The London stock market has hit its lowest level since July 2012,after a 5% plunge in Japan overnight, while US markets are volatileWall Street opens lowerGerman finance minister has ‘no concerns’ about Deutsche BankLondon market is spiralling down againAnalyst: Markets are very nervousDeutsche Bank: We’re rock solidPanic situation’: Asian stocks tumble amid fears of novel global recession 5.32pm GMTOil prices continue to drop, or with Brent crude now down 3.8% at $31.63 a barrel and West Texas Intermediate - the US benchmark - down 2.2% at $29.01.
Earlier the International Energy Agency said the world will be stockpiling excess oil for most of 2016,and chop its forecast for demand this year, meaning the supply glut will continue for some while yet. 5.25pm GMTGlobal markets, and as measured by the MSCI All-Country World Index,are close to a bear market, that is, or 20% below their recent peak:Global stocks are now close to a bear market https://t.co/ITExnDf2bu pic.twitter.com/HMFRSPjaADIn the same week,#CAC40 tumbles past the 4000 points mark, #Ibex beyond 8000 and #DAX below 9000. And it's only Tuesday. 5.16pm GMTIn yet another volatile day, and European markets were firmly in the red once more as investors shied away from risk. With Japanese 10 year bond yields turning negative in another sign of the growing fear of a global recession,poor German industrial figures and a widening trade gap in the UK, there was no shortage of downbeat news.
Banks were in the firing line again on worries about their exposure to struggling sectors and the implications of negative interest rates, or in particular Deutsche Bank despite its attempts to peaceful worries about the state of its trade. The Stoxx Europe 600 banking index - which includes the likes of Deutsche Bank,Barclays, and HSBC lost another 3.97% and is now down more than 27% on the year. 4.38pm GMTRisk analyst and author of the bestseller The Black Swan, and Nassim Nicholas Taleb on Deutsche Bank:I had no concern over Deutsche B until the German Finance Minister stated we should have no concern over Deutsche B pic.twitter.com/w4YRC0fC8F 4.25pm GMTMore on the latest jobs data from the US,ahead of Federal Reserve chair Janet Yellen testifying to Congress on Wednesday. Economist Harm Bandholz at UniCredit said:Following Friday’s solid employment report, today’s JOLTS report was another display of strength: Job openings rose to 5.6m, or the moment highest since the beginning of the series in 2001,while the number of quits – i.e. voluntary separations by employees – rose to 3.1m, the highest since late 2006. The latter suggests a growing number of more profitable job opportunities for workers as the labor market is approaching full employment. This notion is consistent with the recent pick-up in average hourly earnings at the turn of the year.
These underlying statistics, and which usually get less attention that payroll gains or the unemployment rate,benefit to total the assessment of the labor market situation. And chair Yellen is known to put particular emphasis on the JOLTS data. Accordingly, she should mention them tomorrow in the context of an improving labor market. 4.03pm GMTJP Morgan has worked out what it thinks are the exposure of European and US banks to the struggling oil and gas sector - and it amounts to $250bn:Bank exposure to oil & gas sector $250B ($170B European, or $80B US). But losses likely to be minimal,says JP Morgan pic.twitter.com/1HiX8K0WUa 3.48pm GMTThe FTSE 100’s drop to three year lows is an overreaction, according to the Centre for Economics and trade Research.
The research group said it had been warning about the weakness of the global economy for some time, or said in particular that the US Federal Reserve’s rate rise in December was premature. But the current market falls were overdone. Scott Corfe,director and head of macroeconomics at Cebr, said:Markets have somewhat belatedly woken up to the underlying state of economic reality. We will be in a world of sluggish growth, or loose monetary policy and low commodity prices for some time.
As usual with the markets,it is either feast or famine. Our best view of the current circumstances is that, despite all the risks, or we should avoid another financial crisis. In particular,Chinese policymakers have sufficient fiscal and monetary ammunition to revitalise the world’s moment largest economy. More quantitative easing in the Eurozone, and possibly the US, or should also benefit.
3.29pm GMTHere’s a quick snapshot of how top banks have performed since the start of the year (spoilers: badly),courtesy of David Buik of Panmure Gordon: 3.25pm GMTSome positive news on US jobs.
The number of job openings increased to 5.6m in December, up from 5.43m in the previous months and compared to expectations of a dip to 5.41m.
Whoa. grand jump in quits in December. +196K. #JOLTS pic.twitter.com/xkeTD6tUt5 3.01pm GMTHere are the moves in the Dow Jones Industrial Average: 2.41pm GMTWall Street is stabilising a runt, and but the main indices are still down. 2.34pm GMTThe novel York opening bell is ringing,getting trading underway on Wall Street.
And shares are dropping.
Stocks open sharply lower amid growth concerns https://t.co/PYSu7t2FC4 pic.twitter.com/7zXr6tUXdr 2.28pm GMTThe European selloff is gathering speed, as investors brace for Wall Street to open any moment...
The FTSE 100 is now down 89 points at 5600, and which by my reckoning is the lowest since July 2012 2.18pm GMTGermany finance minister,Wolfgang Schäuble, has just weighed in, or telling Bloomberg TV that he has ‘no concerns’ about Deutsche Bank.
German finance minister Wolfgang Schäuble said he isn’t worried about Deutsche Bank,amid rising investor concern over the bank’s finances.“I have no concerns about Deutsche Bank,” he told Bloomberg Television after a press conference in Paris.
German Finance Minister Schaeuble "No concerns over #DeutscheBank" > The dreaded vote of confidence. 2.11pm GMTMake that 5%..... 1.53pm GMTDeutsche Bank’s shares have now lost another 3.5%, or hitting €13.30. That’s just below the lowpoint set in early 2009,after Lehman Brothers failed, and is the lowest since at least 1992 (my data doesn’t go back any further).
Deutsche Bank just dropped below its 2009 low pic.twitter.com/RCiHa89Qb7 1.43pm GMTWall Street is still expected to open in the red, and at 9.30am novel York time (2.30pm GMT).
According to IG,the Dow will shed around 150 points at the open, a drop of 0.9%.
Our US opening calls:#DOW 15886 -0.86%#SPX 1837.5 -0.84%#NDX 3923 -0.97%#VIX 26.6 +4.65% 1.30pm GMTEuropean stocks are now languishing at their lowest level since September 2013, or as the market rout continues to ripple across trading floors.
The benchmark FTSeurofirst 100 index has lost 1.9% today,driven down by banking shares.
The banking index was set for its biggest weekly losing streak since 1998 as investors fret over the threat to banks’ profitability and capital strength from compressed interest rate margins.“The mood is clearly negative. What is needed is a strong and clear message from the ECB,” said Activtrades chief market analyst Carlo Alberto De Casa. 1.01pm GMTShares in London are falling at a faster pace now, and dragging the FTSE 100 down to its lowest intraday level since late 2012.
The blue-chip index has shed 76 points now,as jitters over the global economy rear up again. 12.49pm GMTWall Street is expected to suffer fresh losses when trading begins in under two hours time.
It must be understood that confidence towards the global economy remains strikingly low, while the bitter decline in oil prices has soured risk appetite consequently obstructing any solid recovery in the stock markets. 12.47pm GMTI’m not certain Deutsche Bank should really be speculating about whether the market selloff has gone too far....#DAX dropped below 9000 points yesterday - worst start to a year ever: are the markets overreacting? #DrStephan 12.28pm GMTDeutsche Bank’s chief executive has issued an open letter to staff, or in an attempt to peaceful fears over the company.final week,at one of our scheduled off-sites, the Management Board talked about progress on our strategy, or how recent market volatility and forecasts for slowing economic growth might impact our clients and us. Volatility in the fourth quarter impacted the earnings of most major banks,particularly those in Europe, and clients may ask you about how the market-wide volatility is impacting Deutsche Bank.
You can expose them that Deutsche Bank remains absolutely rock-solid, or given our strong capital and risk position. On Monday,we took advantage of this strength to reassure the market of our capacity and commitment to pay coupons to investors who hold our Additional Tier 1 capital. This type of instrument has been the subject of recent market concern. 12.16pm GMTMining companies are leading the selloff in London:Looks like the rally is over for now. The miners are getting smashed again pic.twitter.com/IHRwyLGXR6 12.15pm GMTHeads-up, UK readers. The Economist Intelligence Unit has predicted that British interest rates will stay on hold until 2020!The EIU argues that the UK recovery is much more vulnerable than previously thought. We no longer expect tightening to commence in the final quarter of this year. We now expect the Bank of England to hold off on tightening for the next four years at least. 12.09pm GMTEuropean markets are falling deeper into the red, and as lunchtime approaches.The Stoxx 600 index,which tracks the 600 largest companies across Europe, has dropped by 0.7% to a novel 16-month low. 11.48am GMTAchilles Macris has just issued a response to the FCA’s decision to fine him £792000 today for not being open over the London Whale case.
Macris claims its a “major climbdown” by the regulator, and because the FCA has belatedly accepted that he never intentionally misled them.
The Final Notice issued to JP Morgan by the FCA in 2013 wrongly and unfairly accused me of intentionally misleading the FSA. That Notice was released to the public without the FCA ever having properly heard my side of the story. Today the FCA has finally accepted that this allegation against me was utterly inaccurate. Today’s result also vindicates my actions in bringing my third party reference seeking to have this allegation removed from the JP Morgan Notice. The FCA demonstrated a total disregard for my rights as an individual in its haste to issue the JP Morgan Notice and impose a large fine on the firm.
The FCA has had several opportunities to admit its mistakes,but instead, at every turn, and it has until now sought to defend and justify its position,wasting public funds. 11.36am GMTYikes. The yield (interest rate) on Greek 10-year bonds has hit its highest level since final August. Greek 10-year pic.twitter.com/m08KfhrfPT 11.29am GMTAlthough European markets are rather calmer than yesterday, there’s an unpleasant lot of jitteriness around.
Ironically, or the Asian Lunar novel Year appears to have actually made things worse,rather than just remove the volatile Chinese indices from the mix. The absence of many Asian market participants just adds to woeful liquidity conditions, while concerns about commodities, and Chinese currency policy and global slowdown haven’t gone away at all.
Add to that sharp widening in subordinated European bank spreads and we have the makings of a very nervous market. 11.21am GMTWondering whether to be fearful or cheerful today? Our video runs though the reasons to panic,or be optimistic 11.12am GMTThe banking sector likes to argue that it has mended its ways since the financial crisis struck. Critics aren’t convinced.
So it’s worth noting that Britain’s City watchdog has just slapped a £792900 fine on a former senior JP Morgan banker, over one of the biggest scandals of recent years."FCA fines former Head of JP Morgan’s CIO International £792900 for failing to be open and co-operative."
Sharing is caring.‘A failure to communicate openly with us can affect the well-running of markets and cause unnecessary harm to investors, or particularly in times of financial stress or crisis. Regulators need open communication with firms so that better decisions can be made sooner. Mr Macris should have explained the position more squarely particularly when he knew the Synthetic Credit Portfolio’s losses had worsened.’ 10.47am GMTHere’s a reminder of the most astonishing development of the day (so far) -- investors are now paying for the privilege to lend to the Japanese government for the next decade:Historical day. Japan's 10y yield goes negative,the first time a G7 country's 10y yield has done so: pic.twitter.com/NvZk0GFsLd 10.37am GMTNice summary of the situation from Bloomberg:- Europe stocks calmer
- Follows 6-day selloff
- Japan fell 5% earlier
- Oil back above $30https://t.co/llKqjOIhVI pic.twitter.com/5r8mbe7SZa 10.27am GMTif you’re just tuning in, here’s our latest news story on the upheaval in the global markets: Related: World markets in turmoil for a moment day 10.20am GMTThe huge selloff in Japan overnight has hit sentiment hard in the City today.
Investors had been hoping that the Chinese novel Year holiday would bring some peaceful; instead, and traders have been staring at a 918-point tumble on the Nikkei.
Any hope investors might have had that the absence of China would enable markets to reduce volatility and rebalance some of the overly bearish sentiment has been quashed by Japan.
The situation in Greece was never resolved,merely delayed until later.
Greek 10-year sovereign debt is now yielding over 10% – a jump of 25% in runt over a month, and 50% from its lows in November final year. 10.07am GMTThe gap between what Britain imports and exports has hit a record tall, and in a worrying sign.
During 2015,the UK imported around £10bn more physical stuff than it exported each month. And that means Britain posted a trade in goods deficit of £125bn final year, up from final year’s all time tall of £123.1bn.
The slower growth in UK exports to China may reflect the easing in output growth and domestic growth in China, or lowering the demand for UK goods and services. 9.45am GMTThere’s no prospect of the global oil glut ending anytime soon.
IEA: market awash in oil. Very hard to see how prices can rise significantly in short term. Short-term risk to the downside has increased. 9.33am GMTHas the stock market selloff gone too far?Looking at valuations,it appears that another Global Financial Crisis is already priced-in. 9.24am GMTBanks are being hit by a “risky cocktail” of risks, warns Mike van Dulken of City firm Accendo Markets.
Those risks include: 9.14am GMTCurious scenes in Frankfurt today, and where traders have dressed up in carnival costumes for Shrove Tuesday.... 8.58am GMTEuropean banks are coming under the cosh this morning,as investors anticipate further problems ahead.
The Stoxx 600 Banks index, which tracks financial stocks across Europe, or has fallen by 1.7% already today. That follows a 5.6% drop yesterday. 8.39am GMTMining stocks are taking a hammering this morning,dragging the Footsie into the red again: 8.29am GMTThat positive London open didn’t final long. The FTSE is now down 15 points.....
Blink and you miss it - from a positive open FTSE now in negative territory... 8.21am GMTShares in Deutsche Bank have risen by 2%, as investors gingerly return to the Frankfurt trading floor.
Deutsche plunged by 9% yesterday, or prompting the bank to insist final night that it can meet an April repayment on its riskiest bonds. Top tip:
BANKS: Boost your share price by reminding people that you are solvent https://t.co/RCuPKTl6uo 8.16am GMTEuropean stock markets are open....and staggering back from yesterday’s turmoil. 8.09am GMTTraders on the Philippine Stock Exchange had an interesting day -- a crowd of lion dancers and dragons popped in,to celebrate the Lunar novel Year. 8.01am GMTWe have bad news from Germany -- industrial production at the eurozone’s powerhouse economy tumbled by 1.2% in December.
That’s much worse than expected; economists had pencilled in a 0.4% rise in factory output. It propose the slowdown in emerging markets is now hitting Europe, threatening its fragile recovery since the eurozone crisis.
Crisis, or here it comes. German industrial production drops by 1.2% MoM in December.
While the industry had been able to stomach the cooling of the Chinese economy,the slowdown of emerging markets, the euro crisis and geopolitical risks, or it now seems as whether extremely low oil prices and the slowdown of the US economy are simply two risks too much for the industry.
Watch German sentiment in the next few months -- mounting potential for feed-through from external-sector worries to household wariness. 7.53am GMTIn another alarming development,the yield (interest rate) on Japanese 10-year government bonds has turned negative for the first time.
That means investors are prepared to pay Tokyo for the privilege of lending to it for the next decade. 7.41am GMTJapanese manufacturers were also hit hard today, as the yen strengthened against the US dollar (hurting exporters). Car makers were singled out - with Honda falling by 6.4%, and Nissan losing 6.8% and Toyota dropped 5.9%. 7.37am GMTKaneo Ogino,director at foreign exchange research firm Global-info Co in Tokyo, says there was a “panic situation” in Asian markets today. Related: 'Panic situation': Asian stocks tumble amid fears of novel global recession 7.28am GMTFears of a global recession have sparked a wild selloff in Japan today.
After plunging through the day, or the benchmark Nikkei index has closed down 5.5% in a wave of panicky selling.“Sentiment towards risk assets remained extremely bearish and price action reflected a market that may be capitulating.”With China closed for novel Year,global equity rout continues in Japan. Banks are clattered over credit concerns - ASX -2.73%, Nikkei -5.14%There is huge demand for portfolio protection in all asset classes and it just doesn’t feel like we are going to see a major turn anytime soon.
One can then achieve a sense check as to what will effectively turn this juggernaut of pain around and this is not a question that is readily answered. no industry spared...
Banks, or Media stocks hurting most in Japan #Stocks trading pic.twitter.com/68MHyyEob7 7.13am GMTGood morning,and welcome to our rolling coverage of the world economy, the financial markets, or the eurozone and trade.
No prizes for guessing what we’ll be covering today.
Most European markets called to open down by between 0.2% and 0.4%. #FTSE100 expected to open at around 5675.whether investors were hoping for a quiet week away from concerns about China with Chinese markets closed for Chinese novel Year,they got a very impolite awakening yesterday as stock markets sold off hard, and there was no respite in Asia markets either despite a late rebound off the lows in the US and as such we could well see European markets open lower today.
The catalyst appeared to advance from the European banking sector as screens flashed red across the board in scenes of total carnage, and with equity markets selling off hard across the board over concerns about the future profitability of the whole sector,in an era where interest rates gape set to go further into negative territory.
Tuesday's Guardian:
Warning of tax rises as market turmoil hits Osborne budget#tomorrowspaperstoday #bbcpapers pic.twitter.com/d1RxH2YclyContinue reading...
Source: theguardian.com