Börsipäev 01. mai
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How Much Can Investors Recover from CDOs? Thomas Tan
On Monday, the S&P cut assumptions on recovery rate for CDOs related to subprime mortgages, about 40% of all CDOs, as linked here. Their new assumptions are shockingly low.
Some of you probably remember, I commented on Bill Gross' article of "Pyramid Crumbling" a couple times in my blogs here. I indicated his assumption of general recovery estimate of 50% is too high. What S&P has come up with is actually even lower than my expectation.
In their new recovery assumptions for structured finance CDOs, the S&P assumed that for any deals rated A or lower, recoveries were likely to be zero, while AA-rated slices would be at best 5%. How about the most seniors, the so-call AAA ones? AAA-rated tranches were likely to recover 60%, while junior AAA-rated tranches could expect to recover only 35%, the S&P indicated. So they are definitely not as good as US Treasuries. It looks that 50% average recovery estimate applies to the AAA tranches only; everything else is pretty much wiped out.
This new assumptions will have a rippling effect, causing more downgrades by rating agencies, subsequently forcing more write-downs by investment banks and other institutions holding CDOs. -
Tänane päris oluline uudis on Exxon Mobili oodatust kesisemad majandustulemused. Lisaks olid ootused numbrite osas kõrged, nii et selline miss head kindlasti ei tõota. Vaatame, kas konverentsikõnega suudetakse asja siluda või mitte. Konverentsikõna algab Eesti aja järgi kell 18.00 ja kuulata saab seda siit. Aktsia on eelturul -2.5% madalamal ning Pro all hiljuti üles läinud nafta- ja energiaettevõtete langusele kahekordse võimendusega panustava börsil kaubeldava fondi DUGi omanikele peaks see hetkel kindlasti head meelt tegema.
Exxon Mobil misses by $0.11 (93.07 ) : Reports Q1 (Mar) earnings of $2.03 per share, $0.11 worse than the First Call consensus of $2.14; revenues rose 34.0% year/year to $116.85 bln. ExxonMobil's first quarter net income was a record $10,890 million, up 17% from the first quarter of 2007. Earnings per share were up 25% reflecting the impact of the continuing share purchase program. Higher crude oil and natural gas realizations, driven by record worldwide crude oil prices, were partly offset by lower refining and chemical margins, lower production volumes and higher operating costs
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Töötu abiraha taotlejate arv kardetust pisut suurem ning futuurid tegid selle peale korraks jõnksu allapoole.
March Personal Income +0.3% vs +0.4% consensus
March PCE Deflator yr/yr 3.2% vs 3.2% consensus, prior 3.4%
March Personal Spending +0.4% vs +0.2% consensus
March core PCE m/m 0.2% vs 0.1% consensus, prior 0.1%
Initial Claims 380K vs 365K consensus, prior revised to 345K from 342K
March core PCE yr/yr 2.1% vs 2.0% consensus, prior 2.0% -
Kell 17.00 ISM indeks ja construction spending, samuti väga olulised turu jaoks täna.
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Enamuse börse küll 1. mail kinni, kuid USA täna avatud.
Saksamaa DAX N/A (börs suletud)
Prantsusmaa CAC 40 N/A (börs suletud)
Inglismaa FTSE 100 +0.05%
Hispaania IBEX N/A (börs suletud)
Venemaa MICEX N/A (börs suletud)
Poola WIG N/A (börs suletud)
Aasia turud:
Jaapani Nikkei 225 -0.60%
Hong Kongi Hang Seng N/A (börs suletud)
Hiina Shanghai A (kodumaine) N/A (börs suletud)
Hiina Shanghai B (välismaine) N/A (börs suletud)
Lõuna-Korea Kosdaq N/A (börs suletud)
Tai Set N/A (börs suletud)
India Sensex N/A (börs suletud)
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Bulls Lurch for Traction
By Rev Shark
RealMoney.com Contributor
5/1/2008 8:31 AM EDT
People say I'm indecisive, but I don't know about that.
-- George H.W. Bush
Yesterday's slightly positive GDP report and the subtle hint by the Fed that it is at the end of rate cuts is accelerating the debate about whether the economy is in a recession.
On one side, there is an optimistic faction that wants to say, "Things really aren't that bad and are improving already." They are convinced that we have already dealt with and priced in some of the worst economic issues in a century and are ready to start trending back up.
On the other side is the nagging news flow that comes in slightly better than expectations but continues to indicate that problems like housing, tight credit, inflation and a slowing economy are substantial and continuing. Some slight improvement occurs here and there, and that is enough to get the usual folks saying that the bottom is in, but there really is no hard proof of a turn.
This battle back and forth over whether we have a recession is leaving the market in a muddled state. The hopeful bulls have helped drive the market up sharply off the March lows, but as we become technically overbought and start to hit some overhead resistance, the niggling doubts about the health of the economy become more prominent.
My feeling is that the bounce off the March lows is fairly typical bear-market action where a surge in hope delivers a big enough countertrend rally to cause many people to start believing the worst really is over. The news flow improves slightly, and some catalysts like better-than-expected earnings from a few key companies cause the permabulls to become excited once again.
As we start the month of May, the health of the recent rally is likely to be quickly tested. With the Fed now back on the sidelines and the great bulk of earnings reports concluded, we are left with economic news as our primary driver. Market participants have become more and more hopeful as the market has rallied, so the bar is set higher and the chances of disappointment greatly increased.
There is an old market saying -- "sell in May and go away" -- which is supposed to reflect the idea that the market is seasonally slow in the summer months. There is some statistic proof to back that up, and like many of these trite sayings, this one can be self-fulfilling if it starts to gain a little traction.
The economy and market are a muddle right now, and the technical conditions, news flow and seasonality suggest that continued upside will not be easy. If we start to stall out in the early days of May, the selling is likely to accelerate quickly. The big picture for the market isn't bad, but we are at an important crossroads where we could easily start to slide down the slope of hope.
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Ülespoole avanevad:
In reaction to strong earnings/guidance: IMB + 28.0% (provides Q1 update), SVLF + 26.4%, VLCM + 17.1%, TTEK + 13.6%, CLRT + 11.4%, AMKR + 10.3%, PSYS + 10.2%, SEPR + 10.0%, GTI + 9.4%, RNOW + 7.1%, LKQX + 6.8%, AXTI + 6.5%, SYMC + 5.7%, HLF + 5.4%, ITRI + 4.4%, OI + 4.3%, NEWP + 4.3%, TRN + 3.9%, GNK + 3.5%, OIIM + 3.3% (also upgraded to Maket Perform at Piper and upgraded to Buy at Roth Capital), BGFV + 3.2%, BANR + 1.7%... M&A news: NETM +64.8% (to be acquired by Micro Focus International for $7.20/share)... Other news: BHP + 2.7% (still checking), PBR + 2.6% (continued momentum from yesterday's ~5% climb), RTP + 2.5% (still checking), YHOO + 2.0% (MSFT board fails to decide on Yahoo), HSC + 2.0% (Cramer makes positive comments), HNZ + 1.1% (Cramer makes positive comments).
Allapoole avanevad:
In reaction to disappointing earnings/guidance: PDGI -32.9% (also downgraded to Hold at Jefferies and downgraded to Neutral at Robert W. Baird), NWK -19.2% (also downgraded to Hold at Brean Murray), FARO -19.1%, MCRS -17.2% (also downgraded to Hold at Brean Murray), WLK -13.2%, ICTG -13.1%, JDSU -12.6% (also downgraded to Hold at Roth Capital), IRBT -10.5%, LVS -8.6% (also downgraded to Underweight at KeyBanc), INSP -8.0%, RRI -4.8%, CI -4.2%, CTX -3.8%, AKAM -3.6%, TTMI -3.5%, EK -3.1%, OMTR -2.5%, ROG -2.5%, PRU -2.4%, XOM -2.0%, APA -2.0%... Select gold stocks showing weakness with strength in dollar: GG -3.2%, AUY -2.4%, GLD -2.4%, NEM -2.3%... Other news: GRZ -15.8% (announced the Venezuelan Ministry of Environment has communicated its plan to rescind the March 2007 permit for the commencement of the construction phase of the Brisas Project; also downgraded to Neutral at tier 1 firm and downgraded to Neutral at JPMorgan), EXPE -8.9% (still checking), WYNN -3.6% (down in sympathy with LVS), PLD -1.0% (files for a $350 mln convertible notes offering)... Analyst downgrades: HOV -2.8% (downgraded to Reduce at UBS), FSLR -2.8% (downgraded to Accumulate at ThinkPanmure and downgraded to Perform at Oppenheimer), YUM -1.1% (downgraded to Neutral at UBS). -
Ning UBS on täna tõstmas Mastercardi (MA) ja Visa (V) hinnasihte. MA uueks sihiks on $350 (vana oli $275) ja V-l $100 (vana oli $88).
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Kuuldavasti on keegi suur tegelane Visa (V) aktsiat täna müümas. Ollakse ilmselt tugevust ära kasutamas. Seega ettevaatust seal.
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põle kuld, põle ! Tavidi klient on olla kole :) Hullul Mellil tuju huvitav.
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Minu arust päris hea võimaliku seletuse on andnud selle kohta, mis turul praegu toimumas, RealMoney alt Rev Shark.
'One school of thinking is that we are simply seeing a short squeeze in some of the underperforming names while the breakdown in old leadership is ultimately the indication that a broader market selloff is to come.'
Antud kontekstis peab Shark silmas järgmist:
Old leadership - oil, agriculture, chemicals
New leadership - retail, financials, tech -
LIBORi asemel NYFR. Bloomberg: ICAP Plans Rival Index to Libor for U.S. Bank Rates. Nii et mingi anonymous daily survey on siis usaldusväärsem kui praegune süsteem. Beats me!
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Boohya! TSLF auction bid-to-cover ratio 0,96.
Kusjuures see oli ju isegi väike, $25bln.
