Consumer sentiment data released | Speech by Vice Chair Richard Clarida -- The Federal Reserve's Review of its Monetary Policy Strategy, Tools, and Communication Practices | Report: FDI in emerging markets dries up
Financial firms and institutions expect material risk when the switch to alternative benchmarks from Libor occurs in 2021, according to Moody's Investors Service. "Most banks and large [nonbank financial institutions] are active in working groups with regulators and industry associations, ensuring sharing of information among market participants and consistent integration of standards into contracts," Moody's says.
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Emerging markets are receiving the lowest foreign direct investment in 20 years, with little hope of improvement amid US-Chinese trade tensions, according to a report by the Institute of International Finance. Low interest rates have sent a "wall of money" to emerging markets during the past decade "so that there is now a positioning overhang," the report notes.
Housing starts climbed almost 6% in April but fell short of the pace a year earlier, according to the US Commerce Department. Building-permit issuance edged up less than 1%, suggesting the trend is unlikely to accelerate.
The Securities and Exchange Commission has authorized the launch of the Long-Term Stock Exchange, a national exchange based in Silicon Valley that will implement policies that encourage long-term investing. The LTSE will be the 14th national stock exchange in the US.
It is still too early to determine how Uber will perform in public markets following its disappointing initial public offering. However, the failed promise of a blockbuster offering in a hot market will weigh on other high-profile tech firms that plan to go public this year, such as Postmates and WeWork.
The relationship between inflation and labor, as well as other resource markets, has broken down and could be problematic if the Federal Reserve cannot bring inflation closer to a 2% target, said Fed Governor Lael Brainard. Eventually, Americans could lose faith that inflation will ever meet the target, she said.
US manufacturing output dropped 0.5% in April, the third decline in four months, the Federal Reserve reported. The falloff included a 2.6% drop in production of vehicles and parts amid rising inventories.
Global regulators should examine the different approaches the EU and the US are taking to implement Basel III, says Fernando Restoy, chairman of the Bank for International Settlements' Financial Stability Institute. A review could show regulators how to encourage "a level playing field while protecting financial stability," Restoy says.
Goldman Sachs has agreed to pay $750 million in cash for boutique wealth manager United Capital Financial Advisers. United Capital, which manages $25 billion in assets, will join Goldman's wealth-management unit and will bring along clients with at least $1 million in assets.
Machine learning and artificial intelligence have become buzzwords in finance, and all major banks are working to leverage these technologies. The technology is being mentioned in company filings 1,700% more than it was 2 1/2 years ago. It is changing the ways companies analyze big data, meet clients' needs, and approach recruiting and talent retention.
SIFMA's Diversity & Inclusion Conference brings together business executives, human resource professionals and diversity practitioners to explore how we can promote diversity, inclusion and parity to shape our workforce and serve our clients. Join us at the SIFMA Conference Center in New York to learn the latest strategies and practices and find out how you can nurture a culture that embraces diversity and inclusion.
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