The Banking and Strategy Initiative

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The Mid Week Trading Update: 6 days and counting, Wall Street nudges down Dell worth $25 Bln to Dell and that Apple blowback

Lululemon Athletica

Lululemon Athletica (Photo credit: Wikipedia)

Those attending the Cuertino CA announcement on Tuesday did not perhaps realise that the plasticised 5c series from Apple was still worth $650 (India) and almost $750(China) unlocked , as they hoped for a bigger tie up in China to start Apple’s new innovation in price off to a racing start. However, it is and that throws a spanner in the wheels of many still driving the Apple way more than a year after Jobs left the company to Tim Cook. Michael Dell also tries to rejuvenate his promoter’s mojo back at Dell as Carl Icahn was discouraged long enough for the pennies higher bid by the promoter and Silver Lake Partners to succeed and let the owner pay $25 Bln to take hs dream private. Dell has $18 Bln in debt after the recent $12 Bln lus losses

Jack Ma, back at Alibaba in China, tried to coach Hongkong Stock Exchange to West coast’s Tech promoter ways looking for special clauses including auditor exemptions from listed Financials and/or special ownership rights for promoter/management  class shares.

The list of trivia at the top does not get rarer either with Italian yields nearing 5% on the 15 year auction still did not stop the Italians from a smooth auction of almost EUR 5 Bln in two terms. Verizon is infact offering a near 5% yield in its $49 Bln bonds, expecting markets to keep driving US yields higher and make the Bonds cheaper later. Verizon would be thrice the earlier jumbo $17 Bln tranche from Apple a couple of percentage points earlier on the same curve which should soon be trading at half its value in the market from the demand.

Today’s Jobless claims data was 10% lower than usual at 290,000 but only because in two states computer systems were down and thus claims wer not added up in time, and that means the suspense continues well into Wednesday afternoon when the Fed speaks its speak. Boehner in the mean time is having perverse fun at the half sized $700 Bln deficit the US as run this time, asking why the US still wants to run a deficit and raise that debt ceiling and should one allow it!

Jack Ma, Founder of Alibaba Group

Jack Ma, Founder of Alibaba Group (Photo credit: Wikipedia)

The Dow and the S&P are still near their highest with 15320 and 1690 respectively as results except at Lululemon remain buoyant and Syria sees off the War radar. The Export prices data still provide fuel to deflation fears with a 0.5% fall in August, almost scaringly below a 0.1-0.2% estimate and score on the other consumer price gauges including PPI. The Job Openings or Jolts report again showed 3.7 million openigs and a hiring rate of 3.7% without change for July and the Bloomberg Business Confidence is still a big fat nothing ( you hope!, its a fat negative -32)

Markets started rising last Thursday, and as the bullish markets allowed all articipants and traders to come back, the consensus of Thursday that the Taper was a good thing is again lost with fears now raging into if the Fed Tapers vs if the FEd tapers more than $15-20 Bln in the first month itself, which would still leave the Fed buying at last $65Bln worth MBS and Treasuries plus automatic overnight repos to keep the short rate off the stick on the yield curve. This month’s deficit score is barely two hours away and will likely underscore the $100 Bln mark again making it a good month to ask for a debt ceiling continuance and the 30 yr Bond auction later may shoot a new yield record to rationalise PD holdings and the in transit moves on the yield curve in one go. We will definitely be looking up Deepak Narula’s books a little closelyat MetaCapital Holdings. They manage a 500% return at Metaapital Management sing Freddie and Fannie portfolios over the crisis since 2008

Facebook has crossed $45 post IPO after a big scare in year one below the issue price of $38 and except Linked in many sharing the journey have infact changed ‘transports’ on the way Also Hedge Funds more recently will have to pay for their resumption of faith in Apple’s $700 cheaper version bleeding their latest 13-Fs yet again

Your buy in for High Yield, Munis and Structured Finance! Go Europe. Basel II and consequently national European regulations allow various Muni issuances to be treated on par with Sovereign Debt. 

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