Liquidity Squeeze in All Markets sell what you can and Ask Questions later Simple reason why Long-standing Correlations Dollar Gold Bonds etc. breaking down. Move into Cash and wait till Dust settles
European Stocks Worst day Ever yesterday having the best day today Since 2008, Welcome to the trade of 2020.All due to Pledged Govt Stimulus from Germany See below;
Stimulus, Interest cuts For Everyone!!(News from BBG, Reuters, and trading economics)
• GERMANY WILL PUT NO LIMIT ON CREDIT PROGRAM TO HELP COMPANIES
• GERMAN ECONOMY MINISTER ALTMAIER SAYS AROUND 0.5 TRILLION EUROS ARE AVAILABLE
• Possible Germany will take on Added Debt
• Germany Pledged to spend billions to help Country
• Italy banned Short Selling MIB +14%, BTP +75 ticks but 450 tick range
The Norges Bank delivered an emergency 50 bps rate cut, joining the RBA, the BOE, the BOC, and the Fed, among others, in slashing rates to cushion the global economic fallout from the coronavirus.
Sweden, meanwhile, rolled out liquidity measures. The Riksbank said it would lend SEK500 billion to companies through banks in a bid to ensure corporates don’t lose access to credit. The new, two-year loans will come with a variable rate equivalent to the repo rate (so, 0%). The Riksbank exited negative rates in December, but will likely have to do more to combat
The Bank of Japan, BOJ, offered $20.7B in Cash Injections in Three different operations While buying a record 101.4 Billion in Stock Funds, this is sixth time this month BOJ has bought stock Funds. They also offered to buy $1.9B of bonds in an unscheduled operation
The Central Bank of Australia Conducted largest repo Operation since 2013 to provide Liquidity
The People’s Bank of China lowered the reserve requirement ratio by 50-100bps for banks that have met inclusive financing targets on March 13th but held the ratio for large banks at 12.5 percent. It was the second cut this year, allowing the release of CNY 550 billion, or USD 79 billion, in liquidity to support the economy hurt by the Covid-19 pandemic. The bank also said it was slashing the RRR for qualified joint-stock banks by an additional 100 bps.
Pelosi, Mnuchin near deal on coronavirus emergency package after-market nosedive- House Speaker Nancy Pelosi told reporters outside her office Thursday evening that after all-day talks with Treasury Secretary Steven Mnuchin, no deal had been reached but one was close, adding that “we hope to have an announcement tomorrow
Wild Ride in Asian Stocks Last night Even though all finished in the Red they closed higher then worst levels of Day
Asian equities were lower, but some gauges pared their worst losses after a harrowing start characterized by a series of circuit breakers in South Korea, the Philippines and other locales, as local markets tried to catch down to Thursday’s “worst since 1987” session on Wall Street. Trading was halted in Seoul, Bangkok, Manila, Jakarta and Mumbai, as stocks careened lower. And yet, by the time the dust settled, record turnarounds were in the books. (Heisenberg report)
Spoos limit Up, Italy’s MIB +14% Spanish Stock +9.75%, Dax +6.75%. treasury’s heavy Bonds down 2 handles, Bunds down 250Ticks maybe just maybe a sense that Central banks and Govts. Finally getting a head of Economic crisis. Watching credit spreads if that start to Contract markets can breathe a bit easier. Oil +6% watching oil companies they are on front line of Credit worries.