Who is buying the negative-yielding bonds that are swelling in number outside of the U.S.? The surprising answer, in some cases, is U.S. investors. They are entering into complex strategies that generate a positive return even from negative-yielding debt. That is made possible by the unusually wide difference between positive U.S. interest rates and their negative European counterparts.
PLANNING & INVESTING
Storm Clouds, Not Capital Ones, Ease for Reinsurers: Dorian’s path spared reinsurers from a massive bill, but a glut of capital will continue to depress returns.
From Dow Jones Newswires
An extension of OPEC cuts “through at least 2020” may balance oil markets next year, especially if the IMO 2020 regulation change boosts oil demand, Rystad Energy says. To achieve a balanced market, “the global economy needs to avoid a sharp slowdown and oil demand recover to more normal growth rates of between 1 million and 1.2 million barrels per day,” says Rystad’s Bjornar Tonhaugen. “If the stars fail to align, however, OPEC may need to discuss much deeper cuts to support the market,” he adds. Rystad estimates shipping fuel regulation changes through IMO 2020 “will cause a net positive effect on crude demand growth next year of about 1 million barrels a day.” Failing that, “prices will be even lower next year,” without a deeper OPEC cut. (email@example.com ; @davidhodari)
Sugar and coffee traders often pin their hopes on the real, saying an upturn in Brazil’s currency could revive the fortunes of commodities that the country exports. A strengthening real has given sugar and coffee prices no respite this week, however. Murilo Aguiar of INTL FCStone says the “high availability of sugar in ports…delayed ship appointments and the possibility of a higher volume in physical delivery” against two London and New York futures contracts have created a downward spiral in the market. Meanwhile, data released by the European Coffee Federation Thursday showed stockpiles in European ports rose by 24,011 tons in August–a sign of plentiful supply. (firstname.lastname@example.org)
BUSINESS & PRACTICE
Manufacturers Cut Spending as Trade War Dents Confidence: U.S. manufacturers are investing less in their factories and workforces as the trade dispute with China makes it more difficult for executives to anticipate costs and demand.
Walgreens, CVS Ask Customers to Stop Carrying Guns: Drugstore chains CVS and Walgreens and grocer Wegmans have asked customers to stop openly carrying firearms in stores.
Big Tech’s Hands-Off Era Is Over: Amazon, Google and Facebook now have to be much more proactive about managing their platforms. But it will be costly.
TRAVEL & LIFESTYLE
‘It’s Kind of Like an Addiction’: On the Road With Trump’s Rally Diehards: A small band of the president’s most devoted fans will do whatever it takes to attend his campaign rallies.
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SOURCE: MoneyBeat – Read entire story here.