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Markets 15th March 2012

Spanish Treasury: yields still falling despite scuffle with Brussels

By Tania Suárez, in Madrid | The new deficit targets established by Brussels left unmoved the Spanish Treasury issuance performance. It has placed €3,009.29 million in bonds and debentures at lower interests, few days after the Spanish government set up a higher deficit target for 201 and after Brussels mended it to a final 5.3% from an initial 4.4%. Specifically, the Treasury has placed €976.18 million of the €4,031.18 million…

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Markets 15th March 2012

Chancellor Osborne strains UK’s special relationship with ratings agencies

LONDON | It was inevitable. The UK woke up Thursday saddled by a 50/50 chance of losing the maximum award of its national borrowing capabilities. After all, as Santander analysts poke out of Fitch Ratings’ statement over its outlook downgrade of the triple A, which British sovereign bonds still hold, the growing public debt to GDP ratio is set to approach the edge of the top-gun category. The figures came…

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Markets 14th March 2012

Madrid’s financial City doubts the Spanish risk premium can fall below 300bp

By Tania Suárez, in Madrid | Even though the Spanish risk premium on Wednesday morning dropped to 328 basis points, financial analysts in Madrid are split up about its evolution. 50% of the analysts consulted by Consenso consider reasonable a fall below 300bp before the end of 2012. Most of them clarify that the risk premium will decrease, but depending on economic developments in the international economic context. Also, some of…

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Markets 12th March 2012

Threadneedle: healthy demand for equities after liquidity boost in EU, UK, Japan

LONDON | Global asset manager Threadneedle pointed at liquidity operations carried out by most G20 governments as the primordial reason behind the recent rally that the equity sector has experienced. “We see the LTROs, the recent £50bn extension to quantitative easing by the Bank of England and the ¥10trn increase in the Bank of Japan’s asset purchase scheme as activities that boost liquidity and are likely to increase demand for…

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Markets 9th March 2012

The Greek swap-opera

LONDON | Half an hour before the deadline passed at 20:00 GMT on Friday, the Greek minister for international economic relations Constantine Papadopoulos confidently told Sky News in London that default had been averted. “The indications we have are that the debt swap seems to be going well. Greece will get the necessary bailout as we have now cleared the major hurdle and can look forward to a new beginning,” Papadopoulos explained, although…

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Markets 8th March 2012

Lose any hope of escaping a stern haircut on Greek debt holdings

By Juan Pedro Marín Arrese, in Madrid | Those hedge funds resisting debt restructuring shouldn’t nurture any hope to save their money. The titles they hold might be governed by international law. But should Greece turn off the tap, counting on CDS to fill the gap might prove a delusion. Credit default guarantors have already warned they will simply fail to respect commitments entered. The ensuing claims might fatten law…

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Markets 8th March 2012

Mortgage rate swaps have become Bankinter’s nightmare

By Capital Madrid | After thousands of Spaniards marched last week throughout the country under the banner of alleged bank abuses, the hunt continues with legal action against one of the products entities often used during the bubble years: the interest rate swaps, also called ‘clips’. Bankinter recently gained one more adverse sentence, which brought its naughty account to 162. The local court number 8 in Madrid declared the nullity of…

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Markets 7th March 2012

“Opening the kimono” of the US market-maker activity

NEW YORK | There are more than 20.000 market makers only in the US. Now one of them –a very, very big one, JP Morgan– has broken for the first time a code of silence among investment banks by revealing how much they rakes in as a market-maker. A market-maker quotes bid and offers prices for specific stocks or other securities that it holds. Its aim is to make money by…

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Markets 6th March 2012

UK investment industry looks on the raising-dividend side

LONDON | 58pc of  the Association of Investment Companies or AIC members in the UK growth and income sector have been able to raise dividends for at least each of the last 10 years. AIC published Tuesday the results of its latest research and reminded investors of its associated firms’ main track record, which described as ‘impressive’. In the longer term, though, only 46pc of uk growth and income sector have been…

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Markets 5th March 2012

Ibex35 non-financial companies hoard €40 billion in cash, cash equivalents

MADRID | Large Madrid-listed non-financial firms accumulate cash positions at year-end record, as data released Monday showed. A study by El País over the consolidated balance sheets of the 26 Spanish non-financial companies on the Ibex 35 unveiled that the corporations closed last year with €21.827 billion in cash and €18.344 billion more in cash equivalents. In total, €40.171 billion, to which it must be added undrawn credit lines. Spain’s most creditworthy companies,…