FirstFT: Hedge funds build biggest bet against Italian debt since 2008


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Good morning. Hedge funds have lined up the biggest bet against Italian authorities bonds since the worldwide monetary disaster on considerations over political turmoil in Rome and the nation’s dependence on Russian gasoline imports.

The whole worth of Italy’s bonds borrowed by buyers to wager on a fall in costs hit its highest degree since January 2008 this month, at greater than €39bn, in keeping with knowledge from S&P Global Market Intelligence.

The rush to wager against Italy comes because the nation faces rising financial headwinds from surging European pure gasoline costs prompted by Russia’s provide cuts and a fraught political local weather, with elections looming in September.

“It’s the most exposed [country] in terms of what happens to gas prices, and the politics is challenging,” mentioned Mark Dowding, chief funding officer at BlueBay Asset Management, who’s shorting Italian 10-year bonds utilizing derivatives generally known as futures.

The IMF warned final month {that a} Russian gasoline embargo would result in an financial contraction of greater than 5 per cent in Italy and three different nations. Italy can also be thought of some of the weak nations to the European Central Bank’s resolution to halt its bond purchases that propped up the nation’s huge debt market.

Thanks for studying FirstFT Europe/Africa — Gary

1. UK faces ‘cost of doing business’ disaster Companies face a “cost of doing business crisis”, ministers have been warned, with many business power payments — as a consequence of be renegotiated in October — poised to rise to greater than 4 occasions their measurement in 2020.

We don’t have the luxurious of ready any longer . . . winter may spell the tip for a lot of companies — Paul Wilson, the Federation of Small Businesses

2. Lars Windhorst pledges to repay €550mn to H2O The controversial German financier has pledged at hand over greater than €500mn to H2O Asset Management in a matter of weeks, which might clear a big chunk of his money owed with the troubled funding agency, an erstwhile star of European asset administration that’s being probed by a number of regulators.

3. Criminal defence solicitors warn sector is dying out Criminal defence legal professionals in England and Wales are struggling for a viable long-term profession within the authorized help system, which is going through a disaster following a decade of austerity cuts which have prompted solicitors to quietly exit the occupation in droves, whereas barristers are getting ready to stroll out subsequent month.

4. UK steelmakers compelled to pay 25% tariff on N Ireland gross sales British metal producers should pay a 25 per cent tariff to promote sure building merchandise into Northern Ireland after EU quotas for world imports have been exhausted sooner than anticipated.

5. Blackstone seeks Pink Floyd catalogue The US personal equity group is vying to purchase Pink Floyd’s again catalogue, an enormous bet on music rights that might worth the psychedelic rock band’s songs at virtually half a billion {dollars}. Artists together with Bruce Springsteen and Bob Dylan have bought their songbooks for lots of of hundreds of thousands of {dollars} in recent times.

The day forward

GCSE outcomes Examination outcomes are revealed in England, Wales and Northern Ireland, following the discharge of A-level grades final week that dipped from file highs prior to now two years.

Economic knowledge The European Central Bank publishes minutes from its July assembly, when it raised rates of interest for the primary time in additional than a decade. France and Germany launch August enterprise confidence knowledge; the latter additionally has second-quarter GDP figures, as does the US, which additionally experiences private earnings, items trade balances and weekly jobless claims. The UK Society of Motor Manufacturers and Traders releases month-to-month car manufacturing figures.

Jackson Hole Economic Symposium The annual convention of central bankers, sponsored by the Federal Reserve Bank of Kansas City, begins in Wyoming, with buyers expecting steering on inflation and rates of interest.

Algeria France’s president Emmanuel Macron begins an official go to to the north African nation.

What else we’re studying and listening to

The funds drone altering world warfare The glossy Bayraktar TB2 is quick, low-cost — with a seven-figure price ticket — and lethal. Ukraine’s drone of alternative has made Turkey one of many world’s high drone powers, pointing to a brand new period through which the expertise turns into accessible to regimes that can’t purchase from extra established arms producers.

Opinion: Europe is turning into a worldwide energy The disaster brought on by Russia’s invasion of Ukraine has triggered new types of co-operation amongst EU member states, accelerating the bloc’s evolution right into a fully-fledged sovereign political energy, writes Laurence Boone, France’s minister of state for Europe.

Big funds blockbusters land amid ‘peak TV’ fears Audiences can get pleasure from among the most costly programmes ever produced this autumn, from Amazon Prime’s The Rings of Power to HBO Max’s House of the Dragon. But the reveals are being served at subsidised costs by streaming platforms making file losses, begging the query: have we lastly reached “peak TV”?

Matt Smith stars as Prince Daemon Targaryen in HBO Max’s House of the Dragon
Matt Smith stars as Prince Daemon Targaryen in HBO Max’s House of the Dragon © AP

Wiretap instances flip up warmth on Greek PM Nikos Androulakis desires solutions. Since the Greek secret service admitted this month that it tapped his telephone, the chief of the opposition Pasok get together has insisted one man — Prime Minister Kyriakos Mitsotakis — clear up his personal function within the affair.

Afghanistan one yr later On the newest episode of our Behind The Money podcast, south Asia correspondent Ben Parkin explains how Afghanistan’s financial system has modified within the yr since US forces left and the Taliban retook management of the federal government.


We are in an period through which the unpredictability of individuals meets the as-yet-not-fully-capable autonomous automotive. In this second, which San Francisco correspondent Dave Lee calls the “Human-Autonomy Clash”, there will probably be crashes, and there will probably be anger.

Disrupted Times — Documenting the adjustments in enterprise and the financial system between Covid and battle. Sign up here

Working it — Discover the large concepts shaping at the moment’s workplaces with a weekly e-newsletter from work & careers editor Isabel Berwick. Sign up here

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