Corp. cut U.S. investment-grade credit to underweight in a note dated Thursday, citing its expectations that yields will continue to rise, which will likely push credit spreads wider. The underweight is a temporary trade, strategists led by Hans Mikkelsen wrote.Citigroup Inc. warned high-grade investors to “brace for fund outflows” in a Thursday note. Spread tightening is no longer offsetting rising Treasury yields, strategists led by Daniel Sorid wrote, adding that a flight-toward shorter duration strategies may be coming.The speed at which rates have risen is a concern for Barclays Plc, which is watching for a “shift in sentiment” on credit, according to a Friday note. Spreads have been resilient so far, “but there is some risk for spreads in the near term from a more disorderly move higher in rates,” strategists Bradley Rogoff and Shobhit Gupta wrote.Sentiment soured Thursday after Federal Reserve Chairman Jerome Powell told a Wall Street Journal webinar that the recent run-up in yields was notable, but declined to be drawn on what tools might be used if disorderly conditions or any persistent tightening in financial conditions threatened the Fed’s goals. With energy prices rising and Covid-19 vaccines fueling bets that an economic rebound will spur inflation, financing costs have started to bounce back from recent lows.In Europe, issuance remains robust for now, and notwithstanding recent bouts of turmoil, selling bonds remains cheaper than it was at the beginning of the coronavirus crisis.Companies and governments have sold over 407 billion euros ($487 billion) of bonds so far this year, the region’s fastest pace of issuance ever, according to data compiled by Bloomberg.“Issuers want to take advantage of this supportive environment provided by the central banks, before the market starts to anticipate tapering,” said James Cunniffe, director for corporate syndicate at HSBC Holdings Plc. “As we enter the second quarter, we expect to see a more normalized level of supply reverting back to previous years’ volumes.”U.S.Mobile gaming company Playtika Holding Corp. sold its debut junk bond Friday.A group of unsecured lenders to Hertz Global Holdings Inc. are proposing an alternative reorganization of the rental car company that would take it public, a move that counters a plan to sell the company to two investment funds for as much as $4.2 billion.For deal updates, click here for the New Issue MonitorFor more, click here for the Credit Daybook AmericasEuropeBooming ethical debt sales have increased the market share of green, social and sustainability debt to 17% of this year’s syndicated debt volumes, from around 7% a year earlier.The much maligned London interbank offered rate is finally within sight of retirement after the U.K. Financial Conduct Authority confirmed that the final readings for most rates will take place on Dec. 31The Republic of Italy’s debut green bond was the most-subscribed deal in Europe’s primary market this week, according to data analyzed by BloombergAsiaChina’s Ji’an Chengtou Holding Group was the sole borrower selling a dollar bond on Friday.“Inflation is likely to rise sharply in developed and emerging markets in the coming months on unfavorable base effects and higher commodity prices,” said Michael Biggs, macro strategist and investment manager at GAM in London. “We do not think the rise in inflation will be sustained, but it could scare the market”Combined with relatively lower liquidity versus investment grade and potential outflows, Asia high yield is ripe for a correction, according to Ek Pon Tay, a senior portfolio manager for emerging market debt at BNP Paribas Asset ManagementIn mainland China, a recent jump in defaults has led investors to favor safer assets, which is being reflected in smaller risk premiums for local-currency top-rated corporate bonds(Updates figures throughout)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.