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☆ Morning Bid: Banks are leaking money
▼ + stars: | 2023-03-27 | by ( ) www.reuters.com time to read: +2 min

There is some relief that First Citizens BancShares Inc (FCNCA.O) is in advanced talks to acquire Silicon Valley Bank (SIVB.O). There was also some talk the Federal Reserve could expand its new lending programme for banks as another step to reassuring depositors. Money is clearly flowing out of smaller banks toward their bigger siblings and to money market funds, which have seen an inflow of more than $300 billion in the past month to a record $5.1 trillion. Capital Economics points out that deposits across all the banks have fallen by $663 billion in the past year as customers search for higher yield. Deutsche Bank's five-year CDS hit 222 bps on Friday, the highest since late 2018, while UBS CDS shot up to 139 bps.

☆ European stocks rebound as banking jitters ease
▼ + stars: | 2023-03-27 | by ( Sruthi Shankar | ) www.reuters.com time to read: +3 min

European banks (.SX7P) rose 0.9% after shedding 3.8% on Friday, when Deutsche Bank (DBKGn.DE) sparked a rout in the sector. "Many investors still don't want to touch the banking sector for fears there is more distress to come," said Russ Mould, investment director at AJ Bell. "Yet for every bleak situation, there is always someone who sees an opportunity to make money, hence why we're seeing a rise in the share price of many European banks today." European stocks are looking to end the first quarter of the year with gains, buoyed by signs of economic resilience and hopes that central banks are near the end of their tightening cycles. However, European banks are set to end the quarter nearly flat amid the banking sector turmoil.

☆ German business sentiment unexpectedly rises in March
▼ + stars: | 2023-03-27 | by ( ) www.reuters.com time to read: +1 min

BERLIN, March 27 (Reuters) - German business morale unexpectedly rose in March, adding to signs that Europe's largest economy is stabilizing despite recent turmoil in the banking sector, a survey showed on Monday. The Ifo institute said its business climate index jumped to 93.3 from a reading of 91.1 in February. The increase in business morale for the fifth month in a row was driven primarily by business expectations, Ifo said. The expectations index rose to 91.2 in March from a revised 88.4 the month before, its highest level in at least a year. Reporting by Miranda Murray, Editing by Friederike HeineOur Standards: The Thomson Reuters Trust Principles.

☆ IFO president: Data positive as supply chain bottlenecks ease and energy prices fall
▼ + stars: | 2023-03-27 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailIFO president: Data positive as supply chain bottlenecks ease and energy prices fallClemens Fuest, president at IFO, discusses the organization's latest data release on the business climate in Germany.

Asia's economic data and policy calendar this week is light, which is perhaps just as well because investors' focus is firmly fixed elsewhere - the global banking crisis and what it means for growth, markets, and policy. Fears over deteriorating credit conditions are rising, despite the swift and bold action from U.S. and Swiss authorities. Fed and European Central Bank officials raised the warning flags on Sunday, echoing soundings from across the private sector last week. The turmoil and volatility across interest rates and fixed-income markets since Silicon Valley Bank was shuttered by California regulators on March 10 has been severe. Currency market volatility has been surprisingly subdued since the banking crisis flared up.

☆ ECB confronts a cold reality: companies are cashing in on inflation
▼ + stars: | 2023-03-02 | by ( Francesco Canepa | ) www.reuters.com time to read: +9 min

"It's clear that profit expansion has played a larger role in the European inflation story in the last six months or so," said Paul Donovan, chief economist at UBS Global Wealth Management. "The ECB has failed to justify what it's doing in the context of a more profit-focused inflation story." Instead, national accounts and earnings reports from listed companies are being used as proxies to paint the inflation picture. "The main story of the risks going forward is still that there's a looming wage-price spiral which should make the central bank even more aggressive in hiking interest rates." loadingloadingEven inside the ECB, labour representatives demanding higher pay for central bank staff have distanced themselves from what they described as the institution's "anti-worker bias".

☆ Ukrainian refugees could help Germany's labor market, but not for long: They're 'ready to go home'
▼ + stars: | 2023-02-24 | by ( Hannah Ward-Glenton | ) www.cnbc.com time to read: +3 min

Germany's labor market is under pressure, but the recent influx of Ukrainian refugees is "no silver bullet" for the workforce issues. Germany's labor market is under severe pressure, and the recent influx of Ukrainian refugees is unlikely to solve the country's workforce issues in the long term. "If I compare to the previous asylum seekers, Ukrainians are clearly better educated and have integrated much faster into the German labor market," he added, noting that Germany is an attractive country for people looking to join the labor market. But Ukrainian refugees can't be expected to fill the gaps in the German labor market. Language barriersAround 60% of Ukrainian refugees in Germany perceived language barriers as the biggest challenge in their new environment, according to an OECD survey.

☆ Morning Bid: Not if or when but how fast?
▼ + stars: | 2023-02-22 | by ( ) www.reuters.com time to read: +3 min

REUTERS/Kai PfaffenbachA look at the day ahead in European and global markets from Anshuman Daga:Is it really good news? Probably yes, probably not. Fed funds futures traders are now pricing for the Fed's benchmark overnight interest rate to reach 5.36% in July and end the year at 5.18%. Asian stock markets floated in a sea of red on Wednesday following an ugly sell-off on Wall Street. Inflation data from Germany and Italy due later on Wednesday will offer clues on price pressures.

☆ Investors are piling the most cash into European stocks in nearly as year as recession outlook fades
▼ + stars: | 2023-01-27 | by ( Carla Mozée | ) www.businessinsider.com time to read: +3 min

European stock funds drew in $3.4 billion last week, the largest inflow since early 2022. Investors want exposure to the euro area as it looks increasingly likely it will avoid a recession. Investors poured in $3.4 billion into European equity funds over the past week, Bank of America said in its Flow Show note published Friday. But demand has been weaker than anticipated, leading to a roughly 70% crash from highs for natural gas prices. EU Economic Commissioner Paolo Gentiloni said this week there's "a chance to avoid a deep recession," for the bloc.

☆ European markets set to nudge higher after U.S. GDP beat expectations
▼ + stars: | 2023-01-27 | by ( Jenni Reid | ) www.cnbc.com time to read: +1 min

European markets looked set to open slightly higher Friday, after U.S. economic data came in stronger than expected and with a slew of rate hike decisions due next week. Investor sentiment appeared brighter despite a mixed performance from corporate earnings released this week, and with the start of year rally having stuttered. The U.S. economy expanded by 2.9% year on year during the fourth quarter, beating expectations, though recession fears remain. All earnings and economic data will be closely watched, with central banks due to take the spotlight next week. The Federal Reserve meets Tuesday to Wednesday, while the European Central Bank and Bank of England will announce their hiking decisions Thursday.

☆ Dollar eases as traders look to central banks for cues
▼ + stars: | 2023-01-25 | by ( Saqib Iqbal Ahmed | ) www.reuters.com time to read: +4 min

REUTERS/Dado Ruvic/IllustrationNEW YORK, Jan 25 (Reuters) - The dollar slipped against the euro on Wednesday, but its losses were capped as traders were hesitant to make any big bets ahead of next week's central bank meetings, including the Federal Reserve and the European Central Bank. "Trading ranges remain remarkably compressed ahead of next week's central bank meetings," said Karl Schamotta, chief market strategist at Corpay. Data on Tuesday showed euro zone business activity made a surprise return to modest growth in January. In contrast, U.S. business activity contracted for the seventh straight month in January, data showed on Tuesday, though the downturn moderated across manufacturing and services for the first time since September. The dollar was down 0.42% against the yen , at 129.615 yen per dollar, having hit a near eight-month low of 127.215 on Jan. 16.

☆ Dollar edges down as traders look to central banks for cues
▼ + stars: | 2023-01-25 | by ( Saqib Iqbal Ahmed | ) www.reuters.com time to read: +4 min

REUTERS/Dado Ruvic/IllustrationNEW YORK, Jan 25 (Reuters) - The dollar edged down against the euro on Wednesday in subdued trading as investors were hesitant to make any big bets ahead of next week's central bank meetings, including the Federal Reserve and the European Central Bank. "Trading ranges remain remarkably compressed ahead of next week's central bank meetings," said Karl Schamotta, chief market strategist at Corpay. Data on Tuesday showed euro zone business activity made a surprise return to modest growth in January. Expectations of further rate increases by the European Central Bank have also supported the euro. In contrast, U.S. business activity contracted for the seventh-straight month in January, data showed on Tuesday, though the downturn moderated across manufacturing and services for the first time since September.

☆ Tech drags European stocks lower on earnings jitters
▼ + stars: | 2023-01-25 | by ( Ankika Biswas | ) www.reuters.com time to read: +3 min

The pan-European STOXX 600 (.STOXX) fell 0.3%, heading lower for a second day with technology (.SX8P) and telecom (.SX8P) declining the most. "The weak outlook painted by Microsoft is weighing on the wider tech sector," said Michael Hewson, chief markets analyst at CMC Markets in London. European stocks came under pressure on Tuesday, as an improvement in economic activity spurred speculation that the European Central Bank (ECB) might have more room to raise interest rates to tackle inflation. Boosting UK stocks, EasyJet PLC (EZJ.L) jumped 10.6% after projecting it would beat current market expectations for 2023 and deliver a full-year profit. Reporting by Ankika Biswas in Bengaluru; Editing by Subhranshu Sahu and Sherry Jacob-PhillipsOur Standards: The Thomson Reuters Trust Principles.

☆ Morning bid: Running out of breath
▼ + stars: | 2023-01-25 | by ( ) www.reuters.com time to read: +2 min

Asian equities held steady on Wednesday near seven-month highs after a mixed session on Wall Street. On a thin day for economic data, focus will be on U.K. producer prices and the German IFO. Revenue at Europe's largest companies is expected to have risen by just 0.9% in the fourth quarter, Refinitiv I/B/E/S data showed on Tuesday. The forecast, which tracks companies listed on the pan-European STOXX 600 (.STOXX) benchmark index, represents a drop from last week when analysts expected revenue growth of 4%. Analysts downgrade earnings forecastsInvestment strategists at Standard Chartered say it is time to fade the rally seen in European stocks and the euro since the lows of September.

☆ German business morale brightens further in January - Ifo
▼ + stars: | 2023-01-25 | by ( ) www.reuters.com time to read: +2 min

REUTERS/Kai Pfaffenbach/File PhotoBERLIN, Jan 25 (Reuters) - German business morale brightened in January as Europe's largest economy started the new year with easing inflation and an improved outlook, a survey said on Wednesday. The Ifo institute said its business climate index rose to 90.2, in line with consensus according to a Reuters poll of analysts and up from a reading of 88.6 in December. "The German economy is starting the new year with more confidence," Ifo's president Clemens Fuest said. The increase is driven by considerably less pessimistic expectations, while companies were, however, somewhat less satisfied with their current situation, Ifo said. "The Ifo business climate has recovered significantly for the third time in a row as the easing on the gas market further diminished companies' fears of a severe recession," Commerzbank's chief economist Joerg Kraemer said.

[1/3] Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., October 7, 2022. Trade in European stocks was lacklustre, as signs of an improving economic outlook in the euro zone fed worries about further rate hikes. AUSSIE DOLLAR SURGEThe Australian dollar surged to $0.7123 after the latest inflation data. Germany's Ifo institute said its business climate index rose to 90.2, in line with the consensus, according to a Reuters poll of analysts, and up from 88.6 in December. U.S. crude futures recently rose 1.01% to $80.94 per barrel and Brent was at $86.68, up 0.64% on the day.

☆ German recession 'very unlikely' given brighter business sentiment, Ifo head says
▼ + stars: | 2023-01-25 | by ( Jenni Reid | ) www.cnbc.com time to read: +3 min

A January Ifo survey showed improved sentiment among German businesses. Tobias Schwarz | Afp | Getty ImagesGerman business sentiment improved in January, according to a widely watched survey from the Munich-based Ifo Institute — in a prospective sign that Europe's largest economy could swerve a recession. Ifo's Business Climate Index rose to 90.2 points from 88.6 points previously on "considerably less pessimistic expectations," a release said. "The expectation was that there might be a recession in the fourth quarter of '22 and the first quarter of '23. Fuest said a number of factors were improving within German manufacturing, including energy prices and supply chain bottlenecks easing.

☆ European markets head for lower open, shrugging off positive PMI data
▼ + stars: | 2023-01-25 | by ( Holly Ellyatt | ) www.cnbc.com time to read: 1 min

European markets are heading for a negative open on Wednesday, continuing a negative trend seen at the end of Tuesday's trading session, despite data out of the eurozone showing an uptick in business activity in the region's services and manufacturing sectors. The S&P Global eurozone composite purchasing managers' index came in at 50.2 in January, up from 49.3 in December and ahead of a consensus forecast of 49.8. The 50 mark separates expansion from contraction. On Wednesday, investors will be looking out for the latest Ifo business climate survey data out of Germany for January to get another gauge of economic sentiment in Europe's largest economy.

☆ Just how bad was the war in Ukraine for Europe’s biggest economy last year?
▼ + stars: | 2023-01-13 | by ( Anna Cooban | ) edition.cnn.com time to read: +7 min

London CNN —Germany’s economy grew slightly last year despite battling an energy crisis sparked by Russia’s war in Ukraine. The bank predicts the German economy will stagnate this year, rather than decline, as it had previously forecast. Tobias Schwarz/AFP/Getty ImagesEither way, it’s welcome news for Europe’s biggest economy. “The German economy has been more resilient than initially feared,” Jan-Christopher Scherer, a research associate at DIW Berlin, told CNN. About 40% of German companies expect business to decline in 2023, and another 35% think it will stagnate, according to a November survey of 2,500 firms conducted by the German Economic Institute.

☆ German industrial orders fall more than expected in November
▼ + stars: | 2023-01-06 | by ( ) www.reuters.com time to read: +1 min

BERLIN, Jan 6 (Reuters) - German industrial orders saw their sharpest drop in more than a year in November on falling foreign demand, decreasing by 5.3% on the month on a seasonally and calendar adjusted basis, the federal statistics office said on Friday. A Reuters poll of analysts had pointed to a 0.5% fall, after a downwardly revised rise of 0.6% in October. Orders from eurozone countries slumped by 10.3% on the month, while those from outside the eurozone fell by 6.8%. "This shows how strongly the high energy prices are weighing on the eurozone," said VP Bank chief economist Thomas Gitzel. The statistics office publishes a statement with more economic data.

☆ German exports unexpectedly fall in November
▼ + stars: | 2023-01-05 | by ( ) www.reuters.com time to read: +1 min

BERLIN, Jan 5 (Reuters) - German exports unexpectedly fell in November as high inflation and market uncertainty continue to weigh on Europe's largest economy despite fading supply chain problems. Exports fell by 0.3% on the month, data from the federal statistics office showed on Thursday. November's drop comes after October's figures were revised up, to growth of 0.8% from an initially reported 0.6% fall. Shipments to Germany's top export partner, the United States, were down 1.5% on the month in November, while exports to European Union member states fell by 0.4%. "The export sector supports the prospect of a mild recession," he added.

☆ Global markets try to put last year’s misery behind them
▼ + stars: | 2023-01-03 | by ( Anna Cooban | ) edition.cnn.com time to read: +4 min

London CNN —Global stocks are striding higher on the first major trading day of 2023 as investors try to look beyond a gloomy outlook for the world economy, China’s worst Covid outbreak and stubbornly high inflation in Europe. ET Tuesday, extending strong gains posted Monday when Chinese and US markets were closed. In Asia, markets ended the day firmly in positive territory, recovering from early losses. Still waryTuesday’s market gains provide cheery news for investors after a rollercoaster 2022 that saw $33 trillion wiped off global equity markets. Kristalina Georgieva, head of the International Monetary Fund, warned in an interview with CBS that aired on Sunday that 2023 will be tougher on the global economy than 2022 was.

The downside is that will increase carbon emissions and for the longer term, the firm is considering a switch to hydrogen, which is a much cleaner energy source provided it is produced using renewable power. "We want to be one of the first large companies in Bavaria to switch to hydrogen," Craig Barker, managing director of the 87-year-old firm, told Reuters. It also announced an action plan to support small and medium-sized companies as they switch to climate-neutral production, including expanding hydrogen infrastructure. More is required to accelerate investments in hydrogen, including a Hydrogen Act to cut bureaucracy and regulate the hydrogen ramp-up quickly, utility industry association BDEW said earlier this month. "2023 must provide new impetus for investments in renewable energies, hydrogen, hydrogen-capable gas-fired power plants and energy networks," BDEW president Kerstin Andreae said.

☆ Morning Bid: No Messi magic for markets
▼ + stars: | 2022-12-19 | by ( ) www.reuters.com time to read: +2 min

A look at the day ahead in European and global markets from Anshuman DagaSoccer fans enjoyed an extraordinary final of the World Cup on Sunday as high emotion and intense drama gave way to Lionel Messi leading Argentina to victory against France in a penalty shootout. Global markets are devoid of any such drama as investors hunker down ahead of interest rate hikes by the world's top central banks and reconcile with weak economic growth. Asian stocks edged lower on Monday, taking the edge off festive cheer, while the yen strengthened on a possible move by the Japanese government to unveil a more flexible inflation target. Federal Reserve Chair Jerome Powell said last week that the Fed will deliver more interest rate hikes next year even as the economy slips towards a possible recessionAnd while the European Central Bank eased the pace of its interest rate hikes, it stressed significant tightening remained ahead as it fights runaway inflation. Rate increases in Europe are here to stay.

There's a reason investors are warned not to fight the Fed, but sometimes they still need to learn the hard way. When the second most powerful central bank in the world is standing shoulder to shoulder with the Fed too, markets are bound to get a bloody nose. And this is the economy into which central banks around the world are still jacking up interest rates? Annual core CPI inflation is expected to inch up to 3.7% in November from 3.6% in October, marking a fresh 41-year high. Will there be a Santa rally, even a mini one, in the last week before Christmas?

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