Monthly Archives: May 2012

Gorman calls Facebook investors ‘naive’

James Gorman, Morgan Stanley chief executive, dismissed outrage over Facebook’s botched initial public offering, calling investors who had expected immediate gains “naïve” for having “bought it under the wrong pretences”. The remarks by Mr Gorman addressing Morgan Stanley’s role as lead underwriter came in a CNBC television interview on the day that Facebook enjoyed its best session since it started…

MF Global UK in fresh dispute with US

MF Global UK’s administrator said on Thursday it was disputing the amount owed to its US counterparts after the closing out of the positions that brought down the US futures broker seven months ago. KPMG, which is administrating the London-based operations of MF Global, said it did not agree with the closing valuations of the repo-to-maturity (RTM) trades in Eurozone…

Hedge funds cut back on equity research

Hedge funds are sharply reducing spending on equity research from brokerage firms, in a sign that volatile markets are hurting demand for brokers’ lucrative client services. Institutional investors cut spending on research services, such as analyst notes and trading ideas, to $6.2bn in the twelve months to March 31, down 9 per cent from the prior year, according to a…

Paraguay to establish first futures market

Paraguay is establishing its first futures market and expects to begin trading a foreign exchange contract within eight months, according to the Argentine clearing house which is helping establish the exchange. Argentina Clearing SA, the clearing house for Rofex, Argentina’s main market for trading dollar futures, and Primary, a leading service provider for exchanges and brokerages, have been working with…

More of the same won’t end stupidity

Several weeks after rumours surfaced of a “London whale” taking huge positions, JPMorgan Chase announced it had suffered a $2bn loss on hedging activity that its chief executive Jamie Dimon rightly called “sloppy” and “stupid”. Within days, the $2bn loss was rumoured to have grown much larger, although the bank has not disclosed details. The US Securities and Exchange Commission…

Spain faces extra risk to funding costs

As Spain’s debt crisis deepens, investors are warily eyeing a trigger that could send yields on the country’s sovereign debt into bailout territory. The number to watch is the difference between Spanish 10-year yields and that of a basket of triple-A rated European debt. If the premium demanded to hold Spanish government bonds stays at more than 450 basis points…

Insurers face clash of rules

Regulation is changing the equation for European insurers operating in the US. At least one disposal is certain: the European Commission has ordered Dutch group ING to offload its insurance and investment management business in the US – along with that in other regions – as a condition for receiving state aid during the financial crisis. Regulatory concerns could also…

Crude slides on higher US inventories

Crude oil threatened to fall below $100 a barrel for the first time in months as cautious investors dumped commodities and embraced the dollar as a haven. Oil prices have not been spared as looming elections in Greece cloud the future of the eurozone. Investors have sought US government bonds, adding strength to the dollar and putting corresponding pressure on…

Ford Motor upgrade sparks junk shift

Junk bond investors are facing significant changes to their portfolios as Ford Motor and Ford Motor Credit, its finance unit, on Thursday quit key benchmark indices and returned to the investment grade market. The move officially sends about $30bn of Ford debt out of the junk bond market and could spark a flurry of activity as some investors who closely…

Global stocks investors head for exits

As investors prepare for summer, the heat is already on equity markets. Global equities are set to post their worst monthly performance since September as the eurozone crisis and slowing emerging market economies propel investors to the exits across Asia, Europe and the Americas. Click to enlarge Global stocks turned negative for the year in May and on Thursday the…