Crude oil is up 23% over the past year and it has started making an impact; US 3-year bond yields at a 11-year high

Crude oil at $65.5 a barrel is up 23% over the past year and Brent is up some 27% during the same period. Gasoline prices are up 16% over the past year and we aren’t yet in the US driving season (which pushes up the price and begins in July). Continue reading “Crude oil is up 23% over the past year and it has started making an impact; US 3-year bond yields at a 11-year high”

Apparently, there are days when no one trades some Japanese government bonds; Could China devalue their currency or sell US Treasurys?

Some 80% of 10-year Japanese government bonds are held by the Bank of Japan. And apparently there are days when no one trades those 10-year bonds because there is no point of trading it. Why? Well, because the Bank of Japan has a policy to control yield curves and since they hold majority of it there are hardly any price movements.

But is also claimed that there are days when the 2-year bonds aren’t traded. That is interesting because the Bank of Japan only holds a small proportion of 2-year bonds. How to traders keep their jobs then? They trade bond futures instead. Continue reading “Apparently, there are days when no one trades some Japanese government bonds; Could China devalue their currency or sell US Treasurys?”

The European banking crisis is far from over

Hidden away in the European Central Bank’s supervisory and prudential statistics are metrics for asset quality. It isn’t easy to find and if you do find them then the spreadsheets won’t open without issues. Once If you manage to get them to work you will find some quite stunning statistics.

Here are the numbers and graphs for asset quality as of September 30, 2017 (the latest set of data available), Continue reading “The European banking crisis is far from over”

Weekly overview: US employment numbers; Bond yields fall globally over the past month; Stock markets volatility

US employers added only 103,000 jobs in March as against 185,000 new jobs expected by economists surveyed by Bloomberg. Jobs have been added for 90 straight months, the longest phase on record. January’s job addition number was revised sharply downward from 239,000 to 176,000. Wage growth was 2.7% which was largely down to tax cuts driven wage rises earlier during the year rather than real wage inflation.

Any addition under 80,000 new jobs a month would cause the unemployment rate to rise. As we covered earlier, unemployment has always hit record multi year lows on an average 6 to 12 months before the start of a recession.

The graphs below might help visualise it better, Continue reading “Weekly overview: US employment numbers; Bond yields fall globally over the past month; Stock markets volatility”

Parts of the European Union have seen nominal GDP per capita fall between 2007 and 2017

We have been analysing some numbers from the latest releases from Eurostat (the official statistical office of the European Union), the International Monetary Fund, the Federal Reserve, the European Central Bank, the Bank of England and the Bank of Japan.

We will be posting several findings in the next couple of days. We begin with GDP per capita between 2007 and 2017 for countries which are part of the European Union based on a statistical release from the Eurostat.

EU GDP Per Capita 2007 to 2017
Data Source: Eurostat

Continue reading “Parts of the European Union have seen nominal GDP per capita fall between 2007 and 2017”

The Athens Stock Exchange General Index has returned 19% over the last year (but lost 85% since 2007); Australian interest rates are lower than that of the US for the first time in 18 years

The Greek stock market has been one of the best performing markets in the world over the past year. The Athens Stock Exchange General Index has returned 19% over the last year. But it has lost 85% (5334.5 to today’s close at 781.14) in value since October 2007. Continue reading “The Athens Stock Exchange General Index has returned 19% over the last year (but lost 85% since 2007); Australian interest rates are lower than that of the US for the first time in 18 years”

Spotify’s direct listing (and comparison to Netflix); ECB sells bond after spotting an error after 2 years; Nomura to hire fewest graduates in five years as it spends more on robots

Spotify’s direct listing

As reported earlier, Spotify listed directly on the NYSE today at an opening price of $165.90, the stock ended the first day of trading in New York at $149.01, up from the reference price of $132 set yesterday by the NYSE.

Spotify has offered a streaming service since 2008 and has 159 million monthly active users including 71 million paid subscribers globally. It generated €4 billion (about $5billion) in revenues last year, up over 40% from 2016, and a €1.2 billion ($1.5 billion) net loss compared with about €542 million ($664 million) in 2016. The company’s average revenue per user has declined from €6.84 in 2015 to €5.32 in 2017 as it promotes its “Family Plan” which allows several users to share one account. Analyst reckon that Apple Music will overtake Spotify in terms of paid subscribers in under 2 years, yet the company is now valued at $28 billion (5.6 times revenues). Continue reading “Spotify’s direct listing (and comparison to Netflix); ECB sells bond after spotting an error after 2 years; Nomura to hire fewest graduates in five years as it spends more on robots”