7^th December 2009

Equity Index

Overview

Last week the S&P 500 future rallied as the fears surrounding the Dubai debt situation dissipated, with new yearly highs posted on Wednesday and Thursday. The release of the payrolls report on Friday resulted in an initial spike in world equity markets before the strengthening of the USD caused an almost full retracement. (more...)

4^th December 2009

Macro Overview

The Changing role of the US Treasury Note

The phenomenal growth of the shadow banking system in the last 2 decades has ushered in a new paradigm for globalisation and markets. The sheer scale of financing global trade through the use of this system means that its tentacles reach every corner of modern day corporate financing, from small business to the behemoths of multinational giants. Traditional banking and the financing of trade used to rely on customer deposits as collateral. However the rapid globalisation of trade in the last 2 decades meant that traditional deposit bases were not large enough to collateralise the complex financial transactions that were taking place. Thus saw the quiet revolution of the use of securitised debt to take over as the collateral of choice. This ensured the rapid growth of the shadow banking system, which imploded spectacularly last in 2008. (more...)

3^rd December 2009

Currency Overview

Focus on ECB policy decision and Short term Interest rates

Today sees the release of the ECB policy decision and the usual press conference. The press conference holds the key in terms of possible volatility in short-term interest rates. With EURIBOR futures steadily moving lower in the past few days from their respective highs, it would seem that market participants may be anticipating a potential move by the ECB. (more...)

2^nd December 2009

Commodity Overview

Focus on Oil & Gold

Over the last five days we have seen some volatility return to the energy markets. In light of the Dubai crisis WTI futures spiked as low as $72.39, the lowest price we have seen since October 12^th. As fears abated the equity markets rallied and the losses were soon erased, by the Friday session we were trading back in the prevailing sideways range.

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1^st December 2009

Bond Futures

Overview

In the light of the negative news out of Dubai and continuing sentiment the Bund has rallied significantly over the last five days. On Friday when the panic surrounding Dubai peaked, the bund hit highs of 124.06, a price not seen since April 2^nd. The US Ten Year mimicked the action of the Bund; highs of 121.215 represented a price not seen since mid May. (more...)