Every afternoon ValueWalk provides an update on global market levels, economic news, and hedge fund news.
Seth Klarman: Don’t Underestimate The Power Of Uncertainty
Since founding his investment partnership in 1983, Seth Klarman has offered a stream of wise and timeless commentary on markets and the craft of investing. His commentary from periods of market volatility is incredibly insightful. Klarman's letters to clients around the time of the dot-com bubble and financial crisis in 2008/09 contained timeless insights on Read More
- US: Dow: 12766.04 (-1.52%), S&P 500: 1342.61 (-1.59%), NASDAQ: 2905.47 (-1.52%)
- Europe: CAC: 3362.56 (-3.72%), DAX: 6633.11 (-3.52%), FTSE: 5765.80 (-1.89%).
- Asia-Pacific: Australia: 4204.70 (-1.37%), China: 2410.45 (-1.43%), Hong Kong: 20806.25 (-2.21%), India: 5222.40 (-1.10%), Japan: 9637.63 (-0.63%)
- Metals: Gold: 1670.40 (-1.97%), Silver: 32.79 (-2.69%), Copper: 3.74 (-3.04%)
- Energy: Crude Oil: 104.75 (-1.85%), Natural Gas: 2.36 (0.25%)
- Commodities: Corn: 6.56 (-0.64%), Soya Bean: 13.32 (0.53%), Wheat: 6.56 (-1.23%)
- Currency: EUR/USD: 1.3122 (-0.7207%), GBP/USD: 1.5715 (-0.9478%), USD/JPY: 80.6910 (-1.0646%)
- 10 year US Treasury: 1.941% (-0.069)
Market News Update
U.S. markets tumble amid global growth concerns: Stocks fell the most in nearly three months on Tuesday with the Dow tumbling more than 200 points as recent government data rekindled concerns about global growth and a deadline loomed for private holders of Greek debt to agree to hefty losses. The Dow Jones industrial average lost 204.57 points, or 1.58 percent, to 12,758.24. The S&P 500 Index dropped 21.66 points, or 1.59 percent, to 1,342.67. The NASDAQ Composite fell 43.27 points, or 1.47 percent, to 2,907.21. http://www.reuters.com/article/2012/03/06/us-markets-stocks-idUSTRE81K0CU20120306
Participation in Greek bond swap might fall short: Greece is optimistic that it will achieve a 75% to 80% participation in a bond swap this week that aims to write off more than half of €177 billion ($234 billion) in debt issued under Greek law, people with direct knowledge of the matter said Tuesday. That participation rate falls short of the 90% needed to avoid the activation of collective action clauses that will rope in unwilling investors. http://online.wsj.com/article/SB10001424052970203370604577264780768710526.html?mod=WSJ_Markets_MIDDLETopStories
Oil drops to two-week low: Oil dropped to a two-week low in New York as the European Union offered to restart negotiations with Iran over its nuclear program, reducing the specter of war in the Middle East, source of 30 percent of the world’s crude. Crude for April delivery fell $1.98, or 1.9 percent, to $104.74 a barrel at 12:13 p.m. on the New York Mercantile Exchange. Prices dropped to $104.52, the lowest intraday level since Feb. 21. Futures are up 6 percent this year.
Gold down two percent: Gold fell 2 percent in heavy volume on Tuesday after breaching a key support, as renewed concerns about Greece’s debt triggered economic fears. U.S. gold futures for April delivery fell $35.40 to $1,668.50. https://www.cnbc.com/
Euro falls against the dollar for fifth consecutive day: The euro fell against the dollar for the fifth day in a row, losing 0.9 per cent to $1.3102, its weakest level in more than two weeks. Losses against the yen were more pronounced, with the single currency dipping 2 per cent to Y105.66 as a forecast of lower annual growth by China on Monday continued to weigh on markets.
Company News Update
- Shares of Chesapeake Energy (CHK) fell after the company announced a partnership with KKR (KKR) to invest in mineral interests and royalties in key domestic oil and gas basins.
- Caterpillar (CAT), the world’s biggest maker of heavy machinery maker, which fell 4%, costing the blue-chip index more than 30 points on its own.
- Online jobs search firm Monster Worldwide (MWW)‘s shares spiked almost 8% after the company announced it had retained Stone Key Partners and BofA Merrill Lynch to review “strategic alternatives.”
- Consol Energy (CNX) will idle a mining unit in Virginia and reduce its continuous mining operating schedule to five days a week due to decreased international demand for its metallurgical coal. Shares fell 1.1%.
- Dick’s Sporting Goods (DKS) reported quarterly earnings of 88 cents a share on $1.6 billion in revenue, matching analysts’ estimates.
- Nutrisystem (NTRI) lost 11% after the home-delivery weight-loss company reported a wider-than-expected fourth-quarter loss, although revenue was above expectations.
- Accuride Corp. (ACW), a maker of wheels for trucks and trailers, fell the most in more than three months after the company said its chairman won’t seek re-election to the board.
- Shuffle Master (SHFL)‘s fiscal first-quarter earnings jumped 59% as the casino-games business saw sharply higher revenue from its electronic-gaming segment. Shares rose 18%.
- Lehman Brothers Holdings Inc. revised its lawsuit against Bank of America Corp. (BAC) and Barclays Plc (BARC) to stop them from selling their remaining stake in real- estate company Archstone for almost $1.5 billion to Sam Zell’s Equity Residential. (EQR).
- Google Inc (GOOG) is renaming its online storefront for music, books and digital goods, its latest move to raise its profile in the market for electronic content sales and to better compete with Apple Inc (AAPL) and Amazon.com Inc. (AMZN). From Tuesday, the store will be rebranded as the Google Play Store.
- Intel Corp (INTC) formally launched its newest high-end “Xeon” server chip on Tuesday, seeking to capitalize on an explosion of Internet traffic sparked by Web-based cloud computing, social networking and expanding use of smartphones and tablets.
- Facebook Inc. (FB) lost a ruling in Germany over using the e-mail addresses of people who aren’t members of its social network.
Hedge Fund News Update
- Asia-focussed hedge funds that were started with the help of a major backer after the 2008 credit crisis are shutting down as a shrinking pool of key investors makes it harder for them to raise capital. Isometric Investment Advisors Ltd decided in December to close after its largest startup investor said it would withdraw its cash. Black’s Link Capital Ltd closed after its biggest investor, a US-based fund of hedge funds, pulled its capital last year, said two people with knowledge of the matter.
- John Paulson lost 1.5 percent in February in one of his largest hedge funds, according to an investor update, paring this year’s gain and setting back efforts by the New York-based manager to recoup record losses in 2011. Paulson’s Advantage Plus Fund, which seeks to profit from corporate events such as takeovers and bankruptcies and uses leverage to amplify returns, gained 3.5 percent in the first two months of 2012.
- Boston-based hedge fund advisory firm Silver Bridge has appointed industry veteran Bradley Fisher as managing director. Fisher will be responsible for designing custom solutions for Silver Bridge’s family office clients nationwide, according to a company statement.
- Ledgex Systems, a leading software provider for the alternative asset management industry, today announced that The Archstone Partnerships, a New York based multi-strategy Fund of Hedge Fund, has licensed the Ledgex Platform.
- GREECE’S major bondholders voiced their support yesterday for a deal that would halve the value of their debt holdings and aims to put the country back on a sustainable debt-repayment footing. The steering committee of the Institute of International Finance (IIF), which includes a dozen major investors in Greek bonds and helped draw up a deal agreed last month, said it would accept the offer. About a quarter of privately-held Greek debt is estimated by industry sources to be in the hands of hedge funds, which are not represented by the IIF committee.
- Global trading companies including Swiss Glencore (GLEN.L) and U.S.-based Bunge (BG.N) have expressed interest in the possible sale of U.S. energy and grains trader Gavilon Group, according to a source familiar with the matter. Gavilon, owned by hedge fund manager Dwight Anderson and investors such as billionaire George Soros, began exploring fund-raising options in January, offering the chance to buy into a leading fertilizer distribution system, a network of grain storage bins and oil storage facilities in Oklahoma.
- The Teacher Retirement System of Texas has taken a $250 million ownership stake in the Bridgewater Associates money management firm, the New York Times reported. The Times reported such a move by a pension system is unusual because it is betting on the long-term viability of a company whose fortunes are closely aligned with its founder, Ray Dalio.