TheChek News Flow

>>> Brokers Upgrades & Downgrades - 2nd of February 2015

>>> Up

*CARREFOUR RAISED TO BUY VS HOLD AT JEFFERIES

*DELHAIZE RAISED TO HOLD VS UNDERPERFORM AT JEFFERIES

*JERONIMO MARTINS RAISED TO BUY VS HOLD AT JEFFERIES

*RBS RAISED TO NEUTRAL AT HSBC

*SWATCH RAISED TO HOLD VS SELL AT SOCGEN

>>> Down

*AHOLD CUT TO UNDERPERFORM VS HOLD AT JEFFERIES

*AIRBUS CUT TO SECTOR PERFORM VS OUTPERFORM AT RBC

*CHRISTIAN DIOR CUT TO NEUTRAL VS BUY AT GOLDMAN

*COLRUYT CUT TO UNDERPERFORM VS HOLD AT JEFFERIES

*ELECTROLUX CUT TO SELL VS NEUTRAL AT UBS

*FRESNILLO CUT TO NEUTRAL VS BUY AT UBS

*INFINEON CUT TO NEUTRAL AT HSBC

*KERING CUT TO NEUTRAL AT HSBC

*KINGFISHER CUT TO HOLD VS BUY AT JEFFERIES

*KINGFISHER CUT TO NEUTRAL VS BUY AT UBS

*LLOYDS CUT TO NEUTRAL AT HSBC

*LUXOTTICA CUT TO NEUTRAL AT HSBC

*NEXT CUT TO UNDERPERFORM VS HOLD AT JEFFERIES

*NOVO NORDISK CUT TO REDUCE VS NEUTRAL AT SWEDBANK

*RANDGOLD RESOURCES CUT TO NEUTRAL VS BUY AT UBS

*SCHRODERS CUT TO SECTOR PERFORM VS OUTPERFORM AT RBC

*SHELL CUT TO EQUALWEIGHT VS OVERWEIGHT AT MORGAN STANLEY

*TOD’S CUT TO SELL VS NEUTRAL AT GOLDMAN

*TSB BANKING GROUP CUT TO UNDERWEIGHT AT HSBC

*WOLSELEY CUT TO NEUTRAL AT HSBC

*YARA CUT TO UNDERWEIGHT VS NEUTRAL AT JPMORGAN

>>> PT Changes

*AB INBEV PT RAISED TO EU115 FROM EU92 AT ING

>>> Initiation

>>> Call

>> Stock

*SCHRODERS CUT TO SECTOR PERFORM VS OUTPERFORM AT RBC

*WARTSILA ADDED TO JPMORGAN'S EUROPEAN ANALYST FOCUS LIST

WSJ : Alstom Gets Break on Fine

Alstom Gets Break on Fine

Court Granted Delay in $772 Million Payment Because of Possible Business Impact

When the U.S. Justice Department announced a record $772 million foreign-bribery settlement with Alstom SA in December, there was a hitch: The French engineering company couldn’t pay without hurting its ability to do business.

So Alstom got a break: approval from a court to wait until its $17 billion deal with General Electric Co. closes before making the payment.

The delay—the reason for which hasn’t previously been reported—gives Alstom more time than some other companies have had to pay criminal penalties for violating U.S. foreign-bribery laws, which often come due 10 business days after a sentencing.

“This is a very leisurely schedule,” Judge Janet Bond Arterton said at the time.

It also underscores how penalties under the powerful Foreign Corrupt Practices Act have grown so large that they can create substantial burdens for companies undergoing financial stress.

An Alstom spokeswoman declined to comment. A Justice Department spokesman also declined to comment.

Other companies have also had to bear large costs as a result of the law. Avon Products Inc. ’s FCPA settlement last year required it to pay $135 million on top of the $350 million it had spent on legal and other matters related to the investigation of bribery in China and elsewhere—a big hit for a company with $10 billion in revenue in 2013. Wal-Mart Stores Inc. has spent more than half a billion dollars on its own probe into possible bribery in Mexico and other countries, as well as a related compliance overhaul. Wal-Mart has said it is cooperating with continuing investigations by the Department of Justice and the U.S. Securities and Exchange Commission, which also enforces the law.

In some cases, companies have been allowed to pay their fines in installment plans. Alcoa Inc. and a company it controls are set to pay part of its $384 million penalty in five equal installments over four years, after the company it controls pleaded guilty a year ago to bribing officials in Bahrain. Some other companies also haven’t had to pay immediately. Japanese trading company Marubeni Corp. , which last year pleaded guilty to bribery in connection with a matter that also involved Alstom, had a roughly two-month gap.

The act gives U.S. authorities the ability to pursue charges against foreign companies when a U.S. unit or employees were involved, or if the company lists securities on a U.S. exchange.

The Justice Department investigated allegations of bribery by Alstom dating back years in countries including Indonesia, Saudi Arabia and Egypt. By the time the probe was coming to a head last year, Alstom was struggling financially and working on the deal to sell its power-generation business to GE.

“We routinely do due diligence on issues such as this,” said GE spokesman Dominic McMullan. “It was a well-publicized issue, so we were well aware of it.”

Alstom pleaded guilty to the foreign-bribery charges. At a plea hearing in the U.S. District Court for the District of Connecticut on Dec. 22, the same day the record settlement was announced, lawyer Robert Luskin, who was representing Alstom, asked a judge to push back the sentencing until the deal with GE closed, according to the transcript.

“We have asked, and the government has concurred, that we would make a request to the court to defer sentencing and entry of judgment until after that transaction has closed,” said Mr. Luskin, a partner at Squire Patton Boggs. “That transaction will facilitate the ability of Alstom to pay the fine without impairing its working capital.”

Alstom’s sentencing is now scheduled for June 23. The deal with GE isn’t expected to close until midyear. If it closes sooner, Alstom may request an earlier sentencing date. If the deal gets delayed, Alstom may ask for a later date.

Assistant Attorney General Leslie Caldwell said in December that prosecutors insisted GE not be responsible for any part of the penalty.

Still, the asset sale to GE will help alleviate Alstom’s pain.

The French company said late last year that it had burned through about €922 million ($1.04 billion) of cash between the end of March and the end of September, leaving it with €1 billion of cash on hand in addition to a €1.4 billion credit line.

Both companies also recently disclosed that GE will pay more in the deal than previously announced, though they both say Alstom will cover the settlement payment.

Alstom Chief Executive Patrick Kron told investors last month that his company would receive the equivalent of more than $450 million in “additional proceeds” from GE through business deals negotiated after the original deal was announced last summer. The deals include an agreement to let GE license the Alstom brand name for 25 years instead of the originally planned five. Mr. Kron said those funds would help offset the fine’s cost.

GE Chief Financial Officer Jeff Bornstein told investors in January that the company would wind up paying the equivalent of about $280 million more to Alstom, but acknowledged that he wasn’t including some costs included in Mr. Kron’s estimate, including the value of interest on cash GE allowed Alstom to use free of charge during 2014.

(Le Parisien) Autoroutes : la nouvelle idée de Ségolène Royal pour faire baisser

Autoroutes : la nouvelle idée de Ségolène Royal pour faire baisser les tarifs

Invitée de l'émission «Tous politiques», réalisée en partenariat avec «Le Parisien-Aujourd'hui en France», la ministre de l'Ecologie Ségolène Royal, envisage de demander aux sociétés d'autoroutes de baisser leurs tarifs pour les automobilistes pratiquant le covoiturage.

Les sociétés d'autoroutes pourraient baisser leurs tarifs de péage en cas de covoiturage, a déclaré dimanche la ministre de l'Ecologie Ségolène Royal sur France Inter.

«C'est une des pistes», a dit Mme Royal interrogé lors de l'émission «Tous politiques», réalisée en partenariat avec Le Parisien/Aujourd'hui en France.

«Il est question de demander aux autoroutes de faire des offres commerciales pour que certains tarifs puissent baisser», a-t-elle affirmé, citant le covoiturage.

L'un des objectifs des négociations entre l'Etat et les sociétés d'autoroutes est «la clarté, la transparence sur la façon dont on fixe les tarifs, pour que les consommateurs sachent ce qu'ils payent», a assuré Mme Royal.

«Renégocier les concessions dans l'intérêt des automobilistes»

L'autre objectif, c'est le «retour sur investissement», a-t-elle ajouté, affirmant qu'il fallait «rendre aux Français par les investissements sur les infrastructures ce que les autoroutes ont retiré de cette privatisation».

«C'est un juste retour des choses», a-t-elle dit. Les sociétés d'autoroutes «ont donné beaucoup d'argent à leurs actionnaires» et «ont bénéficié de conditions tout à fait exorbitantes (...) L'idée est de renégocier ces concessions dans l'intérêt général du pays et des automobilistes», a conclu la ministre.

Le Premier ministre, Manuel Valls, a annoncé mercredi la suspension de la hausse de 0,57% des tarifs des péages prévue au 1er février.

Le gouvernement attend les conclusions d'un groupe de travail sur l'avenir des concessions autoroutières créé en décembre pour étudier les conséquences d'une renégociation ou d'une résiliation à partir de 2017 des contrats de concession des autoroutes.

(BFW) Hedge-Fund Bulls Betting Most on Gold in Two Years

BN 02/02 06:13 Hedge-Fund Bulls Betting Most on Gold in Two Years: Commodities

Hedge-Fund Bulls Betting Most on Gold in Two Years
2015-02-02 06:17:26.198 GMT

By Joe Deaux
(Bloomberg) -- Speculators increased their net-long
position by 80% this year, U.S. government data show.
* Net-long position in gold advanced 15% to 167,693 futures
and options in the week ended Jan. 27
* Long holdings are the highest since 2012

Story Link:NSN NJ4RZ66TTDS0<GO>

For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>

To contact the reporter on this story:
Grant Clark in Singapore at +65-6212-1101 or
gclark@bloomberg.net
To contact the editor responsible for this story:
Grant Clark at +65-6212-1101 or
gclark@bloomberg.net

>>> Asian Update

Asian Mid-session Update: China official PMI contracts for the first time in 2 years; Merkel rules out further Greek debt relief

***Economic Data***

- (CN) CHINA JAN MANUFACTURING PMI (Official): 49.8 V 50.3E; first contraction in 2 years

- (CN) CHINA JAN NON-MANUFACTURING PMI: 53.7 V 54.1 PRIOR; 1-year low

- (CN) CHINA JAN FINAL HSBC MANUFACTURING PMI: 49.7 V 49.8E (2nd consecutive month of contraction)

- (JP) JAPAN JAN FINAL MARKIT/JMMA MANUFACTURING PMI: 52.2 V 52.1 PRELIM (8th consecutive expansion)

- (AU) AUSTRALIA JAN AIG PERFORMANCE OF MANUFACTURING INDEX: 49.0 V 46.9 PRIOR (2nd month of contraction)

- (AU) AUSTRALIA JAN TD SECURITIES INFLATION M/M: 0.1% V 0.0% PRIOR; Y/Y: 1.5% V 1.5% PRIOR

- (AU) AUSTRALIA JAN RPDATA/RISMARK HOUSE PRICE INDEX M/M: 1.3% V 0.9% PRIOR

- (KR) SOUTH KOREA JAN TRADE BALANCE: $5.5B V $2.0BE

- (KR) SOUTH KOREA JAN HSBC MANUFACTURING PMI: 51.1 V 49.9 PRIOR (highest since May 2013)

- (KR) SOUTH KOREA DEC CURRENT ACCOUNT: $7.2B V $11.3B PRIOR

- (ID) INDONESIA JAN CPI M/M: -0.2% V +0.2%E; Y/Y: 7.0% V 7.5%E; CORE CPI Y/Y: 5.0% V 4.7%E

- (ID) Indonesia Jan HSBC Manufacturing PMI: 48.5 v 47.6 prior (4th consecutive contraction)

***Index Snapshot (as of 03:30 GMT)***

- Nikkei225 -0.6%, S&P/ASX +0.8%, Kospi -0.1%, Shanghai Composite -1.2%, Hang Seng -0.3%, Mar S&P500 +0.2% at 1,992

***Commodities/Fixed Income***

- Apr gold +0.1% at $1,180, Mar crude oil -2.7% at $46.94/brl

- (JP) BOJ offers to buy ¥70B in JGBs with maturity less than 1-yr, ¥240B in 10-25yr JGBs and ¥140B in JGBs with maturity over 25-yr

- (KR) South Korea sells 3-yr govt bonds at avg yield of 1.975%

- (CN) PBoC sets yuan mid point at 6.1385 v 6.1370 prior setting (weakest Yuan setting since Dec 4th)

***Market Focal Points/FX***

- In spite of the targeted fiscal and cosmetic monetary stimulus measures in recent weeks, China PMIs for January suggested the overall economy is yet to turn the corner, prompting analysts to call for heavier PBoC lifting in the way of more interest rate and RRR cuts. Official manufacturing PMI contracted for the first time in 2 years, non-manufacturing hit a 1-year low, and HSBC final manufacturing slowed further to its 2nd consecutive sub-50 figure. ANZ economist found the official PMI decline particularly surprising as it comes just ahead of the Lunar New Year, which is typically preceded by "significant front loading effect" providing short-term impetus to the manufacturing industry. HSBC noted that "manufacturing sector remains weak and more aggressive monetary and fiscal easing measures will be needed to prevent another sharp slowdown in growth." China financials were under added scrutiny, as the President of the first private lender Minsheng Bank was hauled off on allegations of corruption. The only good news on the mainland came from the property sector - China Index Academy reported the average price of new residential properties in 100 major cities in January rose 0.2% m/m, the first increase in 9-months. CREIS added the property market has seen a boost in confidence with sales showing improvement fuelled by the mini-stimulus policies and with demand in the major cities picking up.

- Ahead of tomorrow's RBA decision, economists' baseline scenario increasingly appears to be a rate hold but with a much more dovishly oriented bias. Goldman Sachs is of that opinion as well, while TD Securities, which put out its inflation estimates unchanged y/y, expect the RBA to acknowledge substantial progress made in the market toward lower exchange rate. RPData housing prices picked up in January, but resident researcher still believes conditions are cooling, stating "the rolling annual rate of capital gain has been trending lower - at the end of January the annual rate of dwelling value growth across the combined capitals index had slowed to 8.0%, down from the early 2014 peak of 11.5%." AUD/USD slid below 0.7750 at the open but subsequently bounced above the 0.7780 levels.

- In other USD majors, USD/JPY opened below 117.00, but then rose above 117.80. A Nikkei survey speculated Japan would recover from recession as early as of Q42014, with GDP bouncing to 4% after another near-2% contraction in Q3. USD/CHF was also sharply higher on heavy CHF selling after Swiss press reported the SNB is now unofficially targeting EUR/CHF corridor between 1.05-1.10. EUR/CHF cross was up about 120pips at the open to trade around the 1.0480 level.

- EUR/USD is up about 30pips from Friday close just above $1.1310 in the final hour of Tokyo trading session. Greek PM Tsipras expressed to ECB's Draghi his new govt would like to achieve a mutually beneficial solution for Greece situation, but Chancellor Merkel in a German press interview said she does not see another Greek debt cut. Merkel added "there has already been voluntary debt forgiveness by private creditors, banks have already slashed billions from Greece's debt." Greek Fin Min Varoufakis travelled to meet with French Fin Min Sapin ahead of schedule, stating Athens aims to send detailed reform program by the end of February and agree on new debt deal by the end of May, calling for a new social contract between Greece and EU. European Commission Pres Juncker seemed to be supportive of reforming Troika and ending the humiliating visits by lending inspectors, but also expressed opposition to granting a "haircut" for Greek creditors.

***Equities***

US markets:

- RSH: Standard General said to be in talks to lead bankruptcy auction for RadioShack - financial press

- CCO: TPG Capital and Blackstone said to be targeting European business of the company estimated to be valued around £1.6B - UK press

- XOM: United Steelworkers union(USW) issued notices of a potential strike action at several US refineries as current contract expires this weekend

- TRW: NHTSA says several car makers to recall 2.1M vehicles due to faulty airbag sensor provided by TRW; earlier repair was not fully effective

Notable movers by sector:

- Consumer Discretionary: Ricoh 7752.JP -3.1% (9-month results); Kathmandu Holdings KMD.AU -26.2% (H1 guidance)

- Financials: China Life Insurance 2628.HK -2.0% (FY14 guidance); China Minsheng Bank 1988.HK -3.8% (president resigned, said to be investigated for corruption)

- Materials: Aluminum Corporation of China 601600.CN -6.0% (FY14 guidance)

- Energy: Lonestar Resources LNR.AU +13.2% (Q4 results)

- Industrials: Takata Corp 7312.JP -3.0% (press speculation on earnings); Hitachi 6501.JP -1.8% (press speculation on earnings); Skymark Airlines 9204.JP -81.5% (resumes trading after confirming to file for bankruptcy); Sumitomo Chemical 4005.JP +9.0% (9-month results); Honda Motor 7267.JP +3.9% (9-month results)

- Technology: Seiko Epson Corp 6724.JP -10.7% (9-month results); Fujitsu Ltd 6702.JP +9.9% (9-month results)

- Utilities: TEPCO 9501.JP -3.2% (9-month results); J-Power 9513.JP +7.1% (9-month results); Kyushu Electric Power 9508.JP -5.3% (9-month results); Kansai Electric Power 9503.JP -6.6% (9-month results)

- Telecom: KDDI Corp 9433.JP -2.8% (9-month results)

>>> What to look at this week end

Eur$ 1,1310

Macro :

- Tsipras Signals Greece Has No Intention to Default: Renzi’s Aide

- Greek Govt Asks Asset-Sales Fund Board to Resign: Spokeswoman

- Fed’s Williams Expects Jobless Rate to Reach 5% by Year’s End

- Germany’s Schaeuble Says ECB Faces ‘Difficult Environment’: WamS

- Germany to Draft Rules for Self-Driving Cars by Sept.: WamS

Keep an eye on :

- AFR LN : Afren Defers Interest Amortization Payments, Uses Grace Period

- AIR FP : Germany’s Sole A400M Grounded Amid Faulty Lights, Spiegel Says

- ALO FP : Alstom Sees EU2b Value for Train Contract Over 15 Yrs

- CRH LN : CRH to Buy Holcim-Lafarge Assets for Enterprise Value of EU6.5b

- DAI GY : Daimler in Talks Over Additional Shifts at German Factories: FAS

- GIL GY : Elliott Takes 5.55% Stake in DMG Mori Seiki AG

- GUR SW : Gurit Net FY Sales of CHF335.8m Rise 19.4% From CHF281.1m Y/y

- IAG LN : IAG Pledge Won’t Necessarily Win Aer Lingus Stake: Irish Premier

- LG FP : Spain Antimonopoly Regulator Prepares to Fine Cement Companies

- MEO GY : Metro Has No Plan to Sell Kaufhof Stores: Wirtschaftswoche

- RBI AV : Raiffeisen at Odds With ECB Over Dividend Payout, Standard Says

- SHP LN : Shire’s Vyvanse Wins FDA Approval for Binge-Eating Disorder

- TEF SM : Telefonica Plans EU4B-EU5B Share Sale: El Confidencial

- TEF SM : Sovereign Funds Interested in Buying O2 Stake, Sky Reports

- TKA GY : ThyssenKrupp AGM Approves Cevian’s Tischendorf to Join Board

- VOW3 GY : VW to Replace More Workers With Robots to Cut Costs, WamS Says

>>> Hutchison Whampoa receives approaches from funds including GIC about buying

Hutchison Whampoa receives approaches from funds including GIC about buying stakes in merged Three/O2 business

Several sovereign wealth funds have approached Hutchison Whampoa’s advisers about buying stakes in a merger of the Hong Kong-based company’s Three mobile network and O2, Sky News reported. The report cited unspecified sources who indicated on Saturday, 31 January that several parties had already approached the conglomerate about buying shares in the proposed merged group.

It is thought that the Government Investment Corporation of Singapore (GIC) and several pension funds from Canada are among the parties to have sounded out Hutchison, the item said. The talks with sovereign wealth funds are not far advanced, according to the report.

As previously reported, Hutchison is in exclusive talks with O2’s owner, the Spanish telecoms group Telefonica, about an approximately GBP 10.25bn (EUR 13.67bn) bid for the UK-based mobile network operator.

Hutchison has indicated that it plans to sell around 30% of the merged mobile network to institutional shareholders, the item said.

Sky News

(ZH) Denmark Launches "Back-Door QE", Halts Treasury Issuance: Why DKKEUR Could

Denmark Launches "Back-Door QE", Halts Treasury Issuance: Why DKKEUR Could Be The "Trade Of 2015"

Bank of America Bank of America Bond Borrowing Costs Central Banks Currency Peg European Central Bank fixed Janet Yellen Merrill Merrill Lynch Monetary Policy Nielsen Reuters Swiss National Bank Switzerland

While much has been said about last week's third in two weeks rate cut by the Danish Central Bank, one which brought the deposit rate to -0.50%, having previously cut it to -0.35% and -0.2% in the aftermath of the ECB Q€ and the SNB's abandoning of the Franc ceiling - the latest move of desperation to preserve the peg of the DKK to the plunging Euro and one which as reported previously has led to such strange financial abominations as negative interest rate mortgages - few noticed an even more important announcement by the Denmarks Nationalbank. On Friday the Danish central bank said it would halt all government bond issuance "until further notice"!

Suspension of government bond issuance

Upon the recommendation of Danmarks Nationalbank, the Ministry of Finance has decided to suspend the issuance of domestic and foreign bonds until further notice.

The large surplus on the government finances in 2014 implies that the sale of government bonds has been greater than the funding requirement. Given the foreign currency situation, it is no longer appropriate to reduce the issuance of government bonds over several years. The balance on the central government's account at Danmarks Nationalbank is more than sufficient to cover the financing requirement in 2015.

Danmarks Nationalbank has purchased foreign exchange in the market and reduced the monetary-policy interest rates. This has resulted in a widening of the negative spread between money market rates in Denmark and the euro area. The interest rate spreads for government bonds, however, have remained positive in the longer maturity segments.

Danmarks Nationalbank expects that stopping the issuance of government bonds will contribute to reducing the interest-rate spreads in the longer maturity segments and thereby limit the inflow of foreign exchange.

What Denmark just did, in addition to going further into NIRP, is to try and halt the appreciation of its currency by preventing more inflows not only on the short end but across the Treasury curve, and by halting supply of government bonds - the government had been due to issue 75 billion Danish crowns ($11 billion) worth of domestic debt to cover its 2015 financing needs - it hopes to not only lower long-end rates further, but to further weaken the Danish Krone, whose recent strength as a result of offshore inflows is the chief reason why many are increasingly saying the DEK peg to the EUR is in jeopardy.

And stated even simpler, paraphrasing Jan Storup Nielsen of Nordea, what Denmark has done is "back-door QE", because as some forget, there are two ways to push the price of an asset higher (thus pushing its yield lower in the case of a bond): increase demand, which is what conventional QE does when central banks buy bonds, or reduce supply. Which is what Denmark just did by completely cutting off all Treasury issuance "until further notice".

"We had not expected this," said Jes Asmussen, Chief Economist at Handelsbanken. "Everything that happens now is surprising. We had expected the central bank to start to use other instruments if the pressure on the crown continued, but we did not consider it would be this exactly."

But why, when with every passing day it is becoming clearer that the facade of central bank omnipotence is falling away, and central banks will, out of sheer desperation, do anything to delay the moments which as at least the SNB has admitted, is now inevitable?

Some more from Reuters:

While unexpected and unconventional, the Danish move underscores a commitment to its decades-long fixed currency policy and is aimed at weakening the crown to keep it within a tight range to the euro.

Pressure had been building on the crown since the Swiss National Bank abandoned its cap on Jan. 15, letting the franc surge against the euro, and the European Central Bank adopted a bond-buying scheme that helped weaken the euro more broadly.

"They have been successful with pushing the short rates down but not the longer rates and that has been the catalyst for continued inflow into the Danish asset market," Kamal Sharma, G10 FX Strategy Director at Bank of America Merrill Lynch, told Reuters.

"They are obviously looking at the full extent of the policy tool kit."

They sure are, and the central bank "now hopes that removing the option of buying new Danish government bonds will reduce demand for the crown while pushing investors towards existing longer-dated bonds, which would lower borrowing costs more broadly."

That's great, there is only one problem: what was until recently a "central bank put" has now become a "global speculator call" option. Why? Because the as the SNB just showed, there are very specific and defined limits to what banks with non-reserve currencies can do to defend their monetary policy. As a result, the Danmarks Nationalbank can thank its Swiss peers for not only crushing any hopes it may have of defending its currency peg, but essentially assuring that it will suffer massive losses on any and all strategies it implements to avoid a fate similar to that of the Swiss.

Which means one thing: in the aftermath of the EURCHF devastation, where virtually unilimited stops were triggered under 1.20 sending the pair some 30% lower in milliseconds as HFTs and other traders were carried out feet first, increasingly more speculators are betting that the "Trade of 2015" could be doing precisely the opposite of what the Danish central bank is hoping will happen: i.e., shorting the EURDKK (or going long the DKKEUR) in hopes that when the Danish peg finally does break, it too will result in long Swiss France-type profits.

Of course, those who bet against the Danish Central Bank also get the benefit of being hedged against further European risk implosion, because should the Greek situation deteriorate even more resulting in inflows into safe-haven currencies such as the CHF and DKK (now that Draghi will do everything in his power to crush the Euro), then the cost of defending the Danish peg will become insurmountable and Denmark will, like Switzerland, have no choice but to give all those who are now on the other side of the trade the profit that will make many speculators' year in the blink of an eye.

They say "don't fight the Fed", and in this case - at least until Janet Yellen capitulates on the Fed's stubborn insistence of pushing the USD every higher - this means explicitly to keep fighting the Danish Central Bank until its peg finally breaks.

FT : Bill Gross says European QE is ‘too little, too late’

Bill Gross says European QE is ‘too little, too late’

Veteran bond investor Bill Gross has called Mario Draghi’s long-awaited plan to revitalise the eurozone economy with a €60bn-a-month bond-buying programme “too little, too late”.

Mr Gross, who founded Pimco, the world’s largest bond manager, but decamped to Janus Capital last year, said he believed the European Central Bank president had no option but to push ahead with his version of quantitative easing. But he warned that its success would be hampered by the fact Mr Draghi took so long to implement his asset purchasing plan.

The former Pimco chief executive told the Financial Times: “Draghi had no choice [with regards to QE] but it comes far too late. That will become his problem.”

Mr Gross said the delay and subsequent fall in interest rates across Europe raises doubts as to whether banks — the pipeline between quantitative easing and the real economy — will use the money to lend.

“I don’t think QE will work as well in Europe as it did in the US.” he said. “There are only a limited amount of securities to buy and interest rates are now so low that it’s not necessarily the case that [banks will use] the money to invest in the real economy. I do wonder if much good can come of it.”

The 70-year-old has something of a chequered history with QE. He had what he called a “stinker” of a year in 2011, missing a rally in US treasuries after wrongly assessing the implications of bond buying in US. In 2013 he also misjudged the timing and impact of the Fed’s plan to scale back its asset purchases. That mistake contributed to the biggest decline in almost two decades for Pimco’s giant Total Return fund.

In depth

Euro in crisis

A logo of the Euro in front of the European Central Bank headquarters in Frankfurt

News, commentary and analysis of the eurozone’s debt crisis and its faltering recovery as it struggles with austerity and attempts to regain competitiveness

FT : Eurozone alarm grows over Greek bailout brinkmanship

Eurozone alarm grows over Greek bailout brinkmanship

Peter Spiegel in Brussels, Anne-Sylvaine Chassany in Paris and Stefan Wagstyl in BerlinAuthor alerts

Eurozone officials are increasingly worried that Greece’s €172bn bailout will expire at the end of the month and potentially plunge it into chaos, after a series of meetings with the new Greek government convinced them Athens is unaware of how perilous its financial situation has become.

Yanis Varoufakis, the new Greek finance minister, embarked on a tour of European capitals, starting with Paris on Sunday, intended to garner support for a renegotiation of its bailout and debt burden.

EU officials were dismayed on Friday when Mr Varoufakis rejected a bailout extension — and refused to co-operate with the “troika” of international creditors. It capped a tumultuous first week in power for the anti-austerity government, whose announcements reversing spending cuts and privatisation roiled markets and wiped 40 per cent off the value of Greek banks.

There was some relief when Alexis Tsipras, Greece’s radical leftwing prime minister, struck a more emollient tone over the weekend, saying he was not “seeking conflict” and hoped to “reach a mutually beneficial agreement”. He also revealed he had called Mario Draghi, president of the European Central Bank, to reassure him of his intention to reach a deal.

But patience in Greece’s creditor countries, particularly Germany, is running thin. Martin Schulz, the president of the European parliament and a German Social Democrat, urged Greece to go easy with its repeated attacks on Berlin. “Bashing the Germans might go down well in some quarters. But it is also short-sighted and gets us nowhere,” he told Welt am Sonntag newspaper. On Saturday, Chancellor Angela Merkel, bluntly warned Athens not to expect “a further haircut”.

German officials are also annoyed that Mr Varoufakis, who visits London on Monday and then Rome, has made no contact with Berlin.

Officials familiar with the conversations between eurozone policy makers and Athens said they were no wiser about what sort of international financial help Greece was seeking or how it intended to negotiate. Eurozone finance ministers want to discuss Greece’s needs at their next meeting on February 16 — if not sooner, by telephone.

The bailout programme is due to expire on February 28. If it is not renewed, Greece will for the first time in five years be left without an EU financial backstop. Because the International Monetary Fund is unlikely to distribute funds without the EU’s participation, Athens could lack access to emergency funding to repay billions of euros in debt due in the coming months.

EU officials believe the country could eke out €4.3bn in payments owed to the IMF next month, but will run into a wall at the beginning of June when the first of two bonds worth more than €3bn must be paid. Without bailout funding, and an ongoing sell-off in the private bond markets, Athens would be forced to default.

Of more concern to many officials is the Greek banking system, which after massive outflows of deposits, is relying on cheap ECB loans to fund day-to-day operations. ECB officials over the weekend made it clear that if the programme expires at the end of February, the central bank would be forced to cut off their liquidity loans.

But they have not clarified whether Greek banks could still access back-up central bank financing, known as emergency liquidity assistance. Although technically loaned by the Greek central bank, it must be approved by the ECB which has been cagey on whether such lending would be allowed.

Since the outbreak of the eurozone crisis, Greece’s banking system has always been seen as the most likely route to an “accidental” Greek exit from the euro. Without ELA lending, Athens would probably have to print its own currency to keep its banking system running.

Mr Draghi has told colleagues he is planning to drive a hard bargain on bank liquidity — a similar strategy used with Cyprus in March 2013, which forced Nicosia to accept onerous bailout terms. But Mr Draghi is also wary of unelected central bankers taking a decision that would force Greece from the euro.

The French government is hoping to act as broker between a defiant Athens and its increasingly exasperated Berlin.

“France is well placed to be the link ... between this Europe of budgetary rigour and this Europe of the south and in particular Greece, which is suffering,” Michel Sapin, finance minister, said last week. But Paris, like Berlin, has ruled out the debt cancellation demanded by Athens, underlining how few allies the new Greek