Saudis agree to freeze production, stocks mixed... Investment banks set for lower earnings...
Saudis agree to freeze production, stocks mixed
Saudi Arabia, along with Qatar, Russia and Venezuela will freeze oil production at January levels and there may be further easing to come. The Saudi oil minister Ali Al-Naimi called the move “adequate” for the market but said that other producers will need to follow to make any real impacts. He called on Iran in particular to agree to lower output.
The news has given oil prices a lift but there are underlying issues including the record levels of US crude in storage and the high output of US producers. Prices were up 4 per cent overnight but have eased in later trading.
Equity markets have been mixed so far Tuesday with Asian indexes closing higher, led by gains in Shanghai. However, there is concern among analysts that volatility in the markets will continue. Japan’s central bank has started charging financial institutions for holding large cash reserves at the bank. The negative 0.1 per cent interest rate applies to around $200 billion. In a newspaper survey just 13 per cent thought the move would boost the economy.
In Europe, the markets are generally lower despite comments by the ECB president Monday which suggested more easing could be on the way. Whether there is much that central banks can do to boost economies give current headwinds is debated by economists.
Wall Street and Toronto are expected to re-open higher after the holiday weekend.
Investment banks set for lower earnings
A report from JP Morgan Securities predicts that global investment banks will see lower earnings in 2016. It forecasts a drop of around 21 per cent as “challenging” conditions hit issuance activity and credit spreads widen. US investment banks may do better though, the report says, due to their strong capital position. JP Morgan Securities has upgraded Goldman Sachs and Morgan Stanley to “overweight”.
Saudi Arabia, along with Qatar, Russia and Venezuela will freeze oil production at January levels and there may be further easing to come. The Saudi oil minister Ali Al-Naimi called the move “adequate” for the market but said that other producers will need to follow to make any real impacts. He called on Iran in particular to agree to lower output.
The news has given oil prices a lift but there are underlying issues including the record levels of US crude in storage and the high output of US producers. Prices were up 4 per cent overnight but have eased in later trading.
Equity markets have been mixed so far Tuesday with Asian indexes closing higher, led by gains in Shanghai. However, there is concern among analysts that volatility in the markets will continue. Japan’s central bank has started charging financial institutions for holding large cash reserves at the bank. The negative 0.1 per cent interest rate applies to around $200 billion. In a newspaper survey just 13 per cent thought the move would boost the economy.
In Europe, the markets are generally lower despite comments by the ECB president Monday which suggested more easing could be on the way. Whether there is much that central banks can do to boost economies give current headwinds is debated by economists.
Wall Street and Toronto are expected to re-open higher after the holiday weekend.
| Latest | 1 month ago | 1 year ago | |
| North America (previous session) |
|||
| US Dow Jones | 15,973.84 (+2.00 per cent) | -0.09 per cent | -11.35 per cent |
| TSX Composite | 12,381.24 (+2.43 per cent) | +2.55 per cent | -18.89 per cent |
| Europe (at 5.30am ET) |
|||
| UK FTSE | 5,819.71 (-0.08 per cent) | +0.27 per cent | -15.13 per cent |
| German DAX | 9,145.56 (-0.67 per cent) | -4.19 per cent | -16.27 per cent |
| Asia (at close) |
|||
| China CSI 300 | 3,037.04 (+3.07 per cent) | -2.62 per cent | -13.21 per cent |
| Japan Nikkei | 16,054.43 (+0.20 per cent) | -6.37 per cent | -10.83 per cent |
| Other Data (at 5.30am ET) |
|||
| Oil (Brent) | Oil (WTI) | Gold | Can. Dollar |
| 33.93 (+1.62 per cent) |
29.71 (+0.92 per cent) |
1212.80 (-2.15 per cent) |
U$0.7253 |
| Aus. Dollar |
|||
| U$0.7163 | |||
Investment banks set for lower earnings
A report from JP Morgan Securities predicts that global investment banks will see lower earnings in 2016. It forecasts a drop of around 21 per cent as “challenging” conditions hit issuance activity and credit spreads widen. US investment banks may do better though, the report says, due to their strong capital position. JP Morgan Securities has upgraded Goldman Sachs and Morgan Stanley to “overweight”.
