The way companies are behaving is creating distortions in the stock markets, particularly on the other side of the Atlantic. Share buybacks over there have increased by 20% in the first quarter of 2016 from end-2015 and by 31% in year-on-year terms, based on S&P Dow Jones Indices.
Bank of Portugal governor, Carlos Costa, believes that Portugal should find a systemic solution similar to that recently adopted in Italy to enable banks to reduce the weighting of non-performing assets.
via Macropolis | Neo-Nazis marching through the streets of Sweden, the far-right making its political presence felt in Austria, a beefed up military and police presence on borders in many parts of Europe and stinging criticism on moral and legal grounds of the “one in, one out” agreement with Turkey from human rights groups – these are just some of the signs of the existential crisis that the European Union is experiencing.
UBS | The recent credit market sell-off, spate of defaults, spike in Chinese yields and spreads, bond issuance cancellations basically reflect: 1) investors re-pricing credit risk and policy easing expectations.
AXA IM | Argentina’s 200-year history is rich in sovereign debt defaults. The sovereign issued its first bond in 1824 with a maturity of 22 years, but it defaulted four years after issuance. Resolving that default took almost thirty years. Since then, the sovereign defaulted seven more times, most recently in 2001 and 2014.
Caixin | Financial markets have been jolted by a number of defaults on corporate debt in recent weeks, with state-owned Dongbei Special Steel Group Co. missing a 700 million yuan repayment on May 5.
Natixis AM | The upcoming UK referendum on EU membership appears to be a knife’s edge contest. Although financial markets have already felt some impact, if the vote produces an “out” result, global markets face additional turbulence this summer.
James Alexander | At first glance the abstract of this brand new research piece, The Macroeconomic Risks of Undesirably Low Inflation, from the Federal Reserve Board sounds rather dry and innocuous.
BARCLAYS | Euro area Q1 preliminary GDP was revised down slightly to 0.5 % q/q from the flash release (-0.03pp), accelerating from Q4 0.3% q/q growth. German GDP rose 0.7% q/q, in line with our expectations, as robust domestic demand offset weak exports.
China’s Transport Ministry has announced a $770 billion three-year investment plan to improve the country’s infrastructures. For Bankinter’s analysts the investment may look very significant, but there are some uncertainties which call its effectiveness into question.