AUSTRALIA FOCUS : THE CURSE OF ASHLEY MADISON AND APPLE
Ugly commodity headlines as usual.
Oil’s Slump Claims Another Casualty as Santos CEO Steps Down
Origin Energy swings to a loss following writedowns, warns of falling oil prices
But nothing can match this one that Sydney and Melbourne have been revealed to have one of the highest number of active Ashley Madison accounts in the world including an Australian MP as it has transpired, along with a few hundred government email addresses.
[For those who are unaware, Ashley Madison is the largest adultery website in operation and hackers have recently managed to leak the names of virtually every user onto the web in a second round of data dump http://www.theguardian.com/technology/2015/aug/22/adultery-website-ashley-madison-faces-578m-class-action-over-data-breach]
So what happens ?
Apple comes to the rescue with the largest ever bond deal in Australia, raising A$2.25 bio, more than twice the amount of of the previous largest corporate bond deal from BHP earlier this year. And of course that money will be used to for Apple share buybacks and dividends.
Well, I am not a fan of Apple bonds because of the 17 Apple bond issues done in 2015, 12 are trading under water and debt traders have lost money on them. But Aussie pension funds are running short of non-financial bonds to buy, investment grade ones at least, and Apple fills the gap nicely along with SabMiller and their 700 mio
“In less than four months, debt investors have lost an estimated $1 billion in market value on about $30 billion of Apple bonds.” http://www.bloomberg.com/news/articles/2015-07-22/debt-traders-could-ve-bought-millions-of-apple-watches-with-loss
A double jinx ?
Well, the RBA minutes have been intepreted as slightly more hawkish with decreased emphasis on the need for a weaker currency and thus the AUD did not fare too badly this week, depreciating less drastically than the rest of the commodity dependent EM nations as we had expected from a trading perspective last week.
” the currency looks supported too, at the moment along with Iron Ore, with the weekly chart looking favourable for intraday longs and trading on the long side against the USD and against the short AUD positions. 0.76 looks like a decent target against the 0.7250 support after missing the AUDSGD train” https://tradehaven.net/australia-focus-2/
At this point, I would like to point out that the Australian 10Y government yields have converged with the Singapore 10Y yields at 2.58% each which leaves no meat for investors looking for any carry and perhaps a suggestion that it is time to take some chips off the table (especially with the Apple jinx). And I would not even start looking for any green shoots of growth for the time being.
The currency, as with the rest of the world, I would expect to remain in a trader’s paradise for the time being with the markets affected by positionings, news and central bank talk noting RBA Stevens to speak on 26 Aug and a lot of speeches from Jackson Hole next week.
Leaving with the indicative prices.