Senin, 29 Maret 2021

Investors brace for fallout after hedge fund default reportedly triggered $20 billion fire sale of stocks - Financial Post

With a number of banks said to be exposed to Archegos, investors are on the lookout for signs of contagion

Author of the article:

Reuters

Devik Jain and Medha Singh

Publishing date:

Mar 28, 2021  •  27 minutes ago  •  2 minute read  •  13 Comments
Contracts on the S&P 500 declined along with Nasdaq 100 futures following revelations that Archegos Capital Management LLC — the family office of Bill Hwang — was behind a $20 billion spree of block trades on Friday.
Contracts on the S&P 500 declined along with Nasdaq 100 futures following revelations that Archegos Capital Management LLC — the family office of Bill Hwang — was behind a $20 billion spree of block trades on Friday. Photo by Angela Weiss /AFP via Getty Images

Wall Street’s main indexes eased on Monday after a surge in the previous session, as global banks said they faced potential losses from a hedge fund’s default on margin calls.

Nomura and Credit Suisse warned of losses after the U.S. hedge fund, named by sources as Archegos Capital, defaulted, hitting shares in some big media and Chinese technology companies.

Shares in Morgan Stanley fell about 3 per cent after the Financial Times reported it had also sold billions of shares, while Bank of America Corp, Citigroup Inc, JPMorgan Chase & Co, Goldman Sachs and Wells Fargo & Co dropped between 0.3 per cent and 2.7 per cent.

The news has raised concerns about whether the full extent of Archegos’ apparent wipeout has been realized or whether there was more selling to come from other lenders.

Nomura still has positions to unwind, Bloomberg reported, citing a Japan government official.

  1. Nomura Holdings Inc. headquarters, in Tokyo. Nomura said it faced a possible US$2 billion loss due to transactions with a U.S. client.

    Nomura, Credit Suisse warn on big losses after Archegos share dump

  2. Your next statement is going to be fun to look at, but while rejoicing remember that the only useful measure of how you’re doing is your long-term return.

    The last 12 months have been wonderful to investors, but don't let the end-date sensitivity fool you

  3. Investors are likely to find better opportunities abroad, or, in the case of this analysis, just north of the border in Canada.

    David Rosenberg: Investors should look north (or further) because U.S. stocks are looking more and more overextended

Shares in Discovery Inc, U.S.-listed shares of Tencent Music , ViacomCBS, Baidu and VIPShop, all linked to Archegos, gave up early gains. Theses stocks lost between 30 per cent and 50 per cent of their value last week.

“It’s a black eye for the financial industry because it suggests that there still may not be a full handle on risk control when it comes to leveraged trading,” said Rick Meckler, a partner at Cherry Lane Investments in New Vernon, New Jersey.

“This seems like a pretty specific case. It could lead to increased regulation … but the impact on broader markets is going to be small.”

The Dow and the S&P 500 hit record closing highs on Friday on optimism about speedy vaccinations and record stimulus, while the tech-heavy Nasdaq is still about 7.1 per cent from its February all-time closing high.

“We’ve come far really fast and I wouldn’t be surprised to see a pause … especially after the rally that we’ve had and because we don’t have earnings season yet,” said Stephanie Link, chief investment strategist at Hightower Advisors.

At 10:04 a.m. ET, the Dow Jones Industrial Average was up 16.14 points, or 0.05 per cent, at 33,089.02, the S&P 500 was down 16.75 points, or 0.42 per cent, at 3,957.79, and the Nasdaq Composite was down 102.09 points, or 0.78 per cent, at 13,036.64.

Planemaker Boeing Co rose 2.6 per cent after reaching a deal with U.S. budget carrier Southwest Airlines Co for a variant of the 737 MAX aircraft. Southwest’s shares gained about 0.5 per cent.

Bitcoin prices gained about 4 per cent after Visa Inc said it would allow the use of the cryptocurrency USD Coin to settle transactions on its payment network.

Declining issues outnumbered advancers 1.17-to-1 on the NYSE and 1.65-to-1 on the Nasdaq.
The S&P index recorded 60 new 52-week highs and no new low, while the Nasdaq recorded 67 new highs and 17 new lows.

© Thomson Reuters 2021

Let's block ads! (Why?)


https://news.google.com/__i/rss/rd/articles/CBMiYWh0dHBzOi8vZmluYW5jaWFscG9zdC5jb20vaW52ZXN0aW5nL2FzaWEtdG8tcHJvdmlkZS1nYXVnZS1vZi1tb29kLWFmdGVyLWJsb2NrLXRyYWRlcy1tYXJrZXRzLXdyYXDSAY8BaHR0cHM6Ly9maW5hbmNpYWxwb3N0LmNvbS9pbnZlc3RpbmcvYXNpYS10by1wcm92aWRlLWdhdWdlLW9mLW1vb2QtYWZ0ZXItYmxvY2stdHJhZGVzLW1hcmtldHMtd3JhcC93Y20vZDI4ZmFkYWMtODE1MS00MmI2LTkxZDUtNDNkNGE5MTg5YzAxL2FtcC8?oc=5

2021-03-29 14:10:22Z
52781466947013
By di

Tidak ada komentar:

Posting Komentar

Langganan: Posting Komentar (Atom)