Random News, 18 July 2017
"Fixed Income Insight: Global Bond Markets Normalize.
While Quantitative Easing began as a purely theoretical therapy and construct, in practice its aggressive bond buying over the past several years caused nearly $12 trillion of the nearly $70 trillion in global fixed income securities to be priced with negative yields."
"As a result, it will be prudent to watch for signs of contagion going forward, but at the current juncture, energy sector weakness does not pose a threat to the economic expansion."
"Citigroup set to relocate EU base to Frankfurt.
US bank Citigroup is set to become the latest Wall Street bank to pick German financial hub Frankfurt as its European Union base this week in preparation for when Britain leaves the 28-nation bloc."
"Hedge Funds Performing Their Best Since 2009.
The first six months of 2017 were hedge funds’ highest performing start to a year since the financial crisis, according to Preqin data."
"The Best Distressed Fund You’ve Never Heard Of.
One Canadian hedge fund has made big gains on distressed companies, but says it’s still too soon to go shopping for bargains in retail. REITs, however, are another story."
Implied rate hike probability on July 26th ~3.1%, September 20th ~8.2%; 0% probability of rate cut through June 13th, 2018.
VIX ~9.89. 10-yr treasury vol (TYVIX) ~3.93.
"US Homebuilder Confidence At 8-Month Low In July
The NAHB Housing Market Index in the United States fell to 64 in July of 2017 from a downwardly revised 66 in June, below market expectations of 67. It is the lowest reading since November of 2016. The index of current single-family home sales went down 2 points to 70; sales expectations over the next six months declined 2 points to 73 and buyer traffic edged down 1 point to 48.
Overseas Investors Bought $57.3B Of US Assets In May
Overseas investors bought USD 57.3 billion of US assets, including short-dated instruments in May of 2017 after buying an upwardly revised USD 74.4 billion in April. Meanwhile, foreigners bought USD 91.9 billion of long-term US securities, including government and corporate, after buying USD 9.7 billion in the previous month. Foreign investors bought USD 46.4 billion of US treasuries, after selling USD 22.5 billion in April.
South Korea Producer Inflation Lowest In 6 Months
Producer prices in South Korea increased 2.8 percent year-on-year in June of 2017, easing from a downwardly revised 3.4 percent rise in the previous month. It is the smallest producer inflation since December last year, as cost slowed for manufacturing goods (3.1 percent from 4.2 percent in May), due to a decline in global oil prices. Electric power, gas and water supply inflation edged down to 3.0 percent from 3.1 percent; and services cost increased at the same pace (1.6 percent). In contrast, prices went up faster for agricultural, forestry and marine products (10.5 percent from 9.8 percent), as marine food inflation was 30.8 percent in June. On a monthly basis, producer prices decreased 0.4 percent after declining 0.3 percent in May.
UK Producer Inflation At 6-Month Low
Factory gate prices for goods produced by UK manufacturers increased 3.3 percent year-on-year in June of 2017, below 3.6 percent in May and in line with market expectations. It is the lowest producer inflation so far this year as cost rose much less for petroleum (4.4 percent from 9.1 percent in May) and chemicals and pharmaceuticals (4.5 percent from 4.8 percent) and was steady for tobacco and alcohol (3.2 percent) and metals, machinery, and equipment (4 percent). In contrast, producer inflation accelerated for food (5.8 percent from 5.6 percent) and transport equipment (3.7 percent from 3.6 percent). On a monthly basis, output prices were flat. In addition, prices for materials and fuels paid by UK manufacturers for processing (input prices) rose 9.9 percent on the year and fell 0.4 percent on the month.
German Investor Morale Falls In July
The ZEW Indicator of Economic Sentiment for Germany fell slightly by 1.1 points to 17.5 in July 2017 from 18.6 in the previous month and below market consensus of 18. Still, the outlook for the German economic expansion in the coming six months continued to be positive, as 25.4 percent of financial market experts expect economic activity growth to pick up while 66.7 percent expect it to remain steady. Also, the assessment of the current economic situation in Germany decreased by 1.6 points to 86.4 from a six-year high of 88 in June.
Euro Area Zew Economic Index Falls In July
The ZEW Indicator of Economic Sentiment for the Euro Area fell to 35.6 in July of 2017 from 37.7 in the previous month, below market expectations of 37.2. 54.2 percent of the analysts surveyed expect no changes in economic activity in the coming six months while 5.1 percent expect it to get worse. Inflation expectations rose by 7.3 to 23.7. In contrast, the indicator for the current situation increased by 8.2 points to 28.7.
Senegal Industrial Output Rises 3.3% YoY In May
Industrial production in Senegal rose 3.3 percent year-on-year in May of 2017, quickening from a 2.7 percent increase in the previous month. Output recovered for construction materials (1.4 percent vs -16 percent in April) and rose further for food (13 percent vs 11.3 percent) and energy (12.3 percent vs 8.7 percent). Meanwhile, production fell for chemicals (-4.9 percent vs 25.3 percent); mining (-11.2 percent vs -28.6 percent) and paper and cardboard (-31.6 percent vs 3.6 percent). On a monthly basis, output grew 7 percent, following a 11.4 percent decline in April. Considering January to May period, production advanced 4.7 percent.
Stocks in Hong Kong Hit 24-month High
Hang Seng increased to a 24-month high of 26619.
Stocks in New Zealand Hit All-time High
NZX 50 increased to an all-time high of 7708.
British Pound Sterling Hits 42-week High
GBPUSD increased to a 42-week high of 1.3114.
Mexican Peso Hits 14-month High
USDMXN decreased to a 14-month low of 17.466.
Singapore Dollar Hits 41-week High
USDSGD decreased to a 41-week low of 1.3656.
Swiss Franc Hits 55-week High
USDCHF decreased to a 55-week low of 0.95315.
Euro Hits 14-month High
EURUSD increased to a 14-month high of 1.1568."
"June truck tonnage sees a decrease, reports ATA.
Seasonally-adjusted (SA) for-hire truck tonnage at 138.5 (2000=100) fell 4.3% after a revised 6.9% (from 6.5%) jump in May."
"Flexport to Open First Warehouse in Southern California.
Physical footprint would allow startup to offer wider range of services like a traditional freight forwarder."
"New Jersey’s Market for Industrial Space Heats Up.
Supply of N.J. industrial space remains tight despite new construction.
In the first half of the year, 5.1 million square feet of new industrial space has been added, exceeding all of last year’s total of 4.2 million square feet, according to Cushman & Wakefield. About 79% of this year’s new space has been leased, according to Cushman data.
By the end of the year, the total of new industrial space is expected to pass 10 million square feet.
”It’s not just e-commerce,” Mr. Nissim said. “You have all of those firms and industries that are being supported by [e-commerce], transportation delivery companies growing and taking space as a direct result of e-commerce.”"
"Nearly a dozen big-box distributors are shopping the Houston area for warehouse space larger than 500,000 square feet, NAI Partners said Monday in its most recent industrial real estate market report."
"The Idle Containership Fleet Is Shrinking.
A Sign Of Industry’s Improving Vitality, Says Drewry.
Drewry’s latest Container Forecaster report highlights how the idle fleet (defined as inactive for at least 14 days) has shrunk from 1.7 million teu in November 2016 to under 500,000 teu as of June 2017."
"Federal Maritime Commission Pushing Further on Improving Supply Chain.
On July 11, Commissioner Rebecca Dye launched the second phase of the agency’s Supply Chain Innovation Teams initiative. Phase two will focus on identifying the "actionable" information needed by supply chain actors for improved supply chain system visibility, reliability and resilience.
In phase two, nearly 40 experienced industry leaders, organized into three teams, will advance that effort—representing public port authorities, warehouses, exporters, ocean carriers, longshore labor, ocean transportation intermediaries, trucking, and rail."
"House committee report calls for delay of ELD implementation.
While the Federal Motor Carrier Safety Administration’s (FMCSA) Electronic Logging Device mandate remains on track to take effect this coming December, the House Appropriation’s Subcommittee on Transportation, Housing & Urban Development and Related Agencies issued a report that directs the FMCSA to consider delaying the implementation of ELD.
FMCSA formally announced in late 2016 that the federal mandate for electronic logging devices (ELD) for commercial motor carriers was official and would take effect in December 2017..."
"The Top Programming Languages 2017."
1, 6, 15, and 31 for me.
"Microsoft to help Baidu’s ‘Android of autonomous cars’ go global.
We already knew Microsoft Azure Cloud was a member of Baidu’s Apollo self-driving platform alliance, but now Microsoft has revealed more details about what it will be providing the cross-industry partnership. Basically, Microsoft will be offering cloud infrastructure services via Azure for customers in markets outside of China looking to adopt Apollo, which Baidu has described as an open, “Android of the autonomous driving industry.”"
"After blockbuster ICO, Bancor takes first step to become ‘YouTube for currency’.
Bancor eventually hopes to have thousands, even millions, of cryptocurrencies using its protocol, which runs on the Ethereum blockchain. Just as YouTube has allowed anyone in the world to create their own broadcasting channel and embed their video anywhere, Bancor allows anyone to create their own cryptocurrency token and operate it independently of a third-party exchange, Bancor cofounder Eyal Hertzog told VentureBeat."
"Google Glass 2.0 Is a Startling Second Act.
She works for AGCO, an agricultural equipment manufacturer that is an early adopter of Glass EE. For about two years, Glass EE has been quietly in use in dozens of workplaces, slipping under the radar of gadget bloggers, analysts, and self-appointed futurists."
"At the cellular level, a child's loss of a father is associated with increased stress.
In a study published July 18 in the journal Pediatrics, a team of researchers, including those from Princeton University, report that the loss of a father has a significant adverse effect on telomeres, the protective nucleoprotein end caps of chromosomes. At 9 years of age, children who had lost their father had significantly shorter telomeres—14 percent shorter on average—than children who had not. Death had the largest association, and the effects were greater for boys than girls.
But little is known about the biological processes that underlie this link between father loss and child well-being."
"At least 75 per cent of our DNA really is useless junk after all."
"A U.K. parliamentary committee report backs the view that Brexit cannot constitute a “clean break” in data protection law terms with the European Union. Au contraire.
“Brexit means that it will lose the institutional platform from which it has been able to exert that influence. It is imperative that the government considers how best to replace those structures and platforms in order to retain UK influence as far as possible. It should start by seeking to secure a continuing role for the Information Commissioner’s Office on the European Data Protection Board.”"
"Is New York’s Controversial Startup Program Helpful or Harmful?
Businesses that are either relocating or expanding in New York are eligible to participate in the program, which exempts companies from paying state income tax, business or corporate state or local taxes, sales tax, property tax or franchise fees for 10 years if they run their companies in particular zones near participating private and public colleges and universities. Companies have to meet job commitments in order to receive the program’s tax-free benefits."
"Doing a Startup Involving Cryptography? Get Out of the U.S.
Here in Singapore, Pande says, “We have no requirement for a security back door. The fact that the NSA [National Security Agency] requires U.S. companies to provide a back door makes technology developed in the U.S. less trusted around the world.”"
Taputapuātea on Ra’iatea Island is at the centre of the “Polynesian Triangle,” a vast portion of the Pacific Ocean, dotted with islands, and the last part of the globe to be settled by humans. The property includes two forested valleys, a portion of lagoon and coral reef and a strip of open ocean. At the heart of the property is the Taputapuātea marae complex, a political, ceremonial and funerary centre. It is characterized by a paved courtyard with a large standing stone at its centre. Widespread in Polynesia, the marae were places where the world of the living intersects the world of the ancestors. Taputapuātea is an exceptional testimony to 1,000 years of mā'ohi civilization."
US: MBA Mortgage Applications, 7:00 AM ET
US: Housing Starts, 8:30 AM ET
CA: Manufacturing Sales, 8:30 AM ET
US: EIA Petroleum Status Report, 10:30 AM ET
JP: Merchandise Trade, 7:50 PM ET
AU: Labour Force Survey, 9:30 PM ET
https://tradingeconomics.com/calendar (More complete listing, including consensus)