Big money investors have over the last six months poured cash into the markets at the fastest pace in 17 years as they fretted over COVID-19 and the upcoming presidential election, according to a new survey from Bank of America.

Cash holdings fell to 4.4% in October, down from 4.8% in September, and have now dropped 1.5 percentage points since April, the fastest decline since 2003. A reading below 4% is considered investor greed.

Respondents “said the recession is over, reduce cash, pause cyclical rotation, and price in contested election & February vaccine,” wrote Michael Hartnett, chief equity strategist at Bank of America. “We say sell SPX > 3600 and cyclical rotation via banks/energy to resume in Q4.”

Ticker Security Last Change Change %
SPX n.a. n.a. n.a. n.a.

TRUMP’S STOCK GAINS HIT REPUBLICAN RECORD

The Charlotte, N.C.-based lender surveyed 198 participants with $593 billion in assets under management between Oct. 1 and Oct. 8.

Thirty-four percent of respondents feared a second wave of COVID-19 was the biggest “tail risk” as expectations for the timing of a credible vaccine were pushed back from January 2021 to February 2021.

Absent the pandemic, investors were most worried about uncertainty caused by the upcoming presidential election, with 61% predicting the election will be contested.

Seventy-four percent of those surveyed said such an outcome was the one that would cause the most volatility. Another 14% forecast a Democratic sweep would shock markets while 8% feared a divided Congress and 4% were uneasy about a President Trump win.

On the economy, 60% of respondents said we are in an early-cycle phase as opposed to 26% who thought we were still in recession.

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(Bloomberg) — Mercari Inc., the online flea-market operator that has become one of Japan’s most closely watched tech ventures, is closing in on new highs as the stock has drawn both big and small money.

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The company has already grown to command the largest weighting on Japan’s startup-focused Mothers index as individual investors buy in — of some 230 of the largest Japanese companies with market value of over $5 billion, Mercari has the third-highest percentage of individual shareholders. Then on Oct. 7, Los Angeles-based money manager Capital Group declared it had taken a 5% stake in Mercari.

That’s helping propel the stock to near the 6,000 yen mark it hit just once, on the day it listed to great fanfare in 2018. After a rapid decline, the stock has worked its way back up this year, fueled by its first quarterly operating profit. That’s been helped by the coronavirus pandemic, which has boosted usage of its online marketplace where users buy and sell items.



graphical user interface, chart, histogram: Mercari shares are nearly back to the post-IPO pop


© Bloomberg
Mercari shares are nearly back to the post-IPO pop

Mercari fell 0.2% in Tokyo on Tuesday. A gain of just 3.3% in the next trading session would see it match the 6,000 yen high.

Mercari is something of a rarity in Japan, which has few tech startups that have swelled to the size of the $8.6 billion company, according to Ikuo Mitsui, a fund manager at Aizawa Securities Co., who is still bullish on the firm after the share surge.

“In Japan there are very few companies like this, light on assets and not requiring large-scale capex,” he said. That’s why many are piling onto the stock, he added.

It’s even more unusual for being a Japanese startup that is starting to see success on its app outside of its home

(Bloomberg) — Mercari Inc., the online flea-market operator that has become one of Japan’s most closely watched tech ventures, is closing in on new highs as the stock has drawn both big and small money.

Loading...

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The company has already grown to command the largest weighting on Japan’s startup-focused Mothers index as individual investors buy in — of some 230 of the largest Japanese companies with market value of over $5 billion, Mercari has the third-highest percentage of individual shareholders. Then on Oct. 7, Los Angeles-based money manager Capital Group declared it had taken a 5% stake in Mercari.

That’s helping propel the stock to near the 6,000 yen mark it hit just once, on the day it listed to great fanfare in 2018. After a rapid decline, the stock has worked its way back up this year, fueled by its first quarterly operating profit. That’s been helped by the coronavirus pandemic, which has boosted usage of its online marketplace where users buy and sell items.



graphical user interface, chart, histogram: Mercari shares are nearly back to the post-IPO pop


© Bloomberg
Mercari shares are nearly back to the post-IPO pop

Mercari is something of a rarity in Japan, which has few tech startups that have swelled to the size of the $8.6 billion company, according to Ikuo Mitsui, a fund manager at Aizawa Securities Co., who is still bullish on the firm after the share surge.

“In Japan there are very few companies like this, light on assets and not requiring large-scale capex,” he said. That’s why many are piling onto the stock, he added.

It’s even more unusual for being a Japanese startup that is starting to see success on its app outside of its home country. The pandemic was a boon to its U.S. operations, which saw gross merchandise value (GMV) jump almost threefold in the quarter ended June from

An international investment firm now owns an industrial park at DFW International Airport.

New York-based Brookfield Properties acquired the three-building Passport Logistics Center.

The 1.2 million-square-foot warehouse and distribution complex was developed by Dalfen Industrial, which has headquarters offices in Dallas and Canada. The buildings are at the south end of the airport near Airport Freeway and are part of the airport’s mixed-use Passport Park development.

Dalfen built the Passport Logistics Center in partnership with Brookfield, which now is the full owner of the business park.

“With the project’s prime location and best-in-class functionality, Brookfield Properties leased 50% of the project during construction,” Brookfield Properties officials said in a statement. “Over the past three years, Brookfield Properties has increased its footprint in the Metroplex, adding over 5.5 million square feet across nine transactions.”

During the last year, Brookfield has added more than $1.2 billion in logistics properties in the U.S.

North Texas warehouse construction is barely keeping up with demand.

Dalfen Industrial in turn has bought five industrial buildings in Fort Worth and San Antonio.

In Fort Worth, Dalfen acquired the new Mark IV Commerce Center, a three-building, more than 1 million-square-foot industrial park at Interstate 35W and Interstate 820. The buildings were developed by Crow Holdings Industrial.

Dalfen also purchased two industrial buildings north of San Antonio off Interstate 35.

“Best-in-class properties in exceptional infill locations make these acquisitions a natural fit for our rapidly growing portfolio,” Sean Dalfen, president and chief investment officer of Dalfen Industrial, said in a statement.

Dalfen Industrial now owns more than 4 million square feet of industrial buildings in Texas.

Dalfen Industrial bought the Mark IV Commerce Center in North Fort Worth.
Dalfen Industrial bought the Mark IV Commerce Center in North Fort Worth.(Dalfen Industrial )

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Key Takeaways:

  • Recent uptick in rates might spell better times ahead for banks
  • Credit loss provisions still expected to weigh, but cost-cutting has likely helped
  • Housing market seen aiding Wells, while Citigroup’s
    C
    credit card business stays in focus

A lethal combination of ultra-low interest rates, credit worries, a steep economic slowdown, and tough government regulations ganged up on big banks this year. Despite that, expectations for the group’s Q3 earnings performance are on the rise.

Granted, the numbers don’t look like something to throw a party over, with research firm FactSet predicting cumulative Financial earnings to fall 19.4% from a year ago. The good news is that those expectations look a lot sunnier than where analysts were back in June, when they predicted a Financials Q3 earnings cratering of 34.4%.

Why the improvement? For one thing, many banks benefit from the energetic capital markets and the trading revenue they provide. Second, low rates have their good side, encouraging more loan activity.

Some of the big banks leading the upward earnings expectations meter include JP Morgan Chase
JPM
(JPM) and Wells Fargo
WFC
(WFC), FactSet reported. It appears likely they both could have relatively positive Q3 results despite all the headwinds they’ve faced and continue to face in this rough 2020.

The same goes for Citigroup (C), which, like JPM, is expected to report Q3 earnings early tomorrow. Those will be followed Wednesday morning by WFC.

Before zeroing in on individual banks, let’s scroll back for a broader view. Big banks haven’t performed well in the market this year, but they’ve generally done a great job setting aside money for possible credit losses and cutting costs. This could position most of them pretty nicely for any economic rebound once the pandemic passes.

That said, the credit