Another day of calm in Europe is the catalyst for the positive bias in the futures. Italian and Spanish CDS are at 2 week lows, bond yields are little changed, the euro basis swap is in by another 5 bps and European stocks are higher (although banks are mixed). In terms of the ECB actions over the past week which was the main reason why things have stabilized, we can quantify them today as the ECB will release how much in purchases they made and they are also implementing a 7 day term deposit to sterilize their purchases. It is this sterilization that separates the ECB from the Fed and the reason the euro is above 1.40 vs the US$ instead of something much lower. On the flip side, it is these sterilizations that some believe lessen the impact of the bond purchases. Print or not to print? That is the question for central bankers. Japan’s Q2 GDP fell 1.3% which wasn’t as bad as the contraction of 2.5% that was expected. The Chinese yuan fell a touch after 5 straight days of record highs and the Swiss franc is also down as the Swiss Gov’t and the SNB seem close to an agreement to temporarily peg their currency to the euro. In the US, the NY mfr’g survey today will be the 1st Aug industrial number out that will capture the turbulent goings on over the past few weeks.
Relative calm in Europe and other things
August 15, 2011 7:22am by
This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment. The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Ritholtz Wealth Management employees providing such comments, and should not be regarded the views of Ritholtz Wealth Management LLC. or its respective affiliates or as a description of advisory services provided by Ritholtz Wealth Management or performance returns of any Ritholtz Wealth Management Investments client. References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others. The Compound Media, Inc., an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. Investments in securities involve the risk of loss. For additional advertisement disclaimers see here: https://www.ritholtzwealth.com/advertising-disclaimers Please see disclosures here: https://ritholtzwealth.com/blog-disclosures/
Posted Under
UncategorizedPrevious Post
If Share Declines Continue, Who/What is to Blame?Next Post
Vinyl Records
What's been said:
Discussions found on the web: