On a day when U.S. exchanges are closed in observance of the Thanksgiving holiday, investors can take stock of the shifting macro risk factors hanging over financial markets. Mounting tensions between Russia and Turkey sparked by a downed Russian military jet, a continuing state of alert in Brussels and the announcement that China will overhaul its military to better project force abroad suggest that heightened geopolitical instability is here to stay for the foreseeable future. Meanwhile, a record low yield for German five-year sovereign notes set in trading today indicates increasing bets by investors that the European Central Bank will expand its asset-purchase facility in December. As shoppers prepare for the traditional U.S. kickoff of holiday retail frenzy, Black Friday, multiple analysts have urged caution after the most recent economic data indicated that Americans have been saving more and shopping less despite a strong dollar and inexpensive gasoline. The day off allows investors time to reflect on a world that now appears more uncertain than it looked a month ago.
Credit Suisse expands China reach. A joint venture between a Credit Suisse Group and a Chinese counterpart has been cleared by the China Securities Regulatory Commission to begin offering brokerage services in the economic zone of Qianhai in the southern city of Shenzhen. The Swiss bank will join UBS Group and Goldman Sachs in mainland China’s expanding securities-brokerage industry.
Barclays fined for wealth management transactions. On Thursday, the Financial Conduct Authority announced that it has levied a fine of more than $100 million against Barclays. Regulators said that Barclays executed a series of complex financial transactions for ultra-high-net-worth individuals without properly vetting the source of funds or disclosing client identities appropriately.
Hong Kong IPO prices at low end of range. The initial-public-offering debut of Bank of Qingdao on the Hong Kong Stock Exchange received a tepid response from investors Thursday with the Shandong-based commercial lender raising slightly more than $600 million at the lower end of the valuation range. The weak showing may indicate investors remain concerned about rising bad loan ratios and sluggish demand in China.
Goldman employee charged by SEC. On Wednesday the Securities and Exchange Commission filed a civil suit alleging that Yue Han, a compliance employee at Goldman Sachs, used his position to trade on inside information regarding mergers. According to the suit, Han made more than $450,000 in profits through the scheme.
China mulls metal purchases. A rebound in Chinese metal futures markets on Thursday was spurred by reports of a meeting between authorities and China’s largest copper and nickel consumers to discuss options. Expectations that Beijing may take actions including curbing short sales and making state purchases helped drive front-month copper contracts up over 4 percent in trading on the Shanghai futures exchange.
