China and Russia strengthen strategic energy partnership
On the afternoon of February 4, the Chinese and Russian heads of state met offline for the first time in nearly three years. China expressed its willingness to work with Russia to strengthen the strategic energy partnership, steadily promote major oil and gas cooperation projects, strengthen joint innovation and research in major technologies in the energy sector and expand cooperation in new energy.
Rosneft Oil and China National Petroleum Corporation (CNPC) signed an agreement to supply 100 million tonnes of oil to China through Kazakhstan for 10 years, according to Rosneft’s official website on 4 April. The crude oil will be processed at a plant in north-western China to meet the country’s demand for petrochemicals.
US Department of Justice on short-sellers investigations
The US Department of Justice is collecting contact information from dozens of short-selling hedge funds and research institutions in an investigation into possible trading abuses, the Financial Times said, citing people familiar with the matter. The DOJ has already issued subpoenas to a small group of market participants.
Bloomberg reported in December last year that the US Department of Justice was planning a major crackdown on aggressive short sellers who had violated various securities market rules. A few months later, that investigation had been expanded to more than 30 firms, some of which were not even aggressive hedge funds.
CDS index soared in January
The Financial Times has recently observed signs that investors are rapidly flocking to the derivatives market to create a protective barrier for their corporate bond portfolios in order to hedge against the risk of a wave of equity market sell-offs spilling over into corporate bonds.
One of the signs it cited was that trading volumes in the low-rated credit default swap (CDS) index soared to US$197 billion in January from US$123 billion last December, the highest level since March 2020, according to data from the International Swaps and Derivatives Association. This is a widely used instrument through which investors can obtain protection against corporate bond defaults.
The S&P/ASX200 is lower today as at opening, dropping 22.90 points or 0.32% to 7,097.30. The bottom performing stocks in this index are MAGELLAN FINANCIAL GROUP LIMITED and UNIBAIL-RODAMCO-WESTFIELD, down 7.94% and 4.69% respectively.
Retail sales December
The December 2021 seasonally adjusted estimate of retail sales fell 4.4% month-on-month, rose 4.8% compared with December 2020.