Asia avoids overly cautious note but Europe wobbles
Markets across the world remain cautious over some hot spots of unrest but Europe in particular is vulnerable to Russia’s tense relationship with Ukraine. Asian markets, while still closely watching the geopolitical risk, have been boosted today by news
of economic growth in Singapore, lower risk of monsoon in India and positive data on mining industries. Most Asian indexes ended up or flat. Europe though has seen decline so far this morning as the markets waited for data on German investment confidence; it came and showed the lowest level of confidence since December 2012. The tension in Gaza and Iraq is not of major concern to the Germans, but Ukraine certainly is, and news that Russia is sending an aid convoy into its neighbour’s territory has heightened concern. The UK fared better than the Eurozone, with the FTSE100 seeing gains with some large profit gains reported by big name companies. US futures are largely up.
Designer clothing and accessories company Kate Spade is among the big names reporting earnings pre-market while the maker of Candy Crush, King Digital reports after the bell.
Private equity industry seek assurances from regulators
A meeting has taken place between the Private Equity Growth Capital Council and US regulators to address concerns about tighter rules on junk loans. Although the industry is not regulated by the Fed or the OCC, the PEGC were seeking assurance that they were not being targeted in the regulators’ stricter plans for the leveraged lending sector. These loans are important for the private equity sector as they provide inflated returns allowing funds for their acquisitions. Read the full story.
Money makes money – billionaire pockets $1 billion in one morning
Former Enron employee Richard Kinder is no stranger to the big money; he’s built his business empire from $40 million of assets from his former employer to the $106 billion his companies are worth today. He has announced that he is to consolidate his companies to allow faster growth and that saw the value of his holdings increase by $1 billion. By combining his four companies into one, it will lower costs and increase its clout allowing the business to make acquisitions and develop quicker. Read the full story.
Insurer says rate hikes are biggest concern
Global insurance firm Prudential says Federal Reserve monetary policy is its biggest concern. CEO Tidjane Thiam says he believes that the US economy is definitely recovering but that interest rates returning to normal is the big ‘cloud’. A spike in interest rates, which is predicted for next year by some analysts, would mean insurers’ fixed-income investments would lose value; the industry was highlighted as being ‘at risk’ from rate rises in a report by Moody’s rating agency. Prudential has posted a 17 per cent increase in half-year profits with dividends forecast to be up 15 per cent for 2014. Read the full story.