Monday, 16 November 2015

Financial Orbit wrap 16/11/15

Five sentences or graphics which sum up the Financial Orbit output over the last 24 hours across the website, twitter account and anything else thought about...

1. Japan - Japanese GDP shrank more than expected in the third quarter, dragging the economy back into recession for the fourth time in five years. So much for a huge amount of QE...


The detail was not quite as bad as the headline as noted here: 

'Japan's economy shrank by an annualised rate of 0.8 per cent in the third quarter, versus forecasts for a 0.2 per cent decline. But details of the report weren't so pessimistic: businesses ran down inventories, knocking 2.1 per cent off of annualised growth, but consumption contributed an annualised 1.2 percentage points to growth, and net exports added 0.4 point' (FT)

However I cannot get away from the notion that Abenomics is correctly lampooned here: 


(h/t @RANSquawk)

2. Sector performance when bond yields increase - super useful via @HumbleStudent.  In my view another reason (along with value, sometimes yield and general lack of sentiment towards) to be overweight sectors like energy and mining currently:


3. Another day, another takeover this time a US$12bn odd approach by Marriott to Starwood to create a hotel/hospitality behemoth.  Actually scrub that, maybe it was a 'take-under' as noted here.


Over the years I have seen plenty of acquiring companies suffer a falling share price following the announcement of a deal for various reasons.  But a company being acquired - well that is more unusual.  The full write-up is here

4. Everyone believes it will be December


5. Policy confusion scope rising when the headline rate gets impacted in '16 by weak energy/food prices dropping out...

Latest developments in core € inflation are not consistent with Draghi's comments of a "weakening turnaround".

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