Stocks rise; U.S. futures fall after block trades: markets wrap (Link)
Most Asian stocks rose Monday after a record Wall Street close, while U.S. equity futures dipped as traders assessed a $20 billion wave of block trades. Oil fell after salvage teams freed a ship in the Suez Canal.
U.S. equity futures were lower following revelations that Archegos Capital Management LLC - the family office of Bill Hwang - was behind the block trades, selling Chinese tech giants and U.S. media conglomerates amid margin calls.
A dollar gauge ticked higher and 10-year U.S. Treasury yields slipped.
Asia pacific private equity deal value hits new highs despite the pandemic (Link)
Deal value across the region hit a record high of $185 billion, up 19% from 2019 and 23% over the previous five-year average.
In India, a series of 10 significant investments totaling almost $10 billion in technology multinational Jio Platforms, and seven investments in Reliance Retail helped deal value climb to $38 billion, up 64% over the prior five-year period.
While deal value is increasing, exits are hard to come by. Exit deal value totaled $70 billion, down 24% year-on-year and 40% from the previous five-year average. IPOs dominated the exit market, making up more than 60% of exits by value, almost double the previous five-year average. China accounted for 86% of the region's IPOs and the majority were healthcare and technology companies.
In terms of the opportunity set going forward, GPs are looking for companies that are more likely withstand a sudden shock. Sectors GPs are most interested in include digital health, e-commerce, and e-learning.
In 2021, SPAC deals accounted for 73% of initial public offering (IPO) value, following a year in which SPACs were responsible for almost half (46%) of IPOs, DBRS said.
The flurry of activity is driven by several factors, the report said, including strong investor demand for returns amid ultra-low interest rates.
The increase in SPACs being created and competing over a limited number of acquisition targets is leading to higher valuations for these target companies, which may not be sustainable.
So, if the SPAC bubble bursts, future deals may have to incorporate better protections for retail investors that more closely align their interests with the interests of deal sponsors, the ratings agency suggested.
Will institutions switch from gold to bitcoin? (Link)
As cryptocurrencies become more mainstream for institutional investors and family offices, their adoption will come at the expense of gold. J.P. Morgan is one of the few Wall Street banks that’s predicting the major shift out of gold and into crypto.
Some of the world’s largest hedge fund managers are buying bitcoin to hedge inflation rates. Billionaire hedge fund managers Ray Dalio, Stan Druckenmiller and Paul Tudor Jones have all announced they’ve taken positions in bitcoin, noting that other traditional safe havens like bonds lag performance.
Dalio told Yahoo Finance that debates in India about banning bitcoin altogether were a sign of growing concerns. U.S. regulators have given no indication they plan to ban bitcoin or the crypto asset class in general, but the approval process of Fidelity’s bitcoin ETF will be worth following.
Tech investors pump millions into NFT start-ups as digital collectibles boom (Link)
NFTs, or non-fungible tokens, have exploded in popularity this year in tandem with a rise in the values of cryptocurrencies like bitcoin and ether.
Last year, the total value of NFT transactions quadrupled to $250 million, according to data from Nonfungible.com, while in the past month alone overall NFT sales volumes exceeded $220 million.
The trend hasn’t gone unnoticed by investors, who have poured $90 million into NFT and digital collectibles companies so far in 2021, according to data shared with CNBC by Pitchbook. That’s almost triple the $35 million that NFT start-ups raised last year.
SH Capital selects FinIQ as digital trading platform (Link)
The company selected FinIQ, a Singapore-based capital markets technology provider, following a competitive search for a partner to support its expanding services across Dubai and the UAE region.
FinIQ's front-to-back wealth and treasury services platform is used by nearly 15,000 bankers across 21 countries to electronically trade financial instruments
FIConnect is an online order execution tool for a wide range of simple to complex fixed income securities via the world’s largest supplier network including buy-side, sell-side and direct order workflows.
FXDConnect allows access to liquidity from leading investment banks supplying live and dealable quotes for a range of vanilla FX and derivative structures.