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August 4
Good evening everyone. With short selling temporarily eradicated, mainland shares launched for the moon today with the Shanghai Composite surging almost 3.7% while the Shenzhen Composite Index soared a staggering 4.77%. Hong Kong’s Hang Seng Index meanwhile didn’t do too well, ending the day down 0.02%, while Japan’s Nikkei Average had it a little bit worse, falling 0.18% to end the day down at 20,520.36. Over in the currency markets, the aussie had an outstanding day today as better than expected retail sales and forecast-beating deficit figures helped the Australian currency surge 1.5% against the U.S. dollar. The euro, the yen, and the pound meanwhile also made some, albeit tiny, gains, with all three trading at least 0.1% higher against the greenback today.
And now for the news:
Commodities had a good day. Well, good-ish at least as gold, copper, even oil bounced off their forever-new lows. Gold rose $3 to $1,089 an ounce while copper jumped 0.7% to $5,228. West Texas Intermediate and Brent crude meanwhile climbed 1.2% and 1% respectively. Financial Times (paywall)
Greek stocks are getting clobbered again. Burdened by capital controls, bad sales data, and well, everything else, Greek shares continued to nose-dive today and once again, Greek banking stocks were among the worst hit. Attica Bank, the National Bank of Greece, Alpha Bank, and Piraeus Bank fell at least 24% at the opening. The Guardian
Hyundai to slash SUV prices. South Korean carmaker Hyundai Motors announced that they’ll be cutting the price on two of their SUVs in China by at least 11%. Apparently, the continued downturn in the world’s second largest economy lead the company’s shipments in China to fall 14% in the second quarter. Reuters
Madoff trials finally come to an end. Irwin Lipkin, the 77-year old former controller for Bernard L. Madoff Investment Securities and the last defendant connected to the Ponzi scheme, is set to be sentenced by a Manhattan federal court tomorrow for falsifying records. Reuters
CITIC Securities shuts down short selling operations. After Beijing announced last night that it would now require short-sellers to leave their positions open at least overnight, as opposed to the current T+0 rule which allows them to short and cover in the same day, Chinese brokerages are scrambling to shut down their short selling businesses to transition to the new rule. CNBC
Chinese stock pledge loans hit record high. Stock pledge loans, long rumored to be the reason behind all those share freezes, apparently reached a staggering RMB 1.5 trillion.
Chinese stock pledge loans hit RMB1.5T, one reason for the trading freeze- esp for small-caps under pressure $SZCOMP pic.twitter.com/iSuvWx0DeT
— Haidi Lun 伦海迪 (@HaidiLunCNA) August 4, 2015
Aussie jumps off lows as Australian retail sales beat estimates. ‘Straya wowed traders earlier today as retail sales in the nation posted 0.7% gains in June, higher than economists forecasts of a 0.4% reading, and equal to February’s then-strongest rate of growth for 2015. The long-embattled Australian dollar promptly bounced to a session high of US$0.7292. Financial Times (paywall)
Trader gets jail time for Libor scandal. Tom Hayes, the former UBS and Citigroup trader who was the first person ever to stand trial in connection to the Libor probe, was found guilty on eight counts of conspiracy to defraud by a London court and was sentenced to 14 years in jail. CNN Money
Brent crude dives to five-month low. China’s nasty manufacturing data sent Brent crude prices down a massive 5% Monday, while U.S. crude slipped nearly $2 down to $45.17 – just $3 off its 2015 low. Reuters
Puerto Rico defaulted. Puerto Rico was only able to make a partial payment Monday of about $628,000 towards its August 1 deadline to pay back millions of dollars in debt. Moody’s labeled the situation a default. CNBC
Pimco gets Wells Notice from the SEC. The top cop is looking into trades over a four-month period involving the pricing of non-agency mortgage securities in its Total Return ETF. NexChange
Hedge funder is backing Ted Cruz. Robert Mercer gave $11.1 million to the Texas senator’s presidential campaign, almost of third of Cruz’s total campaign money. Ronald Perelman, Len Batavnick, Julian Robertson, and Steven and Alexandra Cohen have also given more than a million dollars each to Republican presidential candidates. New York Post
Kobe teams up with Alibaba. NBA superstar Kobe Bryant has struck an exclusive deal with Alibaba to distribute his documentary through their Tmall Magic Box as well as letting Alibaba Pictures develop and distribute his brand’s products through its own retail platforms. SCMP (paywall)
Photo: Khush N