Deutsche Bank surges, Yellen to address congress, and Trump and Sanders triumph in New Hampshire. Here are some of the things people in markets are talking about today.
Deutsche Bank surges
Deutsche Bank AG shares jumped as much as 15 percent this morning and were trading 13.5 percent higher at 11:05 a.m. London time, leading a surge in European bank shares that sees every bank on the Euro Stoxx Bank Index trading higher. Deutsche Bank is considering a bond buyback to help ease investor concerns, according to a person with knowledge of the matter. The stock remains down over 30 percent since the start of 2016.
Federal Reserve Chair Janet Yellen is due to begin her semiannual testimony to Congress later this morning. With market expectations for a rate cut from the Fed on the rise, investors will be looking to see if she pushes back against those expectations in her remarks. Dollar bulls, who have been having a rough start to 2016, may not get any salvation from today's testimony, according to Citigroup.
New Hampshire hangover
As expected, Donald Trump and Bernie Sanders triumphed in the New Hampshire primary. Hillary Clinton, who lost by 21 percentage points, has promised to "retool" her message. On the Republican side, Trump garnered 35 percent of the vote, with his closest competitor, Ohio Governor John Kasich, getting 16 percent. New Jersey Governor Chris Christie said he’s returning home to reevaluate his campaign after a poor showing in the vote.
Oil is rising this morning following yesterday's collapse that added to a four-session 13 percent decline. West Texas Intermediate for March delivery added as much as 79 cents to reach $28.73 a barrel on the New York Mercantile Exchange and was at $28.66 at 11.30 a.m. London time. The message from the oil industry's annual gathering in London is that the worst of the price slump isn't over yet. Rosneft OJSC's CEO Igor Sechin remains skeptical on an OPEC-Russia oil deal. Global shipping giant Maersk is tumbling today after posting weak results, in part due to the energy industry.
The U.S. Treasury is scheduled to auction $23 billion of 10-year debt later today as benchmark yields fall to the lowest in a year. In pre-auction trading the February 2026 notes were yielding 1.76 percent, which would be the lowest at sale since December 2012 for a benchmark 10-year. The low yields come as investor concerns over the global economy, the Fed's rate path, and the possibility of central banks pushing much further into negative territory increase.
What we've been reading
This is what's caught our eye over the last 24 hours.
- Goldman Sachs abandons five of six 'top trade' calls for 2016.
- CoCo problems show how investors have chased yield down the capital structure.
- Euro inflation outlook matches record low.
- EU plans 1-year extension to MiFID II start date.
- Here's where to invest in a recession.
- New SEC rule proposal aimed at ETFs may force investors into riskier ETNs.
- Self-driving cars also struggle in the snow.
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