Market information

Friday, January 15, 2010

Rating agency Moody's decided to upgrade the status of governmental bonds of 39 emerging markets. Bonds coming from these countries used to have a 'junk' status. Everything below a BBB- rating is classified in this category. Institutional investors are often not authorized to invest in these risky high yield loans. With the increase of the credit rating of these governmental bonds it is now possible to invest in such obligations.

Banks are looking for more long-term savings. This is caused by the expectation of banks that the ECB will increase the refinancing interest. As a consequence, a shortage will arise on the money- and capital market. The funding costs of banks will increase because of that. To prevent this in the future, Rabobank already issued a ten year bond with a face value of €3,5 billion against an interest rate of 4,125%.

This month, the yearly figures of some large financial institutions will be published. Today, JPMorgan presents their results. It is expected that profit and bonusses will be back to the level of the years 2006 and 2007. Next week, among others, Goldman Sachs will follow.

The 6M Euribor stayed the same at 0,98%. The 10Y Swap dropped 2 basispoints to 3,49%.

In the attachment below, today’s market data on money and capital market rates as well as other rates are presented. For more history of these rates or other rates feel free to ask: .(JavaScript must be enabled to view this email address)

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Thursday, January 14, 2010

The price of gold decreased approximately with 2% to USD 1132.75 per ounce. Investors sell their gold, because they expect deteriorating times after the large increase of the gold price in December, when it reached USD 1218.25 per ounce.

Pension funds should be obligated to write a recovery plan after three quarters of underfunding. Now they are obligated to write this immediately when they are underfunded by the "Finacieel Toetsingskader (FTK)". It is expected that the ministry of Social Affairs and DNB come with propositions to adapt the FTK.

The minister from Finance , Wouter Bos, feels nothing for a seperate bankers bonus taxation in the Netherlands. Bos claims that a lot has already been done to control the bankers bonusses.

The German economy contracted in 2009 with 5%, which was larger than expected. In 2008, there was a growth of 1.3%.

The AEX-index increased with 0.4%, while the Dow Jones index increased with 0.5%.

The 6M Euribor remained unchanged at 0.98% and the 10Y Swap increased with 2 bp to 3.51%.

In the attachment below, today’s market data on money and capital market rates as well as other rates are presented. For more history of these rates or other rates feel free to ask: .(JavaScript must be enabled to view this email address)

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Wednesday, January 13, 2010

The American trade deficit increased in November. The deficit in October was slightly more than 33 billion USD. In November, it increased to 36.4 billion USD. Analysts expected an increase of the deficit to 34.6 billion USD.

The rate of American government bonds decreased yesterday as a consequence of the announcement from China that banks need to hold more capital as coverage for their outstanding loans. These new rules result in a increase of this coverage rate of 50 basis points. These measures are taken to limit the lending in the Chinese market.

Yesterday the price of Brent-oil has decreased with more than 2% to 78.7 USD. The was the biggest decrease in the last five weeks.

Later this week, the European Central Bank (ECB) announces her main interest rate. According to the expectations there will be no changes in the interest rate policy.

The 6M Euribor has decreased with 1 basis point to 0.98%. The 10Y Swap rate has increased with 3 basis points to 3.50%.

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Tuesday, January 12, 2010

The Dutch Economical Institute for Construction (EIC) has published new forecasts for the developments in the construction industry in the Netherlands. According tot the EIC 2010 en 2011 will be tough years. From 2012 and onwards, recovery will start and continue to at least 2015. As a consequence of the economic turndown, the EIC expects a loss 33,000 jobs in the industry. Production will decrease by 7.5% according to the EIC.

Industrial production in India had increased in november, rising 11.7% from november last year. This is the largest increase in production in 25 months. The largest part of this is due to the increase in production in October 2009 which showed an increase in production of 10.3%. Analists foresaw an increase of 10% for this month. The rapid increase in production is thought to be due to increases in global trade.

The 6M Euribor remained at the same level as yesterday at 0.99%. The 10Y Swap decreased with 7 basispoints to 3.47%.

In the attachment below, today’s market data on money and capital market rates as well as other rates are presented. For more history of these rates or other rates feel free to ask: .(JavaScript must be enabled to view this email address).

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Monday, January 11, 2010

Last Friday, figures on the American unemployment rate for December were announced. The number of jobs decreased more than expected and unemployment remained at a similar level. The number of jobs fell by 85,000 and unemployment remained at 10.0% due to a parallel decline in the labor force. Analysts expected an unemployment rate of 10.1% and an unchanged number of jobs. The number of jobs in November was revised to an increase of 4,000, marking the first increase in the number of jobs since the start of the recession.

In Europe, unemployment rose unexpectedly to a level of 10.0%. Analysts expected a rise in unemployment to 9.9%.

In China, it was announced that exports in December increased 17.7% (YoY). It was the first time in fourteen months that Chinese exports increased. Chinese imports increased by 55.9% (YoY) and is one of the main drivers of the global economy.

The 6M Euribor remained unchanged at 0.99%. The 10Y Swap decreased 1 basis point to 3.54%.

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