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Hacked Tweet Reveals Longs, Shorts In Market (Sebastien Galy)
The fallout from today’s hacked AP Tweet debacle has already begun. In case you missed it, someone managed to hack the Associated Press’ official Twitter account and said the White House had been attacked. The stock market instantly plummeted. Societe Generale’s points out the drop revealed how the market will react to an actual shock. The Dow fell, the Yen gained against the dollar, and VIX spiked. Takeaway, per Galy: “The market is very long equities and short yen.”
“Financial motivations” accounted for 75% of computer security incidents, according to a Verizon report. State-sponsored attacks accounted for just 20 per cent. Financial organisations comprised 37% of targets, followed by retailers at 24% and industrials at 20%.
60-40 Portfolios Are Dead (Marketwatch)
Inevitably rising interest rates are killing the age-old 60-40 axiom, which held portfolios should be 60% stocks and 40% bonds. A recent study predicts 60-40 would yield just 4.4% between 2011 and 2020, compared with about 14% for the ’80s and ’90s. Managers are now mixing in commodities, real estate and currencies into their portfolios to shore up gains
The Gold Plunge Has Broken The Charts (Morgan Stanley)
Our chart of the day was this illustration of gold’s collapse through all of its moving averages, via Morgan Stanley. They conclude that it’s lure as a safehaven for investors has evaporated.
Morgan StanleyFirms Defying Spring Swoon (UBS)
The Richmond Fed index declined to -6 from +3, while Flash PMI dipped to 52.0 from 54.6. Are firms taking notice? Not really, says UBS’ Drew Matus. In a note today, Matus writes: “We continue to focus on the low level of initial claims as evidence that firms have not adjusted their outlook due to the recent data.”
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