Headlines

Euro zone bond yields soared on Wednesday, as concerns the European Central Bank might reduce the scale of its asset purchases before the programme finally ends unnerved investors. A Bloomberg article on Tuesday cited sources as saying the ECB would probably wind down the monthly 80 billion euro ($90 billion) quantitative easing (QE) scheme gradually. The ECB has not discussed reducing the pace of monthly purchases, a central bank media officer later tweeted. The scheme is due to run until March next year and many analysts expect it to be extended given that inflation remains low.

The International Monetary Fund did not bring up Deutsche Bank’s name when it warned in its financial stability report that cash-poor banks in Europe with outdated business models posed a threat to the financial system, the International New York Times reported. But at a news conference on Wednesday to discuss the study’s findings, fund officials charged with gauging financial stability risks worldwide showed no such reluctance.

The collapsed Hanjin Shipping Co Ltd could not compete against global rivals that were supported by their governments, the chairman of its parent firm told a South Korean parliamentary hearing on Tuesday, Reuters reported. The world's seventh-largest container shipper sought court receivership in late August after its creditors led by a state bank halted further support, stranding $14 billion in cargo and sending waves through global trade networks. "Hanjin Shipping lost the game of chicken played among large shippers," Hanjin Group chairman Cho Yang-ho told the hearing.

The European Central Bank is cooling on a signature policy: negative interest rates. Two senior ECB officials warned early this week that subzero rates could, over time, cause banks to reduce lending to the economy—the opposite of what the central bank hopes to achieve, The Wall Street Journal reported. The shift in tone from the ECB, which has been among the strongest proponents of negative rates, could mark the beginning of the end for a controversial policy experiment that has turned conventional economic thinking upside down.

Britain crashing out of the European single market could cost banks and associated businesses in the U.K. almost 40 billion pounds ($51 billion) in lost revenue, undermining a key sector of the economy, an industry report warned on Tuesday, Bloomberg News reported. Finance firms are making a fresh bid for special status in upcoming Brexit negotiations with the EU after U.K. government officials this week indicated banks will get no favors.

The oil price rebound has come too late with another firm in the offshore sector joining the debt restructuring frenzy amid the most brutal industry downturn in 30 years, The Straits Times reported. Singapore-listed rig and vessel chartering group Swissco Holdings said yesterday that it is seeking to restructure $100 million worth of bonds, including a $2.85 million coupon payment due on Oct 16.

Ericsson AB plans to cut 3,000 jobs in Sweden, a fifth of the workforce in its home country, as it curbs production to cope with shifting technology and stagnant demand for wireless-network equipment. The company will reduce manufacturing in the towns of Boraas and Kumla - a move it signalled last month - as it turns its focus to software development, the Irish Times reported.

The Central Bank of Kenya (CBK) has extended the appointment of Kenya Deposit Insurance Corporation as receiver of the bank for a further six months. The regulator says the move follows a request by KDIC for an extension as the 12 months’ receivership term nears end. KDIC was appointed to take over the management of the bank on October 13, 2015 due to unsafe and unsound practices. KDIC will maintain the management and control of the bank and advise CBK of a resolution strategy as soon as it is practicable and not later than six months from October 13, 2016.

Canada took a series of steps aimed at cooling housing markets in the country’s biggest cities, including addressing concerns about foreign investors’ influence in driving up home prices to frothy levels, The Wall Street Journal reported. The moves follows months of mounting worries about how foreign cash has contributed to soaring house prices in Toronto and Vancouver, British Columbia, and highlight the dilemma facing policy makers looking to balance prolonged rock-bottom interest rates with outsize housing-related debt.

Glencore, the miner and commodity trader, has announced plans to repurchase up to $1.25bn of bonds as part of an ongoing plan to reduce debt and leverage, the Financial Times reported. The buy back is targeting bonds that mature in 2018 and 2019 with investors being given until the end of the month to tender their notes, writes Neil Hume in London. The world’s biggest miners are slashing costs and cutting their debt burdens after being shaken to the core by the worst price rout in a generation.