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Flurry By hedge funds in the market

Hedge funds have come out from hibernation to get the market in a bit of action today. Hedge funds have been busy buying banks as the banks look more and more attractive as they inch the australian markets higher with stock market investing today.

Hedge funds action in the Australian markets

Hedge funds are buying into Australian stocks, especially banks, in a currency play, broker Southern Cross Equities said. "This currency carry trade in banks has taken the major banking sector to a premium to the broader market. I think that's ambitious," Southern Cross' head of institutional dealing, Charlie Aitken, said in a note.

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"What concerns me is Australian equities, but particularly Australian banks who account for a record 30% of the index, are part of one giant hedge fund currency trade. We all need to be acutely aware that an unexpected move in currencies will have exponential ramifications for the related equities.

They are major wheels that are turning, a lot more than just short-term hedge funds games, indicating our ride has a lot further to run yet.

The Aussie dollar's rise above 92 U.S. cents helped lure funds into the top four banks, which climbed between 0.3 and 1.4 percent Retail stocks were mixed. Coles owner Wesfarmers rose 21 cents to $26.25, Harvey Norman gave up 6 cents to $4.33 and David Jones retreated 7 cents to $5.68.

The Australian share market has ended firmly in positive territory after strong commodities prices drove gains among resource stocks. At the close, the benchmark S&P/ASX200 index was up 53.4 points, or 1.1 per cent, at 4846.2 points, while the broader All Ordinaries index rose 51 points, or 1.1 per cent, to 4842.8 points


U.S. inside-trading net widens to rattle hedge funds: sources

U.S. investigators plan to charge at least 10 securities professionals with insider trading, some linked to the criminal case against billionaire hedge-fund manager Raj Rajaratnam that shook Wall Street last week, say people familiar with the matter.

The pending crackdown, some two years in the making and among the biggest undercover looks at alleged insider trading, may yield charges against hedge-fund managers and associates this week, the people said, seeking anonymity because the cases are not public. More here

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