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5 US Tech Giants Just Spent $116 Billion Of Repatriated Cash On Buybacks


by Tyler Durden
Wed, 11/14/2018 - 21:25


While many analysts wanted to attribute the divergence in US stocks during the first three months of this year to strong economic data, the fiscal stimulus unleashed by Trump or stronger-than-expected corporate earnings, as analysts at Nomura (including cross-asset strategist Charlie McElligot) and Deutsche Bank have argued, when it comes to factors undergirding the market rally, buybacks trump growth "divergence".



And while equity-market performance in late September and October - when corporations entered a buyback "blackout" period - has largely vindicated their analysis, in case anyone still doubts the crucial role of the corporate bid, the Financial Times offered yet another piece of evidence in a story published in Tuesday's paper when it revealed the full magnitude of tech company buybacks fueled by the Trump tax cuts during the first three quarters of 2018. Out of all the money repatriated by US companies thanks to the Trump tax cuts, US companies have spent a staggering sum on buybacks, and a comparatively paltry amount on boosting capex spending and reinvestment (the kind of corporate spending that helps drive economic growth).



Per the FT, the five US tech companies with the largest cash piles spent more than $115 billion on buybacks during the first three quarters of the year, nearly double what they spent during the entirety of last year. This is the latest sign that, while Trump sold his tax cuts as a boon for working Americans, investors have reaped most of the benefits to date (though to be fair, the companies did boost their capital spend by a combined $42 billion). The tech firms also spent some of the repatirated cash paying down debt, freeing up more money to spend on buybacks in the future.

"Most companies are using cash to buy back stock and make acquisitions, rather than invest in new facilities," said Walter Price, a tech investment manager at Allianz. "I think this is good for shareholders and management." Tech companies were also paying down debt they took on in previous years to buy back shares, he added.​
These companies (Apple in particular) had been sitting on massive cash piles that had been stashed off-shore to avoid paying US taxes when the money was repatriated.



Take Apple, for example: While the tech giant spent $14.5 billion on capex during the first three quarters of 2018 (after promising to reinvest some $350 billion in tax-cut enabled repatriated cash within the US), its buyback spending soared to $62.6 billion - nearly three times the prior-year period. To be sure, some of the repatriated money has likely been earmarked for capital spending. However, this spending will likely take longer to plan and execute.

"There’s a strong correlation between tax reform and capital spending," added Youssef Squali, an internet analyst at SunTrust Robinson Humphrey, pointing at Google and Facebook, which plan to spend a combined $37bn between them this year, up from just under $21bn in 2017.​
Notably, the growth in buybacks hasn't been confined to tech alone: US corporate buybacks rose 44% during the first nine months of 2018.

Meanwhile, share buybacks have risen 44 per cent so far this year, according to Goldman Sachs, which estimates that buybacks will climb another 22 per cent in 2019. Just 25 companies accounted for 99 per cent of the growth in buybacks this year, the bank found, underscoring the outsized influence of tech companies’ use of cash.
But while the buybacks led tech stocks to outperform on the way up, like the old saying goes: The bigger they are, the harder they fall.

https://www.zerohedge.com/news/2018...s-spent-116-billion-repatriated-cash-buybacks
 

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Ira Epstein's End of the Day Financial Video 11 14 2018
Ira Epstein


Published on Nov 14, 2018
 

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Ira Epstein's End of the Day Agriculture Video 11 14 2018
Ira Epstein


Published on Nov 14, 2018
 

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Where's the Gold Mr. Carney?
maneco64


Published on Nov 15, 2018
 

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Share Talk Bulletin Board Heroes, Thursday 15th November 2018


Share Talk
Published on Nov 15, 2018
A charting look at some of the most followed stocks on the London market, Zak Mir covers.

Aminex (AEX)
Oilex (OEX)
Parity (PTY)
Yolo Leisure (YOLO)
Vr Education H. (VRE)

@ZaksTradersCafe deductive reasoning as to what should happen next in terms of the newsflow regarding the companies listed in this video.

Zakmir.com is a purely journalistic website – Zak Mir is a member of the National Union of Journalists. There is no intention here of providing financial advice. It is recommended you seek an independent professional opinion before deciding whether or not to take any action with regard to anything written here.
 

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Global Rally Shattered, Europe Slides As Brexit Turmoil Returns


by Tyler Durden
Thu, 11/15/2018 - 07:04


US futures pared earlier gains, European stocks slumped and the pound tumbled after the Brexit crisis returned with a bang to the forefront after a series of British ministers quit in protest at Theresa May’s Brexit deal, plunging the U.K. government into crisis and sparking fresh fears about a May ouster and a hard Brexit.



Today's turmoil started around 4am ET when Brexit Secretary Dominic Raab announced his resignation on Twitter, the highest profile of several departures on Thursday morning. “No democratic nation has ever signed up to be bound by such an extensive regime, imposed externally without any democratic control over the laws to be applied, nor the ability to decide to exit the arrangement,” he said in his resignation letter.

His, and subsequent resignations, threw into doubt May’s ability to secure Parliament’s support for her plan and even to survive as leader.


The pound, which rebounded strongly on Wednesday after May announced she had won cabinet support for the withdrawal draft, tumbled 3 big figures almost instantly on the news, dropping as much as 1.9%, its biggest plunge since 2017.



“The reaction is sterling shows that the chance of no Brexit deal has spiked,” said Tim Graf, Head of Macro Strategy for EMEA at State Street Global Markets. “It also introduces thoughts of a leadership challenge (for British Prime Minister Theresa May) which seems likely now.”

While the prime minister defended her plan as the only way to protect the union of the U.K when addressing law makers in the House of Commons, the renewed threat that May could be replaced and Britain could crash out of the EU with no deal is an unpredictable and high-risk scenario for markets. As the resignations rolled in, the FTSE 100 Index trimmed gains as trading volumes soared to double the 30-day average while gilts surged. European stocks, which started the session in the green, pared all gains and dropped to yesterday's lows, down 0.4%.



"The truth is no one can accurately predict how this will play over the next few days and weeks," said Epworth Investment Management Chief Investment Officer Stephen Beer. "However, in some important respects, nothing has changed since the referendum. It remains the case that Brexit is likely to be economically worse for the U.K. than remaining in the European Union. What we have now is more people realizing that."

S&P 500 had been solidly up before they pared much of their advance, although they have since rebounded to near session highs once more.

The yen rose, and gold and the Swiss franc were steady, suggesting the market was not too concerned by the latest Brexit turmoil.



The S&P 500 had fallen for a fifth straight day overnight, with financial stocks hit by fears of tighter regulations once the Democratic Party takes control of the House of Representatives. U.S. stocks were also pressured by concerns that earnings growth might be peaking, trade tensions and a slowing global economy - factors that had triggered a rout in riskier assets in October.

The European turmoil followed a relatively calm Asian session with the MSCI Asia index rising 0.8%, as Hong Kong shares jumped after Tencent earnings beat expectations while Chinese equities rose 1.4%, cheering news that China and the United States were back in contact about their bitter trade disputeas after a report that Chinese officials had sent a letter to the White House outlining a series of potential concessions to the Trump administration, despite subsequent reports that the offering by China was insufficient to meet Trump's demands. Japanese stocks edged lower while the Australian dollar jumped after a strong local jobs report.

There was some good news overnight: in a closely watched question-and-answer session late on Wednesday Federal Reserve Chairman Jerome Powell played down recent turbulence in equities, saying volatility was only one of many factors that the Fed takes into account. Then again, Powell's admission confirmed that the Fed put is hundreds of points lower than the S&P's latest price, which likely means that stocks have a long way to fall before Powell gets truly concerned about the Fed's beloved "wealth effect."

UK turmoil also boosted demand for safe-haven German government bonds. Ten-year Bund yields fell over three basis points to 0.36 percent, the lowest in over two weeks.

“While it’s difficult to pin-point a specific event for the risk-off move, recent themes appear to be keeping markets cautious include oil’s recent plummet, Apple’s fall, U.S. political gridlock, China’s slowing growth, tightening liquidity, a hawkish Fed, earnings peak, Italian jitters, and Brexit uncertainty,” wrote economists at ANZ.

Elsewhere, West Texas crude resumed its slide following Wednesday’s rebound from a record losing streak. Emerging-market shares rallied and their currencies strengthened.

“If U.S. stocks are to bounce back, economic indicators will be key,” said Junichi Ishikawa, senior forex strategist at IG Securities in Tokyo. “Focus will be on today’s U.S. retail sales data, which will provide a view of how private consumption -the main component of economic growth- is faring.” U.S. retail sales for October will be released today at 830am ET.

Market Snapshot
  • S&P 500 futures little changed at 2,696.50
  • STOXX Europe 600 down 0.3% to 361.05
  • MXAP up 0.8% to 151.53
  • MXAPJ up 1.2% to 485.20
  • Nikkei down 0.2% to 21,803.62
  • Topix down 0.1% to 1,638.97
  • Hang Seng Index up 1.8% to 26,103.34
  • Shanghai Composite up 1.4% to 2,668.17
  • Sensex up 0.5% to 35,317.74
  • Australia S&P/ASX 200 up 0.06% to 5,736.02
  • Kospi up 1% to 2,088.06
  • German 10Y yield fell 3.9 bps to 0.359%
  • Euro up 0.09% to $1.1320
  • Italian 10Y yield rose 4.3 bps to 3.117%
  • Spanish 10Y yield rose 2.8 bps to 1.646%
  • Brent futures little changed at $66.12/bbl
  • Gold spot little changed at $1,210.57
  • U.S. Dollar Index up 0.6% to 97.34
Top Overnight News from Bloomberg
  • Prime Minister Theresa May is fighting for her political life as a growing revolt from within her own party threatens to derail her Brexit plans and force the U.K. out of the European Union with no deal
  • Chinese officials have outlined a series of potential concessions to the Trump administration for the first time since the summer as they continue to try to resolve a trade war, according to three people familiar with the discussions
  • Federal Reserve Chairman Jerome Powell said the U.S. economy is strong but could face headwinds next year as policy makers weigh how far and fast to raise interest rates
  • Apple’s outlook dims as suppliers worldwide sound the alarm, with Austrian-based AMS AG the latest to sound the alarm
  • A Saudi royal adviser and a senior intelligence official played key roles in the mission that ultimately led to the killing of government critic Jamal Khashoggi and authorities will seek the death penalty for five people who confessed to the murder
Asian equity markets were eventually mostly higher after the region gradually shrugged off the cautious lead from the losses stateside, where weakness in tech and financials saw all US majors finish in the red. ASX 200 (+0.1%) and Nikkei 225 (-0.2%) were lower throughout most the session as financials lagged although the Australian benchmark staged a late rebound and just about turned positive at the close, while sentiment in Tokyo remained pressured by a firmer currency and as blue-chip banking stocks declined post-earnings. Elsewhere, Hang Seng (+1.7%) and Shanghai Comp. (+1.4%) weathered a choppy start as outperformance in tech kept Chinese markets afloat after a beat on earnings from Hong Kong index-giant and China’s largest tech firm Tencent Holdings. Finally, 10yr JGBs were flat with only minimal support seen despite the losses in Tokyo stocks and with price action also muted following mixed results in today’s 5yr JGB auction. China's government is said to have sent a written response to the US concerning trade reforms, which reports noted offered insufficient concessions.

Top Asian News
  • Tencent-Backed Fashion Site Is Said to Halve IPO Valuation Goal
  • Tencent’s Big Beat Falls Flat With Analysts Pining for New Games
  • Takeda Offers Mega-Euro Bond Amid Renewed Brexit Upheavals
  • Philippines Delivers Fifth Rate Hike to Curb Inflation
European indices are mixed, with the FTSE MIB (-0.5%) lagging alongside broad underperformance in Italian assets. Furthermore, Prysmian (-4.3%) have also weighed on the index after a guidance cut and STMicroelectronics (-2.5%) are lower in sympathy with AMS (-1.3%) who cut guidance pre-market. FTSE 100 (+0.1%) is bucking the trend as recent Brexit updates are weighing on Cable. However, upside for the index is being capped by losses in RBS (-7.3%) and Barclays (-6.0%) in the wake of the rate implications of today's Brexit turmoil. Elsewhere, Antofagasta (+2.1%) are lower following board approval of expansion to the Los Pelambres copper mine. In contrast Royal Mail (-5.2%) are in the red after reporting lower half year pre-tax profit.

Top European News
  • Raab Resignation Means Higher Risk Brexit Deal Fails: Nordea
  • Pound Could Fall to $1.25 After Raab, Says Mizuho’s Jones
  • Raab Resignation Signals Parliament Vote Challenge: Danske
  • Soubry: Raab’s Resignation Marks End of PM’s Withdrawal Pact
  • In Brexit Brinkmanship, Europe Was Always Going to Be The Winner
  • European Car Sales Slump Again, Testing VW’s Upbeat Outlook
  • Four Weeks That Will Determine Fate of the ECB’s Bond Buying
In FX, all eyes were on GBP as the Post-UK Cabinet approval of the withdrawal draft has been extremely short-lived, as Brexit Minister Raab resigned due to reservations over the proposal, followed by McVey (Work and Pensions Secretary and other not as high profile (so far) Government officials. Significantly weaker than forecast retail sales data merely compounded the misery for Sterling, but probably won’t be the final straw amidst reports of more MPs and aides considering their position and an official leadership challenge against PM May. Cable collapsed from 1.3000+ through 1.2900 and the recent 1.2828 low to circa 1.2750 at one stage, with only the November base at 1.2696 protecting the ytd trough (1.2662) aside from any psychological or sentimental support at 1.2700. Meanwhile, Eur/Gbp rallied from around 0.8700 to 0.8845, breaching some interim chart resistance at 0.8766 on the way, and without much effort, before partially retracing.

EUR - Although the single currency is benefiting from the Gbp’s demise, it has lost ground vs the Usd after running into offers at 1.1350, but is holding in well above recent lows not far from 1.1200 and may be relatively contained by hefty option expiries at 1.1300 and 112.50-60 in 1.5 bn and 1.6 bn respectively.

AUD - The clear G10 outperformer and retaining the bulk of its overnight gains vs the Greenback on the back of an upbeat Aussie jobs report – Aud/Usd currently around 0.7260 within a 0.7300-0.7230 range, and with the Aud/NZD cross back above 1.0650 as the Kiwi pivots 0.6800 against the Usd.

DXY - The Dollar is mixed vs major counterparts and broadly weaker against EM currency, but the index has rebounded firmly above 97.000, largely due to the aforementioned Pound rout and knock-on effects.

In commodities, gold (+0.9%) prices have extended gains above USD 1200/oz as the dollar continues to fall from the 16-month highs that were reached at the start of the week. Separately, copper has been boosted following China sending a written response to US trade reforms, although it has been noted that it offers insufficient concessions. Brent (-0.1%) and WTI (-0.2%) initially traded higher, and were mostly unaffected by the larger than expected build in API inventory. but have since reverted into negative territory following the dollar beginning to strengthen again. Of note reports that Russia have cut oil output to 11.38mln BPD for the first two weeks of November. Markets will be looking ahead to the EIA weekly data later today.

As for today’s calendar,the highlight is the October retail sales report which will be a first look for forecasters into Q4 consumer spending. The consensus is for a +0.5% mom headline reading, and +0.4% readings for the core and control group components – the latter of course important as it’s a direct input into the BEA’s estimate of consumers’ spending on goods in the GDP numbers. Away from that we’ll also get regional November manufacturing reports from the NY and Philly Fed’s, October import price index, initial jobless claims, and September business inventories. Away from the data it’s another busy day for ECB speakers with Coeure, Praet and de Guindos due to speak. The Fed’s Quarles will also appear before the Senate, before Chair Powell speaks again – albeit on hurricane recovery efforts so it’s unlikely to be market sensitive – and Bostic and Kashkari speak tonight. Oh and there might be a few more Brexit headlines.

US Event Calendar
  • 8:30am: Empire Manufacturing, est. 20, prior 21.1
  • 8:30am: Philadelphia Fed Business Outlook, est. 20, prior 22.2
  • 8:30am: Retail Sales Advance MoM, est. 0.5%, prior 0.1%; Ex Auto MoM, est. 0.5%, prior -0.1%;
    • Retail Sales Ex Auto and Gas, est. 0.4%, prior 0.0%; Retail Sales Control Group, est. 0.4%, prior 0.5%
  • 8:30am: Import Price Index MoM, est. 0.1%, prior 0.5%; 8:30am: Import Price Index YoY, est. 3.3%, prior 3.5%
  • 8:30am: Export Price Index MoM, est. 0.05%, prior 0.0%; 8:30am: Export Price Index YoY, prior 2.7%
  • 8:30am: Initial Jobless Claims, est. 213,000, prior 214,000; Continuing Claims, est. 1.63m, prior 1.62m
  • 9:45am: Bloomberg Consumer Comfort, prior 61.3
  • 10am: Business Inventories, est. 0.3%, prior 0.5%
  • 10am: Fed’s Quarles to Appear before Senate Banking Panel
  • 11:30am: Fed’s Powell Reviews Post-Hurricane Harvey Recovery Efforts
  • 1pm: Fed’s Bostic Speaks in Madrid
  • 3pm: Fed’s Kashkari Speaks to Minnesota AgriGrowth Council
DB's Jim Reid concludes the overnight wrap
Before we get into Brexit, inflation, oil and the likes I’d like to ask the more experienced parents out there if your children have ever had a more insignificant part in a nativity play than my three year old Maisie has just been given. In her pre-school performance at Xmas she’s been cast as a “bell”. I’ll resist the urge to storm into school and ask why she’s not playing Mary.

The bells looked like they were tolling for PM May’s Brexit deal yesterday morning, as the initial political response to her withdrawal agreement proved to be quite negative and the pound shed as much as -0.73% at its intraday lows. However, May ended the day by again rising from the flames and securing Cabinet approval for her plan, and the pound ultimately rallied +0.16% on the day to just below $1.30 by the US close but traded between $1.2882 and $1.3072 during a turbulent session.

The pound did close off the immediate cabinet backing highs as PM May described the outcome as “collective agreement,” conspicuously avoiding the word “unanimous” in a possible acknowledgement of internal pushback. The government then released the almost 600-page withdrawal agreement, which will be scrutinised by MPs and the press over the coming days for any surprises. The Parliamentary arithmetic still looks quite dicey, and it’s noteworthy that Boris Johnson waited 48 hours after Chequers to resign, so PM May is certainly still exposed to further dissent/resignations from her cabinet in the hours and days ahead.

The good thing about Brexit is that most other things that are going on in markets right now feel fairly straightforward by comparison. Despite WTI oil finally snapping its unwanted record-breaking run of 12 consecutive daily declines with a rebound of +0.84% yesterday, US markets struggled once again yesterday with the NASDAQ leading the way with a -0.90% decline, followed closely by the S&P 500 (-0.76%) and DOW (-0.81%). Apple underperformed again, down -2.82% as investors continued to digest the news of reduced upstream demand from the company’s suppliers. That’s five trading sessions in a row that the S&P has dropped now which is the third worst run this year following the two six-day consecutive loss runs in October. We’ve now had 27 down days over the 39 trading days since the index peaked on September 20, the longest such streak since November 2008 amid the post-Lehman fallout.

Late last night we did have some non-Brexit related news when Fed Chair Powell spoke positively about the US economy and downplayed concerns about financial market volatility. He argued that the US economy can continue to grow and can even pick up pace in the future, though he did note some downside risks from fading fiscal stimulus, slower growth abroad, and any greater-than-expected impacts of rate hikes. Powell mentioned that credit spreads remain tight, suggesting that it will take broader risk-off price action in markets to affect his reasoning than just an equity selloff. Finally, he asserted that all meetings will be “live” moving forward, since they will now all be accompanied by press conferences.

This morning in Asia, markets are off to a mixed start with the Nikkei (-0.50%) down while the Hang Seng (+0.61%), Shanghai Comp (+0.68%) and Kospi (+0.10%) are all up. Elsewhere, futures on the S&P 500 (-0.17%) are pointing towards a slightly negative start.

Credit markets are starting to get more and more attention of late especially in the US. Even Powell mentioned them last night - albeit in a positive light. As a reminder, our view has been that US HY has been far too expensive this year. Other indices have hit our targets, but HY has stubbornly held in. This week, the downgrade of GE has first rocked IG credit and then the significant re-pricing of oil has had an impact on HY energy bonds once again. Just to recap on US HY, in October we finally saw some cracks start to appear as spreads widened more than 70bps (tight to wide). Whilst the first week of November seemed to bring some reprieve to credit markets, the last few days have seen some further notable moves wider. USD HY has widened the best part of +40bps with HY energy more than +50bps wider. Both series are now at their wides for the year with USD HY now more than +30bps wider YTD. USD IG has widened nearly 10bps from the recent November tights and is up against their YTD wides. Similarly EUR IG and HY credit is now also at the wides for the year at around 45bps and 150bps wider respectively.

Back to markets yesterday, sentiment was actually initially positive at the open following a marginally dovish US CPI report (more on that below) but weakness soon followed and equity markets in Europe failed to hold onto an intraday recovery with the STOXX 600 finishing down -0.60% and DAX -0.52%. Bond markets were once again a sideshow with Treasuries (-1.8bps) and Bunds (-1.1bps) a touch stronger.

Talking of European equities our strategist Sebastian Raedler has published his 2019 market outlook this morning. He sees upside for the Euro area and China PMI over the coming months, implying tactical upside for the Stoxx 600 to 385 by Q1, 6% above current levels. However, from Q2 onwards, he sees renewed downside for the market as the Euro area real bond yield (i.e. the discount rate for European equities) starts rising on the back of a recovery in Euro area core inflation and the EUR appreciates in line with our FX strategists’ projections, leading the Stoxx 600 to fade to 345 by end-2019, 5% below current levels. See here for the report.

Moving on. It wouldn’t be a recap without mentioning Italy and it was interesting to hear DB’s Clemente De Lucia’s take on the letter Italy sent to Brussels late Tuesday which broadly confirmed the original version of the DBP. In Clemente’s view, the tone of the letter was tough suggesting that a compromise with Brussels is a long way from being reached. The new, higher levels of planned privatisation is very unlikely to change the mind of the Commission. Such initiatives are very difficult to monitor and, in the past, Italy have missed their targets. As for where things stand now, a Eurogroup meeting is scheduled for December 3rd, which means we could see an EDP launched as soon as early next month. It could be an interesting final month of the year for politics in Europe with this and Brexit. The FTSE MIB closed down -0.78% yesterday and slightly underperformed the rest of Europe, while 2y and 10y BTPs rose +4.8bps and +4.5bps respectively. Talking of politics, our German experts last night published a piece on what Merkel succession race means for Europe. See here for more.

In other news, yesterday was a packed day for data although there wasn’t a huge amount to move the dial. In Germany, Q3 GDP came in slightly weaker than the downwardly revised forecast at -0.2% qoq. The first negative quarterly print since early 2015 is likely to be temporary though, with new car emissions tests disrupting car production. In France the final October CPI print was confirmed at +0.1% mom and unrevised versus the flash, while here in the UK, CPI missed to the downside slightly at +0.1% mom (vs. +0.2% expected) for the headline level, although the core did hold at +1.9% yoy as expected. Shortly after that euro area GDP for Q3 was confirmed at +0.2% qoq as expected.

Meanwhile, as mentioned above the October CPI report in the US was at the margin a tad disappointing in the context of a small rounding down in the annual rate for the core to +2.1% yoy from +2.2%. The six-month annualised reading is also now down to +1.95% which is food for thought for the Fed maybe. The October reading itself was confirmed at +0.2% mom as consensus expected (+0.1926% unrounded) with positive payback from used cars in particular.

As for today’s calendar, this morning in Europe we’ve got October retail sales data out in the UK first thing, followed later on by the September trade balance reading for the euro area. In the US the highlight is the October retail sales report which will be a first look for forecasters into Q4 consumer spending. The consensus is for a +0.5% mom headline reading, and +0.4% readings for the core and control group components – the latter of course important as it’s a direct input into the BEA’s estimate of consumers’ spending on goods in the GDP numbers.

Away from that we’ll also get regional November manufacturing reports from the NY and Philly Fed’s, October import price index, initial jobless claims, and September business inventories. Away from the data it’s another busy day for ECB speakers with Coeure, Praet and de Guindos due to speak. The Fed’s Quarles will also appear before the Senate, before Chair Powell speaks again – albeit on hurricane recovery efforts so it’s unlikely to be market sensitive – and Bostic and Kashkari speak tonight. Oh and there might be a few more Brexit headlines.

https://www.zerohedge.com/news/2018...hattered-europe-slides-brexit-turmoil-returns
 

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Should You Hold Materials With Holidays Coming? - 11/14/18
iScrap App


Published on Nov 14, 2018
Check Scrap Prices Today: https://iScrapApp.com/ - Copper has had a turbulent week with the markets going up and down about 5-7 cents per lb overall. With the markets in limbo we have to watch what is going on going into the meeting at the end of this month and with the holidays here. With such a strong year in the stock markets a lot of the commodity traders are still making money even with the metal prices down. Read more: https://iscrapapp.com/?p=1200768

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Taxpayers to Fund Helipad for Amazon CEO
RT America


Published on Nov 14, 2018
Anya Parampil follows up on Amazon’s latest announcement that it will open two new headquarters: one in Crystal City, Virginia and another in Long Island City, New York by highlighting some of the disturbing promises local governments have made the company, including New York’s pledge to subsidize a helipad for CEO Jeff Bezos. Richard Wolff, Co-Founder of “Democracy at Work” and Professor of Economics & International Affairs, joins the show to explain how taxpayers will ultimately subsidize Amazon without benefiting from its presence.
 

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Uber reveals losses of $1 billion last quarter and a slow down in bookings growth ahead of its IPO next year, with company valued around $76 billion

  • Uber lost $1.07 billion in the third quarter, more than it did in the second quarter of the year when it posted a loss of $891 million
  • In total, Uber reported $12.7 billion in gross bookings for quarter three, up six percent for last quarter and 41 percent from last year
  • This is the first quarter that company has posted single-digit growth in bookings
  • Uber Eats accounted for $2.1 billion in gross bookings for the company, a increase of 150 percent from last year
  • The company's initial public offering must happen before September 30 of next year due to an agreement with Japanese investor Softbank
  • It is currently valued at around $76 billion though some believe it could be worth as much as $120 billion
https://www.dailymail.co.uk/news/ar...on-loss-bookings-spending-ahead-IPO-year.html
 

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China Leads Countries Plumbing the Ocean Depths for Metallic Rocks
November 14, 2018 by Reuters


Photo: DeepGreen



By Barbara Lewis LONDON, Nov 14 (Reuters) – China, the leading holder of international deep sea exploration licences, has increased its lead in the race for alternative sources of battery minerals by taking samples from cobalt-bearing mountains deep in the Pacific.

The cobalt-rich crusts could one day curb the world’s dependence on cobalt from Democratic Republic of Congo, but most companies say deep sea mining is a distant prospect.

Maersk Supply Service, part of shipping company Maersk , is working with Canada’s DeepGreen to harvest metallic rocks from the ocean floor.

“It is a promising business area with the potential for significant future growth,” Maersk Supply Service said in an email. “Production is a few years away.”

Miner-trader Glencore has a stake in DeepGreen which would eventually give Glencore 50 percent of any copper and nickel output.

Glencore declined to comment and DeepGreen had no immediate comment.

So far only Canadian-listed firm Nautilus Minerals has gone beyond the exploration stage to try and mine off the coast of Papua New Guinea, for copper, gold and silver, but it been slowed by funding issues and local opposition.

Anglo American sold its 4 percent stake in Nautilus in May, as part of efforts to retain only its most profitable assets.

Nautilus this week agreed a $600,000 loan to shore up its balance sheet. It was not immediately available for further comment.

While Nautilus wants to mine Papua New Guinea’s territorial waters, international waters are regulated by the International Seabed Authority (ISA), an agency set up by the United Nations to manage the seabed and protect the marine environment.

China is in pole position in international waters as the holder of four of the 29 deep sea ISA exploration contracts granted so far, more than any other nation.

Along with Glencore, the country already dominates world cobalt supplies, mostly from the politically volatile Democratic Republic of Congo.

News last week that cobalt from Glencore subsidiary Katanga Mining must be processed to remove its uranium content highlighted concerns about the reliance on Congo.

Ian Coles, a partner at law firm Mayer Brown, which has worked on the legality of mining at sea, said its potential to diversify sources of supply was particularly valid for “esoteric minerals”.

“They are susceptible to serious supply and demand issues because supply is limited to Democratic Republic of Congo for cobalt and China dominates rare earths,” he said.

Environmental campaigners say extreme caution is needed before miners disturb little understood parts of the planet.

“We call for tough regulations and 30 percent-to-50 percent of all ISA exploration areas to be set aside as no-mining zones,” Conn Nugent, director of the Pew Seabed Mining Project, said.

(Reporting by Barbara Lewis; Editing by Kirsten Donovan)

(c) Copyright Thomson Reuters 2018.

https://gcaptain.com/china-leads-countries-plumbing-the-ocean-depths-for-metallic-rocks/
 

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COMMODITY PRICE FORECAST: November 15, 2018: Crude Oil & Gold Price Forecast
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Published on Nov 15, 2018
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Ira Epstein's End of the Day Financial Video 11 15 2018
Ira Epstein


Published on Nov 15, 2018
 

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Ira Epstein's End of the Day Agriculture Video 11 15 2018
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Published on Nov 15, 2018
 

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Proof of JP Morgan Silver Manipulation - Interview w/ James Anderson
Silver Fortune


Published on Nov 15, 2018
More proof of JP Morgan's control of the silver market recently came out, and James joins us to discuss it, along with many other topics.

Help support the Silver Fortune Channel through my sponsor, SD Bullion - 10 oz. of Silver at Spot! https://sdbullion.com/sf

Support Silver Fortune through Patreon: https://www.patreon.com/silverfortune


Any content within this video or any other video by the Silver Fortune channel is merely one man's opinion, commentary, and analysis, or actual information obtained from elsewhere, and should not be constituted as legal, investment, or financial advice. Make your own financial decisions, or consult a professional if you'd prefer to go that route. The Silver Fortune channel disclaims any liability for legal, financial, or investment decisions made.
 

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Futures Fall On Chip Carnage As World Await Brexit Verdict


by Tyler Durden
Fri, 11/16/2018 - 07:17

Stocks in Europe faded early gains and S&P futures fell after a mixed session in Asia as chip stocks were taken to the woodshed on poor guidance from Nvidia and Applied Materials sparked fears that the chip bull run is over, while investors wondered whether China and America can de-escalate their trade war after mixed signals by US officials just days before the G-20 summit.



The euro failed to rebound while the sterling halted its biggest drop in 2 years after some of the most dramatic 24 hours yet in the Brexit process and another turbulent week for world markets. With reports of a UK leadership coup still rife and fear that the country could crash out of the EU without an agreement, cable struggled to rise above $1.28.



Meanwhile traders around the world were waiting for an outcome from the ongoing Brexit saga: “If and when a vote on the withdrawal agreement occurs is uncertain. Whether the withdrawal bill is passed by both houses of Parliament is uncertain,” Joseph Capurso, a senior currency strategist at CBA, said in a note. “Whether the Prime Minister resigns or is challenged for the leadership is uncertain. And, whether there is a second referendum and/or an election is uncertain.”

Fears over political turmoil in the UK and Italy dragged Europe's Stoxx 600 back into the red, set for its first weekly drop in three, trimming Friday’s gain as AstraZeneca's drop weighed on the gauge after a cancer-drug setback while telecom names were outperforming. Utilities started the session lower in the wake of yesterday’s ECJ decision which deemed the UK’s scheme for ensuring power supplies during the winter months as a violation of state aid rules. Other individual movers include Vivendi (+4.2%) sit at the top of the Stoxx 600 after posting impressive Q3 sales metrics and announcing a potential sale of part of their Universal Music Group division. Elsewhere, AstraZeneca (-2.3%) and Shire (-1.3%) have been seen lower throughout the session after both posting disappointing drug updates.

Not helping sentiment, ECB head Mario Draghi said the bank still plans to dial back its stimulus at the end of the year, but acknowledged the economy had hit a soft patch and inflation may rise more slowly than expected. “If firms start to become more uncertain about the growth and inflation outlook, the squeeze on margins could prove more persistent,” Draghi told a conference.

Earlier in the day, Asian shares ended the session in the red (MSCI Asia -0.2% to 151.52), led lower by declines in Japan, even as China and Hong Kong rose after initial reports the United States might pause further China tariffs were denied by Commerce Secretary Wilbur Ross who damped hopes of any imminent trade deal with China. The Nikkei fell 0.6% pressured by a drop in the USDJPY after China Mofcom began an investigation into alleged dumping of machine tools by Japanese firms. The Hang Seng (+0.3%) and Shanghai Comp. (+0.4%) swung between gains and losses after continued liquidity inaction by the PBoC which skipped Reverse Repos for a 16th consecutive occasion.

S&P futures were hit on fresh slowdown concerns, this time out of the semiconductor/chip space, after Nvidia gave a dire sales forecast, projecting a 20% drop in revenue while a disappointing outlook from Applied Materials indicated the chip industry is holding off on expansion plans in the face of a murky outlook for electronics demand. The chipmaking sector saw another bout of selling in Asia, wiping at least $11.2 billion in market value amid signals that demand for servers, personal computers and mobile is falling.



Also falling after hours were shares of AMD and Intel, dragging Nasdaq futures lower.

"It started with Apple, then Nvidia ... Since performances of these companies set the tone for the global tech and chip industries, related Japanese stocks will likely be sluggish for a while,” said Takatoshi Itoshima, a strategist at Pictet Asset Management.

The Bloomberg Dollar Spot Index was little changed after Fed Chairman Powell flagged his concern over potential headwinds for the U.S. economy, while the pound staged a modest rebound on reports that some pro-Brexit ministers decided to stay in their governmental posts. The pound gained as U.K. Prime Minister Theresa May defied demands to quit and amid reports her environment secretary wouldn’t resign, following the resignation of several ministers Thursday. The yen rallied as trade stress simmered, with investors trying to gauge whether China and the U.S. can de-escalate their dispute.

Also under water was the cryptocurrency Bitcoin, which hit a one-year trough overnight. It had tumbled 10 percent early in the week when support at $6,000 gave way. It was last changing hands at $5,500 on the Bitstamp platform.

Treasuries were steady while 10-year yields on German bonds were set for their biggest weekly fall in three weeks, in a sign that the Brexit uncertainty and worries about Italy’s finances, continued to support demand. Italian bonds edged higher even as European Commission Vice President Valdis Dombrovskis said in an interview with Il Sole 24 Ore that the country’s government was openly defying EU budget rules. Emerging-market currencies consolidated recent gains while oil prices extended their rebound.

Oil prices rose, helped by a decline in U.S. fuel stockpiles and the possibility of a cut in OPEC output. Brent (+1.3%) and WTI (+1.1%) are both in the green and continuing their rebound seen yesterday with WTI hovering around USD 57.00bbl. Energy newsflow remains light, post-yesterday's DoE report, however, Iraq’s North Oil Co. have announced that they have resumed Kiruk oil exports heading towards the Turkish port of Ceyhan. Looking ahead, the main highlight on the calendar will be the Baker Hughes rig count. Elsewhere, natural gas futures are relatively steady after their 19% decline yesterday which came in the wake of a 20% increase the day before.

In geopolitical news, US Republican and Democrat Senators filed a bipartisan bill seeking to suspend arms sales to Saudi Arabia in response to war in Yemen and killing of journalist. North Korean Leader Kim inspected test of new high-tech tactical weapons, according to Yonhap citing North Korean state media

Today's data include October industrial production and capacity utilization. Viacom is among companies reporting earnings

Market Snapshot
  • S&P 500 futures down 0.3% to 2,725.25
  • STOXX Europe 600 down 0.01% to 358.38
  • MXAP down 0.2% to 151.52
  • MXAPJ up 0.2% to 486.84
  • Nikkei down 0.6% to 21,680.34
  • Topix down 0.6% to 1,629.30
  • Hang Seng Index up 0.3% to 26,183.53
  • Shanghai Composite up 0.4% to 2,679.11
  • Sensex up 0.5% to 35,446.11
  • Australia S&P/ASX 200 down 0.1% to 5,730.55
  • Kospi up 0.2% to 2,092.40
  • Brent futures up 1.2% to $67.41/bbl
  • Gold spot up 0.3% to $1,216.36
  • U.S. Dollar Index little changed at 96.93
  • German 10Y yield rose 0.8 bps to 0.368%
  • Euro up 0.2% to $1.1346
  • Italian 10Y yield rose 0.3 bps to 3.12%
  • Spanish 10Y yield fell 1.4 bps to 1.617%
Top Overnight News
  • Fed Chairman Jerome Powell has laid out a scenario for a pause in the central bank’s interest-rate hiking campaign sometime next year by highlighting potential headwinds to the U.S. economy.
  • British Prime Minister Theresa May is defying demands to quit as she battles to keep control of her fractious government long enough to deliver a Brexit deal that’s drawn ire from across the political spectrum.
  • Pro-Brexit ministers Michael Gove, Liam Fox, Chris Grayling, Penny Mordaunt and Andrea Leadsom have decided together not to quit the government, Times reporter Tim Shipman said on Twitter.
  • ECB’s Draghi sees no reason for expansion to come to abrupt end, he said at an event in Frankfurt, Germany.
  • PG&E Corp. rallied as much as 49 percent in extended trading Thursday after the head of the California Public Utilities Commission said he can’t imagine allowing the state’s largest utility to go into bankruptcy as it faces billions of dollars in potential liability from deadly wildfires
  • Deutsche Bank AG and Bank of America Corp. have been contacted by U.S. criminal investigators for information about transactions they handled for a small bank branch in Estonia that’s at the center of one of the biggest money-laundering investigations in history, according to two people familiar with the matter.
Asia-Pac stocks traded indecisively as the region lacked fresh catalysts and as uncertainty regarding Brexit and US-China trade played on investor’s minds. ASX 200 (-0.1%) and Nikkei 225 (-0.6%) were choppy with outperformance of tech and mining names in Australia overshadowed by a lacklustre broader market, while the Japanese benchmark was subdued by mild flows into the JPY and after China Mofcom began an investigation into alleged dumping of machine tools by Japanese firms. Elsewhere, Hang Seng (+0.3%) and Shanghai Comp. (+0.4%) swung between gains and losses after continued liquidity inaction by the PBoC which skipped OMOs for a 16th consecutive occasion, while participants were also tentative amid ongoing trade uncertainty after conflicting reports regarding the next round of China tariffs being placed on hold which USTR Lighthizer later denied. Finally, 10yr JGBs were mildly higher with prices underpinned amid an indecisive tone seen in stocks and with the BoJ also present in the market for JPY 680bln of JGBs in the belly to super-long end.

Top Asian News
  • China’s Kindergarten Crackdown Is the Latest Disaster for Stocks
  • Modi Is Said to Enlist Tata for Jet Airways Rescue Ahead of Vote
  • Philippines Shuts 3 Miners, Suspends 9 Others After Review
  • Indian Central Bank Board to Discuss Surplus Funds Transfer
European equities trade relatively flat (Eurostoxx 50 +0.2%) in the wake of mixed trade headlines overnight for the US and China. Performance across European indices is relatively equal whilst focus once again falls on the FTSE 100 (U/C) which remains at the whim of Brexit-inspired fluctuations in the GBP. Once again, potential upside for the index is being capped by losses in domestically focused banking names (RBS -3.0%, Lloyds -2.1%) as Brexit uncertainty continues to dampen investor sentiment. In terms of sector specifics, most sectors are trading higher with mild outperformance seen in telecom names. Utilities started the session lower in the wake of yesterday’s ECJ decision which deemed the UK’s scheme for ensuring power supplies during the winter months as a violation of state aid rules. Other individual movers include Vivendi (+4.2%) sit at the top of the Stoxx 600 after posting impressive Q3 sales metrics and announcing a potential sale of part of their Universal Music Group division. Elsewhere, AstraZeneca (-2.3%) and Shire (-1.3%) have been seen lower throughout the session after both posting disappointing drug updates.

Top European News
  • Finnish Software Company Basware Is Said to Explore Sale
  • Vauxhall Owner Said to Weigh Closing a Factory Post-Brexit
  • Amid Brexit Gloom, Deutsche Bank Sees Frankfurt as Next London
  • Nyrstar Surges on Hopes Over Trafigura Refinancing Talks
Currencies:
  • GBP - The Pound is not the biggest net mover for a change, but still one of the most volatile and vulnerable as Cable pivots 1.2800 and Eur/Gbp trades between 0.8850-80. The fall-out from Wednesday’s Cabinet meeting continues as UK PM May strives to sell the Brexit draft, but facing a rising rebellion within the Conservative Party that appears to have reached the critical mass required to trigger a no confidence vote. However, some positive news with a key Minister deciding not to follow others out of the Government, as Gove opts to stay rather than go. In terms of technical impulses, Cable is holding above yesterday’s 1.2725 low, ahead of chart support around 1.2710-00 that protects mtd and ytd troughs at 1.2696 and 1.2662 respectively, while near term resistance is seen around 1.2836 before 1.2850, but 1 bn option expiries at 1.2800 could well exert more influence into the NY cut. For Eur/Gbp, several MAs form support blow 0.8850 and the 100 DMA at 0.8910 may hamper further gains if 0.8900 is breached.
  • JPY - Maintaining a firm underlying safe-haven bid as broad risk sentiment remains fragile and China is reportedly investigating machine dumping by Japan – Usd/Jpy near the bottom of a 113.20-65 range.
  • EUR/CAD/CHF - All narrowly mixed vs the Greenback, with the single currency keeping afloat of 1.1300 and eyeing a Fib at 1.1358, while the Loonie is holding recent recovery gains through 1.3200 as oil prices continue their rebound and the Franc meanders between 1.0075-50 vs 1.1000+ earlier this week when the broad Dollar and DXY were in the ascendency (index well above 97.000 vs just below the figure presently).
  • EM - The Lira is off best levels, but still relatively bid after reports that the US could Turkish cleric Gulen in an attempt to assuage President Erdogan to adopt a less aggressive stance against Saudi Arabia over the Khashoggi killing. Usd/Try now near the middle of a 5.3240-3940 band.
In commodities, gold (+0.2%) is trading relatively flat after hitting new weekly highs of USD 1218.39/oz earlier in the session; following uneventful overnight trade. Elsewhere, Shanghai Zinc prices have risen due to London Metal Exchange stockpiles falling to decade-low levels. Brent (+1.3%) and WTI (+1.1%) are both in the green and continuing their rebound seen yesterday with WTI hovering around USD 57.00bbl. Energy newsflow remains light, post-yesterday's DoE report, however, Iraq’s North Oil Co. have announced that they have resumed Kiruk oil exports heading towards the Turkish port of Ceyhan. Looking ahead, the main highlight on the calendar will be the Baker Hughes rig count. Elsewhere, natural gas futures are relatively steady after their 19% decline yesterday which came in the wake of a 20% increase the day before.

US Event Calendar
  • 9:15am: Industrial Production MoM, est. 0.2%, prior 0.3%; Manufacturing (SIC) Production, est. 0.2%, prior 0.2%
  • 11am: Kansas City Fed Manf. Activity, est. 11, prior 8
  • 4pm: Total Net TIC Flows, prior $108.2b, Net Long-term TIC Flows, prior $131.8b
DB's Jim Reid concludes the overnight wrap
Yesterday was an extraordinary day where we saw rival factions go into battle, huge infighting, disloyalty, a colossal power struggle, and lots of head scratching over who will win out and where this is all going to end. Indeed, the teaser trailer for the final Game of Thrones series out next April was finally released. However, a remarkable 3 hour UK parliamentary session where PM May was grilled from all sides of the House of Commons probably topped it for drama even if it lacked the CGI effects.

Before we lay out our views on what’s happened over the last 24 hours in our homeland, it’s worth quickly recapping what markets have done as unlike in previous months, it’s not just Sterling which has borne the brunt.

Yes, the Pound did fall -1.65% relative to the Dollar for the biggest one-day decline since October 2016. It was also down -1.86% against the Euro. More dramatic was the move for Gilts where 10y yields rallied -13.3bps and the most since August 2016. They are also now down -37.6bps from the intraday October highs and there’s now only about 12.5bps of hikes priced in for next year by the BoE. In equities, the overseas earnings-focused FTSE 100 closed flat but the more domestically orientated FTSE 250 ended -1.31%. The sector breakdowns were starker with an index of UK homebuilders closing down -6.76% and the most since the referendum in June 2016 and UK banks selectively weak. RBS at one stage tumbled -10.20% intraday before closing -9.63%. Barclays and Lloyds were down -4.11% and -5.04% respectively. The biggest movers in credit indices were unsurprisingly UK assets too. Looking across iTraxx Main, nine of the top 10 widest credits were UK names with the top three being Marks & Spencer (+17bps), Barclays (+17bps) and RBS (+16bps). How much of these moves were Brexit specific and how much were concerns about what a Jeremy Corbyn led Labour Party General Election win might mean for various companies was difficult to disentangle.

The pain for UK assets spread throughout Europe too, with the DAX, CAC and FTSE MIB finishing -0.52%, -0.70% and -0.90%. Bunds rallied -3.7bps and are now down to 0.358% and testing the October lows again. Treasuries also rallied slightly, with 2- and 10-year yields down -1.5 and -1.2bps. US equities rallied strongly throughout the afternoon session in New York, with the S&P 500 retracing losses of as much as -1.14% to close +1.06%, for the 15th widest trading range of the year. Other major indexes staged similar rebounds, with the DOW up +0.83% and the NASAQ gaining +1.72%. The price action reflected a partial unwind of the last few sessions’ sharp moves, with the best-performing sectors being those that had recently sold off. Energy gained +1.47%, as WTI oil rallied +0.46%, and tech advanced +2.46%. Sentiment was also boosted by comments from US Commerce Secretary Ross, in which he described the upcoming meeting between Presidents Trump and Xi as “the big event” and said that “if it goes well, it’ll set the framework for going forward.” This suggests that there is scope for real compromise later this month at the November 30-December 1 G20 summit.

This morning in Asia, markets are largely up following Wall Street’s lead with the exception of Japan. The Hang Seng (+0.29%), Shanghai Comp (+0.71%) and Kospi (+0.40%) are all higher along with most Asian markets while the Nikkei (-0.29%) is down. Elsewhere, futures on the S&P 500 (-0.21%) are pointing towards a softer open.

So back to the main story. All eyes now are on whether or not we’ll get a vote of no confidence for PM May. The remarkable 3 hour Parliamentary session yesterday left you feeling in no uncertain terms that the Withdrawal Agreement (WA) is highly unlikely to pass in its current form. However, before we even get there, the leadership challenge is the next hurdle. The odds of such a contest appeared to substantially increase yesterday with headlines speculating that close to the required 48 MPs had written to the Conservative 1922 Committee including arch-Brexiteer Jacob Rees-Mogg. This came after two cabinet members yesterday resigned including Dominic Raab – the Brexit Secretary. PM May reportedly offered Tory MP Michael Gove – one of the staunchest Brexiteers – the job of Brexit minister to replace Raab, though media reports suggested that he will resign his post completely instead, which would be a negative signal for May’s ability to keep her coalition together. Other junior ministers also resigned through the day. Overnight, the Telegraph reported that the DUP will scrap its coalition with the Conservatives unless/until PM May is replaced. This would be materially negative news for the embattled PM and for markets, but the pound traded flat amid thin overnight liquidity.

The dilemma for those Brexiteer Tories wanting a leadership contest is that if they force one and May survives (she only needs a majority but, in reality, a narrow win could make her position untenable) she is safe from a challenge for 12 months. The dilemma for those Brexiteers voting against her WA is that this may lead to a series of events that brings a second referendum and the possibility of no Brexit at all. The dilemma for the remain Tory MPs is that if they vote against either or both of Mrs May and the WA, it may topple Mrs May and lead to a leadership challenge. It is highly likely that a hard Brexiteer will be one of the two candidates put to the grass root membership, and given demographics they would have a strong chance of winning and would thus pursue a harder Brexit. So no side has the upper hand at the moment.

As discussed above, the last twenty four hours have illustrated that there is seemingly no parliamentary majority for the current WA. At the same time, there is little prospect of further negotiation with the EU27, given the limited timeline. As DB’s Oliver Harvey wrote yesterday, May is therefore trapped in a bind. The only way to secure parliamentary support for the current deal will be under considerable market pressure, perhaps after multiple failed votes. There are two other options perhaps. One is a pivot towards a much softer form of Brexit – such as EEA membership plus a permanent customs union – however it’s not clear if there’s sufficient time on the EU side to agree to this. The other is a second referendum. This in itself would likely split the Tory Party although it would likely gain parliamentary support. The difficulty will be deciding what question to pose to electors. Some suggest there might be two.

Believe it or not, there was some non-Brexit newsflow yesterday. In Italy, Deputy PM Salvini’s Chief Economic Advisor Claudio Borghi made headlines by responding to a tweet in a manner that seemed to imply that if the League gets a majority in the next election, then Italy would exit the Eurozone. In fairness, this wasn’t how I read the reply but markets traded off the headlines and didn’t really look for the tweet. It was entirely inconsistent with what he’s said in the past and he later denied it outright. However, Italian assets did still react and underperformed post the headline. BTPs sold off +8.9bps from their strongest intraday level, but ultimately closed flat. Elsewhere the US announced sanctions against a total of 17 Saudi Arabian officials concerning the death of Khashoggi. Those sanctions including freezing assets of the officials and limiting access to the US financial system.

The Turkish Lira was already gaining yesterday, but was boosted further by reports that the US is considering removing the Turkish cleric Fethullah Gulen from US territory and ultimately closed +1.94% stronger. Turkish authorities have accused Gulen of coordinating an attempted coup in 2016, though the US has not endorsed the claims. If confirmed, the move by the US would represent a considerable thaw in relations between the two countries after they reached a nadir earlier this year.

Meanwhile the economic data that was out was truly a sideshow however for completeness, euro area new car registrations fell -7.3% yoy in October. This partially reflects the idiosyncrasies associated with new emissions rules and shows some bounce back from September’s -23.5% decline. The euro area’s seasonally adjusted trade balance printed at 13.4bn euros, a touch softer than expected. In the UK, retail sales fell -0.5% mom and softened to +2.2% yoy, versus expectations for +0.2% and +2.8%. Core retail sales missed by a similar margin. In contrast, October US retail sales beat expectations, rising +0.8% mom (versus expected +0.5%), though the control group marginally missed, rising +0.3% versus expected +0.4%. November activity surveys from the Philadelphia and New York Federal Reserve Banks were mixed, with the Philly index dropping to 12.9 from 22.2 and the NY index rising to 23.3 from 21.1.

Before we take a look at day ahead, in credit, Michal in our team published a one-pager “After Red October, Better Credit Fund Flows in November So Far” in which he provides an update on recent IG fund flows and puts them in the broader context of other asset classes. You can download the report here . Now as for the day ahead, well it’s hard to look past anything other than Brexit headlines dominating. However there are some data releases due. In Europe we’ll get final October CPI revisions for the Euro Area and Italy while in the US we’ll get October industrial production and the November Kansas City Fed PMI. We’ll also hear from ECB President Draghi this morning in Frankfurt before the Bundesbank’s Weidmann speaks at the same event this afternoon. Over at the Fed, Evans speaks in the afternoon. Oh and their might be some Brexit headlines to consider.

https://www.zerohedge.com/news/2018-11-16/futures-falls-chip-carnage-world-await-brexit-verdict
 

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The Debt is The Problem and Everything Else is a Distraction.
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Published on Nov 16, 2018
 

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Ira Epstein's End of the Day Agriculture Video 11 16 2018
Ira Epstein


Published on Nov 16, 2018
 

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Even Jim Cramer is Turning Bearish on the Economy
Silver Fortune


Published on Nov 16, 2018
Jim Cramer says that if the Fed doesn't stop raising rates soon, there will be a price to pay for the economy.

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Any content within this video or any other video by the Silver Fortune channel is merely one man's opinion, commentary, and analysis, or actual information obtained from elsewhere, and should not be constituted as legal, investment, or financial advice. Make your own financial decisions, or consult a professional if you'd prefer to go that route. The Silver Fortune channel disclaims any liability for legal, financial, or investment decisions made.
 

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Silver Slumps, US Military Weak, and PTJ Says We Are headed For Scary Moments
The Morgan Report


Published on Nov 16, 2018
Market Analysis/Investing/Trading Methods At TheMorganReport.com For Only $50 Per Month. | http://www.themorganreport.com/join

Silver Slumps, US Military Weak, and PTJ Says We Are headed For Scary Moments | The Morgan Report's Weekly Perspective | http://www.themorganreport.com

The gold/silver ratio has risen to its highest level in roughly a quarter century, with silver suffering from both weakness in precious metals lately but also dragged down by pessimism about base metals.

The ratio measures how many ounces of silver it takes to buy an ounce of gold. When the number is rising, this reflects silver is underperforming relative to gold.
 

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Ira Epstein's End of the Day Financial Video 11 16 2018
Ira Epstein


Published on Nov 16, 2018
 

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WEEK AHEAD COMMODITY REPORT: 19-23, November 2018: Gold, Silver & Crude Oil Price Forecast
TheGoldAndSilverClub


Published on Nov 17, 2018
JOIN THE LIVE TRADING ROOM HERE ▶ http://www.jointhelivetradingroom.com/
▶ To Receive LIVE Trade Alerts, Mentorship & Expert Insights For Profitable Commodity Trading.

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JP Morgan Silver Manipulation Confirmation | Ted Butler
SilverDoctors


Published on Nov 16, 2018
Bullion deals ➜ https://SDBullion.com/deals
Podcast ➜ http://www.silverdoctors.com/precious...

This week's guest has spent a large portion of his adult life, working on knowledge revolving around commodity price discovery, most specifically in the silver market.

Often within his research are acute questions such as who dictates or mostly influences price discovery?

What are the How's and the why's for the prices we pay for critical commodities?

Early last week, on November 6th 2018. The US Department of Justice confirmed much of what this week's guest has been publicly alleging year after year.

If you have spent any time trying to understand JP Morgan's involvement in the silver market, high chance is you too have come across his spearheading work.

This week, Ted Butler visits with us, to discuss the FBI's recent receiving of a guilty plea from a 13 year ex-precious metal derivative trader from JP Morgan.

Facing a potential sentence of 30 years in prison, the individual (John Edwards) pled guilty to commodities fraud and spoofing conspiracy.

SHOW NOTES:
https://sdbullion.com/blog/jp-morgan-...

The Department of Justice published the following words on their website:

"This trading strategy was admittedly intended to inject materially false and misleading liquidity and price information into the precious metals futures contracts markets by placing the Spoof Orders in order to deceive other market participants about the existence of supply and demand.
The Spoof Orders were designed to artificially move the price of precious metals futures contracts in a direction that was favorable to the guilty party and his co-conspirators at the Bank, to the detriment of other market participants.

In pleading guilty, Edmonds admitted that he learned this deceptive trading strategy from more senior traders at the Bank, and he personally deployed this strategy hundreds of times with the knowledge and consent of his immediate supervisors.

This case is the result of an ongoing investigation by the FBI’s New York Field Office."

https://www.justice.gov/opa/pr/former...

In a few seconds we will begin discussing this and other ranging topics related to silver, gold, crude oil, and the financial markets.

If you like this discussion, perhaps SHARE THIS VIDEO with those, who you think may also benefit from hearing it as well.
 

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Commercials Almost Net Long Gold Futures According to COT Report.
maneco64


Published on Nov 17, 2018
 

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Trade War Finally Hits Commodity Shipping, Confounding Optimists
November 15, 2018 by Bloomberg


By sunsinger / Shutterstock

By Prejula Prem and Firat Kayakiran (Bloomberg) — The commodity shipping industry was expected to sail through the trade war unscathed.

Tariffs were being slapped on hundreds of goods and yet shipping rates for dry bulk — the segment that hauls billions of tons of coal, iron ore and crops around the globe — kept rising. No more.

The Baltic Dry Index is within a whisker of crashing through 1,000 points for the first time since April, despite only modest expansion in fleet capacity, the usual culprit when rates collapse. This time, it’s about waning growth in Chinese demand.

“Expect a fragile recovery going into 2019,” said Peter Sand, chief shipping analyst at BIMCO, a 113-year-old shipping association representing vessel owners and operators. “At best, sideways rates improvement is seen.”



The daily rate for a giant Capesize hauling iron ore to China stands at $7,987, from $27,283 in August. Forward freight agreements, used to hedge future costs, have also collapsed.

China buys more than a billion tons of iron ore and coal annually. While imports expanded 1.8 percent this year, growth in 2017 was 5.5 percent. At the same time, the government may restrict imports of coal used in power plants as it seeks to curb pollution. The nation is also buying fewer U.S. agricultural products, hurting smaller ships.

The freight market has also been buffeted by random events. BHP Group, the biggest mining company, was forced earlier this month to derail a runaway train in Western Australia, disrupting iron-ore shipments. That prompted a liquidation of overly optimistic fourth-quarter positions in the Capesize market, Macquarie Wealth Management said.

© 2018 Bloomberg L.P

https://gcaptain.com/trade-war-finally-hits-commodity-shipping-confounding-optimists/
 

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Saturday Scrap - Learn Something About Transformers
iScrap App


Published on Nov 17, 2018
Check Scrap Prices Today: https://iScrapApp.com/ - Newer transformers may not be what you think they are. Tom gives you a tip this week to look out for while scrapping them. Also, tune in for current scrap prices. Read more: https://iscrapapp.com/?p=1200768

Download the iScrap App:
Free iPhone App: https://iscrapapp.com/iOS
Free Android App: https://iscrapapp.com/Android

- Visit our blog for prices & news: https://iscrapapp.com/blog/
- US State Scrap Metal Laws: https://iscrapapp.com/scrap-laws/
- Get news delivered to your inbox: http://eepurl.com/DNJJH
- Buy an iScrap App T-Shirt: https://iscrapapp.com/shop

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If you have video requests for us, comment below or email us at: info@iscrapapp.com. Happy iScrapping!
 

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Meet The "Heavy Labor" Humanoid Robot Set To Revolutionize Construction


by Tyler Durden
Sat, 11/17/2018 - 18:40


Japanese researchers at the Advanced Industrial Science and Technology (AIST) research center have developed a prototype humanoid robot, the HRP-5P, designed to autonomously perform heavy labor in hazardous environments.



Standing just under 6-feet tall and clocking in at 222 lbs, the HRP-5P has "unsurpassed physical capabilities," according to Phys.org, and is fitted with an array of sensors in order to fully assess its environment to perform various tasks.

In one demonstration, the HRP-5P shows of its skills grabbing standard 77 lb. boards of drywall typically used in construction.


In order to complete the task, the robot must:

  • Generate a 3-D map of the surrounding environment, detect objects, and approach the workbench.
  • Lean against the workbench, slide one of the stacked gypsum boards to separate it, and then lift it.
  • While recognizing the surrounding environment, carry the gypsum board to the wall.
  • Lower the gypsum board and stand it against the wall.
  • Using high-precision AR markers, recognize and pick up a tool.
  • Holding a furring strip to keep HRP-5P itself steady, screw the gypsum board into the wall.

Aside from construction, AIST's robot has compelling applications at aircraft facilities, shipyards or any other environment in which heavy things need to be lifted or manipulated - particularly in hazardous environments.

AIST collaborated with several private companies in the development of the HRP series, including Kawada Robotics, which has assisted in the design of several prototypes leading up to the 5P. HRP-2, for example, was able to walk, lie down, stand up, walk on narrow paths, and other navigational maneuvers. Its successor, the HRP-3 was able to walk on slippery surfaces and tighten bridge bolts via remote control.



The 5P marked a significant leap over its predecessors - employing technology from Honda Motor Co, and the New Energy and Industrial Technology Development Organization (NEDO), the latest and greatest from AIST can work in "unstructured environments," and excels at "targeting full-body motion planning based on environmental model acquisition that enables humanoid robots to adapt to unknown environments."



More specs via AIST:

  • At a height of 182 cm and weight of 101 kg, HRP-5P has a body with a total of 37 degrees of freedom: two in its neck, three in its waist, eight in its arms, six in its legs, and two in its hands. Except for the hands, this represents the most freedom of movement in the HRP series to date. Compared to the revised version of HRP-2, adding one degree of freedom to the waist and one to the base of the arms has enabled operations more closely resembling human motion. Accordingly, using both arms, HRP-5P can handle large objects such as gypsum boards (1820 × 910 × 10 mm, approx. 11 kg) or plywood panels (1800 × 900 × 12 mm, approx. 13 kg).
  • To emulate human motion by the robot without as many degrees of freedom as people, the researchers ensured a wider movable range of joints in the hip and waist areas, where multiple joints are concentrated. For example, hip joints that flex and extend the legs have a range of motion of 140° in humans and 202° in HRP-5P (Fig. 1), and waist joints that turn the upper body have a range of motion of 80° in humans and 300° in HRP-5P. This enables work by the robot in a variety of postures, such as when deeply crouched with the upper body twisted.
  • Joint torque and speed were approximately doubled on average relative to the revised HRP-2, by employing high-output motors, adding cooling to the drive mechanism, and adopting a joint drive system with certain joints featuring multiple motors. As a result, the robot can do work involving heavy loads, such as lifting a gypsum board from a stack. (Each arm of HRP-5P, extended horizontally, can bear a weight of 2.9 kg, compared to 1.3 kg for the revised version of HRP-2 and 0.9 kg for HRP-4.)
  • Using head-mounted sensors, the robot constantly acquires 3-D measurements of the surrounding environment (at a frequency of 0.3 Hz). Even if the field of view is blocked by objects used in work, stored and updated measurement results enable execution of the walking plan while carrying a panel or correction of walking when the feet slip. (Fig. 2).
  • Learning involves a convolutional neural network using a newly constructed image database of work objects. The robot can detect ten types of 2-D object regions at a high precision of 90 % or more even against low-contrast backgrounds or under dim lighting (Fig. 3).
  • It was possible to build a highly reliable robot system and maintain the quality of large-scale software (with approx. 250,000 lines of code) by arranging a virtual test environment for the robot intelligence in the Choreonoid robot simulator and monitoring software regression for 24 hours.
https://www.zerohedge.com/news/2018...humanoid-robot-set-revolutionize-construction
 

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One of the Most Important Sources of Energy Is Up Over 40% in the Last Six Weeks!
maneco64


Published on Nov 18, 2018
 

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farm talk november 18 2018
Ag Talk In The Raw


Published on Nov 18, 2018
i am here to talk about farming and all that goes with it.
 

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Being Your Own Central Bank Is the Road to Freedom and Independence.
maneco64


Published on Nov 19, 2018
 

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Share Talk Bulletin Board Heroes, Monday 19th November 2018
Share Talk


Published on Nov 19, 2018
A charting look at some of the most followed stocks on the London market, Zak Mir covers.

Active Energy (AEG)
Haydale (HAYD)
Greatland (GGP)
Infrastrata (INFA)
Oilex (OEX)
Rockfire (ROCK)

@ZaksTradersCafe deductive reasoning as to what should happen next in terms of the newsflow regarding the companies listed in this video.

Zakmir.com is a purely journalistic website – Zak Mir is a member of the National Union of Journalists. There is no intention here of providing financial advice. It is recommended you seek an independent professional opinion before deciding whether or not to take any action with regard to anything written here.
 

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Futures Slide After US-China APEC Clash, Apple Production Cuts


by Tyler Durden
Mon, 11/19/2018 - 07:08


After a dramatic end to the APEC summit in Papua New Guniea which concluded in disarray, without agreement on a joint communique for the first time in its history amid the escalating rivalry between the United States and China, U.S. index futures initially traded sharply lower as investors digested signs that America-China trade tensions are set to persist, however they staged a modest rebound around the time Europe opened, and have traded mixed since amid subdued volumes as a holiday-shortened week begins in the US.



Last Friday, US stocks jumped after President Trump said that he might not impose more tariffs on Chinese goods after Beijing sent a list of measures it was willing to take to resolve trade tensions. However, tensions between the two superpowers were clearly on display at the APEC meeting over the weekend where Vice President Mike Pence said in a blunt speech that there would be no end to U.S. tariffs on $250 billion of Chinese goods until China changed its ways.

“The comments from Trump were seen as offering a glimmer of hope that further tariff action could be held in abeyance,” said NAB’s head of FX strategy, Ray Attrill. “The exchange of barbs between Pence and Chinese President Xi Jinping in PNG on the weekend continues to suggest this is unlikely.”

US Futures were also pressured following a report by the WSJ that Apple has cut iPhone production, creating turmoil for suppliers and sending AAPL stock 1.6% lower and pressuring Nasdaq futures.

Yet while early sentiment was downbeat following the APEC fiasco, US futures staged a rebound as shares in both Europe and Asia rose while Treasuries declined, the dollar faded an initial move higher as traders focused on the Fed’s new-found concerns over the global economy, and the pound advanced amid speculation that the worst may be over for Theresa May, since the potential for a vote of no confidence in May may be losing traction: the Sun reported that 42 lawmakers have sent letters of no confidence to Graham Brady, 6 more are needed to trigger a leadership challenge



Asia took a while to warm up but made a strong finish, with the Shanghai Composite closing 0.9% and Japan's Nikkei 0.7% higher, helping Europe start the week off strong too as a 1 percent jump in mining, tech and bank stocks helped traders shrug off last week’s Brexit woes. At the same time, stocks fell in Australia and New Zealand, where the Aussie and kiwi currencies dropped after U.S. Vice President Mike Pence attacked China at the weekend APEC summit.

Telecommunications and construction shares pushed Europe's Stoxx 600 Index higher, along with stocks in Italy, where Deputy Premier Luigi Di Maio said the government is ready for dialog with the European Commission over the country’s budget, which however seems just more semantics as Italy refused to concede to European budget demands.

Meanwhile, in addition to confusion over trade, the outlook for U.S. interest rates was also uncertain. While Federal Reserve policymakers are still signaling rate increases ahead, they also sounded more concerned about a potential global slowdown, leading markets to suspect the tightening cycle may not have much further to run and Morgan Stanley to write that "We Sense A Shift In Tone From The Fed."

Goldman Sachs also chimed in, saying it expected the pace of U.S. economic growth to slow toward the global average next year. The bank now sees a broad dollar decline next year, and revised its long-standing bearish view on the Japanese yen and tipped Latin American currencies, the Swedish krona, the Canadian, Australian and New Zealand dollars and the Israeli shekel to rise.

“We see several changes to the global economic backdrop which, combined with a few negative medium-run factors, point to more downside than upside to the broad dollar in 2019,” Goldman economists said in an outlook report. Goldman's bearish tilt will focus attention on an appearance by New York Fed President John Williams later on Monday to see if he echoes the same theme. As Reuters notes, investors have already cut odds of further hikes, with a December move now priced at 73%, down from over 90%. Futures imply rates around 2.74% for the end of next year, compared to 2.93% early this month.

As a result, yields on 10-year Treasurys declined to 3.08 percent, from a recent top of 3.25 percent while the currency market saw the dollar fade early gains while the pound rebounded from sharp losses last week as Theresa May prepared to appeal to business leaders to help deliver her Brexit deal as the premier fights almost insurmountable Parliamentary opposition.

May said on Sunday that toppling her would risk delaying Brexit as she faces the possibility of a leadership challenge from within her own party. With both pro-EU and pro-Brexit lawmakers unhappy with the draft agreement, it is not clear that she will be able to win the backing of parliament, increasing the risk that Britain will leave the EU without a deal.

Elsewhere, the Australian and New Zealand dollars held on to their declines after Mike Pence's attack on China this weekend fueled concern Sino-U.S. trade tensions will worsen; the yen neared a month-to-date high on the risk-aversion, onshore yuan weakened for the first time in five days.

Treasuries slipped while European bonds were mixed, with core notes slipping and peripherals rising led by Italy. In the U.S., trading activity may be thinned before the Thanksgiving holiday later this week.

In commodity markets, gold found support from the drop in the dollar and held at $1,1220.19. Oil prices suffered their sixth straight week of losses last week, but climbed toward $57 a barrel in New York on Monday. Bitcoin dropped further below $6,000, at one point touching a one-year intraday low.

Market Snapshot
  • S&P 500 futures down 0.2% to 2,738.50
  • STOXX Europe 600 up 0.5% to 359.37
  • MXAP up 0.4% to 152.43
  • MXAPJ up 0.2% to 488.43
  • Nikkei up 0.7% to 21,821.16
  • Topix up 0.5% to 1,637.61
  • Hang Seng Index up 0.7% to 26,372.00
  • Shanghai Composite up 0.9% to 2,703.51
  • Sensex up 0.9% to 35,758.30
  • Australia S&P/ASX 200 down 0.6% to 5,693.66
  • Kospi up 0.4% to 2,100.56
  • German 10Y yield rose 2.4 bps to 0.391%
  • Euro up 0.04% to $1.1419
  • Italian 10Y yield unchanged at 3.119%
  • Spanish 10Y yield fell 0.4 bps to 1.632%
  • Brent futures up 0.4% to $67.05/bbl
  • Gold spot down 0.3% to $1,219.37
  • U.S. Dollar Index down 0.1% to 96.41
Top Overnight News from Bloomberg:
  • Theresa May will appeal to business leaders to help deliver her Brexit deal, as she fights almost insurmountable opposition in Parliament and a possible leadership challenge. You do the math: Can May get her Brexit deal through Parliament?
  • Vice President Mike Pence sharpened U.S. attacks on China during a week of summits that ended Sunday, most notably with a call for nations to avoid loans that would leave them indebted to Beijing
  • An Asia- Pacific summit ended in tumult after the U.S. and China failed to agree on language in a final statement, the latest sign that a trade war between the world’s biggest economies won’t end anytime soon
  • The European Central Bank shouldn’t rush to spell out how long it plans to reinvest proceeds from bonds maturing under its asset-purchases program, said French policy maker Francois Villeroy de Galhau
  • President Donald Trump said he wouldn’t stop acting Attorney General Matthew Whitaker if he curtails special counsel Robert Mueller’s investigation into possible collusion by Trump campaign officials with Russian interference in the 2016 presidential election
  • U.K. house asking prices fell from a year earlier for the first time since 2011, led by declines in London and among the most expensive properties.
  • President Donald Trump said Saudi Crown Prince Mohammed bin Salman has denied to him perhaps five times any role in the killing of journalist Jamal Khashoggi, and the U.S. may never know whether he was involved in the murder
  • Trump’s famously opaque business will face a bracing new reality next year when House Democrats hit it with a flurry of subpoenas for the first time
  • The European Central Bank shouldn’t rush to spell out how long it plans to reinvest proceeds from bonds maturing under its asset-purchases program, said French policy maker Francois Villeroy de Galhau
  • The European Union is hammering out the first bloc-wide rules to prevent foreign investments from threatening national security, as Chinese acquisitions foster political unease
  • Hedge funds’ wagers against West Texas Intermediate and Brent crude soared for a seventh straight week, the longest global short-selling streak in data going back to 2011
Asian equity markets began the week somewhat cautious on lingering trade concerns and after disunity at the APEC summit over the weekend which failed to agree on a joint communique for the first time in history due to US-China tensions. ASX 200 (-0.6%) and Nikkei 225 (+0.6%) traded mixed in which nearly all of Australia’s sectors were in the red aside from miners, while Nikkei 225 was positive as participants digested mixed trade data which showed a jump in imports. Elsewhere, Hang Seng (+0.7%) and Shanghai Comp (+0.9%) were choppy amid trade-related uncertainty following the verbal jabs between US and China in which Chinese President Xi warned that countries which embraced protectionism were doomed to fail and US Vice President Pence later commented the US could more than double the tariffs imposed on Chinese goods. Finally, 10yr JGBs futures rose to match the YTD high as they tracked the recent upside in T-notes and with the BoJ also present in the market for JPY 800bln of JGBs in the belly to the short-end of the curve. APEC summit ended without an agreement on a joint communique for the first time in its history after China refused to sign amid US-China tensions, while there had been comments from Chinese President Xi Jinping that countries which embraced protectionism were "doomed to failure" and US Vice President Pence later commented that he was prepared to "more than double" the tariffs imposed on Chinese goods.

Top Asian News
  • China’s Ping An Buys Stake in German Fintech Incubator Finleap
  • Japan Bank Shares Fall Most in Month After U.S. Yields Drop
  • Asian Markets Come out of Their Torpor as Stock Gains Accelerate
  • An Accountant Stirs Debate as India Central Bank Board Meets
Major European indices are in the green, with the outperforming FTSE MIB (+1.1%) bolstered by news that Luigi Gubitosi has been appointed as the new CEO of Telecom Italia (+4.3%). The SMI (-0.2%) gave up initial gains and is lagging its peers, weighed on Swatch (-4.0%) and Richemont (-1.4%) following unfavourable price outlook for both by Bank of America Merill Lynch. Sectors are mostly all in the green, with outperformance in telecom names, while energy names are lower given pullback in oil prices in recent trade and consumer discretionary names are weighed on by Renault (-7.0%), with the company shares extending losses following reports that Nissan’s boss has been arrested in Japan regarding allegations of financial violations. Renault shares are hit given the Renault-Nissan-Mitsubishi alliance. Elsewhere, BPost (-5.7%) shares are hit following a downgrade at HSBC, while Tele2 (+1.8%), are near the top of the Stoxx 600 after being upgraded at Berenberg.

Top European News
  • Villeroy Sees No Need to Define Reinvestments Length in December
  • U.K. Housing Woes Deepen With First Asking-Price Drop Since 2011
  • EU Set to Tighten Rules on Foreign Investment to Fend Off China
  • New Telecom Italia Boss Deepens Activist Shareholder’s Clout
In FX, the Greenback has regained some composure following its downturn at the end of last week amidst soft US data and cautious if not concerned or outright dovish Fed rhetoric (Clarida conscious about contagion from slower global growth, Kaplan envisaging headwinds from rising debt and Harker opposed to a December rate hike), but the DXY remains capped below a key Fib level (96.590) and the Dollar overall is mixed vs major counterparts.
  • NZD/AUD/CAD - All on the back foot against their US peer and underperforming other G10 currencies, with the Kiwi retreating below 0.6850 and undermined by cross flows as Aud/Nzd rebounds further from recent lows towards 1.0700 and Aud/Usd holds above 0.7300 in wake of last week’s strong Aussie jobs data.
  • GBP - The Pound has derived some comfort, or is simply just relieved that the Tory uprising and challenge to UK PM May has not reached the minimum level required to trigger a no confidence vote and adding another potential spanner in the Brexit works. However, the situation remains far from stable and certain given that Parliament still has to vote on the Withdrawal Agreement and the room for further renegotiation with the EU looks limited at best ahead of Sunday’s Summit and more meetings planned in the run up to try and sound out whether there is scope to tweak elements of the draft. Cable has tested and marginally breached last Friday’s peak at 1.2877, but far from convincingly amidst supply ahead of 1.2900, and with the 21 DMA also representing formidable tech resistance just above the big figure (1.2918-20). Meanwhile, Eur/Gbp has not pulled back too far below 0.8900, as the single currency holds firm in its own right.
  • EM - The Rand has made an encouraging start to the week, with a break through 14.0000 vs the Usd exposing recent peaks and momentum to re-test 13.8700 ahead of 13.6000 (50% Fib).
In commodities, Brent (+0.5%) and WTI (+0.1%) are in positive territory, albeit off highs, following market expectations that Saudi Arabia will steer OPEC and Russia to cut oil supply. Meanwhile, Russian Energy Minister Novak said the country is planning to sign an output agreement with OPEC at their December 6th meeting in Vienna. Overnight gains in the complex were driven by reports that Saudi is said to want oil prices around USD 80.00/bbl. Elsewhere, Iranian President Rouhani emerged on state TV and stated that the US has failed to reduce Iran’s oil exports to zero and Iran will continue to sell their crude. Conversely, Gold (-0.2%) prices fell this morning, with traders citing profit taking from last week’s gains, while Palladium is nearing parity with gold as an all-time high of USD 1185.4/oz was hit on Friday. Separately, copper is lower following tension between the US and China at the APEC summit which ended without an agreement on a joint communique for the first time in its history.

It's a fairly quiet start to the week on Monday with the only data of note being the Euro Area and the November NAHB housing market index reading in the US. Away from that, the Fed's Williams is due to speak in the afternoon, while BoJ Governor Kuroda, Bank of France Governor Villeroy de Galhau and his predecessor, Noyer, will all speak at the Europlace Financial Forum. Euro Area finance ministers are also due to gather in Brussels to seek to make progress on Franco-German plans to shore up the currency union.

US Event Calendar
  • 10am: NAHB Housing Market Index, est. 67, prior 68
  • 10:45am: Fed’s Williams Speaks in Moderated Q&A in the Bronx
DB's Jim Reid concludes the overnight wrap
Brexit was left in a bit of phoney war this weekend. We’re no closer to a leadership contest for Mrs May but it could still happen at any point. The Sun -citing their “extensive investigation” - has concluded that 42 lawmakers have sent letters of no-confidence in the PM (48 needed). Overall though more Conservative MPs are disliking the deal - and will vote against it - than will ask for a leadership battle in our opinion. The consensus that is forming amongst the Conservative MPs who dislike the Withdrawal Agreement is that it can be improved upon. This time next week we will have just had the Sunday EU summit to sign off their side of the deal but its not clear how meaningful tweaks could be made before this and before the agreement goes before UK Parliament in the next 2-3 weeks. The only thing that could be fleshed out is more on the future relationship between the UK and Europe as Mrs May travels to Brussels this week to try to progress on this. That might appease some MPs but likely not enough to help the vote pass. As such my personal view is that May stays on as leader, the EU offer no concession, the vote doesn’t get through Parliament and then the fun and games start. The UK may go back to Europe and ask for specific concessions at this point or we may end up with a path towards a hard Brexit or a second referendum. Quite binary options. For the EU maybe the gamble is to offer nothing and assume the UK Parliament eventually offers a second referendum and voters eventually decide to stay. This increases the risk of a cliff-edge hard Brexit but also one where no Brexit happens at all. This story has a lot of legs left in it.

There was lots in the press this weekend about Brexit but interestingly for me as a credit strategist by day, there was also a fair bit of negative press about credit with some of the more sensational articles suggesting that credit could soon blow up financial markets due to (amongst other things) the weight of US BBBs about to swamp the HY market, record levels of Cov-lite issuance and due to record high US corporate leverage. For us there needs to some perspective. We have been on the underweight side of credit all year, more weighted to a US underweight of late but that’s been more of a valuation play than over too much concerns about immediate credit quality. The US economy remains strong and credit deterioration is likely to remain idiosyncratic until it rolls over. At that point we will have big problems though and last week’s activity made us more confident liquidity will be bad when the cycle turns as we moved a fairly large amount on nervousness as much as anything else.

GE, PG&E, plunging oil and the factors discussed above provided a jolt but we don’t think this is enough for now to impact the economy so credit will probably stabilise. However once there is actual broad economic weakness, this last week will be a dress rehearsal for the problems ahead and there will be little two-way activity with spreads gapping wider. However that’s for further down the cycle. For now credit’s main problem has been it hadn’t responded enough to the pick up in vol. The good news is that this is starting to catch-up and correct. Last week, EU non-fin. IG spread widened by 13bps and HY by 45bps while those on US IG by 14bps and HY by 49bps. Big moves relative to a small down week in equities.

Looking ahead to the highlights for this week, I’d imagine if you’re in the US this will revolve around family, friends and perhaps Turkey as you sit down for Thanksgiving on Thursday. Outside of that we get the flash PMIs around the globe on Friday which in a period of nervousness about the global growth outlook will be scrutinised in thin post holiday trading. Black Friday will also mark the start of Xmas shopping season for retailers. Also worth noting is the European Commission's opinions on the budget plans of the Euro Area countries on Wednesday. While the EC formally has three weeks to provide an opinion on Italy's new fiscal plan following their budget resubmission last week, it's possible that they will issue this for Italy alongside this and thus kick starting the EDP process.

This morning in Asia, markets have kicked off the week on a positive note with the Nikkei (+0.48%), Hang Seng (+0.40%) and Shanghai Comp (+0.22%) all up along with most Asian markets. Elsewhere, futures on S&P 500 (-0.33%) are pointing towards a weaker start. In terms of overnight data releases, the UK Rightmove house prices index fell -0.2% yoy (-1.7% mom), first dip since 2011, led by declines in London (-2.4% yoy). Japan’s October adjusted trade balance stood at –JPY 302.7bn (vs. –JPY 48.3bn) as growth in imports (+19.9% yoy vs. +14.1% yoy expected) outpaced the growth in exports (+8.2% yoy vs. +8.9% yoy expected).

In other news, the US Vice President Pence delivered some sharp rhetoric on China over the weekend where he called upon countries to avoid taking debt from China as that would leave them indebted to China. He also added that the US wasn’t in a rush to end the trade war and would “not change course until China changes its ways.” Elsewhere, the APEC summit ended in disarray on Sunday after the US and China failed to agree on a joint statement, reflecting tensions due to the ongoing trade war. This is the first time since the summit began in 1993 that no joint statement was issued.

Looking back briefly now to last week before we focus on the full day-byday week ahead. Friday was an eventful day for market-moving rhetoric from policymakers, highlighted by Fed Vice Chair Clarida and President Trump. First, the dollar shed -0.52% after Clarida discussed the global economy and said there “is some evidence it’s slowing.” Two-year treasury yields rallied -3.8bps (-11.0bps on the week) and the market removed 6bps of Fed hikes through the end of next year (priced out a total of 16bps on the week). This came despite Clarida’s other remarks, which emphasised the strong US economy and his support for moving policy to a “neutral” level, consistent with the FOMC’s projections. Later in the session, Chicago Fed President Evans said that he too wants to move policy to neutral, and then another 50bps or so beyond that level.

Later on Friday, President Trump injected optimism on the trade policy front by telling reporters that China wants to make a deal and that he may not institute further tariffs. China has apparently offered a list of potential concessions, which could prove to be the basis of a trade deal at the 30 November G20 summit. Even though unnamed White House sources subsequently tried to soften expectations, the market rallied with the S&P 500 up +0.22% (-1.31% on the week). The DOW and Russell 2000 closed -2.22% and -1.42% on the week, though they both rallied on the President’s comments as well (+0.22% and +0.49% on Friday, respectively). After Pence’s weekend comments we should probably discount some of the above optimism.

Other markets were already closed when President Trump’s comments boosted sentiment. The STOXX 600 closed the week -2.20% (-0.20% on Friday), while UK equities outperformed marginally, with the FTSE 100 shedding only -1.29% on the week (-0.34% Friday). This reflected the weaker pound, which retreated -1.13% versus the dollar (+0.41% Friday) and -1.83% versus the euro (its worst such week since July 2017, and -0.38% on Friday). Asian equities were mixed, with the Shanghai Composite advancing +3.09% (+0.41% Friday) on trade optimism and the Nikkei down -2.56% (-0.57% Friday). German Bunds rallied -4.0bps last week, while peripheral spreads widened slightly with Italy leading the way. BTPs sold off +8.8bps (flat on Friday) as the government continued to escalate its confrontation with the European Commission.

It's a fairly quiet start to the week on Monday with the only data of note being September construction output data for the Euro Area and the November NAHB housing market index reading in the US. Away from that, the Fed's Williams is due to speak in the afternoon, while BoJ Governor Kuroda, Bank of France Governor Villeroy de Galhau and his predecessor, Noyer, will all speak at the Europlace Financial Forum. Euro Area finance ministers are also due to gather in Brussels to seek to make progress on Franco-German plans to shore up the currency union.

https://www.zerohedge.com/news/2018...ter-us-china-apec-clash-apple-production-cuts