Lockhart says September, IMF says not yet to yuan and more good news for Spain. Here are some of the things that people in markets are talking about this morning.
Lockhart signals September
The U.S. dollar rose to a four-month high following Federal Reserve Bank of Atlanta President Denis Lockhart's comments in an interview with the Wall Street Journal in which he said that it would take a significant deterioration in the data to convince him not to push for a rate hike in September. Traders now see about even odds of an increase in interest-rates at the September meeting.
The IMF has proposed delaying by nine months, until September 2016, any changes in the basket of currencies that make up the lender's Special Drawing Rights. The delay would allow the fund the time it says it needs to undertake "significant work" analyzing data ahead of any decision to grant the Chinese yuan reserve currency status. Traders expect the Chinese authorities to maintain the yuan's tight peg to the U.S. dollar ahead of that decision.
More good news for the Spanish economy this morning as Markit said their index of services activity jumped to 59.7, up from 56.1 in June, well ahead of survey expectations of a decrease to 55.8. Separately, June home sales in Spain increased 17 percent from a year earlier, the largest increase since March 2014, according to data compiled by the National Statistics Institute.
SocGen profit, StanChart dividend cut
Societe Generale SA shares soared after the bank reported its highest profit since 2007. Net income rose to €1.35 billion ($1.47 billion) in the second quarter, well ahead of the €1 billion estimate of four analysts surveyed by Bloomberg. Shares traded in Paris jumped as much as 10.4 percent following the announcement. Standard Chartered Plc announced a cut in its dividend after first half profit dropped by 44 percent. Crucially, the bank said it may not need to raise more capital, leading the shares to jump as much as 6.5 percent, after initially falling after the announced cut in the dividend to 14.4c per share.
Greek bank pain continues
Day three of trading on the Athens stock exchange following its five-week closure and day three of Greek bank shares getting obliterated. The rout has now wiped more than half the value of Greek lenders in three days. Stock market rules mean that share price drops are limited to 30 percent per session, and Piraeus Bank SA is going for three out of three in hitting that limit. Shares in the lender which were at €0.40 when the exchange closed in June, are this morning trading at €0.138.
What we've been reading
This is what's caught our eye over the last 24 hours.
- Keynes would probably approve, but does the world need Egypt's $8 billion Suez extension?
- What Obama can learn from Germany's push for renewable energy.
- It was the market, not the president, that killed coal.
- The diverging fates of Italy's two greatest cities.
- The best stock to buy on the Athens stock exchange is the Athens stock exchange's owner, says Merrion.
- The best way to start your new fund is to get a $2 billion investment from the fund you've just left.
- Lockhart talks to Hilsenrath in the Wall Street Journal.