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| BondsOnline.com: instant access to and extensive coverage of over 3.5 million stocks, bonds, indexes and other securities covering major and emerging markets and exchanges across the globe. |
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| Bonds Online |
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| 5/10/2013Market Performance |
| Municipal Bonds |
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S&P National Bond Index
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3.00% |
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S&P California Bond Index
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2.96% |
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S&P New York Bond Index
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3.13% |
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S&P National 0-5 Year Municipal Bond Index
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0.70% |
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| S&P/BGCantor US Treasury Bond |
400.09 |
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| More |
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| Income Equities: |
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| Preferred Stocks |
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S&P U.S. Preferred Stock Index
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848.03 |
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S&P U.S. Preferred Stock Index (CAD)
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636.26 |
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S&P U.S. Preferred Stock Index (TR)
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1,701.05 |
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S&P U.S. Preferred Stock Index (TR) (CAD)
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1,276.26 |
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| REITs |
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S&P REIT Index
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174.07 |
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S&P REIT Index (TR)
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425.30 |
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| MLPs |
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S&P MLP Index
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2,469.58 |
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S&P MLP Index (TR)
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5,428.50 |
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See Data
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Euro break-up is 'inevitable' |
FT Adviser - Jan, 17, 2011 - By Bradley Gerrard
The euro crisis is unstoppable and a break-up of the single currency would provide a positive boost to the global economy and markets, according to Investec Asset Management.
Philip Saunders and Max King, of Investec's global multi-asset team, said while the German economy was close to booming, peripheral Europe was locked into indefinite recession by its structural loss of competitiveness relative to northern Europe.
"This makes it near impossible for most countries to reduce fiscal deficits and thereby improve confidence in their creditworthiness," Mr Saunders said.
"A rolling break-up of the eurozone is a matter of when, not if.
"We think bailouts can only postpone the inevitable and make it worse."
He added history showed the demise of previous currency unions had been positive.
"Nearly all precedents from Argentina in 2001 to Asia in the late 1990s, the UK in 1992 and 1967, back to the demise of the gold standard in the 1930s, have shown the break-up of unsustainable currency unions is bullish for the economies and equity markets of the countries concerned," he said.
"A break-up of the euro would be no different, providing a welcome stimulus to the global economy and markets.
"We anticipate the only issue would be the need of governments to recapitalise their banks in response to the heavy losses rolling devaluations would inflict, but this would be a lot cheaper than bailing out countries."
As such, Mr Saunders said investors should take advantage of the opportunities provided by the likely chaos and crisis to add equity exposure and to return to the affected countries and the financial sector.
Elsewhere, Mr King said corporate credit spreads should narrow further.
"Higher yields on government bonds would be a significant headwind for corporate bonds but rising corporate profits and balance sheets should lead to credit upgrades," he said.
"This is likely to provide reasonable opportunities in medium and high yield while there is a strong rationale for spreads on high-quality multi-nationals turning negative."
Mr King added the pressure on governments to cut fiscal deficits would continue to increase and the appetite for credit and mortgage debt in the Anglo Saxon economies would remain muted.
Furthermore, he expected fund flows into bonds to continue to reverse after their fall in the last two months of 2010 from their "elevated levels" and therefore result in negative returns.
"The good news is higher real yields should force governments to cut deficits, to the benefit of economic stability and trend rates of growth, and prevent governments inflating away their debts," he said.
As such, investors should consider avoiding government bonds in developed markets, he added.
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| BondsOnline Advisor |
Income Security Recommendation January 2013 Issue.
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