29 Nov 2021
Markets slumped in Asia and Europe on Friday and thin volumes exaggerated market moves in New York, much of the activity appearing to be driven by short-term algos and other technical trading accounts. investors will need to see clear signs that a major new health crisis and heavy economic disruptions are on the way. WHO is holding off judgement and the South Africans are downplaying the symptoms, saying that so far patients have not reported loss of smell or taste and there has been no major drop in oxygen levels with the new variant. Despite this ambiguity, Japan has jumped the gun and effectively banned all foreigners from entry.
This morning the high yield market opened weaker, but property took a backseat to Macau Gaming following news that Suncity CEO has admitted to illicit betting activity, according to the police. Wynn Macau and Melcro Resorts, which have higher exposure to VIP gross gaming revenue, were the targets for fast money, pushing prices down as much as 4pts. Retail sold SJM Holdings and MGM China, but held in well as dealers were happy to cover shorts. Casino stocks were down about 6%.
Despite this uncertainty the new issue market is starting to come alive a diverse mix of issuers. Philippines and Pakistan are looking at the US$ market while in the corporate space China based New Development Bank, Japan’s Olympus and Del Monte Pacific are also prospecting. NTT is looking at the Euro market.