Saxo Bank følger begivenheden i den japanske hedge fund Archegos Capital, der har sendt chokbølge gennem markedet, fordi den lille ukendte fund er tvunget til at sælge ud af sine positioner. Er der større problemer på vej?
Market Quick Take
Summary: The US equity market ended last week atop a strong rally on Friday, with the S&P 500 Index just a few points from its all-time high. However, widening awareness that a large hedge fund sold enormous positions on Friday, a story that saw intense focus over the weekend, has spooked the market, sending the futures sharply lower on the Monday opening, although Asian markets were mostly in the green overnight.
What is going on?
Archegos Capital hedge fund’s forced position unwinding spooks market – a little known hedge fund only managing its own capital, Archegos has suddenly gained prominence on the news that counterparties were involved in a forced unwinding of its significant positions.
Billions of dollars in block trades went through on Friday in the US company ViacomCBS(VIAC:xnas) and Chinese technology stocks among other holdings, and there is uncertainty how much more of the hedge fund’s holdings remain and could hit the market this week.
Already, Japanese bank Nomura Holdings (8604:xtks) overnight reported a $2 billion loss at its US subsidiary linked to Archegos and cancelled a bond issue, sending the company’s shares down more than 15% inTokyo overnight. Credit Suisse also announced that the fund’s default on a margin call would result in losses for the bank.
What are we watching next?
Tracking the Archegos story and whether there are further significant holdings by this troubled hedge fund to unwind and any further contagion and especially, whether the Archegossituation is a unique oneis the top point on the agenda early this week.
