Managed Funds Stay updated with Business News, Pakistan news, Current world news and latest world news with Business Recorder.. Sun, 23 Nov 2014 21:59:46 +0000 SRA Framework 2.0 en-gb JGBs edge up, BoJ buying helps longer-dated maturities imageTOKYO: Japanese government bond prices edged up on Friday, lifted by slipping Tokyo shares and overnight gains in US Treasuries.

A regular operation by the Bank of Japan, through which large amounts of government debt is purchased for its monetary easing programme, also supported longer-dated JGBs.

The BoJ said on Friday it is buying 160 billion yen($1.36 billion) of JGBs with maturities of 25 years or longer.

The 30-year yield went as low as 1.355 percent, a trough not seen since April 2013.

Amply supported by the BoJ's debt purchases, longer-dated JGB yields have declined steadily this week despite the possibility of Japan raising the issuance of 30- and 40-year bonds.

The benchmark 10-year yield dipped half a basis point to 0.460 percent.

Tokyo's Nikkei skidded 0.9 percent as selling ahead of a long weekend and signs of short-term overheating offset a boost from a solid Wall Street performance.

Copyright Reuters, 2014

]]> (Shoaib-ur-Rehman Siddiqui) Managed Funds Fri, 21 Nov 2014 14:47:02 +0000
Treasuries prices advance after weak China, euro zone data imageNEW YORK: US Treasury debt prices rose on Thursday, as investors sought the safety of government bonds amid concerns about global growth following weak manufacturing data from China and Europe.

Global stocks fell as a result, with risk appetite diminishing and pushing yields in safe-haven German bunds and U.S. Treasuries to the day's lows.

Data showing increased underlying U.S. inflation pressures last month and lower initial weekly jobless claims helped yields edge higher. But pessimistic data out of Europe and China outweighed the impact of sturdy U.S. data.

"This one snapshot of inflation doesn't undo all the potential headwinds in China, Japan, and Europe and certainly we'll wait and see if this becomes a trend rather than the exception," said Tyler Tucci, Treasury strategist, at RBS Securities in Stamford, Connecticut.

"It's a step in the right direction, but a step is all it is."

In mid-morning trading, benchmark 10-year U.S. Treasury notes were up 10/32 in price to yield 2.31 percent from 2.36 percent late Wednesday. Five-year notes were up 5/32, yielding 1.60 percent.

U.S. 30-year Treasury bonds were up 22/32 in price, with a yield of 3.02 percent, from 3.07 percent at the close on Wednesday.

Benchmark 10-year note and 30-year bond yields rose from the day's lows after data showed the core consumer price index, which excludes food and energy, rose 0.2 percent, the largest increase in five months.

A separate report showed first-time applications for unemployment benefits fell 2,000 to a seasonally adjusted 291,000 last week, staying below the 300,000 threshold for a 10th straight week.

"We have an improving labor market and a very subdued inflation situation," said Kim Rupert, director of fixed income at Action Economics in San Francisco.

"And it seems that even though the jobless numbers and some of the other economic data are pointing to the Fed hiking rates sooner rather than later, the inflation data remain too soft for them to hike rates."

Global markets were roiled earlier on reports showing weaker-than-expected manufacturing output in the euro zone and China's factory output contracting for the first time in six months.

Copyright Reuters, 2014

]]> (Imaduddin) Managed Funds Thu, 20 Nov 2014 16:04:30 +0000
Yields rise as markets brace for Fed minutes imageNEW YORK: US Treasury debt yields rose on Wednesday ahead of the release of minutes from the latest Federal Reserve meeting, which investors believed would show a central bank optimistic about the U.S. economy and ready to raise interest rates next year.

Treasuries were also pressured by the expected new issuance of Alibaba Group Holding's $8 billion corporate bond deal, traders said. Asset managers are selling Treasuries to make way for the Alibaba deal.

For now though, the focus has been on the Fed minutes to be released later in the session. Investors want to find out if the comments of the Fed committee members in the minutes affirm the more hawkish policy statement released more than two weeks ago.

"There's selling ahead of the Fed minutes," said Tom di Galoma, head of credit and rates trading at ED&F Man in New York. "There's a lot of pressure on the Fed to raise rates. And the consensus is that the Fed is looking to raise rates. Whether they do it or not is another question."

In mid-morning trading, benchmark 10-year U.S. Treasury notes were down 4/32 in price to yield 2.33 percent from 2.32 percent late Tuesday. Five-year notes were down 4/32, yielding 1.63 percent.

U.S. 30-year Treasury bonds were down 8/32 in price, with a yield of 3.05 percent, from 3.04 percent at the close on Tuesday.

Benchmark 10-year note and 30-year bond yields hit session highs after data showed starts for U.S. single-family homes rose for a second straight month in October and overall building permits approached a 6-1/2-year high.

But Craig Dismuke, chief economist at Vining Sparks in Memphis, Tennessee, was not as upbeat on the housing sector, although he noted that the stronger-than-expected permits boded well for next month's housing data.

He said since mortgage rates started to rise last May, almost every housing metric has flat-lined.

"We are on track for home price increases slowing to about 3 percent by year end," Dismuke said. "The Fed has to be cautious to not allow longer-term rates to rise because the housing recovery has stalled with this very small increase in mortgage rates."

Copyright Reuters, 2014

]]> (Imaduddin) Managed Funds Wed, 19 Nov 2014 16:55:17 +0000
JGBs extend gains after BoJ holds steady imageTOKYO: Japanese government bonds extended gains on Wednesday after the Bank of Japan held policy steady as expected and kept to its overall upbeat economic view - even with news this week that the economy had slipped into recession.

The BoJ said Japan's economy "continues to recover moderately as a trend" and voted to continue its purchases of government bonds and risky assets, maintaining its pledge of increasing base money, or cash and deposits at the central bank, at an annual pace of 80 trillion yen ($683 billion).

"At this point, the market feels like there is more downside risk in terms of the Japanese economy than upside risk, so that's why the JGB is basically strong," said Tadashi Matsukawa, head of fixed-income investments in PineBridge Investments in Tokyo.

On the supply side, the Ministry of Finance is considering increasing the issuance of 30- and 40-year Japanese government bonds by a total of 2 trillion yen in the new fiscal year starting in April, government officials with knowledge of the matter said on Wednesday.

The plan is aimed at taking advantage of current ultra-low yield levels to reduce the need for future debt rollovers as Japan's public debt continues to snowball.

The MOF's plan came as Prime Minister Shinzo Abe announced on Tuesday he would postpone a planned sales tax hike by 18 months to support the economy.

The 30-year JGB yield stood at 1.415 percent, down 5 basis points from the previous session, and from 1.445 percent earlier on Wednesday.

The 10-year yield shed 3 basis points to 0.470 percent , while the 20-year yield fell 5 basis points to 1.235 percent.

The yield on the two-year JGB fell one basis point to zero , meaning any further fall would put it in negative territory for the first time.

Japanese one-year government bills were sold for the first time at negative yields on Tuesday, underlining strong demand for the debt under the BoJ's qualitative and quantitative easing policy.

Lead 10-yr Dec JGB futures ended up 0.25 point at 146.30.

Copyright Reuters, 2014

]]> (Shoaib-ur-Rehman Siddiqui) Managed Funds Wed, 19 Nov 2014 08:11:11 +0000
Treasuries prices inch higher after tame core US producer prices imageNEW YORK: US Treasury debt prices edged higher in choppy trading on Tuesday after a core inflation measure showed just a tepid rise in prices last month, which suggested the Federal Reserve could take its time raising interest rates.

Yields, which move inversely to prices, were much lower following the release of the stronger-than-expected U.S. producer prices data but edged up from their troughs, indicating a market lacking any strong conviction trade.

German Bund yields hovering near record lows have also weighed on their U.S. counterparts. Benchmark U.S. yields have declined in three of the last four sessions.

U.S. data on Tuesday showed producer prices unexpectedly rose in October, but a broader measure, which excludes food, energy and trade services, remained benign, inching up just 0.1 percent last month.

"The headline was firmer than expected, but the sub-text reveals no inflation pressures and are closer to the traditional way we looked at PPI," said David Ader, head of government bond strategy at CRT Capital in Stamford, Connecticut.

In mid-morning trading, benchmark 10-year U.S. Treasury notes were last up 3/32 in price to yield 2.32 percent from 2.34 percent late Monday. Five-year notes were up 1/32, yielding 1.61 percent.

"Treasuries continue to be attractive versus our trading partners," said David Coard, head of fixed income sales and trading at Williams Capital in New York. "We have backed off from the lows in 10-year yields that we saw a month ago, so people see value here."

U.S. 30-year Treasury bonds, meanwhile, were up 7/32, with a yield of 3.04 percent, from 3.06 percent at the close on Monday.

CRT's Ader said while the United States looks in decent shape compared to the euro zone and Japan, the monetary policies for these countries reflected the fact their economies cannot stand on their own two feet.

"This may help explain why yields remain so low in general and specific to the U.S., reflect the global influence as much if not more than the pure domestic story," said Ader.

Copyright Reuters, 2014

]]> (Imaduddin) Managed Funds Tue, 18 Nov 2014 15:44:18 +0000
Turkey's 2-year benchmark bond yield falls below 8pc, year low imageISTANBUL: Turkey's benchmark bond yield fell below 8 percent on Tuesday, its lowest in a year, as markets started to price in easing from the Turkish central bank in the coming period with a lower inflation outlook for next year.

The 2-year government bond yield fell to 7.99 percent from 8.08 percent on Monday.

The central bank said last month that elevated food prices are delaying the improvement in the inflation outlook, yet falling commodity, especially oil, prices, are expected to support disinflation foreseen for the next year. "The market is preparing itself for a rate cut in the coming period from the central bank.

It's not being priced in the lira yet but short-term bonds are pricing in a 100 basis point reduction in interest rates in the coming 3-6 months," said a banker.

The central bank will meet on Thursday for its monthly rate setting meeting, but economists forecast that high inflation will mean no change to interest rates this month. Turkey is struggling to control inflation which is well above the central bank's year-end target of 5 percent, while economic growth is faltering.

Investors are also eyeing Standard & Poor's credit note, due on Friday, with bankers saying that a positive surprise from the rating agency is seen as more likely than a negative one.

S&P - which rates Turkey at BB+ with a negative outlook - is the only one of the three major rating firms that does not class Turkey as investment grade.

S&P said last year it had failed to reach a deal to offer a full rating for Turkey and would only issue "unsolicited" assessments - meaning it is not paid by Turkey to provide coverage but does so anyway to meet investor needs. The lira was firmer at 2.2219 by 0900 GMT from 2.2280 against the dollar late on Monday, while the 10-year government bond yield was unchanged at 8.46 percent.

Markets also eyed treasury debt auctions on Tuesday.

The treasury will sell a new 2-year benchmark bond and tap a 10-year fixed-coupon bond.

The Istanbul stock index was up 0.45 percent at 80,863.42 points, outperforming the broader MSCI emerging markets index, which was down 0.07 percent.

Copyright Reuters, 2014

]]> (Shoaib-ur-Rehman Siddiqui) Managed Funds Tue, 18 Nov 2014 09:53:01 +0000
JGBs slump, extend losses after poor 20-year auction

imageTOKYO: Japanese government bond prices fell on Tuesday, extending losses after an auction of 20-year bonds drew tepid bids despite a recent increase in the amount of buying by the Bank of Japan in the sector.

The 20-year JGB auction produced the tail, or the gap between the lowest and average prices, of 0.41, much wider than 0.08 in the previous auction.

The bid-to-cover ratio also fell to 2.88 from 3.59.

The poor results hit the longest maturities hardest, with the 30-year bond yield rising 7.0 basis points to 1.490 percent.

The 20-year yield also rose 6.0 basis points to 1.300 percent while the 10-year yield rose 4.0 basis points to 0.510 percent.

The market was also pressured as Japanese share prices staged a strong recovery after sharp falls on Monday following surprisingly poor gross domestic product (GDP) data showing Japan slipped into a recession.

The Nikkei share average rose 2.2 percent by early afternoon, erasing almost three quarters of its losses on Monday.

The 10-year JGB futures prices fell 0.27 point to 146.00. But the shorter end of the curve was firm after the government's one-year discount bills sold at a negative yield for the first time at auction.

The one-year bills were sold at a high yield of minus 0.0009 percent. The issue was bought further in the secondary market later, trading at minus 0.010 percent.

That also brought down the three-month yield 1.2 basis points to minus 0.070 percent.

Copyright Reuters, 2014

]]> (Shoaib-ur-Rehman Siddiqui) Managed Funds Tue, 18 Nov 2014 08:12:55 +0000
Treasuries prices slide in choppy trading; Japan data briefly lifts;-japan-data-briefly-lifts.html;-japan-data-briefly-lifts.html imageNEW YORK: US Treasury debt prices fell on Monday in choppy trading as investors took profits on gains fueled by weak Japanese economic data, ahead of the release this week of the minutes of the latest Federal Reserve meeting.

Market participants expect the Fed minutes to show optimism about the U.S. economy that should keep the U.S. central bank on track to raise interest rates sometime next year.

"Treasuries have been strong all year and we did see some buying after Japan's GDP data," said Aaron Kohli, interest rate strategist at BNP Paribas in New York.

"But we have sort of come off the low in yields because we have the Fed minutes coming up. There's really little scope for the Fed to be dovish given the run of pretty solid U.S. data."

U.S. industrial production for October was weaker than expected, falling 0.1 percent, but the report was decent compared with Japan's gross domestic product data, which fell unexpectedly by an annualized 1.6 percent in the July-September quarter.

That followed a 7.3 percent contraction in the previous quarter, caused by a rise in Japan's national sales tax, and ran counter to economists' forecasts for a 2.1 percent rebound.

"Overall, the U.S. economy is doing so much better than the rest of the world," Kohli said.

In mid-morning trading, the benchmark 10-year U.S. Treasury notes were last down 7/32 in price to yield 2.34 percent from 2.32 percent from late Friday. Five-year notes were down 3/32 to yield 1.62 percent.

U.S. 30-year Treasury bonds were down 17/32 to yield 3.06 percent, from a yield of 3.05 percent late Friday.

Copyright Reuters, 2014

]]> (Imaduddin) Managed Funds Mon, 17 Nov 2014 17:10:01 +0000
France to sell 7.3-8.8bn euros of bonds on Nov. 20 imagePARIS: France plans to sell 6.5-7.5 billion euros of medium-term fixed-rate bonds at its next regular auction on Nov. 20, plus 0.8-1.3 billion euros of inflation-linked bonds.

Fixed-rate bonds on offer are a February 2017 OAT, July 2017 OAT and November 2019 OAT.

Also on offer are a July 2023 OAT linked to French inflation plus a July 2027 and a July 2040 OAT linked to euro zone inflation.

Copyright Reuters, 2014

]]> (Shoaib-ur-Rehman Siddiqui) Managed Funds Fri, 14 Nov 2014 12:54:58 +0000
US long-dated bond prices inch lower ahead of auction imageNEW YORK: US long-dated Treasuries prices edged lower on Thursday ahead of an auction of $16 billion in bonds, while prices on other Treasury maturities were little changed following U.S. jobless claims data.

The Treasury will sell $16 billion in 30-year Treasury bonds at 1:00 p.m. EST (1800 GMT), the last leg of this week's $66 billion in new supply. Analysts said dealers were selling some 30-year debt ahead of the auction in order to raise yields to levels more attractive to buyers.

"Dealers are more likely to lighten up on Treasury holdings given the relatively weak demand at Treasury auctions this week," said Ellis Phifer, senior market analyst at Raymond James in Memphis.

Treasuries prices gained slightly on Labor Department data showing initial claims for state unemployment benefits rose to 290,000 in the latest week, more than economists expected, according to a Reuters poll.

Traders discounted the data as it wasn't far from expectations and was less significant than Friday's monthly jobs report for October, analysts said.

Analysts said traders awaited comments from Federal Reserve Chair Janet Yellen later in the day, but did not expect key revelations on the status of U.S. monetary policy. Traders are watching the Fed closely for signs of how soon the central bank will raise rates from rock-bottom levels.

The scarcity of U.S. economic data kept Treasuries yields, which move inversely to prices, in a narrow range, said David Ader, head of government bond strategy at CRT Capital in Stamford, Connecticut.

He said benchmark 10-year yields, which were as high as 2.66 percent on Sept. 19, remained down from those levels on recent weak Asian and European economic data and a stronger U.S. dollar.

U.S. 10-year notes were last up 1/32 in price to yield 2.36 percent, from a yield of 2.37 percent late Wednesday. U.S. 30-year bonds were last down 4/32 to yield 3.09 percent, from a yield of 3.08 percent late Wednesday.

On Wall Street, the benchmark S&P 500 stock index was last up 0.25 percent following Wal-Mart earnings and the jobless claims data.

Copyright Reuters, 2014

]]> (Imaduddin) Managed Funds Thu, 13 Nov 2014 16:49:54 +0000