We found fresh market news just for you. It's hand-curated by our research team, and straight to the point.
If you're ready, let's go! 🚀
Natural-gas prices surge ahead of winter season
The Big Story 💥
Low inventories around the world have made the heating fuel more expensive than it has been in years prompting worries about winter shortages and forecasts for the most expensive fuel since frackers flooded the market more than a decade ago.
U.S. natural-gas futures ended Friday at $5.105 per million British thermal units. They were about half that six months ago and have leapt 17% this month. A substantial and sustained increase in price would be felt from households to heavy industry.
Stocks have already gotten a lift from $5 gas. Energy has been the best performing sector in the S&P 500 stock index in September and one of only two that are up this month.
The U.S. Energy Information Administration on Thursday will give a fresh estimate of the volume of natural gas in storage, which it last estimated to be 16.5% less than a year ago. Now is the time of year when drillers fill storage tanks and caverns to get through winter, when demand is greatest and households are most exposed to higher prices in their heating bills.
Similar factors are at play in Europe, where prices have been setting records all summer. In Asia, buyers are paying more than ever for deliveries of liquefied natural gas, or LNG, to sail across the Pacific instead of to Europe.
The supply deficit is particularly acute in Europe however, where inventories are thin thanks to hot weather, lackluster wind-power generation and lower imports from Russia. Stockpiles in northwestern Europe have recently been about 24% below average.
Overnight Action 😴☕
The Hang Seng Index plunged 3.44% to a near eleven-month low in early deals on Monday, amid mounting concerns about the health of China's economy and Beijing's regulatory crackdown.
China's top securities regulator defended their clampdown in various industries in a private meeting with Wall Street executives. Shares of China Evergrande Group plummeted over 10%, as 40 billion Yuan in cash-strapped developer wealth management products are outstanding.
Reuters said that Evergrande Group has begun repaying investors with real estate, allowing them to choose from discounted apartments, offices, retail spaces, or car parks for repayment. At the same time, traders remained nervous as Macau began an overhaul of the rules governing 'Asia's Las Vegas'. Markets in China are closed for the Mid-Autumn Festival.
US stock futures traded considerably lower today after a sharp pullback in Wall Street Friday, with the Dow Jones Friday hitting a 2-month low and the S&P 500 falling to a one-month low, as investors cautiously await the FOMC meeting later this week looking for clues about the tapering timeline.
Recent economic data painted a mixed scenario, increasing doubts on when the Fed will start cutting stimulus. The Michigan consumer sentiment disappointed and continued to point to the least favorable economic prospects in more than a decade.
Retail sales also unexpectedly rose and inflation eased more than expected while jobless claims were above forecasts and the payrolls report disappointed. Investors also await a number of major quarterly earnings reports this week with Adobe, FedEx, Nike, and Costco posting financial results.
Oil prices fell on Monday, extending losses from Friday after the U.S. dollar jumped to a three-week high and the U.S. rig count rose, although nearly a quarter of U.S. Gulf of Mexico output remained offline in the wake of two hurricanes.
Top 5 Moves 🆕📰
Iron Ore rout keeps rolling as China imposes curbs
Iron ore extended its slump below $100 a ton as China stepped up restrictions on industrial activity in some provinces. Prices have collapsed about 60% since a record in May, with futures trading below three figures for the first time in more than a year, as steel production curbs hammer demand. China is seeking to cut output this year to reduce greenhouse-gas emissions as it pushes forward with its vow to be carbon neutral by 2060, while more recent restrictions have focused on improving air quality for the Winter Olympics next year.
China Evergrande shares plummeted 15% this morning
Shares of Evergrande plunged over 15% on Monday, extending losses as investors take a dim view of its business prospects with a fast approaching deadline for payment obligations this week. The company's property management unit dropped over 8%, while its electrics car unit declined 2%. Movie streaming company Hengten Net, majority-owned by Evergrande, plummeted 10%. The developer said on Sunday it has begun repaying investors in its wealth management products with real estate. Evergrande is due to pay $83.5 million interest on Sept 23 for its March 2022 bond. It has another $47.5 million interest payment due on Sept 29 for the March 2024 notes. The bonds would default if Evergrande fails to pay the interest within 30 days.
Hong Kong property firms fall as Evergrande fears grow
The Hong Kong stock exchange tumbled Monday over fears of a contagion from the potential collapse of Chinese real estate giant Evergrande as it struggles under a mountain of debt. The firm, one of the country's biggest developers, has warned it may not be able to repay loans and interest on its bonds -- totalling more than $300 billion -- and could go under. With some payments due Monday and Thursday, traders are keeping a nervous eye on the crisis, which has fanned fears of a domestic and international contagion.
Other property firms were also in the firing line, with Henderson Land losing 12.3 percent and New World Development 11 percent lower. Sun Hung Kai Properties shed nine percent. Insurance giant Ping An lost eight percent. China Minsheng Bank, Agricultural Bank of China and Industrial and Commercial Bank of China were all down around five percent each.
France's OVHcloud could see $4.7B IPO
European cloud-services provider OVHcloud plans to launch a possible initial public offering as soon as Monday that could value the business at more than $4.7 billion. Based in Roubaix, France, OVHcloud rents computing, storage and networking capability to users, overseeing a network of dozens of data centers across North America, Europe, Singapore and Australia. It also operates its own fiber- optic network globally that the company claims gives it a competitive edge. The challenge and opportunity for OVHcloud, which was founded in 1999 and is formally known as OVH Groupe, will be convincing investors it has the ability to compete with industry behemoths such as Amazon.com Inc. Microsoft Corp.'s Azure and Google Cloud, a unit of Alphabet Inc. Largely owned by the family of founder and chairman Octave Klaba, the company has built its own in-house server technology, including systems that run water over its processors to cool them. An IPO could value OVHcloud at more than 4 billion Euros.
Europe faces corporate credit supply shortfall
The amount of corporate bonds investors can trade in Europe is shrinking for the first time since 2005. Despite a rush in deals by high-grade non-financial firms, there’s effectively a 21 billion Euro drop in the investable pool of euro bonds because of calls, buybacks, upcoming redemptions and European Central Bank debt purchases. Dwindling supply will typically limit liquidity in credit markets, making the pricing of risk more challenging. The issue is already prevalent in Europe’s sovereign bond market, where central bank dominance has sapped volatility, crimped trading volumes and squeezed out investors in what’s known as “Japanification.” So-called negative net-net supply is the result of continuing central bank stimulus in a period when companies have limited funding needs after the 2020 debt binge. Firms in the euro area boosted cash reserves during the pandemic and now sit on record-high deposits with banks. Gross supply of euro non-financial bonds has seen a 42% year-on-year drop.
Crypto Outlet 🐳
Gary Gensler recently said that stablecoins “may well be securities” and thus potentially subject to SEC regulation.
Bitcoin (BTC) retested $47,000 on Sept. 19 as the weekly close looked set to hinge on the CME futures gap, now at $45,709.
Multiple tokens showed bull flags over the week, including Solana (SOL).
As part of the inquiry, U.S. officials have been looking into whether Binance or its staff profited by taking advantage of its customers
Investors will be closely watching the meetings of central banks across the globe this week, including the Federal Reserve, Bank of England and Bank of Japan policy meetings. Officials in the US are widely expected to give an update on the timing of the bank's asset purchase tapering, but no significant changes are meanwhile expected from other major banks. Elsewhere, Canadians are voting for a new parliament today, while flash PMI surveys for the US, UK, Eurozone, Japan and Australia will provide an insight about the state of the global economic recovery.
A preview of the news, earnings, and economic data to expect in the week ahead. This week includes the Fed meeting and Swiss National Bank rate decision as well as an election in Canada and earnings from Nike, Oracle, and Adobe.
This email and any files transmitted with it are confidential and intended solely for the use of the individual or entity to whom they are addressed. If you have received this email in error, please notify us immediately, and delete it from your system. If you are not the intended recipient, you are notified that disclosing, copying, distributing or taking any action in reliance on the contents of this information is strictly prohibited. Although we scan attachments, we advise you to carry out your own virus check before opening any attachment.