The following HSI warrants will start trading at approximately 9:45 am today:
August Trading Call Warrants (Short term bullish view)
HSI17400MBLeCW090828 (H9OW) exercise level 17,400 index points.*
HSI18800MBLeCW090828 (H9QW) exercise level 18,800 index points.*
August Trading Put Warrants (Short term bearish view)
HSI16600MBLePW090828 (H9PW) exercise level 16,600 index points.*
HSI18000MBLePW090828 (H9RW) exercise level 18,000 index points.*
World Bank sounds note of caution
Overnight, U.S and European equity markets tumbled after the World Bank said the recession will be deeper than previously forecast. This sparked a wave of profit taking from investors, leading the Dow (-2.4% day-on-day [dod], 8,339.0), S&P 500 (-3.1% dod, 893.0), DJ Euro Stoxx 50 (-3.1% dod, 2,359.3) and FTSE 100 (-2.6% dod, 4,234.1) to close sharply in the red.
Bloomberg reported that The World Bank said the global recession this year will be deeper than it predicted in March, stating that the world economy will contract 2.9% compared to a previous forecast of a 1.7% decline. It also warned that a flight of capital from developing nations will swell the ranks of the poor and the unemployed.
Commodities tumble as investors seek safety in Treasuries
Commodities saw a similar pullback, with NYMEX crude oil futures tumbling 3.8% dod to close at US$66.93 per barrel, and the Reuters / Jefferies CRB Index (comprising of both hard commodities like Gold and Crude Oil, as well as soft commodities like Soybeans and Wheat) tumbled 2.7% dod to close at 246.1.
Investors fled to perceived safer instruments such as U.S Treasuries. The 10 year U.S Treasury yield fell 0.1 percentage points to 3.681% overnight (yields and prices move inversely) while the U.K 10 year gilt dipped 0.07 percentage points to 3.743%.