January, 2018

• 17 January

  Catalan row drags Rajoy down as party whispers of change

  

  Bloomberg The Catalan crisis is proving to be a millstone around the neck of the Spanish prime minister. Mariano Rajoy saw his People’s Party routed in elections in the rebel region last month and it has plumbed historic lows in opinion polls as the premier’s hesitant efforts to keep the push for independence in check disappoint voters across the rest ...

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• 17 January

  America’s new tax rules are a gift to Europe

  

  The effects of the Trump administration corporate tax reform on US multinationals that were, as of the end of last year, holding some $1.4 trillion in cash overseas, are largely beneficial: Now these companies finally know how much of that money the US wants — and there’s also some long-awaited clarity on how foreign profits will be taxed going forward. ...

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• 17 January

  Emanuel Macron can lead a horse to China, but not an Airbus A380

  

  French president Emmanuel Macron gave a horse to his Chinese counterpart Xi Jinping, but handing over the Airbus A380 has proved more difficult. The visit started with talk about Airbus offering China a production role on its superjumbo aircraft to secure a program-extending order for the slow-selling jet. While discussions were held on sales of the A380, according to Macron, ...

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• 17 January

  Britain’s GKN shouldn’t surrender for $9.5bn

  GKN Plc’s defenses could scarcely be weaker in the face of Last week’s unsolicited takeover approach from plucky deal machine Melrose Industries Plc. But the British engineer was right to reject this audacious proposal. Its shareholders, however desperate for a boost, should be wary of surrender. Last year was terrible for GKN. Accounting errors and mismanagement in its US operations ...

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• 17 January

  China bond selloff won’t signal global bear market

  The unrelenting selloff in China’s $9 trillion onshore bond market last year caused deep angst among investors. That performance is far from enticing as the country aims to further open up this market, the world’s third largest, through initiatives such as the Bond Connect programme. For now, foreign investors account for less than 2 percent of the onshore market, though ...

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• 17 January

  Cryptocurrencies steal volatility away from stocks

  

  What drives volatility? In equities these days, it turns out, not much. With just 6.8 percent realized volatility in the S&P 500 Index, 2017 marked the least volatile year since 1964. Low correlation among stocks, muted inflation variability and market-friendly central bank policies all played a role. But that hasn’t stopped investors from asking, ‘Who ate the vol?’ We point ...

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• 17 January

  Citi’s positives outweigh one big, bad headline

  

  Citigroup Inc. investors are rightly looking past the ugly headline. The bank on Tuesday reported a large fourth-quarter loss, reflecting a bigger-than-expected $22 billion writeoff related to changes in US corporate tax laws and a move to a territorial tax regime. Importantly, the one-time charge shouldn’t compromise Chief Executive Officer Mike Corbat’s ability to deliver on targets due by 2020, ...

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• 17 January

  Succour or slap? India’s bond market needs a bit of both

  

  India’s banks were hoping the regulator would feel the pain of their bond-market losses and maybe offer a palliative. What they got instead from the Reserve Bank of India (RBI) was tough love. Condemnation by deputy governor Viral Acharya may be correct, but it won’t resolve the mess. In a speech in Mumbai on Monday, Acharya revisited the nexus between ...

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• 17 January

  Yen emerges as top currency wager for fund bets on central bank shift

  

  Bloomberg A minor tweak in the Bank of Japan’s bond purchases has emboldened investors to bet the central bank is about to wind back monetary stimulus. Going long on the yen is the biggest currency wager for AMP Capital Investors Ltd.’s Nader Naeimi. Singapore-based hedge fund Kit Trading Fund Ltd. started a bet on the yen last week, predicting the ...

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• 17 January

  Citigroup positive on lower tax rates ahead

  

  Bloomberg Citigroup Inc. envisions years of tax-reform benefits ahead, even as competitors warned that their rewards may soon start fading away. Last month’s Republican-led legislation cut Citigroup’s effective threshold to about 25 percent in 2018 and company executives said it will go even lower from there, leading the bank to boost its forecast for profitability. That contrasts with JPMorgan Chase ...

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