Newsletter Semanal "Markets Perspectives" Fincor 10-09
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Weekly Markets Perspectives September 10 th , 2012 . Fincor- Sociedade Corretora, S.A. provides services of reception, execution, and transmission of orders. The contents mentioned in this document do not constitute (nor should they be interpreted as to form) any kind of counseling, or investment recommendation, or a record of our trading prices, or an offer or solicitation to trade in any financial instrument. Fincor- Sociedade Corretora, S.A. will not accept any responsibility resulting from any use referring to said content or about any resulting effect that could have occurred.
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Principais destaques: Semana Passada: -“O Euro é Irreversível” – Nova política monetária do banco Central Europeu; -Zona Euro vai continuar a contrair; -“Grécia: Vais ser expulsa da Zona Euro?”; -“Espanha: Não tens alternativas”; Estimativa Europa, não apresentam melhorias; Estimativa EUA, “Quantitative Easing 3 (QE3), cada vez mais perto”; Perspectivas para esta semana: Europa: Tribunal Constitucional Alemão decide sobre ESM; Eleições Legislativas Holanda; Decisão da Troika sobre a Grécia; Pedido de resgate (cada vez + próximo) por parte de Espanha? EUA: Reunião do FED (5ª feira); Anúncio do “Quantitative Easing 3 (QE3); Dados macroeconómicos (Inflação, Vendas a retalho, Produção Industrial e Confiança do consumidor); China: Dados macroeconómicos Import/Export (indicam abrandamento);
Transcript of Newsletter Semanal "Markets Perspectives" Fincor 10-09
Weekly Markets Perspectives
September 10th, 2012
.
Fincor- Sociedade Corretora, S.A. provides services of reception, execution, and transmission of orders. The contents mentioned in this document do not
constitute (nor should they be interpreted as to form) any kind of counseling, or investment recommendation, or a record of our trading prices, or an
offer or solicitation to trade in any financial instrument. Fincor- Sociedade Corretora, S.A. will not accept any responsibility resulting from any use referring to
said content or about any resulting effect that could have occurred.
-Draghi announced the Outright Monetary Transactions Program (OMT). Within it, the ECB will define a target to Yields and if that value is exceed they will intervene buying bonds on secondary market. To apply to the program, each country needs to implement reforms ands define financial targets. -Bonds will have a maturity between 1 and 3 years, to guarantee that the ECB isn’t financing a State as it goes against its mandate.
-The purchases will be revealed on a weekly basis, to maintain transparency.
-The ECB won’t have seniority against other investors on these bonds.
ECB – “The Euro is Irreversible” -Draghi told that in case a country starts deviating from the Program signed with the Rescue Funds, the ECB might start selling bonds, increasing the costs of funding of the country.
The Eurozone will continue contracting -The ECB revised its growth forecasts for the Eurozone from -0,1% to -0,4% in 2012, and from 1% to 0,5% in 2013.
Greece: Are you going to get kicked from Eurozone? -Schäuble told in a Press Conference after a meeting with the Greek Finance Minister that the country will only receive the next tranche if Troika’s report reveals that Greece has been implementing the austerity measures designed.
1,70%
3,20%2,90%
0,30%
-4,40%
2,00%1,40%
-0,40%
0,50%
2005 2006 2007 2008 2009 2010 2011 2012 2013
Eurozone: GDP Growth
-Andalusia asked for a bailout of €1B from the Government. It was the 4th region after Valencia, Murcia and Catalonia. Over 60% from the €18B capacity of the Regional Rescue Fund was already spent with just these 4 regions.
-After the announcement of the OMT Program, Spain’s Prime Minister told that his government will study if a bailout will be advantageous for Spain. Olli Rehn thinks that Spain shouldn’t wait any longer, and should apply for a bailout.
-So, how long will Spain wait until asks for a bailout?
Spain – You don’t have any alternatives
Europe – The Outlook isn’t getting any better
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10
20
30
40
50
60
70
PMI Manufacturing
Germany
France
Italy
Eurozone
UK
0
10
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30
40
50
60
70
PMI Services
Germany
France
Italy
Eurozone
UK
US – The QE3 is getting closer after this week data -Manufacturing Data got its worst value since 2009.
-Non-Farm Payrolls provided another sign that the economy isn’t boosting.
49,6
48
51
54
57
60
63
ISM Manufacturing
202
112
157
223
275259
143
6887
45
141
96
Change in Non-Farm Payrolls
Weekly Preview
US The FOMC Meeting might be crucial for the Markets Performance over the next weeks. The announcement of a QE3 is expected. It will be published economic data on the country, where we should focus on inflation, retail sales, industrial production and consumer confidence.
Europe The most important events should be the Germany’s Constitutional Court decision over ESM, Parliamentary Elections in Holland, a decision over Greece by Troika and any new details about the start of the OMT Program by the ECB. We should follow closely Spain, as the country might be close of asking for a bailout and qualifying for the Program.
Rest of the World
All eyes are above China after economic data that continues to point to a slowdown of the economy.
Market Indicators We remain positive for the markets, but there are some risks that can prompt them to fall.
Weekly Preview
Vicious Cycle of Europe. We are currently on level 2.
2,70
2,21
1,00
2,00
3,00
4,00
5,00
6,00
7,00
Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12
2Y Bond Yields: Spread VS
Germany
Spain
Italy
0,59
0
0,2
0,4
0,6
0,8
1
1,2
CBOE PutCall Ratio
Ideas for the week: Portugal BES: Buy at the market, stop-loss at 0,65€. Reasons to buy: - The markets are rallying, due to the OMT from the ECB. As this Program will prompt to fall the Yields of Government Bonds from countries that asked for assistance, the price of these securities will rise. As we know, Portuguese Banks as BES are largely exposed to Portuguese Government Bonds. - The markets risks are falling, and with it the costs of financing of these companies. For a Bank from a peripheral country as BES, these are really good news. - From the major Banks in Portugal, this was the only who didn’t require any assistance from the Portuguese State for its recapitalization.
Weekly Preview
