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OPEC is set for an informal meeting, everyone wants dollars, and it's a bad day in the plane business. Here are some of the things people in markets are talking about today.
OPEC meeting as oil slump continues
Oil prices have become a one-way gamble for hedge funds as they increase bets on declining crude to a record, building a short position in West Texas Intermediate to 218,623 futures and options combined during the week ended Aug. 2. The Organization of Petroleum Exporting Countries will hold an informal meeting in Algiers next month, the group's president said this morning, after the commodity fell into a bear market last week. Oil is gaining today, however, with a barrel of WTI for September delivery trading at $42.37 as of 5:57 a.m. ET.
U.S. Treasury yields turn negative
For offshore buyers, at least. The cost of dollar hedging means that for investors in Japan and Europe, the yield on 10-year U.S. Treasuries has fallen to less than zero. The cost of funding dollars, reflected in the three-month Libor rate, has disconnected from the Federal Reserve's policy rate in recent weeks, with worries increasing that there is a big crunch brewing as U.S. money market fund reforms are due to come into effect in October.
Bad day in the plane business
Delta Air Lines Inc. grounded all takeoffs worldwide this morning due to a computer systems failure. Shares in the carrier are falling in premarket trading due to the ongoing disruption. At the manufacturing end of the business, Airbus Group SE said that the U.K.'s Serious Fraud Office has opened a criminal investigation into allegations of fraud, bribery and corruption relating to some of the company's third-party consultants. Shares in the plane-maker fell to their lowest since July 11 in Paris trading this morning.
The MSCI Asia Pacific Index climbed 1.4 percent overnight, as shares reached their highest level in a year. In Japan, the Topix index closed 2 percent higher as the yen weakened following stronger than expected U.S. jobs data on Friday. In Europe, the Stoxx 600 Index had gained 0.2 percent by 6:10 a.m. ET, with miners among the strongest gainers as commodity prices climbed. Futures for the S&P 500 added 0.1 percent as investors start to question current lofty valuations.
Republican presidential nominee Donald Trump will propose a moratorium on new financial regulations in a speech later today, in an effort to move the race to the White House back to policy issues after a difficult couple of weeks. Democratic presidential nominee Hillary Clinton is set to deliver her own speech on the economy on Thursday, her campaign said.
What we've been reading
This is what's caught our eye over the weekend.
- A hedge fund betting on the yuan's collapse for seven years is not about to give up...
- ... and neither is sterling's biggest bull.
- How a hairdresser's lawsuit could spell trouble for Brexit.
- Draghi jumps Brexit hurdle to find oil is damping the price outlook.
- Japan's Emperor indicates he is ready to step down.
- Researchers or allies of business? Think tanks blur the line.
- China's great river of steel returns.