Nov. 7, 2014, 7:09 AM
- The nonfarm payrolls report for October is due at 8:30 ET, and U.S. index futures are about flat as they await the print. Expectations are for a 231K gain in jobs and the unemployment rate holding steady at 5.9%.
- Europe's posting sizable losses for a 2nd day following the ECB's nonaction at its policy meeting yesterday. The heaviest loss today is in Spain (NYSEARCA:EWP) which is lower by 1.3%. Asia was mixed overnight.
- The 10-year Treasury yield is flat at 2.39%, as is gold at $1,144 per ounce.
- ETFs: SPY, QQQ, DIA, SH, SSO, SDS, VOO, PSQ, IVV, SPXU, UPRO, TQQQ, SPXL, RSP, QID, SQQQ, DOG, QLD, DXD, RWL, EPS, UDOW, SDOW, DDM, BXUB, QQEW, QQQE, SPLX, BXUC, SFLA, QQXT, SPUU
Oct. 26, 2014, 1:20 PM
- Twenty-five of about 150 EU lenders technically failed the central bank stress test, but 13 of them have already taken steps to bring their grade up to passing. That leaves 12 lenders with a capital shortfall of €9.05B ($12B) - the low end of market expectations (SocGen calls the amount "trivial").
- “I would have preferred they be a bit tougher and force more [banks] to raise capital," says Pimco's global head of financial research Philippe Bodereau.
- A total of nine Italian banks were found in need of more capital based on how things stood at year-end 2013, but five have already addressed that issue this year, leaving four lenders needing to come up with €3.31B in new capital. Most prominent is Banca Monte dei Paschi di Siena - the world's oldest bank and Italy's (NYSEARCA:EWI) 3rd largest - which needs to raise €2.11B. The bank today says it has retained investment banks to help explore strategic options.
- Banks in Spain (NYSEARCA:EWP) and Germany (NYSEARCA:EWG) mostly aced the tests - with just one smaller lender in each country failing - but a number of midsize regional banks in Germany only squeaked by.
- The iShares MSCI Europe Financial Sector ETF (NASDAQ:EUFN) is off 7.9% YTD.
Oct. 16, 2014, 6:59 AM
- S&P 500 (NYSEARCA:SPY) futures are down 1.2% and Nasdaq 100 (NASDAQ:QQQ) by 1.25%, led by a 26% premarket dive in Netflix following its Q3 results.
- Europe's plunging for a second consecutive day, the Stoxx 50 (NYSEARCA:FEZ) -2.2%, led by Spain's IBEX 35 (NYSEARCA:EWP) off 2.9%, and Asia was lower across the board overnight, led by the Nikkei's 2.2% decline.
- Treasurys are the most volatile asset of all for a 2nd straight day, the 10-year yield off a whopping 12 basis points to 2.02%. Gold catches no bid for now, down $2 per ounce to $1,242.
- ETFs: SPY, QQQ, DIA, SH, SSO, SDS, VOO, PSQ, IVV, SPXU, UPRO, TQQQ, SPXL, RSP, QID, SQQQ, DOG, QLD, DXD, RWL, EPS, UDOW, SDOW, DDM, BXUB, QQEW, QQQE, SPLX, SFLA, BXUC, QQXT, SPUU
Oct. 15, 2014, 9:44 AM
- Europe's Stoxx 50 (NYSEARCA:FEZ) is lower by 3.5%, led by a 3.7% and 3.6% declines in Italy (NYSEARCA:EWI) and Spain (NYSEARCA:EWP), respectively.
- Germany (NYSEARCA:EWG) is down 3% and France down 3.5%.
- In what may go down as one of the more notorious cases of herd behavior ever, traders have been buying the government paper of Europe's periphery with the same fervor as that of the core. That's changing today, and Italian and Spanish sovereign yields are on the rise as those in Germany tumble to new record lows.
- ETFs: VGK, FEZ, IEV, HEDJ, EPV, EZU, FEU, FEP, UPV, ADRU, FEEU, EURL, DBEU, EURZ, IEUR, FIEU, HEZU, ESTX
Oct. 14, 2014, 9:27 AM
- Catalonia had planned an independence vote for November 9, but the Spanish government asked the country's constitutional court to declare the referendum illegal, and the court suspended the vote until it rules on the case (which could take years).
- Instead, says Catalonia regional president Artur Mas, there will be a "consultation of citizens." "There will be ballots and ballot boxes. We can't apply the decree (to hold a referendum) but it will be possible to vote."
- A wealthy region in Spain's northeast with its own language, Catalonia has stirred for years to create its own nation on the Mediterranean.
- Spain's IBEX 35 is off 0.25%.
- ETF: EWP
Oct. 14, 2014, 4:18 AM
- Italian CPI -0.4% on month in September vs -0.4% in August and consensus of -0.3%.
- On year, CPI -0.2% vs -0.2% and -0.1%. (PR)
- Spanish CPI stayed at +0.2% on month in September, as expected. On year, CPI -0.2%, as forecast, vs -0.5% previously. That's the third consecutive month of annual price declines in Spain. (PR [Spanish])
- ETFs: EWI, EWP, QESP
Oct. 13, 2014, 7:16 AM
- Down moderately when opening for trade on Sunday evening, futures have turned higher, the S&P 500 (NYSEARCA:SPY) +0.3% and Nasdaq 100 +0.1%.
- European markets are all in the green, also after opening lower. Leading the advance is Spain's IBEX 35 (NYSEARCA:EWP), +1.2%.
- The 10-year Treasury yield is down three basis points to 2.28% and gold is up $4 per ounce to $1,227.
- ETFs: SPY, QQQ, SH, DIA, SSO, SDS, VOO, PSQ, IVV, SPXU, UPRO, TQQQ, SPXL, RSP, QID, SQQQ, DOG, QLD, DXD, RWL, EPS, UDOW, SDOW, DDM, BXUB, QQEW, QQQE, SPLX, SFLA, BXUC, QQXT, SPUU
Oct. 7, 2014, 11:42 AM
- We've seen this movie before. The ECB floats the need for unconventional stimulus measures, and the Germans object, and then the Germans strenuously object. and then the plan moves forward anyway.
- “There is a risk of monetary policy, especially in the euro area, being held hostage by politics,” Bundesbank chief Jens Weidmann tells the WSJ, unsurprisingly not pleased with the ECB's decision to begin buying ABS, and fiercely opposed to what could be the next step - full-out QE with the mass purchases of government paper.
- Weidmann is but one member of the 24-person ECB governing council. While somewhat influential, he cannot veto any decisions and has been overruled by the majority in the past.
- European stocks are at session lows, the Stoxx 50 (FEZ -1.6%), Italy (EWI -1.5%), France (EWQ -1.7%), Germany (EWG -1.1%), Spain (EWP -2%).
- ETFs: VGK, FEZ, IEV, HEDJ, EPV, EZU, FEU, FEP, UPV, ADRU, FEEU, EURL, EURZ, DBEU, IEUR, FIEU, HEZU, ESTX
Sep. 19, 2014, 12:25 PM
- A check of European closing prices finds the euphoric early reaction to the "No" vote from Scotland mostly faded by day's end. The Stoxx 50 (NYSEARCA:FEZ) closed just 0.2% higher, with the U.K.'s FTSE 100 (NYSEARCA:EWU) gaining 0.3%.
- Looking at U.K. bank ADRs: RBS (RBS +1.2%), Barclays (BCS -0.9%), Lloyds (LYG +0.5%), HSBC (HSBC -0.2%).
- Dealing with its own separatist movement, Spain (NYSEARCA:EWP) managed just a 0.1% gain.
- Previously: Euro shares lean green on "No" vote
- Previously: Might Catalonia secession fears ebb following Scotland vote?
Sep. 19, 2014, 7:38 AM
- Stocks in Madrid (NYSEARCA:EWP) also breath a sigh of relief following Scotland's vote not to secede from the U.K. Earlier this month, 1.8M rallied in Barcelona to demand a vote on independence for Catalonia - something the Spanish government says is illegal.
- Despite warnings from Madrid, the pro-separatist Catalan government plans to hold a non-binding independence referendum on Nov. 9, and a bill approving this vote is could be approved today. Scotland's "No" vote, however, just might halt, or at least slow the process. "There will not be a legal referendum now, in my view, which is positive for Spain and Europe," says CM Capital Markets' Predrag Dukic.
- The IBEX is up 0.5%.
Sep. 4, 2014, 8:46 AM
- The ECB cut its growth forecast for the EU for 2014 and 2015, says Mario Draghi at his post-meeting press conference, but raised its outlook for 2016. Inflation is seen at lower-than-expected levels in the coming months before increasing gradually in 2016.
- The central bank, says Draghi, will start to purchase a broad portfolio of euro-denominated covered bonds and also begin to buy ABS, with further details coming in October. It sounds like the Germans are on board: "Should it become necessary, the Governing Council is unanimous in using additional measures."
- The Stoxx 50 is now higher by 1.5% and the euro lower by 1% to $1.3015.
- ETFs: FXE, VGK, EUO, EWG, FEZ, EWP, ERO, IEV, HEDJ, EPV, EZU, EWQ, DRR, FEU, FEP, UPV, EUFX, ULE, DBGR, ADRU, DXGE, FEEU, URR, EURL, FGM, EURZ, DBEU, QDEU, IEUR, FIEU, HEWG, QESP
- Previously: Euro tumbles, stocks gain as ECB cuts rates
Aug. 19, 2014, 8:59 AM
- Reversing a big YTD trend, U.S. investors pulled nearly $4B out of Europe-focused ETFs over the past week. Among the reasons, suggests Markit's Simon Colvin: Europe is seen as more exposed to Russian sanctions, anemic European growth, and a strengthening U.S. dollar. "The only certainty is that a growing portion of American investors think that their assets are better invested outside of Europe, something which wasn't the case six weeks ago."
- Interestingly, it's the "core" Eurozone countries like Germany (NYSEARCA:EWG) and France (NYSEARCA:EWQ) with which U.S. investors are least interested, while Italy (NYSEARCA:EWI) and Spain (NYSEARCA:EWP) have seen net inflows over the past three months.
- Europe equity ETFs: VGK, FEZ, IEV, HEDJ, EPV, EZU, FEU, FEP, UPV, ADRU, FEEU, EURL, EURZ, DBEU, IEUR, FIEU
Aug. 14, 2014, 6:46 AM
- Euro-Zone GDP failed to grow in the second quarter following 12 months of weak growth, causing European equity markets to fall and increasing pressure on the ECB to do more to boost growth and inflation.
- Data released this morning by the European Union's statistics office translates into 0.2% growth in annualized terms, down from the first quarter's 0.8% pace.
- The euro zone's three largest economies, which account for two-thirds of the region's €9.6T ($12.8T) GDP, all did not post any growth. German GDP shrank 0.2% from the first quarter and Italy's output fell at a similar pace. The French economy, the bloc's second largest behind Germany, stagnated for a second straight quarter.
- The region's next largest economies, Spain and the Netherlands, posted some growth but not enough to offset their larger peers.
- ETFs: FXE, RSX, VGK, EUO, EWG, FEZ, GREK, EWP, EWI, DFE, RUSL, ERO, RSXJ, IEV, ERUS, RUSS, EWL, HEDJ, EU, EWU, EPV, EUFN, EZU, EWD, NORW, EWQ, EPOL, EIRL, PLND, RBL, EWO, DRR, GXF, FEU, EWN, GUR, EWK, EDEN, FDD, EWGS, FEP, ESR, UPV, EUFX, PGAL, ULE, IFEU, DBGR, ENOR, ADRU, EWUS, EUDG, DXGE, FEEU, GERJ, URR, FGM, EFNL, EURL, FKU, FSZ, DXPS, RUDR, EURZ, DBEU, QDEU, IEUR, FIEU, EUMV, HEWG, SMEZ, QESP, DBUK, QGBR
Jul. 10, 2014, 7:12 AM
- S&P 500 (SPY), Nasdaq 100 (QQQ), and DJIA (DIA) futures are all off about 0.9% and Russell 2000 (IWM) down 2% as trouble brews in the EU periphery.
- Banco Espirito Santo - Portugal's largest listed bank - is off another 16% as its parent reportedly considers bankruptcy protection unless a deal can be worked out with creditors. Portugal broad market is down another 4.1%, bringing its 7-session slump to 11%.
- Previously: Portugal tumbles on bank worry
- Europe's Stoxx 50 (FEZ) is down 2%, led by Italy (EWI) -2.5% and Spain (EWP) -2.6%.
- The 10-year U.S. Treasury yield is down four basis points to 2.51% and gold catches a serious bid, up $20 per ounce to $1,344.
- ETFs: SPY, QQQ, SH, DIA, IWM, TZA, TNA, SSO, SDS, PSQ, VOO, IVV, SPXU, UPRO, IWC, UWM, TQQQ, VB, SPXL, QID, RSP, IJR, SQQQ, DOG, SLY, QLD, DXD, RWJ, RWL, URTY, EPS, UDOW, SCHA, TWM, SDOW, DDM, RWM, SRTY, SAA, BXUB, DWAS, VTWO, QQEW, QQQE, VIOO, SDD, SFLA, PZI, FDM, SPLX, QQXT, SBB, BXUC, WMCR, RSCO, JKJ, FYX, XSLV, EWRS, TWOK, SMLV, SPUU, PXSC
Jul. 7, 2014, 3:11 PM
- You need to look at more than the size of flows, says Deutsche's Sebastian Mercado, who instead relies on what he calls "flow trend formation." For example, noting that ETFs attracted $25B in a month is of little use, but a pattern of $1B of inflows every day for a month is a sign of a demand shift for that asset class.
- The bank is now publishing a Tactical Asset Allocation Relative Strength Signal report, and the latest one sees strong equity flows across all regions, particularly Europe and North America, more particularly still in periphery states like Spain (EWP) and Italy (EWI). Treasury and corporate bond flows are negative and the rally in gold has failed to attract much in the way of inflows into those ETFs.
- ETFs: AOA, GTAA, AOK, AOM, AOR, EPRO, RLY, DBIZ, GAL, MATH, GIVE
Jun. 30, 2014, 7:05 AM
- Spain's IBEX 35 (EWP) with a 0.7% decline is leading Europe's Stoxx 50 (FEZ) lower by 0.2%. Asia was mostly in the green, led by India (+1.25%), Shanghai (+0.6%), and the Nikkei (+0.45%).
- The 10-year Treasury yield is down one basis point at 2.53% and gold is lower by $6 per ounce to $1,314.
- ETFs: SPY, QQQ, SH, DIA, SSO, SDS, PSQ, VOO, IVV, SPXU, UPRO, TQQQ, SPXL, QID, RSP, SQQQ, DOG, QLD, DXD, RWL, EPS, UDOW, SDOW, DDM, BXUB, QQEW, QQQE, SFLA, SPLX, QQXT, BXUC, SPUU
EWP vs. ETF Alternatives
The iShares MSCI Spain Capped Index Fund (the “Fund”) seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the MSCI Spain 25/50 Index (the “Underlying Index”).
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