Temasek writes down full FTX investment, says it has no direct exposure in crypto
Singapore’s sovereign wealth fund Temasek announced it will write down its full investment in FTX after the firm’s rapid collapse last week.
The state investor said in a release that “in view of FTX’s financial position, we have decided to write down our full investment in FTX, irrespective of the outcome of FTX’s bankruptcy protection filing.”
Temasek said its cost of investments in FTX was less than 0.1% of its net portfolio value of 403 Singapore dollars ($294 billion) – holding less than 1% in FTX International and less than 1.5% in FTX US.
“There have been misperceptions that our investment in FTX is an investment into cryptocurrencies. To clarify, we currently have no direct exposure in cryptocurrencies,” the company said.
– Jihye Lee
Japan reports larger-than-expected trade deficit of $15 billion
Japan reported a larger-than-expected trade deficit of 2.16 trillion yen ($15.5 billion), according to the latest release by its Ministry of Finance. Economists were expecting a deficit of $11 billion, according to a Reuters poll.
Exports rose by 25.3% to 9 trillion yen in October compared to the same period last year, while imports jumped 53.5% to 11.16 trillion yen.
Retail stocks remain under pressure following Target warning, with some bright spots
Several retail stocks were down on Wednesday morning following Target’s weak financial results and sales outlook.
Target itself was down 15% shortly after the opening bell. Nordstrom suffered a 9% decline, while Macy’s and Gap each fell roughly 7%.
The SPDR S&P Retail ETF was down by 3.9%.
Lowe’s shares were higher, however by 3.8% after the company reported raised its full-year earnings forecast and reported strong results. Walmart held onto a 1% gain after reporting strong results Tuesday. Costco fought its way into positive territory.
— Tanaya Macheel
Treasury yields slide, recession worries rise
The 10-year Treasury yield temporarily sank below 3.7%, and the spread between it and the 2-year yield continued to fall deeper into negative territory.
That so called yield inversion is a warning of recession. The 10-year was 3.73% in afternoon trading, after dipping to 3.69%. The 2-year Treasury was at 4.35%.
“I still think there’s more downside risk for rates from here. The curve inversion 2s/10s is negative 67. That could get to negative 75 in the near term,” said Ian Lyngen at BMO.
He said a next target for the 10-yea yield would be 3.55%. Yields move lower as bond prices rise.
“A large impetus behind the rally is the market looking past the current tightening cycle and beginning to grow increasingly jittery about the potential for a more significant fallout, as the Fed continues to reiterate its willingeness to hike the economy into recession,” said Lyngen.
Tencent to report earnings, reportedly starting new round of job cuts
Chinese tech giant Tencent is due to report third-quarter earnings late in Asia.
The company is expected to see another drop in revenue after posting the first-ever revenue decline in the previous quarter ending in June. A median forecast from Refinitiv predicts a fall of 0.47% to 141.7 billion Chinese yuan ($20 billion).
Separately, sources told Reuters that Tencent is starting a new round of job cuts. The news comes as tech firms around the world announce layoffs.
Tencent shares rose as much as 3% in early trade, and were last up 0.83%, compared with a 0.81% fall in the broader Hang Seng index.
— Abigail Ng, Jihye Lee