• "Spreading the ideas of freedom loving people on matters regarding high finance, politics, constructionist Constitution, and mental masturbation of all types"

R.T.M. ~ Frontrunning ~ 15th Ed., Vol.2 ~ Apr 11th - 15th

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#1
Frontrunning: April 11


Submitted by Tyler Durden on 04/11/2016 07:35 -0400

  • Italian Bank Stocks are Surging on the Back of Rescue Reports (WSJ)
  • European Stocks Rise Led by Italian Banks; Emerging Markets Gain (BBG)
  • Oil price dips on prospects for producers' meeting (Reuters)
  • U.S. shale oil firms feel credit squeeze as banks grow cautious (Reuters)
  • U.S. banks' dismal first quarter may spell trouble for 2016 (Reuters)
  • Miserable Year for Banks: Stocks Suffer as Rates Stay Low (WSJ)
  • Whipsawed Wall Street Traders Find Bullish Signal in Bad Profits (BBG)
  • Sales of Short-Term Health Policies Surge (WSJ)
  • Panama Furor Rumbles Into Week Two as Global Pressure Mounts (BBG)
  • Daily Mail parent in talks with private equity for Yahoo bid (Reuters)
  • As Puerto Rico Nears Record Default, Insured Investors Rest Easy (BBG)
  • Wall Street Wages Double in 25 Years as Everyone Else’s Languish (BBG)
  • U.S. Navy officer charged with spying, possibly for China, Taiwan (reuters)
  • The Invisible Money Makers Who Thrived During 2015's Oil Slump (BBG)
  • Audio recording reveals Brussels Attacks were coordinated from Syria (RTBE)
  • Tale of Two Chinas Is Emerging as Economy Slows, Fidelity Says (BBG)
  • China internet regulator says web censorship not a trade barrier (Reuters)
  • Kerry says Hiroshima 'gut-wrenching' reminder world should abandon nuclear weapons (Reuters)... just not the US


Overnight Media Digest

WSJ

- The UK's Daily Mail has emerged as a suitor for Yahoo Inc's assets, joining a wide group of interested companies that includes telecom giant Verizon Communications Inc as an April 18 deadline for preliminary offers nears, according to people familiar with the matter. (http://on.wsj.com/1XpCSXL)

- Ukrainian Prime Minister Arseniy Yatsenyuk said on Sunday he would resign from his post, opening the way for the formation of a new government and the potential for urgently needed reforms to be passed in parliament. (http://on.wsj.com/25SUmBC)

- The Brussels suicide attacks that killed 32 people were the result of a last-minute scramble by terrorists after the capture of a comrade days earlier persuaded them to ditch plans for a fresh strike in France, Belgian prosecutors said. (http://on.wsj.com/1VJsKKp)

- UK Prime Minister David Cameron faced further questions about his financial affairs on Sunday, including a cash gift from his mother, despite taking the unprecedented step of publishing information about his income tax for the past six years following a week of scrutiny sparked by the Panama leaks. (http://on.wsj.com/1N2C0rx)

- TransCanada Corp said its Keystone oil pipeline resumed pumping Sunday after a nearly week-long shutdown due to a leak discovered in South Dakota. The Canadian company said it has completed repairs to the leak, which caused a spill of about 400 barrels, or 16,800 gallons near the company's Freeman pump station in Hutchinson County. (http://on.wsj.com/20tHPkl)



FT

Prime Minister David Cameron will promise to create a new criminal offence for companies that fail to stop their staff assisting in tax evasion. (http://on.ft.com/25TznyJ)

Ukraine's prime minister Arseniy Yatseniuk stepped down late on Sunday afternoon, accusing the president's party of plunging the country into an "artificially created" crisis. (http://on.ft.com/25Tzz0V)

Opposition is growing in Germany to Deutsche Boerse AG's merger with London Stock Exchange, as concern mounts about the consequences for the combined company if Britain votes to leave the European Union. (http://on.ft.com/25TzQ3R)



NYT

- After two years of heavy legal and financial consequences, General Motors has finally turned the tide and started winning lawsuits related to the gravest safety crisis in its history. So far this year, General Motors has prevailed in three injury lawsuits, including a case dismissed on Friday, in ongoing litigation to resolve hundreds of remaining claims linked to its recall of 2.6 million small cars with faulty ignition switches. (http://nyti.ms/1qCKrA7)

- Panama leak signaled something that was a big deal but went unheralded: The official WikiLeaks-ization of mainstream journalism; the next step in the tentative merger between the Fourth Estate, with its relatively restrained conventional journalists, and the Fifth Estate, with the push-the-limits ethos of its blogger, hacker and journo-activist cohort. (http://nyti.ms/23nKJwf).

- In the year since Pakistani investigators raided Axact, a Karachi-based software company accused of raking in hundreds of millions of dollars with a vast Internet degree scam, Pakistani and American investigators have uncovered a tangled web of corporate entities - dozens of shell companies and associates, from Caribbean tax havens to others in Delaware, Dubai and Singapore - used to funnel illicit earnings back to Pakistan.(http://nyti.ms/1WmFirO)

- Intuit, a Silicon Valley company, is now focusing on its TurboTax software, which tens of millions of Americans use to file their tax returns, and on QuickBooks Online, an Internet-based version of the company's flagship book-keeping software for small businesses and their accounting firms. (http://nyti.ms/1Vh9JRp)



Britain

The Times

* The owner of the Three mobile phone network has complained to the European Commission that Vodafone Group PLC, its rival, is seeking to bully it into coughing up 1 billion pounds to drop objections to its takeover of O2. (http://bit.ly/1qI5aCF)

* Thousands of patients are dying because the NHS cuts corners on operations for the critically ill, the Royal College of Surgeons has warned. (http://bit.ly/1RNq9xS)

The Guardian

* The boss of Revenue & Customs (HMRC), the UK's government department overseeing a 10 million pound inquiry into the Panama Papers, was a partner at a top city law firm that acted for Blairmore Holdings and other offshore companies named in the leak. (http://bit.ly/1Xpy5Wt)

* Companies will be held criminally liable if they fail to stop their employees from facilitating tax evasion, UK Prime Minister David Cameron will tell MPs, as he uses a parliamentary statement to defend himself after one of the most difficult weeks of his premiership. (http://bit.ly/23m9OaH)

The Telegraph

* Tesco PLC will unveil a return to full-year profits and the first quarter of UK sales growth in three years on Wednesday as chief executive Dave Lewis tries to prove to investors his turn-around plan is working. (http://bit.ly/1Yo9cue)

* David Cameron will launch a robust defence of the right of parents to give money to their children after Labour said it will review inheritance tax rules. In an unprecedented Commons appearance, the prime minister will reject suggestions that he has avoided tax after he disclosed that he had personally profited from his stake in an offshore investment fund. (http://bit.ly/1oOFnXQ)

Sky News

* Chancellor George Osborne has "never had any offshore shareholdings or other interests", a Treasury source has told Sky News. The comments come after members of David Cameron's Cabinet were urged to follow the prime minister's lead and publish any links they have with tax havens. (http://bit.ly/1SInrGc)

* The bosses of some of Britain's biggest companies are warning that they may refrain from further interventions in the debate about Europe amid concerns that they risk falling foul of strict campaign rules. Sky News understands that the Electoral Commission will publish new guidance on Monday setting out the scope of activities permissible for businesses once the referendum period formally begins on Friday. (http://bit.ly/1UT5VFn)

The Independent

* Dozens of London Underground stations are at "high risk" of flooding, with London "fortunate to have escaped" the worst consequences so far. An unpublished report seen by The Independent reveals Transport for London has identified 85 sites across its network which are at high risk of flooding. (http://ind.pn/1RMW816)

* Lobbying companies working at the heart of Whitehall are exploiting loopholes in transparency legislation that allow them to avoid declaring clients who pay them thousands of pounds to help influence Government policy, The Independent can reveal. (http://ind.pn/1VLccBU)

http://www.zerohedge.com/news/2016-04-11/frontrunning-april-1
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#2
U.S. Futures Jump In Tandem With Soaring Italian Banks On Hopes Of Government Bailout


Submitted by Tyler Durden on 04/11/2016 06:50 -0400


it has been a rather quiet session, which saw Japan modestly lower dragged again by a lower USDJPY which hit fresh 17 month lows around 170.6 before staging another modest rebound and halting a six-day run of gains; China bounced after a slightly disappointing CPI print gave hope there is more space for the PBOC to ease; European equities rose, led by Italian banks which surged ahead of a meeting to discuss the rescue of various insolvent Italian banks, while mining stocks jumped buoyed by rising metal prices with signs of a pick-up in Chinese industrial demand.

The Italian bank rescue euphoria spilled over to the US where equity futures spent most of the session around the flatline before a sudden buying jolt after the Europen open sent them almost instantly to session highs. WTI started off stong, immediately printing above $40 on the break but has since faded the jump and was down 0.5% at last check even as the USD has dipped, with the DXY sliding once again.

European shares erased earlier losses of as much as 0.8 percent as measures of banking stocks and commodity producers posted the biggest gains of the index’s 19 industry groups. Spain’s Banco Santander SA and Italy’s Intesa Sanpaolo SpA led the advance, while Anglo American Plc and ArcelorMittal rose at least 3 percent. As a result, the Stoxx Europe 600 Index extended Friday’s gains, putting it on course for the biggest back-to-back advance since March.

The U.S. earnings season unofficially kicks off later Monday, when Alcoa Inc. reports quarterly results after markets close. European peers including Tesco Plc and Sodexo SA are scheduled to release financial reports this week. Analysts are forecasting profit at companies in Europe’s Stoxx 600 index will shrink in 2016, reversing earlier calls for earnings to improve.

Some strategists were concenred about what this quarter's earnings season will reveal: "Investors won’t find it easy to believe in the rally until they get more evidence of a business-cycle recovery,” Allan von Mehren, chief analyst at Danske Bank A/S in Copenhagen, told Bloomberg. "The good news is that we already know that the beginning of the year was pretty tough for most companies, so the bar has been set pretty low for this earnings season.”

Others were more worried about the ongoing strength of the Japanese currency: "Yen strength is really hurting at the moment,” Steve Brice, chief investment strategist at Standard Chartered Bank, told Bloomberg TV in Singapore. “It’s shaken a lot of people’s confidence in Abenomics and the underlying thesis behind holding Japanese equities. The extent of the strength we’ve seen has surprised pretty much everybody."

All that really matters, however, is what Janet Yellen and company will say or do, and what the closing price pegged for the S&P500 at the New York Fed is today. And speaking of that, recall that today at 11:30AM the Fed will hold a closed, emergency session behind closed doors where rates will be discussed, followed by an impromtpu meeting between Obama, Biden and Yellen in the afternoon.

Market Wrap

  • S&P 500 futures up 0.3% at 20470
  • Stoxx 600 up 0.3% to 333
  • FTSE 100 +0%
  • DAX +0.7%
  • Euro down 0.11% to $1.1387
  • German 10Yr yield down 1bps to 0.09%
  • Italian 10Yr yield down 1bps to 1.3%
  • Spanish 10Yr yield down 1bps to 1.51%
  • MSCI Asia Pacific down 0% to 126.3
  • Nikkei 225 down 0.4% to 15751.1
  • Hang Seng up 0.3% to 20440.8
  • Kospi down 0.1% to 1970.4
  • Shanghai Composite up 1.6% to 3034
  • US 10Yr yield up 0bps to 1.72%
  • Dollar Index down 0% to 94.23
  • Brent Futures down 0.8% to $41.6/bbl
  • WTI Futures down 0.8% to $39.4/bbl
  • Gold spot up 0.7% to $1248.2/oz
Top Global News

  • Greece Points Finger at IMF as Schaeuble Sees Deal Within Weeks: Greek Minister of State Nikos Pappas speaks in interview
  • Italy Officials, Banks Said to Plan Monday Meeting on Fund Setup: UniCredit would be among investors in possible fund, CEO says
  • Panama Furor Rumbles Into Second Week as Global Pressure Mounts: David Cameron to face parliament over offshore tax havens
  • Daily Mail Says It’s In Early Talks With Potential Yahoo Bidders: Verizon, Google said to be among bidders for Yahoo’s Assets
Looking at regional markets, Asian stocks traded relatively mixed after inflation figures suggested deflationary pressures eased, while Nikkei 225 underperforms on JPY strength. JPY weighed on the Nikkei 225 (-0.4%) with a contraction in Machine Orders adding to the dampened sentiment, while ASX 200 (-0.1%) is also negative, although losses have been stemmed amid advances in energy. Shanghai Comp (+1.6%) was underpinned by commodity strength and a mixed bag of Chinese data in which CPI missed estimates but matched its 22-month high, while PPI was better than expected despite declining for a 49th consecutive month. 10yr JGBs saw muted trade with prices flat despite a cautious tone in Japan, while the BoJ refrained from entering the market under its bond-buying program.

Top Asian News;

  • Standard Chartered Said Selling $4.4 Billion of Asian Assets: Stressed Indian loan portfolio draws interest from SSG Capital
  • Abenomics Rebuked as BlackRock Joins $46 Billion Japan Pullout: BlackRock among cos. ending bullish calls on Japan equities
  • Chinese Authorities Said to Probe Nanjing Peer-to-Peer Lender: Easy Richness raised at least 10b yuan from investors
  • Mystery $9 billion in Extra Cash Perplexes India: Cash spikes during election time, notes RBI’s Rajan
  • HNA Agrees to Buy Airline Caterer Gategroup for $1.5 Billion: HNA makes all-cash offer for Swiss caterer at 20% premium
In Europe, this morning the Eurostoxx (+0.60%) pare opening losses led by gains in financial and material names. The FTSE MIB (+1.2%) outperforms in the region amid reports that Italy is finalising plans for a new multibillion-EUR rescue fund to shore up ailing banks. While upside in the precious metals complex underpinned strength in miners with Anglo American and Arcelormittal notching up gains of over 4%.

Bunds remain elevated as the 10 yield dropped to a fresh 12-month low of 0.077, just shy of the all-time low at 0.074 , however saw a modest pullback amid the turnaround in stocks. Interestingly, this week sees supply as largely net negative with around EUR 36b1n of redemptions (all due to be repaid on Friday) due to offset the circa EUR 10bIn of supply. Furthermore, the latest CFTC report has revealed that markets have placed their largest bet against treasuries in five months, while this week is also set to see USD 56b1n of US paper hit the market. Finally, analysts at RBS expect that the main driver for Bunds will be an acceleration of ECB QE rather than risk sentiment with expectations of outperformance in the periphery.

Top European News

  • Vivendi Agrees to Buy Berlusconi’s Pay-TV Unit in Swap Deal: Vivendi and Mediaset will acquire stakes of ~3.5% in each other
  • Aegon to Sell $8.5b of U.K. Annuity Portfolio to Rothesay: is disposal aimed at freeing up capital
  • SAP Sales Miss Estimates as Some Deals Slip to Next Quarter: co. reiterates operating profit forecast for 2016
  • HNA Agrees to Buy Airline Caterer Gategroup for $1.5b: Shareholders would get CHF53/shr as well as previously declared CHF0.30/shr dividend
  • Standard Chartered Said Selling $4.4b of Asian Assets: Stressed Indian loan portfolio draws interest from SSG Capital
  • CaixaBank, dos Santos Agree on Plan for BPI Angola Exposure: Deal allows Portuguese lender BPI to comply with ECB request
  • Three-O2 Deal Should Be Banned If No Network Sale, U.K. Says: U.K.’s antitrust regulator tells EU concessions fall short
  • Nordea Plans to Sell Baltic Units ‘In Near Future:’ Aripaev: says sale has been prepared for 1.5 yrs
  • Total CEO Interested in Gas Downstream Sales in China: Caixin: Total aims to increase its lubricant market share in China from current 3%
In FX, a few interesting moves in FX this morning, with USD/JPY making a fresh cycle low at 107.61 but this was only a marginal extension of the lows seen last week. Price action suggests some demand ahead of 107.50, but back above 108.00, there seems little momentum for a full blown recovery to 109.00+ levels seen at the end of last week. Some of this support may have come from a reported buy order in GBP/JPY, which saw the recovery from sub 152.00 touching levels just shy of 154.00. Cable ripped through 1.4150-70 stops in the process, taking out 1.4200-10 before the latest dip back under the figure. We saw EUR/GBP back to .8000, but this level has held so far. Relatively tight ranges seen in the commodity currencies, with the CAD weakening temporarily through 1.3000 on a slip in Oil prices. Norwegian inflation pretty much in line with expectations. NOK makes new 4+ week highs vs the EUR.

In commodities, WTI initially opened above $40 but later erased gains as Iraq boosted its March oil production to a record before a meeting in Qatar of OPEC members and other producers on April 17 to discuss capping output. West Texas Intermediate dropped 0.4 percent to $39.57 a barrel and Brent lost 0.3 percent to trade at $41.82.U.S. natural gas futures slid 2.8 percent to $1.935 per million British thermal units, the biggest drop in more than two weeks.

Gold rose to the highest level in almost three weeks. Bullion for immediate delivery advanced 0.6 percent to $1,247.66 an ounce, extending a gain of 1.5 percent last week, as a subdued USD overnight underpinned the commodities complex and supported copper and iron ore prices, with the latter higher by over 3% alongside firm gains in steel prices on lower stockpiles and after a Chinese government official called for more capacity reductions. However, the FT are running a story suggesting that restructuring of the sector will lead to much more capacity than is required and thus the glut of supply will remain. Silver added 0.9 percent.

There is nothing on today's economic calendar, although the relentless speeches from Fed presidents continue, with Dudley and Kaplan on deck. Of course the actually relevant Fed meetings, those in the close session at 11:30 where the Fed will be discussing rates, and the subsequent in which Yellen will meet Obama, will be entirely behind closed doors.



Bulletin Headline Summary from Bloomberg and RanSquawk

  • European equities enter the US session in positive territory amid outperformance in Italian banks and materials names
  • Despite printing a cycle low of 107.61, USD/JPY ran in to support above 107.50 to reclaim 108.00 while GBP/USD ripped through stops to take out 1.4200 to the upside
  • Looking ahead, the calendar is relatively light with the only notable highlight being potential comments from Fed's Kaplan
  • Treasuries lower in overnight trading as European equity markets rally on news of Italian bank clean up, Asian markets rise; this week will feature Treasury auctions of $56b 3Y,10Y and 30Y.
  • Italian Treasury and central bank officials will meet with executives of major banks on Monday to discuss the creation of a fund that would buy bank shares and help the institutions tackle non-performing loans
  • Italian industrial production fell 0.6% in February, reflecting concerns about the pace of recovery that prompted the government to cut this year’s growth outlook
  • After correctly predicting the yen’s advance beyond 115 and then 110 per dollar, the former Finance Ministry official in charge of currency intervention in Japan Eisuke Sakakibara now says Japan’s currency may strengthen to 100 by year-end
  • Foreign traders have been pulling out of Tokyo’s stock market for 13 straight weeks, the longest stretch since 1998, dumping $46 billion of shares as economic reports deteriorated, stimulus from the Bank of Japan backfired and the yen’s surge pressured exporters
  • Standard Chartered Plc is seeking to sell at least $4.4 billion of assets in Asia, people with knowledge of the matter said, as the lender pares its balance sheet after booking record impairments
  • Five years after Occupy Wall Street protesters spawned a national discussion about the divide between America’s highest and lowest earners, the pay gap has only gotten wider; Wall Street bankers earned five times the national average in 2014
  • The fallout from the Panama leaks showed no sign of abating as U.K. PM David Cameron was forced to provide more transparency over his wealth and European officials pledged measures to require companies to report their offshore bank accounts
  • Brazilian security forces are deploying thousands of troops and erecting barricades in the capital city of Brasilia this week to prevent violent clashes as Congress holds key votes on the impeachment of President Dilma Rousseff
  • Sovereign 10Y bond yields mostly steady; European, Asian equity markets mixed; U.S. equity-index futures rise. WTI crude oil and copper fall, gold rallies
US Event Calendar

  • No major reports scheduled
Central Banks

  • 9:25am: Fed’s Dudley speaks in New York
  • 1:00pm: Fed’s Kaplan speaks in Ruston, Louisiana
DB's Jim Reid concludes the overnight wrap

In Asia this morning there is some important inflation numbers out of China data to digest. CPI for the month of March has printed at +2.3% yoy which was a smidgen below expectations (of +2.4%) but flat on the prior month which was then the highest since July 2014 and will likely provide for some comfort that the data is stabilising. Meanwhile the latest PPI numbers continue to show improvement after printing at -4.3% yoy (vs. -4.6% expected), and up six-tenths from the prior month. While factory gate prices remain yet again in negative territory, the +0.5% mom reading is the first positive monthly rise in prices since 2013.

Looking at the market reaction, sentiment appears to be buoyed in China post the data where the Shanghai Comp and CSI 300 have bounced +1.82% and +1.74% respectively. Elsewhere, it’s a bit more mixed. Following a 3.24% rally last week for the Yen, further modest gains this morning appear to be weighing on Japanese equity markets where the Nikkei is currently -1.30%. Meanwhile the Kospi and ASX are flat and the Hang Sang (+0.51%) is posting a modest gain. Credit markets are little moved, as are US equity index futures this morning.

Away from the data the newsflow over the weekend has been fairly quiet on the whole. We highlighted on a few occasions in the EMR last week the notable underperformance of European Banks since the ECB bazooka over a month ago now. The notable drag for that asset class has come from Italian banks in particular where concerns for the sector have remained elevated. That said sentiment was greatly improved on Friday (FTSE MIB +4.08%) over hopes that the nation is looking to piece together a bank rescue fund. According to the FT, Italy’s finance minister, Padoan, has called a meeting in Rome today to run over and agree upon the final details of a ‘last resort’ bailout plan. The article suggests that the plan could become official as soon as tonight but there are still concerns about whether or not the proposal will be sufficient enough to ring fence Monte dei Paschi from contagion. One to keep an eye on.

Staying in Europe, our European Economists – in their Focus Europe piece from Friday – also gave their latest thoughts on the current political situations in Greece and Spain which had weighed on fixed income markets (particularly in rates) to some degree last week. With regards to the latter, our colleagues believe their central scenario of a new election in June in Spain has become more likely. Last Thursday negotiation teams from centre-left PSOE, liberal Citizens and left-wing Podemos met to see whether they could find an agreement to form a government. Their pessimism appears to have been justified and the Citizens’ and Podemos’ economic and political agendas continue to appear irreconcilable. Should their prediction prove correct and no PM nominee wins a confidence vote by the 2nd of May then the King will dissolve parliament and call a new election, likely due three days after the Brexit referendum.

Meanwhile, in terms of Greece, our Economists judge that a return of Grexit fears as being unlikely over the coming weeks. While they note that the ongoing disagreements between Greece, the IMF and European creditors suggest that there remains some way to go until agreement is reached, they highlight two important factors as dampening risks. First, both the refugee crisis and the Brexit referendum significantly increases the costs to Europe of a crisis in Greece. Second, the Syriza government has a greater commitment to the program with PM Tsipras having obtained voters’ support for continued cooperation with Europe last September and espousing the benefits of co-operation with European partners over the last six months. The perhaps greatest risk for now is that debt relief negotiations are not completed in time for Greece’s July ECB redemptions, once again deferring full IMF participation in the program and leaving some of Greece’s medium term issues – including the full lifting of capital controls on the banking system – unresolved.

Over to markets and a quick recap of how we closed out last week on Friday. Sentiment was broadly improved with a large part of that owing to the big rally across the Oil complex on Friday. WTI and Brent both closed up more than 6% on the day meaning they finished just shy of $40/bbl and $42/bbl respectively (although they have broken through those respective levels this morning). There didn’t appear to be any fresh news to drive those big moves but the rally did help to conclude the first five-day gain for both (WTI +7.96%, Brent +8.46%) in three weeks. Those gains boosted energy stocks which led the Stoxx 600 firstly to a +1.15% gain, and then helped the S&P 500 get off to a decent start before momentum faded as the session came to close, with the index eventually stumbling to a much more modest +0.28% gain. EM currencies were the big outperformer (Brazilian Real +2.83%, South African Real +1.91%, Russian Ruble +1.39%) while the better tone was reflected in a boost for peripheral rates markets where we saw yields drop 7-8bps, while core markets were little changed.

In terms of the macro, the economic data out of the US on Friday was fairly soft and representative of a further drag on growth this quarter from diminishing inventories. Both wholesale inventories (-0.5% mom vs. -0.2% expected) and trade sales (-0.2% mom vs. +0.2% expected) came in lower than expected and so much so that we saw the Atlanta Fed downgrade their Q1 GDPNow forecast by three-tenths to a lowly 0.1% and the lowest forecast they have predicted so far. After getting back into positive territory not too long ago, US economic surprise indices have now slipped back into negative territory again.

Away from this the latest comments out of the Fed were from NY Fed President Dudley, who certainly came across as more cautious and dovish than some of his colleagues. Dudley noted that risks to the US outlook are ‘slightly’ tilted to the downside and that caution is warranted ‘because of our limited ability to reduce the policy rate to respond to adverse developments, recognizing that we could also use forward guidance and balance sheet policies to provide additional accommodation if that proved warranted’.

Wrapping up the rest of the Friday dataflow, in Europe the highlight was a couple of softer IP reports covering the month of February. Both the UK (-0.3% mom vs. +0.1% expected) and France (-1.0% mom vs. -0.4% expected) missed to the downside which poses some downside risk for the Euro area reading this Wednesday. Finally on Friday, Germany reported a slightly higher than expected trade surplus as of February owing to a notable beat in exports (+1.3% mom vs. +0.5% expected) during the month.

There’s more important Fedspeak to keep an eye on including Dudley and Kaplan today, Harker, Williams and Lacker all tomorrow Lockhart and Powell on Thursday and finally Evans on Friday. Over at the ECB we’ll hear from Knot on Wednesday. Finally this week will also see the unofficial commencement of earnings season in the US with Alcoa due to report today. Also scheduled to report are the banks with JP Morgan (Wednesday), Bank of America (Thursday), Wells Fargo (Thursday) and Citigroup (Friday) all due up. Tuesday will also see the release of the IMF’s World Outlook ahead of its spring meetings.


http://www.zerohedge.com/news/2016-...oaring-italian-banks-hopes-government-bailout
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#3
Guest Post - Path to the Great Reset


Submitted by Cognitive Dissonance on 04/10/2016 09:10 -0400


Guest Post - Path to the Great Reset

By Joe Withrow
Author of 'The Individual is Rising'


The financial, political and economic powers wish you and I to remain confused about what constitutes money because this promotes apathy and the desire to let the 'experts' remain in control. And while the subject can be complex, it can also be summarized rather elegantly when the author wishes to clarify rather than confuse. We welcome Joe back for another lesson in simplification.

Cognitive Dissonance
www.twoicefloes.com

Gold has been money for most of recorded human history. Industrial capitalism operated on a global gold standard up until the world wars shredded Europe’s economy. In 1933, President Roosevelt criminalized private gold ownership using an executive order, and the U.S. government forced citizens to sell their gold at a below-market valuation. This gold was melted down into bricks and shipped to Fort Knox where KPMG says it still sits to this day.

The Bretton Woods Agreement was executed in 1944, which pegged the U.S. dollar to gold at $35 per ounce, and installed the dollar as the world’s reserve currency. Under Bretton Woods, all other national currencies were pegged to the dollar, and foreign central banks could exchange dollars for gold at the fixed rate.

The Bretton Woods Agreement required the U.S. government to maintain the dollar-to-gold exchange ratio, but that didn’t happen. The U.S. government instead ramped up the printing presses to power its “Guns and Butter” campaigns in the fifties and sixties. Eventually foreign central banks caught on and began to exchange their dollar reserves for gold through the gold window. Gold steadily flowed out of the U.S. Treasury until August 15, 1971 when President Nixon unilaterally closed the gold window and ended the U.S. dollar’s direct convertibility to gold.

This action thrust the entire world onto a fiat monetary standard where all currencies floated in value against one another. The word “fiat” is defined as: an arbitrary order or decree, and the word very literally means “let it be done” in Latin. Fiat money is simply money that comes into existence and derives its value exclusively from government decree.

Free market economists, specifically those of the Austrian school, decried this move immediately. Fiat money had been used on a national level on numerous occasions throughout history, they said, and each time it led to economic disaster. Now you want to try it on a global scale? You are asking for a catastrophe!

Many of the Austrians didn’t think the fiat system would even survive the decade.

The reason being is really just common sense: if you give a select group of people the ability to create money out of thin air then they are going to do just that. And they are going to keep on doing just that in greater quantities, especially when they discover that they can funnel the new money to their own friends and business partners. Here’s the kicker: each new monetary unit that comes into circulation necessarily steals value from all of the other monetary units in existence.

This is just basic economics, but French economist Richard Cantillon noticed something especially nefarious about this dynamic way back in the early 1700’s. When such a fiat money system is employed, the people who receive the new money first – always the politically connected and financial elite – become fantastically wealthy while everyone else becomes poorer over time. In other words, Cantillon said, this system actively transfers purchasing power away from everyone who holds money, and it funnels this purchasing power directly to the few people who are on the receiving end of the printing presses!

This came to be known as the Cantillon effect, and it is the sole reason for the massive wealth disparity that has come to exist in the U.S. over the past four decades. There is a reason why the suburbs surrounding Washington, DC have become the wealthiest counties in the country. The Federal Reserve has been systematically transferring the nation’s wealth to Washington (and New York) for forty years now.

The fiat monetary system has fundamentally transformed how the economy operates as well. Free market purists, of which I am one, can list numerous reasons why the Bretton Woods System was a crony fractional gold standard that was riddled with problems right from the start, but it did serve to restrict the creation of currency and credit to a certain degree.

Gold was the restrictive mechanism. The amount of currency and credit in circulation was tied directly to the amount of gold in the vaults. Though the system was imperfect, credit could only come from real savings which could only come from real production prior to 1971.

Contrast this to the creation of credit today. Banks are required to hold a fraction of deposits in reserve in order to issue credit. This reserve number is roughly 10%.

In other words, banks can issue a $1,000 loan for every $100 on deposit with a simple journal entry. But the $1,000 created by the loan typically finds its way back into the banking system. Very few people take out a loan and stuff the cash in their mattress; they usually use it to purchase something. The business or person on the receiving end of that transaction typically deposits the proceeds from the sale into their bank account. At that point there is an extra $1,000 floating around in the system… which means banks can now issue additional loans up to $10,000 on top of the new $1,000 deposit.

Now it may not be the same bank with the additional $1,000 deposit, but all of the banks are tied together via the central banking system so the net effect for the entire system is the same. The credit expansion feeds itself and self-perpetuates.

The U.S. national debt was effectively restricted by gold as well, as the Feds found out when French President Charles de Gaulle began shipping dollars back to the U.S. Treasury in exchange for gold.

Gold was like the fuddy-duddy who collected everyone’s car keys at the door of the college party. He would let you have a little bit of fun, but he drew a distinct line in the sand.






So what has happened to the economy since 1971 is not a mystery – everything can be traced back to the fact that we went from using real money to using money created from thin air. The data very clearly shows the results of this:

  • The U.S. money supply has exploded since 1971.
  • The cost of living has risen dramatically because of this monetary expansion.
  • The U.S. national debt has exploded by a factor of 10 – it has quite literally doubled more than three times in forty years.
  • Unfunded government liabilities have exploded all around the world – eclipsing $210 trillion in the U.S.
  • Household debt has exploded significantly, and household debt-to-income has now surpassed 130%.
  • Interest rates have been pushed negative around the world, and to near-zero in the U.S. which has prevented seniors and conservative investors from earning any real returns on their savings.
  • Real money and savings have been replaced by credit – the entire economy has been hooked on cheap credit.
The perpetuation of this system depends entirely on continued credit expansion. The house of cards will fall as soon as the credit dries up.

Here’s the funny thing about this: the Baby Boomers have spent most of their adult lives immersed in this system. Their children have spent their entire lives in this system. This monetary system is anomalous from a historical perspective and it is completely unsustainable, but most people alive today consider it absolutely normal. They have known nothing else.

So the fiat money system has chugged right along with its booms and busts, seemingly oblivious to the mounting problems and the select few voices crying wolf. The system has hit road blocks several times during each decade, but it has overcome and persevered on each occasion - elevating asset prices in the U.S. to new highs as it advanced.

This has made the average investor complacent. Talk to your neighborhood financial professional and he will tell you decisively how it all works: Stocks always go up over time. So does real estate. Government bonds are your safe haven. Corrections happen from time to time - you just need to wait them out.

He's not trying to trick you - that is what mainstream finance believes. Indeed, that's mostly how it has worked for quite some time now. The normalcy bias is firmly entrenched.

What isn't often considered, however, is that we haven't seen the other side of the credit cycle since the fiat monetary system came to being. Credit has been expanding consistently, and interest rates have been falling since the early 1980's. At some point the cycle has to turn.

That point may be rapidly approaching. The puppet masters are engaging in more and more aggressive policies in an effort to keep the system progressing forward.

Policymakers in Japan and Europe have already pushed sovereign interest rates into negative territory. Chinese policymakers, as of last week, have done the same. This is capitalism flipped upside down. Instead of receiving a rate of return on their capital, savers actually must pay interest to purchase government bonds or to keep their money in the bank.

Think about what this means for large institutional investors. Are they really going to deploy their capital in a way that guarantees a loss?

What about insurance companies? Millions of people and businesses around the world have bought insurance policies to protect their homes, businesses, property, and even entire cities. These insurance companies must maintain a huge cash reserve in order to honor their guarantees as claims come in. Are these companies going to keep their cash reserves in accounts that steadily eat away at their capital because of negative interest rates?

You could ask the same question about pension funds.

And how about individuals all around the world? Are people going to keep their money in the bank and watch their account steadily dwindle month in and month out? Aren’t deposit accounts supposed to protect capital in a liquid manner?

A general rule of thumb is that capital flows to where it is treated best. Right now, that place is the United States. With the rest of the world descending into negative interest rate territory, the Federal Reserve has actually been talking about raising interest rates.

It is only logical to expect huge amounts of capital to rush into the U.S. credit and financial markets to escape the ills of negative interest rates. But this would drive Treasury yields down and send the U.S. dollar skyrocketing relative to all other currencies which would cause massive imbalances in the global economy.

Here’s just one example: emerging market debt has exploded by more than 600% in the last ten years alone. This debt is denominated in dollars, but the emerging market debtors earn money in their own currencies. This means they must convert their currencies to dollars to service this debt. If the dollar-to-emerging market currency exchange ratio is too extreme then these debts simply cannot be paid. Then problems in the credit markets really start to cascade.

So if the Fed pursues its "normalization" policies then the global economy faces some major problems. But the Fed has taken a more dovish stance recently, and Janet Yellen has even name-dropped negative interest rates.

Will the Fed follow the world into the realm of negative interest rates to suppress the dollar and avoid shaking up the global economy? This of course would lead to a different set of problems. If all of the world's major economies were submersed in negative interest rates, there would be no safe haven for the aforementioned economic actors to run to within the financial system. So what would they do?

Maybe they would just take it on the chin and let their capital gradually decay. Or, much more likely, they would move into physical cash and gold as a means to preserve their capital thus triggering a global bank run – something long thought conquered in the age of central banking.

Oh, and this is more than just a theory… a number of power players are already starting to do just that - move into physical cash and gold.

Could the Great Reset be at hand?

Of course, nobody knows for certain. Prominent Austrian economists thought the fiat monetary system would crash and burn a long time ago. They have been wrong for decades on this. Maybe they will be wrong for decades more... or maybe they will finally be proven right.

What's important to take from this is that the rules of the game are changing. Those stuck within the old paradigm of mainstream finance have huge threats facing their retirement, and quite possibly even their current standard of living.

We will be hosting a webcast on April 10 to discuss these major threats, analyze the trends, and talk about what you can do financially to not only insulate yourself, but possibly even grow your capital as this story unfolds. The broadcast will begin promptly at 8:00 pm EDT, and it is absolutely free with no obligations. Space is limited so register today to reserve your spot here:


Joe Withrow is an author, editor, instructor, investor, and philosopher... in no particular order. His work can be found at http://www.zenconomics.com/.






http://www.zerohedge.com/news/2016-04-10/guest-post-path-great-reset
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#4
Schedule for Week of April 10, 2016
Read more at http://www.calculatedriskblog.com/2...eek-of-april-10-2016.html#UrkdFrxAUUQPx8DO.99

MtM - Emerging Markets: Preview of the Week Ahead 04/10
http://www.marctomarket.com/2016/04/emerging-markets-preview-of-week-ahead.html

SA - Real time news 04/11
http://seekingalpha.com/market-news

Key U.S. Events In The Coming Week 04/11
http://www.zerohedge.com/news/2016-04-11/key-us-events-coming-week

Tim Iacono - Monday Morning Links 04/11
http://timiacono.com/index.php/2016/04/11/monday-morning-links-195/

Ritholtz's Reads: Drugs, Facebook and Elon Musk 04/11
http://www.bloombergview.com/articles/2016-04-11/ritholtz-s-reads-drugs-facebook-and-elon-musk

CWS - Morning News: April 11, 2016
http://www.crossingwallstreet.com/archives/2016/04/morning-news-april-11-2016.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+Crossingwallstreet+(Crossing+Wall+Street)

DB - Opening Bell: 4.11.16
http://dealbreaker.com/2016/04/opening-bell-4-11-16/

TCS - Initial Guidance | 11 April 2016
http://www.capitalspectator.com/initial-guidance-11-april-2016/

Naked Capitalism Links 04/11
http://www.nakedcapitalism.com/2016/04/links-41116.html

LT - Outlook for Week of April 11
https://lunatictrader.wordpress.com/2016/04/10/outlook-for-week-of-april-11/

MtM - Sterling Shines Temporarily in Choppy Start for Foreign Exchange 04/11
http://www.marctomarket.com/2016/04/sterling-shines-temporarily-in-choppy.html

SA - Wall Street Breakfast: Earnings Season Kicks Off 04/11
http://seekingalpha.com/article/3964312-wall-street-breakfast-earnings-season-kicks
 
Last edited:

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#5

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#6
Bank Bail-Ins Begin as EU Bank “Bailed In” In Austria
By: Mark O'Byrne, GoldCore
Bank bail-ins in the EU are here after Austria’s financial markets regulator FMA imposed a hefty haircut on creditors in an Austrian bank. Creditors in the bank Heta Asset Resolution will receive less than half of their money back according to the country’s financial regulator, the FMA.


Gold and Silver Market Morning: April-11-2016 -- Waiting for something to happen?
By: Julian D. W. Phillips, Gold Forecaster
India – The government of India has formed a sub-committee under former Chief Economic Advisor Ashok Lahiri to study the imposition of the 1% sales tax on gold and silver in addition to the existing 10% already imposed and come up with suggestions. The jeweler’s strike is now completing its first month with no sign of respite. We don’t think anything will change because now, the Central Board of Excise and Customs (CBEC), has imposed 15% ad valorem duty on several items including gold and silver that are brought into the country by travelers.
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#7
RANsquawk Week Ahead Preview - 11th April 2016
RAN squawk


Published on Apr 11, 2016
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#9
Goldman Sachs to pay over $5billion in connection with its sale of mortgage-backed securities leading up to the financial crisis
  • The Justice Department announced the settlement on Monday
  • Goldman Sachs is agreeing to pay more than $5billion to settle claims they misled mortgage bond investors before the 2008 financial collapse
  • Bank will pay $2.4billion civil penalty, an additional $1.8billion in relief to distressed homeowners and borrowers, and $875million in other claims
  • The agreement is the latest multi-billion-dollar civil settlement reached with a major bank
  • Bank of America, Citigroup and JPMorgan Chase & Co have reached previous settlements


Read more: http://www.dailymail.co.uk/news/article-3534256/US-Goldman-Sachs-reach-5B-settlement-risky-mortgages.html#ixzz45XYYT72q
Follow us: @MailOnline on Twitter | DailyMail on Facebook
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#13
The 13-Year Record for Copper
By: Mickey Fulp
My recent work has focused on the seasonal price trends of major commodities. I previously documented year-over-year price moves of gold and oil over a period of 20 years (Mercenary Musings: January 4, 2016; March 28, 2016). Once again employing a series of normalized charts, I submit our research on the price of copper from 2003 to 2015 and show, much like gold and oil, there are recurrent intra-year trends. Note that our data set is the closing Comex spot price for Grade A Copper Cathode.


Subprime makes a comeback; Auto Loan crisis is here
By: Sol Palha
The number of individuals who are more than 60 days late on their auto payments surged 11.6% year over year; this brings the current delinquency rate to 5.16%. During the financial crisis of 2008, the delinquency rate peaked off at 5.04% according to Fitch. This fully validates the argument we have made over the years stating that this recovery is nothing but an illusion. This illusion is maintained by hot money, and this was done by keeping rates so low that it would force any sane person or business to speculate to earn a higher yield.


Gold Seeker Closing Report: Gold Gains Over 1% and Silver Surges Nearly 4%
By: Chris Mullen, Gold-Seeker.com
Gold gained $19.12 to $1258.62 by late morning in New York before it edged back lower in afternoon trade, but it still ended with a gain of 1.34%. Silver rose to as high as $15.962 and ended with a gain of 3.65%.
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#14
Frontrunning: April 13


Submitted by Tyler Durden on 04/12/2016 07:40 -0400

  • Gloomy start to results season hits shares (Reuters)
  • Stocks Rise Around World as Commodities Advance; Bonds, Yen Drop (BBG)
  • Oil hits 2016 high above $43 on producer meeting hopes (Reuters)
  • Rosneft chief Igor Sechin says low oil prices will not last (FT)
  • Banks Face Massive New Headache on Oil Loans (WSJ)
  • Wells Fargo Misjudged the Risks of Energy Financing (BBG)
  • Hedge Funds Abandoning Dollar's Biggest Bull Run in a Generation (BBG)
  • Boeing Meets With Iranian Airlines to Discuss Jets, Aircraft Services (WSJ)
  • Bundesbank’s Weidmann rebukes Draghi critics in Berlin (FT)
  • A year after Freddie Gray, Baltimore makes slow progress (Reuters)
  • Who Loses the Most From ‘Brexit’? Try Goldman Sachs (WSJ)
  • US faces ‘disastrous’ $3.4tn pension funding hole (FT)
  • As Islamic State is pushed back in Iraq, worries about what's next (Reuters)
  • LVMH Leads Luxury Share Slide as Terror Attacks Damp Tourism (BBG)
  • Feds charge Texas AG Ken Paxton with fraud (Dallas News)
  • UBS Says Junk-Debt Bubble Just an Economic Slowdown From Popping (BBG)
  • Bond Traders Show Skepticism of Goldman's Forecast for Fed Hikes (BBG)
  • VW Moves to End Clash With Labor Over Brand (WSJ)
  • Dan Loeb's Hedge Fund Is Biggest Winner in Dan Loeb's Reinsurer (BBG)


Overnight Media Digest

WSJ

- Boeing Co has opened talks to sell airliners to Iran in what would be one of the highest-profile deals between a U.S. company and Tehran since the West lifted nuclear sanctions on the country in January. (http://on.wsj.com/1S1F4kw)

- A congressional impeachment committee voted late Monday to recommend a Senate trial for President Dilma Rousseff on charges of manipulating public finances, in a raucous session that sets up a decision this weekend by the entire lower house of congress. (http://on.wsj.com/1N5eR85)

- Canadian Pacific Railway Ltd abandoned its nearly $30 billion pursuit of Norfolk Southern Corp on Monday after it was unable to overcome a wall of opposition from rival railroads, shippers and U.S. politicians warning the merger would diminish competition. (http://on.wsj.com/1qiOa5p)

- General Motors Co has scrapped a plan to invest an additional $245 million in a factory north of Detroit to build a small Cadillac, with management deciding instead to build the future product in Kansas to contain costs. (http://on.wsj.com/22pGb2v)

- Valeant Pharmaceuticals International Inc requested that Michael Pearson, its outgoing chief executive, to cooperate with a Senate committee investigating the hike in the prices of certain prescription drugs after he didn't appear for his deposition last week. (http://on.wsj.com/1XqREO3)

- Volkswagen AG moved to end a clash with labor over restructuring the company's namesake brand and to resolve a dispute over executive bonuses in the wake of the auto maker's emissions-cheating scandal. (http://on.wsj.com/23xwUaW)



FT

Business secretary, Sajid Javid opened up the possibility of a part nationalisation of Port Talbot steelworks after offering to co-invest with a buyer on commercial terms. (http://on.ft.com/1Q3FEw6)

Former Foreign Secretary David Miliband said it would be "an act of arson on the international order" for Britain to leave the European Union. (http://on.ft.com/1Q3FLHQ)

British members of parliament have responded angrily to the idea of being forced to publish their tax returns. (http://on.ft.com/1Q3FQeC)



NYT

- State and federal officials said on Monday that Goldman Sachs would pay $5.1 billion to settle accusations of wrongdoing before the financial crisis. However, buried in the fine print are provisions that allow Goldman to pay hundreds of millions of dollars less - perhaps as much as $1 billion less - than that headline figure. (http://nyti.ms/1UW8Hd8)

- Puerto Rico proposed a plan to restructure its debt, offering some creditors better terms than an earlier plan but falling well short of winning broad support. (http://nyti.ms/1ScB5qW)

- Two unions representing roughly 36,000 Verizon workers in the eastern United States have set a strike deadline of Wednesday morning, saying they have made little progress with management in the more than eight months since their most recent contracts expired. (http://nyti.ms/1UXpvQQ)

- Attorney General Ken Paxton of Texas, who was indicted last year on state securities fraud charges, faced a new round of legal troubles on Monday after federal regulators accused him of misleading investors in a technology company. (http://nyti.ms/1Q3WqLq)



Canada

THE GLOBE AND MAIL

** The Ontario Securities Commission will open the doors on its new whistle-blower office in the early summer, providing payments as high as C$5 million ($3.89 million) for tips that lead to successful prosecutions. (bit.ly/25WCYMg)

** The Canada Revenue Agency is vowing to recover C$2.6 billion ($2.02 billion) over five years by targeting notorious tax havens, stepping up audits of large foreign transfers of money and investigating consultants selling shelters. (bit.ly/1Q4hvW6)

NATIONAL POST

** Canadian Prime Minister Justin Trudeau has told his senior lieutenants to draw up plans to make the Energy East pipeline and the Trans Mountain expansion in British Columbia to achieve the ambitious economic growth targets his government has set. (bit.ly/1Vj7f48)

** Iraq offers Canadian companies investment and business opportunities worth $1 trillion as it looks to rebuild itself, but there are also large security risks, according to Bruno Saccomani, the Canadian ambassador to Iraq and Jordan. (bit.ly/1VjrcYI) (



Britain

The Times

* Graeme Jenkins, the man scheduled to join Pets at Home as chief financial officer, is in the doghouse after being linked to what his former employer called "a mind-blowingly stupid" decision. The vets-to-pets group said that Graeme Jenkins would not, after all, be joining it and the decision was taken "by mutual agreement." (http://bit.ly/1SKk01Y)

* Austin Reed, the struggling menswear outfitter, is lining up an adviser to help it to carry out a financial restructuring only a year after shutting 31 stores. The Times reported it understands that the retailer is holding discussions with AlixPartners on proposals to help to ensure its survival on the high street, where it has had a presence since 1900. (http://bit.ly/1S68Gzz)

The Guardian

* The legality of Britain's surveillance laws will come under the scrutiny of 15 European judges on Tuesday in a politically sensitive test case that could limit powers to gather online data. The outcome of the hearing at the European Court of Justice in Luxembourg is likely to influence the final shape of the government's investigatory powers bill and will test judicial relationships within the EU. (http://bit.ly/1SZEfLx)

* Britain's competition regulator has called on the European Commission to block the owner of Three's 10.25 billion pound acquisition of O2, or force the combined mobile phone operator to break itself up to protect consumers. (http://bit.ly/22nSa0C)

The Telegraph

* Royal Bank of Scotland has purchased 2.3 billion pounds of its own bonds in an effort to cut its borrowing costs and move closer to turning a profit. (http://bit.ly/1YqznRe)

* Boardroom tensions at insurer CPP Group have reached the boiling point after the company applied for a High Court injunction to stop founder Hamish Ogston being able to vote to remove the board. (http://bit.ly/1N59x4u)

Sky News

* The government could co-invest with a buyer to save the Port Talbot steelworks, the business secretary has told MPs. Sajid Javid made his comments after the current owner, Tata Steel, confirmed it was contacting "many tens" of potential buyers for the South Wales site - adding that it would prefer one buyer. (http://bit.ly/1Vk2KqQ)

* Prime Minister David Cameron has defended his family's financial affairs as he faced MPs two days after publishing his own tax details. The prime minister maintained that Blairmore Holdings, his father's offshore investment fund, was not set up for tax avoidance purposes, and he hit out at "deeply hurtful and profoundly untrue allegations" about his late father.

The Independent

* The government could buy a stake in the Port Talbot steelworks to save it from closure, the business secretary has said. Sajid Javid said the government was considering "co-investing" with a buyer to save jobs at the plant, which is currently owned by Tata Steel. (http://ind.pn/1Scgenx)

* Tata Steel has sold its Long Products Europe business, including its Scunthorpe plant, to investment firm Greybull Capital in a move that will save more than 4,000 jobs, the company has confirmed. (http://ind.pn/1XqtRO6)



http://www.zerohedge.com/news/2016-04-12/frontrunning-april-13
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#15
Futures Rebound On Weaker Yen; Oil Hits 2016 Highs


Submitted by Tyler Durden on 04/12/2016 06:54 -0400


In recent days, we have observed a distinct trading pattern: a ramp early in the US morning, usually triggered by some aggressive momentum ignition, such as today's unexplained pump then dump in the EURUSD...





... with stocks rising after the European open, rising throughout the US open, then peaking around the time the US closed at which point it is all downhill for the illiquid market.

So far today, the pattern has held, and after trading flat for most of the overnight session, with Europe initially in the red perhaps on disappointment about the Italy bank bailout fund, a bout of early Europe-open associated buying pushed US futures up, following the first rebound in the USDJPY after 7 days of declines which also helped the Nikkei close 1.1% higher (even though as BBG notes, investors in the options markets don’t seem to share enthusiasm that the USDJPY will rebound as the premium for USD/JPY puts over calls is 164 bps versus 161 bps yesterday; has climbed about 94 bps in favor of puts in just this month).

Oil, likewise, has continued to climb and earlier hit new 2016 highs when WTI rose just 9 cents shy of $41 on the same recurring catalyst: the Doha OPEC meeting (where even Russia admitted yesterday nothing will happen), and hopes shale production will contract even as many companies reactivate DUCs and quite the opposite may in fact happen.

Brent crude was up 50 cents at $43.33 a barrel at 0842 GMT and earlier in the session reached a 2016 high of $43.53. U.S. crude gained 39 cents to $40.75 a barrel. "The weak dollar is one important reason," said Eugen Weinberg of Commerzbank. "Also, the fact that we are above $40 and at multi-month highs is also contributing to the price increase as it is prompting some speculative buying."

As Reuters adds, also supporting prices was rising vehicle sales in China - a further sign of strong gasoline demand in the No. 2 consumer - and a plan by thousands of oil and gas workers in Kuwait to go on strike from Sunday. "If it is not clear if the strike will last long and will have any meaningful impact on exports or domestic production (including refineries), it does illustrate further the amount of pain that (Gulf) oil producers are also facing at current price levels," said Olivier Jakob, analyst at Petromatrix.

For now, however, as Bloomberg puts it, "crude oil’s advance above $40 a barrel boosted economic optimism" and the MSCI All-Country World Index advanced for a third-straight day and Russia’s ruble joined the Australian dollar and Norway’s krone among the best-performing currencies. Metals prices jumped, helping push the Bloomberg Commodity Index to the highest this month.

The key catalyst preserving stability for the time being are emerging markets which are "strong, mainly on the back of the weak U.S. dollar and strong oil," Maarten-Jan Bakkum, a senior strategist at NN Investment Partners, told Bloomberg. "Flows have clearly improved, Chinese risks are lower for the short term, but we do not see a convincing improvement in growth momentum yet."

Here is a snapshot of where markets stand right now:

  • S&P 500 futures up 0.3% to 2040.6
  • Stoxx 600 up 0.1% to 333.1
  • Euro Stoxx 50 up 0.1%
  • FTSE 100 up -0.2%
  • DAX up 0.4%
  • Euro up 0.21% to $1.1432
  • Italian 10Yr yield up 1bps to 1.35%
  • Spanish 10Yr yield up 1bps to 1.52%
  • US 10Yr yield up 3bps to 1.76%
  • Dollar Index down 0.17% to 93.79
  • German 10Yr yield up 4bps to 0.15%
  • MSCI Asia Pacific up 1% to 127.9
  • Nikkei 225 up 1.1% to 15928.8
  • Hang Seng up 0.3% to 20504.4
  • Kospi up 0.6% to 1981.3
  • Shanghai Composite down 0.3% to 3023.6
  • Gold spot up 0.2% to $1260.4/oz
  • Brent Futures up 1.4% to $43.4/bbl
  • WTI Futures up 0.6% to $40.62/bbl
Top Global News

  • ‘Brexit’ Akin to Unilateral Disarmament, David Miliband to Say: Miliband will be speaking in London today
  • Nomura Said Planning to Exit European Equities, Cut 1,000 Jobs
  • Italy Forms $5.7b Fund to Shake Off Doubts in Banks: Atlante fund managed by Quaestio Capital investment firm
  • Spain Heading for Fresh Elections as Podemos Targets Socialists: lawmakers must choose leader by May 2 or new vote triggered
  • Roche Sees Superior Efficacy of Ocrelizumab in Relapsing MS: comments in emailed statement
  • Vivendi to Acquire Equity Interest in Fnac of About 15%: move is part of strategic partnership for cultural activities
  • Shell CEO Van Beurden Sees Iran as Investment Opportunity: Van Beurden speaks to reporters in Perth, Australia
  • AB InBev Offers Remedies to EU in Review of SABMiller Deal: EU sets new deadline of May 24 to rule on beer deal after getting commitments offer
Looking at regional markets, we start in Asia where equities shrugged off Wall St.'s weak lead with the region's bourses mostly positive on short-covering. Nikkei 225 (+1.2%) recovered from opening losses to trade higher by over 1% as participants found a reprieve from a pause in JPY strength and took the opportunity to bargain hunt following yesterday's declines. ASX 200 (+0.6%) traded higher led by financials and materials with the latter underpinned by strength across commodities in which iron ore rose nearly 5%. Elsewhere, Chinese markets saw mixed trade after the PBoC upped its liquidity injections and China released a negative list for investment which included steel and coal as off-limit sectors. 10yr JGBs traded marginally higher despite heightened risk appetite in Japan with today's 10yr inflation-linked auction printing a higher than prior b/c, while yields in the super-long-end were also under mild pressure with the 30yr yield falling to a fresh record low.

Top Asia News

  • CIC, Ormat, Malakoff Said to Weigh Bids for Chevron Asian Assets: Bids due end-May for $3b of Asian geothermal fields
  • Chinese Debtors Have Never Faced Such Hard Times Paying Interest: Oper. profit double interest costs, down from ratio of six
  • Strengthening Yen Leaves Kuroda Facing More Radical Options: Credit Agricole joins those forecasting action in April
  • Indian Bankers Said to Be Wary of Solar as SunEdison Totters: Financial risks seen from rock-bottom Indian solar power rates
An air of caution swirls in European equities ahead of the forthcoming slew of US earnings as the Eurostoxx oscillated between gains and losses, with luxury names lower this morning amid soft earnings from large cap LVMH. However, EU bourses pared the entirety of their earlier declines amid the upside in the commodities complex supporting miners with Anglo American also driving higher on the back of higher diamond sales from their De Beers unit. Elsewhere, pull back in European stocks saw Bunds trip below yesterday's low situated at 163.74, with the long end weighed given the long-duration supply, including a Buxl auction and the 20 and 50 dual tranche from France.

European Top News

  • Asos 1H Retail Gross Margin Beats, On Track to Achieve Outlook: 1H retail gross margin up 40bps, est. up 7bps
  • Lonmin CFO to Step Down, Sucessor Search at an Advanced Stage: Simon Scott to stand down as CFO and director
  • Mercedes Sales Climb Twice as Fast as BMW in 1Q: Daimler is closing in on goal of overtaking German rival
  • EPH Utility Plans Infrastructure Unit IPO in Prague, London: Czech utility expects to complete unit offering this quarter
  • Al-Thani Private Bank KBL to Buy Dutch Firm From BNP Paribas: KBL plans Insinger de Beaufort & Theodoor Gilissen combination
  • BayWa in Talks With U.K., European Investors to Sell Solar Farms: BayWa still to short-list candidates
In FX, stronger than forecast UK inflation has given GBP a fresh bid, with Cable having extended through a series of resistance levels, but topping out at 1.4320 as yet (last week's high). EUR/GBP was knocked back under .8000, and with EUR/USD holding 1.1465-70 resistance in another test higher (traded 1.1464), the pullback has added some fresh momentum in the cross rate. The USD as a whole has lost yet more ground on the day, with the commodity rates all benefitting. NZD has traded to within a few ticks of .6900 again, while AUD/USD has tipped .7670. USD/CAD has fallen to just shy of 1.2850, matching the recent lows, but a clean break below here required to suggest a deeper move towards 1.2500-1.2600. The USD index now not too far off stronger support levels in the mid 92.00's, with the more cautious approach by the Fed still keeping the greenback offered. USD/JPY is digging in a little though, but 107.60-108.40-45 still containing trade here for now — stocks keenly watched. Swedish inflation also stronger than expected, and giving the SEK a fresh bid — long term highs vs the USD matched just under 8.0300.

In commodities, energy prices enter the US session in positive territory with WTI holding above the USD 40/bbl handle. In terms of energy specific newsflow, this has been somewhat light this morning but according to a spokesman of KNPC, Kuwait has stopped exporting oil from all ports due to bad weather. Elsewhere gold rose in European trade remain around 3-week highs amid the softness in the USD-index, while iron ore extended on its advances alongside strength in steel prices, which posted 10-month highs.

Bulletin Headline Summary from RanSquawk and Bloomberg

  • European equities pare their opening losses while luxury names fall on the back of soft LVMH sales.
  • UK CPI drives GBP higher, with GBP/USD breaking above the 1.4300 level with gains further exacerbated by the weaker greenback.
  • Looking ahead, highlights include US Import Price Index, API Crude Oil Inventories and Fed's Harker.
  • Treasuries lower in overnight trading as global equity markets, WTI crude oil and metals rally; week’s auctions begin with $24b 3Y notes, WI 0.86%; sold at 1.039% in March, was second straight 3Y auction to tail after all but one of previous 19 stopped through.
  • Alcoa Inc. cut forecasts for its largest manufacturing unit as the biggest U.S. aluminum producer prepares to split itself in two amid slumping profit, 1Q net income fell 92 percent to $16 million
  • Italian officials and bank executives agreed to create a multibillion-euro fund to help troubled lenders raise capital and offload bad loans, as the nation tries to assuage investor jitters. The new vehicle will be named Atlante
  • Nomura plans to shut down its European equity operations and cut 1,000 jobs as it reduces costs after years of failing to become profitable overseas, a person with knowledge of the matter said
  • At its annual investor conference in San Francisco in May 2014, with oil trading at $102 a barrel, Wells Fargo boasted that in just two years it had almost doubled its energy exposure and seized the title of Wall Street’s top oil and gas banker. The timing couldn’t have been worse
  • U.K. inflation accelerated to a 15-month high in March as an early Easter boosted air fares and clothing prices increased. Consumer prices rose 0.5% from a year earlier, the fastest pace since December 2014
  • Just as monetary easing is pushing Chinese bond yields to record lows, firms generated just enough operating profit to cover the interest expenses on their debt twice, down from almost six times in 2010
  • The Bank of Japan is reducing the share of funds financial institutions keep at the BOJ that will be subject to the new negative interest rate policy
  • Brazilian lawmakers pushed President Dilma Rousseff a step closer to impeachment after a committee in the lower house voted for her ouster in the first formal test of sentiment in Congress
  • Sovereign 10Y bond yields mostly higher; European, Asian equity markets higher; U.S. equity-index futures rise. WTI crude oil, gold and copper rally
US Event Calendar

  • 6:00am: NFIB Small Business Optimism, March, est. 93.5 (prior 92.9)
  • 8:30am: Import Price Index m/m, March, est. 1% (prior -0.3%)
  • Import Price Index y/y, March, est. -4.8% (prior -6.1%)
  • 2:00pm: Monthly Budget Statement, March, est. $104b (prior $52.9b)
Central Banks

  • 9:00am: Fed’s Harker speaks in Philadelphia
  • 3:00pm: Fed’s Williams speaks in San Francisco
  • 4:00pm: Fed’s Lacker speaks in Wilmington, N.C.
Supply

  • 11:30am: U.S. to sell $35b 4W bills
  • 1:00pm: U.S. to sell $24b 3Y notes
DB's Jim Reid wraps up the overnight summary

yesterday saw the starting whistle blown for Q1 with Alcoa unofficially getting things started after the closing bell. The numbers were fairly mixed. While earnings came in above consensus, a miss on revenues and a downgrade to full year aluminium demand saw shares down 3% or so in extended trading. Prior to this it had felt like markets were in a bit of a wait and see mode with little else to particularly drive sentiment. That said, momentum certainly faded as the US session in particular wore on with the S&P 500 eventually finishing last night with a -0.27% loss. This came after performance for most European bourses had been relatively positive (Stoxx 600 +0.30%, DAX +0.63%) and after further gains for Oil, with WTI rising +1.61% and closing back above $40/bbl again.

This morning in Asia and outside of a slight reversal for markets in China, the tone is relatively positive with Japan in particularly leading the way. The Nikkei is currently +1.23% and gaining as the session wears on, with the move coinciding for a softer day for the Yen (-0.26%) which is coming off the back of seven consecutive days of gains. The Hang Seng (+0.20%), Kospi (+0.44%) and ASX (+0.68%) are all following suit, while credit markets are generally posting modest gains. It’s China which is the relative underperformer however with the Shanghai Comp -0.65%. Despite Alcoa shares dropping last night, US equity index futures are currently flashing green on our screens.

The modest weakening for the Yen this morning has seen it hover just north of 108 meanwhile. Yesterday, DB’s George Saravelos published a note highlighting that Japan’s biggest problem with the recent Yen rally is that it is justified by fundamentals, with the bulk of metrics suggesting that USDJPY is still expensive or just approaching fair value. George highlighted that taking the average of three of DB’s FX valuation models, he and his team come up with a USD/JPY equilibrium rate of 97, more than 10% below current levels. There are two implications of this. Firstly, it is unlikely that Japanese FX intervention is going to be very successful in pushing USD/JPY significantly higher - there is no misalignment to correct in the first place. The very public commitments the G20 have made against competitive devaluations make large-scale, sustained intervention even less likely. Second, unless the BoJ can convince the market that it is able to bring inflation expectations back up (and real yields down) it is unclear what can be done to reverse the yen rally. On the one hand, the market is likely to challenge the reflationary impact of further rate cuts into negative territory. On the other hand, an expansion of JGB purchases seems more straightforward, but it is not clear how many more marginal JGB holders are left to squeeze out into other (foreign) assets.

Back to yesterday. One notable snippet of news was out of Italy with the announcement from PM Renzi that following drawn out talks, Italian officials and financial institutions have agreed on the terms for a €5bn bailout fund aimed at shoring up the weaker banks through raising capital and unloading bad loans. According to the FT the deal apparently defied expectations that it could have been softened at the last moment, while the terms of the deal show that in return for providing private funds, the Italian government has agreed to align Italy’s laws around bankruptcy (previously seen as being behind the times) with the rest of Europe. Unsurprisingly it was Italian equities which were the relative outperformer yesterday in anticipation of the news with the FTSE MIB gaining +1.25%, driven by big moves higher for the Banks with the likes of Banco Popolare and also Banca Monte dei Paschi gaining +10.30% and +9.78% respectively.

Staying in Europe, sovereign bond yield curves were generally a bit steeper by the close yesterday with 10y Bunds in particular back above 10bps in yield after moving nearly 2bps higher to 0.109%. With the shorter end of the curve dipping lower however, it was interesting to note that the average yield for all outstanding German Bunds fell to 0% yesterday for the first time in history. The Bundesbank once-a-day quoted rate (also known as the Umlaufrendite) had been testing that level for some time but notably failed to quite reach the historic level in April last year (when it got as low as 5bps) during the big rally across rates markets.

With regards to some of the macro, while there was a complete lack of economic data for investors to dig their teeth into, we did hear from the Dallas Fed President Kaplan who played down the possibility of a hike this month (which won’t come as a surprise) but highlighted that ‘it is worth in this environment being patient and basically being willing to be cautious and let events unfold’ before suggesting that he is open minded to the possibility of possible tightening at the June meeting. Kaplan also made mention to what is likely to be a soft Q1 GDP report for the US, indicating that this is ‘probably inconsistent with the job numbers’. Kaplan did however suggest that his forecasts have growth bouncing back in the next couple quarters.

Looking at the day ahead, after a fairly sparse calendar yesterday, the diary is a little busier today. This morning in Europe and shortly after we go to print we’ll get the final revisions to the March CPI report in Germany. Following this and later this morning in the UK we get the latest inflation report including the CPI/RPI/PPI data docket. This afternoon in the US we get last month’s import price index reading, as well as the latest data from the NFIB small business optimism survey. Later on this evening we’ll get the March Monthly Budget Statement. Away from the data, the next round of Fedspeak comes out of Harker (2pm BST), Williams (8.00pm BST) and Lacker (9.00pm BST).

http://www.zerohedge.com/news/2016-04-12/futures-rebound-weaker-yen-oil-hits-2016-highs
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#16

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#20
Ted Cruz Steals Colorado Delegates With No Votes. Secret Obama Yellen Meeting
Fabian4Liberty


Published on Apr 11, 2016
Ted Cruz Steals Colorado Delegates With No Votes. Secret Obama Yellen Meeting

Colorado will not vote for a Republican candidate for president at its 2016 caucus after party leaders approved a little-noticed shift that may diminish the state's clout in the most open nomination contest in the modern era.

Read more here: http://www.denverpost.com/news/ci_287...

GOP Establishment Money Funding Mark Levin, Glenn Beck, Erick Erickson To Attack Trump

Read more: http://dailycaller.com/2016/04/08/gop...

Obama to meet Fed Chair Yellen on Monday
http://www.cnbc.com/2016/04/11/obama-...
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#21
MUST WATCH: Federal Reserve April Surprise
Fabian4Liberty


Published on Apr 12, 2016
The Federal Reserve had an emergency closed door secret meeting yesterday and than Janet Yellen met with Barack Obama behind closed doors. What was discussed and is an April Surprise in the cards?
 

Argent Dragon

Site Support
Site Bus
Site Supporter
Joined
Mar 29, 2010
Messages
8,280
Likes
2,999
Location
Lone Star State
#22

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#24
What in the World is Going on with Banks this Week?
By: David Haggith
Just about every major banker and finance minister in the world is meeting in Washington, D.C., this week, following two rushed, secretive meetings of the Federal Reserve and another instantaneous and rare meeting between the Fed Chair and the president of the United States. These and other emergency bank meetings around the world cause one to wonder what is going down.


Gold Seeker Closing Report: Gold Gains and Silver Rises Almost 2%
By: Chris Mullen, Gold-Seeker.com
Gold gained $6.35 to $1262.45 in Asia before it fell back to $1251.17 by midmorning in New York, but it then bounced back higher into the close and ended with a gain of 0.02%. Silver rose to as high as $16.207 and ended with a gain of 1.7%.
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#25
Dollar Falls To 9 Month Low. What Does Silver Do?
SalivateMetal


Published on Apr 12, 2016
What happens to silver when the dollar falls?
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#27
Frontrunning: April 13


Submitted by Tyler Durden on 04/13/2016 07:47 -0400


  • China trade surprise gives stocks a lift (Reuters)
  • JPMorgan profit hurt by drop in investment banking revenue (Reuters)
  • About 40,000 Verizon workers launch strike (Reuters)
  • Regulators Set to Reject Some Big Banks’ ‘Living Wills’ (WSJ)
  • More Startups Are Getting Lower Valuations Than Joining the Billion-Dollar Club (BBG)
  • Closures and court cases leave Turkey's media increasingly muzzled (Reuters)
  • PBOC Seen Averting Cash Shortage as $155 Billion Leaves Market (BBG)
  • Mossack Fonseca Says It's Cooperating After Panama Office Raids (BBG)
  • Tax-Rule Changes Ripple Widely (WSJ)
  • VW says management bonuses to be cut significantly (Auto News)
  • IMF Sees No Cause for Japan to Intervene Now in Currency Market (BBG)
  • China Steelmaker Misses 3rd Bond Payment as Defaults Spread (BBG)
  • Syrians vote for parliament as diplomacy struggles (Reuters)
  • Who Loses the Most From ‘Brexit’? Try Goldman Sachs (WSJ)
  • Coal Slump Sends Mining Giant Peabody Energy Into Bankruptcy (BBG)
  • In Libya, Islamic State struggles to gain support (Reuters)
  • Inside the Nondescript Building Where Trillions Trade Each Day (BBG)


Overnight Media Digest

WSJ

- Regulators are set to reject the so-called living wills of at least half of the U.S.'s systemically important banks, including J.P. Morgan Chase & Co, sending them scrambling to revise plans for a potential bankruptcy, according to people familiar with the matter.(http://on.wsj.com/1Vl4q2K)

- The Treasury Department's new corporate rules will reach far beyond the few companies that moved their legal addresses to low-tax countries, forcing many firms based in the U.S. to change their internal financing strategies and tax planning. (http://on.wsj.com/1TQkMiR)

- A large holder of Valeant Pharmaceuticals International Inc's bonds called a default as a result of the Canadian drugmaker's failure to file its annual report earlier this year, adding to the litany of woes it faces. (http://on.wsj.com/1VTibEJ)

- Chip maker Integrated Device Technology was the subject of a mysterious regulatory filing Tuesday, submitted by individuals claiming to own a chunk of the company and looking to buy the rest of it at a steep premium. (http://on.wsj.com/1qPDifX)

- The Central Intelligence Agency and its regional partners have drawn up plans to supply more-powerful weapons to moderate rebels in Syria fighting the Russia-backed regime in the event the country's six-week-old truce collapses.(http://on.wsj.com/1YsO9Hb)



FT

Oil services provider Schlumberger is cutting back on some of its activity in Venezuela due to insufficient funds. (http://bit.ly/1T2s4xu)

Deutsche Bank AG has frozen plans to expand in North Carolina after a law that overturns protections for gay people. (http://bit.ly/1T2sfsQ)

U.S. House of Representatives Speaker Paul Ryan ruled himself out as a potential Republican presidential nominee, ending speculation that he could be a choice if Donald Trump and Ted Cruz failed to win enough delegates. (http://bit.ly/1T2sEeT)



NYT

- As Puerto Rico has spiraled toward possible bankruptcy, the island's sole representative in Congress has seen his family wealth swell, thanks in part to Wall Street companies that have sought to capitalize on the island's financial crisis and have hired his wife to advise them. (http://nyti.ms/1YsNUvN)

- The Swiss authorities said that they had started a criminal investigation into two officials in charge of a sovereign wealth fund in Abu Dhabi, in the United Arab Emirates, as part of an inquiry into the financial transactions of the troubled Malaysian state investment fund 1Malaysia Development Berhad. (http://nyti.ms/1SyfLWH)

- The world's finance ministers opened their annual spring meeting on Tuesday facing dampened expectations for global growth and warnings about financial risks and political movements toward nationalism and protectionism - in the United States and abroad. (http://nyti.ms/1WqTkc4)

- European Union officials waded into the fight against international tax dodging, calling for the world's biggest companies to disclose more data about their tax arrangements with the bloc's member governments and to share information about offshore havens where they shelter money. (http://nyti.ms/1SM29Yt)



Britain

The Times

Inflation has risen to its highest level in nearly 18 months, with prices pushed higher by an early Easter holiday and a rise in airfares, the Office for National Statistics said. A 22.9 percent rise in the cost of flights in March was largely responsible for the better-than-expected 0.5 percent increase in the consumer prices index, the statistics office said. (bit.ly/1Xu46fV)

Royal Dutch Shell has signalled that it is likely to sell some of its older North Sea assets. Ben van Beurden, Shell's chief executive, said that the company would have to consider its operations in the region as he sets about delivering the $30 billion of disposals earmarked when announcing the 36 billion pound acquisition of BG Group last year. (bit.ly/1NniSzn)


The Guardian

B&Q is offering workers two years' compensation and further negotiations over their pay packages after nearly 136,000 people signed a petition against the retailer's planned cuts to employee benefits. (bit.ly/1RSw6JW)

Tax investigators from 28 countries will meet in Paris on Wednesday to launch an unprecedented international inquiry following the publication of the "Panama Papers". (bit.ly/1NmSSEr)


The Telegraph

Major Tory donors are preparing to fund a grassroots campaign to leave the European Union following David Cameron's decision to spend millions of pounds on a pro-EU leaflet, the Telegraph can disclose. (bit.ly/1oVyJ1V)


Amazon.com Inc is in talks with British broadcasters to add their channel brands and programmes to its streaming service. The company is attempting to adapt its American Streaming Partners Programme to the UK media market and make its Prime Instant Video service and Fire TV set-top box hardware into a more credible alternative to Sky and Virgin Media, and give it an edge over Netflix Inc. (bit.ly/1SLO1yl)


Sky News

Large companies operating in the European Union will be forced to publish key information on the profits they make and taxes they pay in each EU country under plans published on Tuesday. (bit.ly/1S50EVm)

Brexit could cause severe damage to the global economy, the International Monetary Fund has warned. The IMF used its closely-watched World Economic Outlook report to slash its forecast for UK economic growth and warned if Britain were to leave the European Union it "could do severe regional and global damage by disrupting established trading relationships". (bit.ly/20zOCcf)

The Independent

Greater transparency could be imposed on multinational companies operating in the European Union after the European Commission unveiled plans to require all large firms to disclose their profits earned and taxes paid in each of the bloc's countries, as well as in overseas tax havens. (ind.pn/1MrQQrK)

A formal inquiry is to open into the UK Home Office's treatment of international students after Home Secretary Theresa May wrongly deported almost 50,000 students in the wake of the TOEIC English exam scam. (ind.pn/1SLtwSe)


http://www.zerohedge.com/news/2016-04-13/frontrunning-april-13
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#28
Futures Jump On Chinese Trade Data; Oil Declines; Global Stocks Turn Green For 2016


Submitted by Tyler Durden on 04/13/2016 06:49 -0400


With oil losing some of its euphoric oomph overnight, following the API report of a surge in US oil inventories, and a subsequent report that Iran's oil minister would skip the Doha OPEC meeting altogether, the global stock rally needed another catalyst to maintain the levitation. It got that courtesy of the return of USDJPY levitation, which has pushed the pair back above 109, the highest in over a week, as well as a boost in sentiment from the previously reported Chinese trade data where exports rose the most in over a year, however much of the bounce was due to a favorable base effect from last year's decline. Additionally, as RBC reported, the 116.5% y/y increase in China’s reported March imports from HK likely reflects the growing trend of "over-invoicing", which is merely another form of capital outflow.



In other words, which giving the impression that growth is stabilizing, China was really just covering up for even more outflows. Curiously the onshore yuan fell 0.06%, shrugging off the "better-than-forecast" China March exports data, suggesting that at least the FX market may have been paying attention.

Equities, however, were not, and as a result global stocks advanced higher for one more session, wiping out the year’s declines.



Copper and iron ore were among the beneficiaries, while haven assets including the yen and gold retreated.

“The commodity sector is well supported after the good numbers out of China,” said Benno Galliker, a trader at Luzerner Kantonalbank AG in Lucerne, Switzerland. “Most investors were under-invested or were on the downside, they all thought we should see a bigger correction. Everything can turn around if we see negative numbers from the U.S. banks.”

Additionally, European stocks rose for a fourth day, shares in emerging markets climbed to the highest since November, and China’s equities traded in Hong Kong gained the most worldwide, as the Asian nation’s exports surged. Futures on the Standard & Poor’s 500 Index rose half a percent, as investors awaited earnings from JPMorgan Chase & Co.

This is where global markets stand now:

  • S&P 500 futures up 0.5% to 2066
  • Stoxx 600 up 1.9% to 341.1
  • Eurostoxx 50 +2.2%
  • FTSE 100 +1.5%
  • CAC 40 +2.4%
  • DAX +2.3%
  • Dollar Index up 0.57% to 94.49
  • US 10Yr yield up 1bps to 1.78%
  • German 10Yr yield down 1bps to 0.15%
  • MSCI Asia Pacific up 1.9% to 130
  • Nikkei 225 up 2.8% to 16381.2
  • Hang Seng up 3.2% to 21158.7
  • Kospi up 0.6% to 1981.3
  • Shanghai Composite up 1.4% to 3066.6
  • Brent Futures down 0.9% to $44.3/bbl
  • WTI Futures down 1.3% to $41.6/bbl
  • Gold spot down 0.8% to $1245.1/oz
Global Top News

  • China’s Exports Jump Most in a Year, Boosting Growth Outlook: Shipments +11.5%, imports moderate drop to 7.6%
  • Oil Extends Losses as Speculation Swirls Over Doha Output Talks: Iran’s oil minister won’t attend freeze meeting, Seda reporter says
  • Business Groups Warn ‘Brexit’ Would Hurt Trade and Investment: employer groups from four EU partners urge U.K. to stay in
  • Pound’s Rally if Voters Reject ‘Brexit’ Predicted to Be Fleeting: Pioneer, Julius Baer see maximum 4% gain on vote to stay in EU
  • Euro-Area Industrial Production Plunges Most in 18 Months
  • Panama Prosecutor Raids Mossack Fonseca Office, La Prensa Says: newly created prosecutor carried out inspection yday
  • French Govt Maintains Forecast for 1.5% GDP Growth in 2016: sees govt deficit of 3.3% of GDP in 2016 and 2.7% in 2017
  • Bilfinger Says CEO Resigns, To Be Replaced in Interim by CFO: confident will be able to appoint new CEO shortly
  • McCormick Abandons Bid for U.K.’s Premier Foods Over Price: Premier had rejected three advances from U.S. spice producer
Looking at regional markets, we start with Asia where equity markets took the impetus from a firm Wall St. lead as a resurgence in the commodities complex and firm Chinese Trade data bolstered sentiment. This underpinned large commodity names in the ASX 200 (+1.3%) following oil's surge to YTD highs on reports Russia and Saudi reached a consensus on an output freeze, while iron ore also climbed towards the USD 60/ton level. Nikkei 225 (+2.6%) advanced above 16000 on JPY weakness with index giant Fast Retailing also gaining after a reduction in Uniqlo prices, while Shanghai Comp (+2.1%) completed the optimistic tone following strong trade figures which showed exports rose 18.7% in CNY terms and expanded by the most in a year in USD terms. Finally, 10yr JGBs were pressured following the heightened risk-appetite across the region which dampened safe-haven demand alongside BoJ operations which attracted more selling interest.

Top Asian News

  • PBOC Seen Averting Cash Shortage as $155 Billion Leaves Market: Central bank may extend loans, ease reserve ratio
  • Japan’s Economic Recovery Is Still Weak, Says BOJ’s Harada: He sees consumption is probably flat, GDP increasing slightly
  • Singapore Set to Skip Easing to Save Tools for Brexit, China: No reason to change policy now, Nomura’s Chan says
  • China Steelmaker Misses 3rd Bond Payment as Defaults Spread
  • JPMorgan Said to Trim 5% of Jobs at Asia-Pacific Wealth Unit: Bank has cut about 30 jobs at the business
  • Wall Street Gives Up on India Funds as JPMorgan Joins Exodus:Goldman Sachs, Morgan Stanley have already exited India funds
European equities are in a bullish mood underpinned by the better than expected China trade data, subsequently dispelling concerns over slowing global growth. Also, gains across Europe has been attributed to the upside in the region's largest oil producers as energy prices remain near 4-month highs. This had been inspired by yesterday's source reports that Russia and Saudi Arabia have come to a consensus regarding a freeze in oil production. However, one of the notable underperformers this morning is Tesco (-4.5%) after cautious comments on their near-term outlook despite returning to profit. Elsewhere, Bunds initially bounced back from the softer open amid unwinding of the recent supply concession, coupled with support from redemption flow. Additionally, analysts at IFR note an absence of leveraged selling providing a reprieve for German paper.

Top European News

  • Tesco CEO Lewis Gives Reality Check as Turnaround Progresses
  • Deutsche Bank Said to Hire Citi’s Boyle to Help Lead Derivatives: Boyle to co-head equity derivatives, run Asia Pacific equities
  • Medivation Said to Have Rebuffed Sanofi Takeover Approach: Drugmaker Sanofi hasn’t ruled out hostile bid for U.S. company
  • VW Chairman Said to Accept Bonus Cut to Quell Board Unrest: Unions, govt called for reduction in management payouts
  • Tata Steel Said to Set May 28 Date for U.K. Ops Sale: FT: Tata Steel plns to close down its UK arm if it is unable to negotiate a viable sale by that date
  • RWE Sees U.K. Profit Recovering as It Seeks to Win Back Clients: plans to cut U.K. workforce by 21% after posting 2015 loss
  • Fnac Is Studying Possible New Offer for Darty, Le Figaro Says: co. believes that many Darty holders are willing to accept its shares as part of a new offer
  • Dassault Aviation CEO Hopes to Sign India Rafale Deal Soon: CEO Eric Trappier speaks on Radio Classique
  • Berkeley Wins Approval for 652 Homes in West London Project: The project was approved late Tuesday by Westminster council
  • Elekta Names Richard Hausmann New CEO: Hausmann will join May 1 and take over as CEO on June 10
In FX, a morning of correction for USD/JPY, pushing through the 109.09 highs from Friday and on course for a potential test towards 110.00, but progress is slow. That said, the USD index is in recovery mode, and this has been largely facilitated by the EUR/USD push on 1.1300 lower down. A break below here threatens a stop loss sell off, and we suspect this will materialise as USD momentum is building up. EU industrial production was softer than expected, prompting the move down to 1.1307, and the bounce has been minimal at best. The commodity currencies are faring well, with AUD and NZD having reclaimed .77 and .69 respectively, though the former struggling to hold on to better levels. Oil has turned back off the highs post API, and this looks to have given USD/CAD a bid under 1.2750. 1.2800+ a struggle, and will remain so into the BoC later. US retail sales key.

In commodities, heading into the North American crossover, WTI and Brent crude futures trade in modest negative territory. In terms of recent news flow, according to Al Hayat, the Saudi Oil Minister has ruled out cut in crude output, while source reports note that the Iranian Oil Minister is to not attend the Doha meeting which is to no overall surprise. Given that Iran have remained firm in their decision to not take part in the freezing of oil output as they look to increase output to pre-sanction levels. However, conflicting reports later noted that the Iranian Oil Minister has yet to make a decision to attend the April 17th talks.

Some more details on China commodity trade data:

China March crude imports were at 7.68min, which is just off the February record of 8min bpd. China Q1 crude imports rose 13.4% Y/Y to 7.31 min bpd.

China March iron ore imports rose 16.5% to 85.77min tons vs. Prey. 73.61 min tons in February, March copper imports rose to 570k tons vs. Prey. 420k tons in February and China steel products exports rose 23.1 % to 9.98min tons vs. Prey. 8.11min tons in February, according to China customs bureau. Furthermore, China Jan-Mar iron ore imports rose 6.5% Y/Y, Jan-Mar copper imports rose 30.1% Y/Y and Jan-Mar crude oil imports rose 13.4% Y/Y.

Gold prices have been pressured for much of the morning amid the heightened risk-appetite across the region following firm Chinese trade data, allied with the uptick in the USD-index. The aforementioned better than expected Chinese trade figures also bolstered copper and iron ore prices with the latter gaining as much as 5% alongside similar advances in steel.

On today's calendar we get retail sales numbers there will also be a close eye kept on the March PPI report, while business inventories are also due. Later this evening we’ll see the Fed’s Beige Book released. As highlighted earlier, JP Morgan is the highlight of today’s earnings releases.

Bulletin Headline Summary from RanSquawk and Bloomberg

  • European stocks edge higher on the back of firm Chinese trade data, while Tesco underperforms amid cautious profit guidance.
  • USD-index pulls away from its recent near 8-month lows to weigh on its major counterparts.
  • Looking ahead, highlights include Bank of Canada Rate Decision, US Business Inventories, PPI Final Demand, and Retail Sales.
  • Treasuries lower in overnight trading, global equity markets surge higher as Chinese trade data cheers investors; week’s auctions continue with $20b 10Y notes, WI 1.795%; last sold at 1.895% in March, compares with 1.73% in February.
  • China’s exports rose 11.5% in dollar terms in March, the most in a year, and declines in imports narrowed, adding to evidence of stabilization in the world’s second-biggest economy
  • China’s regulators are considering allowing global investors freer access to the nation’s market
  • U.S. coal giant Peabody Energy Corp. filed for bankruptcy on Wednesday, the most powerful convulsion yet in an industry that’s enduring the worst slump in decades
  • Russia sees a deal to freeze oil output as possible when it meets other producers including Saudi Arabia this weekend, regardless of Iran’s stance
  • The regulator that helps oversee U.K. banks and brokerages proposed changing the process for initial public offerings to reduce favoritism and ensure that investors are better informed
  • European Central Bank Governing Council member Klaas Knot called for “patience and reality” over ultra-loose monetary policy as concerns mount over the impact on pensions and savings
  • Euro-area industrial production fell 0.8% in February, the most in 18 months, giving up some of the surge seen at the start of the year
  • Sovereign 10Y bond yields mixed with Greece +16bp; European, Asian equity markets higher; U.S. equity-index futures rise. WTI crude oil, precious metals drop; copper rally
US Event Calendar

  • 7:00am: MBA Mortgage Applications, April 8 (prior 2.7%)
  • 8:30am: Retail Sales Advance m/m, March, est. 0.1% (prior -0.1%)
    • Retail Sales Ex Auto m/m, March, est. 0.4% (prior -0.1%)
    • Retail Sales Ex Auto and Gas, March, est. 0.3% (prior 0.3%)
    • Retail Sales Control Group, March, est. 0.4% (prior 0%)
  • 8:30am: PPI Final Demand m/m, March, est. 0.2% (prior -0.2%)
    • PPI Ex Food and Energy m/m, March, est. 0.1% (prior 0%)
    • PPI Ex Food, Energy, Trade m/m, March, est. 0.1% (prior 0.1%)
    • PPI Final Demand y/y, March, est. 0.3% (prior 0%)
    • PPI Ex Food and Energy y/y, March, est. 1.3% (prior 1.2%)
    • PPI Ex Food, Energy, Trade y/y, March (prior 0.9%)
  • 10:00am: Business Inventories, Feb., est. -0.1% (prior 0.1%)
  • 11:30am: U.S. to sell $20b 10Y notes in reopening
  • 2pm: Federal Reserve Releases Beige Book
DB's Jim Reid concludes the overnight wrap

While earnings season is about to spring into life, the current focus for markets remains on Oil which determined much of the direction yesterday as WTI rallied +4.48% and nearly $2 to close above $42 (at $42.17/bbl to be precise) for the first time since late-November. It's now rallied a fairly remarkable near-20% off the April lows. All the noise yesterday came from the multiple reports suggesting Russia and Saudi Arabia were in agreement on a production freeze without the participation of Iran. As we move closer and closer to the Doha production meeting this Sunday it’s starting to feel like we’re getting almost daily headlines like this but ultimately much will hinge on Sunday’s outcome. For now though, those moves were enough to drive equity markets to reasonable gains yesterday. The S&P 500 finished +0.97% while in Europe the Stoxx 600 closed with a +0.53% gain. In credit Main and Crossover iTraxx indices ended 1bp tighter, while the US outperformed after CDX IG closed nearly 2bps tighter.

Speaking of credit markets, Valeant was back in the limelight last night when after the closing bell we got the announcement that the company has received a notice of default from one of its largest bondholders. According to the WSJ, Centerbridge Partners have filed the notice, which given their roughly 25% issue bondholding in Valeant allows them to do so. This comes after Valeant had reportedly breached a provision in its docs for failing to disclose its 10k report. A 60-day grace period now starts in which Valeant will have to file its annual report, and if not may be forced to repay bondholders. Valeant’s shares were down up to 3% in extended trading, although it’ll be interesting to see how the bonds trade when markets kick into gear this morning, particularly given its relative size in the US HY market as one of the biggest issuers.

Switching over to the latest in Asia now where we’ve got some important Chinese trade numbers to sink our teeth into. The data makes for relatively supportive reading, with exports rising +11.5% yoy in USD terms last month and more than expected (+10.0% expected), which comes after that sharp decline in the prior month (-25.4% yoy). The rate of decline for imports has slowed meanwhile to -7.6% yoy (vs. -10.1% expected) from -13.8%. While favourable base effects appear to be playing a role, the export print is still the highest in over a year, while in CNY terms the data showed a similar trend.

Markets have reacted positively to the data, with Chinese equity markets currently rallying. The Shanghai Comp is +2.20%, while the CSI 300 is +2.30%. Elsewhere we’ve seen the Nikkei (+2.64%) bounce with further weakness for the Yen, while the Hang Seng, Kospi and ASX are up between 1 and 2%. Credit markets have tightened while base metals have also been given a boost post the numbers.
Recapping the rest of yesterday now. Along with the moves for Oil, base metals put in a strong performance with notable gains for Copper (+2.21%), Iron Ore (+4.59%), Aluminium (+1.62%) and Zinc (+4.15%). Unsurprisingly it was commodity-sensitive currencies which led the way, while the big rally for the Yen finally took a pause for breath with the currency closing -0.56% weaker which was the first time it has weakened this month. Meanwhile sentiment was sapped in rates markets where we saw the vast majority of core government bond markets weaken (10y Treasury yields in particular closing 5bps higher at 1.777%).

There was also some fairly mixed Fedspeak for us to digest after we heard from a number of officials. Some of the more cautious commentary was from Harker and Kaplan (both non-voters) with the former in particular saying that his current considerations ‘make me a bit more conservative in my approach to policy, at least in the very near term’ and that ‘it might be prudent to wait until the inflation data are stronger before we undertake a second rate hike’. This was in contrast to San Francisco Fed President Williams who said that assuming there are no surprises in the data, then he see’s two to three rate hikes as being reasonable. Richmond Fed President Lacker played up recent improvement in the inflation numbers which makes a ‘persuasive case for increasing the target range for the federal funds rate’, although Lacker did balance this with his view that a gradual pace of tightening is still appropriate for now.

Elsewhere, the IMF was also the focus of some attention after the Fund cut its global growth forecast for this year to 3.2% from the previous 3.4% forecast made in January. In its semi-annual World Outlook which was published yesterday, the IMF made mention to the fact that there has been a renewed episode of global asset market volatility and some loss of growth momentum in the advanced economies, as well as headwinds for emerging markets.

Further downside risks remain in their view, while the fund also made mention to the possibility of the UK leaving the EU as causing ‘severe global damage’ and an ‘extended period of heightened uncertainty.'

Just wrapping up the data yesterday, in Germany there were no surprises to the final revisions for the March CPI report which was confirmed at +0.8% mom and +0.3% yoy. The inflation docket out of the UK showed a slightly higher than expected CPI print of +0.4% mom (vs. +0.3% expected) which had the effect of lifting the YoY rate two-tenths to +0.5%, while retail prices also came in a touch above consensus (+0.4% mom vs. +0.3% expected). In the US the NFIB small business optimism reading declined an unexpected 0.3pts last month to 92.6 (vs. 93.5 expected) which is the lowest now since February 2014. The import price index came in at a slightly lower than expected +0.2% mom (vs. +1.0% expected), while the March Monthly Budget Statement revealed a modestly wider than expected deficit ($108bn vs. $104bn expected).

Looking at the day ahead now, this morning in Europe and shortly after we go to print we’ll get the final confirmation of the March inflation data for France. Shortly following this will be the February industrial production report for the Euro area (where expectations are for a fairly lowly -0.7% mom reading), while we’ll also receive the Bank of England’s latest credit conditions and bank liabilities survey. Stateside this afternoon, as well as those retail sales numbers there will also be a close eye kept on the March PPI report, while business inventories are also due. Later this evening we’ll see the Fed’s Beige Book released. As highlighted earlier, JP Morgan is the highlight of today’s earnings releases.

http://www.zerohedge.com/news/2016-...dollar-oil-declines-global-stocks-turn-green-
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#30

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915

Argent Dragon

Site Support
Site Bus
Site Supporter
Joined
Mar 29, 2010
Messages
8,280
Likes
2,999
Location
Lone Star State
#32

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#33

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#34
RANsquawk Preview - BoE Rate Decision April 2016
RAN squawk


Published on Apr 13, 2016
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#37
Frontrunning: April 14


Submitted by Tyler Durden on 04/14/2016 07:47 -0400

  • Global shares reach four-month high, forex hit by Singapore sting (Reuters)
  • Dollar Rally Hits Commodities as Europe Halts Global Stock Gains (BBG)
  • Currencies Across Asia Fall Sharply Against U.S. Dollar (WSJ)
  • IEA expects limited impact from oil output freeze at Doha (Reuters)
  • IEA Sees Oil Oversupply Almost Gone in Second Half on Shale Drop (BBG)
  • BofA Profit Declines 13% on Trading Slump, Energy Reserves (BBG)
  • BlackRock quarterly profit falls 20 percent (Reuters)
  • Negative Rates: How One Swiss Bank Learned to Live in a Subzero World (WSJ)
  • With plenty of punch, central bankers wait in vain for the world to drink (Reuters)
  • Russia's Putin: Panama papers are 'provocation' (Reuters)
  • Goldman Asset $15 Billion Manager Sees Wild Markets, Tame Gains (BBG)
  • Pay Shrinks for Most Oil CEOs, as Crude’s Swoon Hits Stocks (WSJ)
  • Trump takes steps to reset his campaign, tries to soften his image (Reuters)
  • Trump Could Lose Delegates in States That Have Yet to Vote (BBG)
  • Bernie Sanders Makes Bold—and Risky—Moves Before New York Primary (WSJ)
  • Exxon Says `$25 Billion Rule' Will Sink Deepwater Oil Drilling (BBG)
  • Qatar's Oil-Freeze Letter to Norway Reveals Doha Deal Logic (BBG)
  • Republican Cruz speaks highly of Rubio when asked about possible VP running mate (Reuters)


Overnight Media Digest

FT

Facebook Inc hired Regina Dugan from Google to lead a new research and development lap focused on large technological leaps. (http://bit.ly/1T52Xub)

Coal producer Peabody Energy Corp filed for bankruptcy protection after bearing the brunt of low prices and falling demand. (http://bit.ly/1T5388A)

Jeremy Corbyn backed Britain remaining in the European Union as the Labour party seeks to mobilise support behind the Remain campaign. (http://bit.ly/1T53AE0)



NYT

- The Federal Reserve and the Federal Deposit Insurance Corporation said on Wednesday that five of the nation's eight largest banks - including JPMorgan Chase and Bank of America Corp did not have "credible" plans for how they would wind themselves down in a crisis without sowing panic. (http://nyti.ms/1Xvi9lu)

- Federal regulators have threatened a series of stiff sanctions against Theranos, the embattled blood-testing company, including closing down its flagship laboratory and potentially barring its chief executive from owning or operating its labs for two years. (http://nyti.ms/1Q8tqSW)

- Hundreds of pages of internal Takata Corp documents and emails examined by The New York Times reveal new details about how economic pressures helped guide the company's handling of its airbag defect, which has been linked to at least 11 deaths and more than 100 injuries. (http://nyti.ms/1XwJiEF)

- Only two months after the European Union's top policy makers agreed to a hard-won data-sharing pact with United States officials, the bloc's national privacy regulators said on Wednesday that the deal did not go far enough to safeguard the personal information of Internet users in Europe. (http://nyti.ms/1N9DXTd)

- Skeptical lawmakers at the House Natural Resources Committee heard testimony Wednesday on a plan to rescue Puerto Rico, as witnesses warned that only quick action by Congress could keep a bad situation from becoming a lost decade. (http://nyti.ms/23GyYgZ)

- The work stoppage by nearly 36,000 Verizon workers highlights crucial questions about the place of middle-class jobs in an economy shifting toward tech. (http://nyti.ms/1VmT3r4)



Canada

** Canada's telecom regulator is taking a tough look at the industry's claims that satellite technology will soon cure the woes of poor access to high-speed Internet for Canadians living outside urban areas. (http://bit.ly/1VY7Szd)

** Alberta, Newfoundland and Labrador are expected to unveil unpopular budgets on Thursday as the resource-dependent provinces grapple with ballooning deficits and weak oil prices. (http://bit.ly/1YuYBxH)

NATIONAL POST

** After delivering a mostly positive outlook on the Canadian economy, and keeping its lending rate on hold, the Bank of Canada found itself unexpectedly on the defensive on Wednesday over its policy independence from the federal government. (http://bit.ly/22wnrhT)

** Progress Energy Ltd, a unit of Malaysia's state-owned Petronas Bhd, is drastically slashing its capital expenditure as it awaits a final approval from the Canadian environmental agency on a proposed liquefied natural gas export project on the West Coast. (http://bit.ly/1Xx8sTE)

** Canada's pharmacists and medical marijuana producers are engaged in a brewing dispute over how pot should be distributed to patients. If they can't reach an agreement, it could leave Ottawa with a tough decision as it crafts new regulations for the sector. (http://bit.ly/23Ho7U9



Britain

The Times

* Unsecured consumer borrowing is growing at its fastest rate for 11 years as supermarkets and car dealers offer more credit to customers and water down their credit-scoring criteria. The annual growth rate in the stock of consumer credit rose to 9.3 per cent in February, its highest since before the financial crisis, according to the latest Bank of England quarterly credit conditions review, published yesterday. (http://bit.ly/1V2og2X)

* A year of global growth could be lost by 2021 unless world leaders take steps to fend off stagnation and strengthen the banks, the International Monetary Fund has warned. (http://bit.ly/1N9n0Zc)

The Guardian

* The accountancy firm PricewaterhouseCoopers has handed over 29 million pounds to the Spanish government to save four of its former employees from serving lengthy jail terms for fraud. (http://bit.ly/1Q6Kfxu)

* The Institute of Directors has made a rare intervention on executive pay, urging BP PLC shareholders to think twice before backing a decision to award 14 million pounds to chief executive Bob Dudley in a year when the company ran up its worst-ever losses.

The Telegraph

* Tata Steel Ltd could suffer another 100 million pounds of losses on its unprofitable UK steel operations before the company finally sells them off or shuts them down. (http://bit.ly/1qqadXT)

* Peabody Energy became the latest miner to buckle under the weight of the commodities price collapse after filing for bankruptcy in the US on Wednesday. (http://bit.ly/1V2oxD5)

Sky News

* Tesco PLC boss Dave Lewis has said he led the business out of crisis after it swung to an annual pre-tax profit of 162 million pounds following a record loss of 6.33 billion pounds a year ago. Tesco said it was continuing to cut prices to stay competitive in a "challenging, deflationary and uncertain market" - and warned this would slow the pace of profit improvement, particularly in the first half of the current financial year. (http://bit.ly/1NoXFVX)

* The UK is failing to improve the well-being of children from poor backgrounds, according to a damning study by UNICEF. The U.N. children's group claims Britain has greater inequality between kids from wealthy and poor backgrounds than almost any other developed nation. (http://bit.ly/20CXhe3)

The Independent

* The campaign group Vote Leave has been designated the official campaign in favour of leaving the European Union, the Electoral Commission has said. The title, which brings with it public funding and media platforms, had been contested between a number of groups. (http://ind.pn/1qR8FXG)

* Junior doctors have begun what they say will be a permanent protest outside the Department of Health, to call for Britain's Jeremy Hunt to reopen talks and avert unprecedented strike action due to take place at end of the month. (http://ind.pn/1RTzGU1)


http://www.zerohedge.com/news/2016-04-14/frontrunning-april-14
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#38
U.S. Futures Flat After Oil Erases Overnight Losses; Dollar In The Driver's Seat


Submitted by Tyler Durden on 04/14/2016 06:49 -0400


In another quiet overnight session, the biggest - and unexpected - macro news was the surprise monetary easing by Singapore which as previously reported moved to a 2008 crisis policy response when it adopted a "zero currency appreciation" stance as a result of its trade-based economy grinding to a halt. As Richard Breslow accurately put it, "If you need yet another stark example of the fantasy storytelling we amuse ourselves with, juxtapose today’s Monetary Authority of Singapore policy statement with the storyline that the Asian stock market rally intensified on renewed optimism over the global economy. Singapore is a proxy for trade and economic growth ground to a halt last quarter." The Singapore announcement led to a sharp round of regional currency weakness just as the dollar appears to have bottomed and is rapidly rising. The Singapore dollar slid 1 percent in the wake of the new stance.

Speaking of the Greenback, the USD rose against most major peers and base metals denominated in the U.S. currency fell to compensate for the appreciation. The dollar’s more than 6 percent drop since late January is starting to meet some resistance amid lackluster euro-area expansion and investor speculation that U.S. economic growth remains intact, strengthening the case for higher interest rates this year. To be sure, none of that speculation was actually confirmed by the data, with both retail sales and inventories missing but when did facts matter over narratives.

"We’ve seen stabilization in macro data in China, but stabilization is one point, re-acceleration is another," said Ralf Zimmermann, a strategist at Bankhaus Lampe in Dusseldorf, Germany.





After crude dropped as low at $40.84, it rebounded and was trading unchanged after the latest IEA forecast predicted the global supply glut would narrow to just 200k b/d in 2H, down from 1.5m b/d in 1H. Brent mirrors WTI recovery after testing support at 200-day moving avg. "The IEA report bounced the market, being quite positive for when the supply glut will disappear, seeing this happen in 2H based on demand and based on non-OPEC production,” says Saxo Bank head of commodity strategy Ole Hansen. The market also remained keenly focused on any and all "Doha" headlines ahead of the OPEC meeting in Qatar on Sunday.

Also notable are the oil technicals: "We tested the 200-day MA earlier” Hansen added, but bounced back w/ IEA report, says Hansen. "If we close today below the 200-day MA that could trigger a negative technical reaction, but at this stage we are seeing a bit of a fightback."

In Europe, the Stoxx 600 was little changed as miners and energy producers tumbled, while investors weighed earnings reports from Burberry Group Plc and Nestle SA. Commodity producers, the best performers among industry groups in 2016, fell for the first time in five days. Anglo American Plc and Randgold Resources Ltd. lost at least 2.7 percent. BP Plc led oil stocks lower. Lenders also declined, paced by Standard Chartered Plc and Barclays Plc, after jumping the most since 2011 on Wednesday. Burberry tumbled 5.9 percent after forecasting a revenue drop at its wholesale unit in the first half of the year. Peer Cie. Financiere Richemont SA lost 1.4 percent. Nestle rose 1.8 percent after its sales beat analysts’ estimates.

S&P500 futures fell 0.1 percent, in a modest retreat from a four-month high. Bank of America Corp. and Well Fargo & Co. are due to report earnings Thursday. Investors also await data on initial jobless claims and inflation for indications on the possible trajectory of interest rates.

Where markets stand right now

  • S&P Futures down 0.1% to 2075
  • Stoxx 600 down 0.2% to 342.5
  • German 10Yr yield up 3bps to 0.16%
  • Euro Stoxx 50 down -0.2%
  • FTSE 100 down -0.2%
  • DAX up 0.1%
  • MSCI Asia Pacific up 1.7% to 132.2
  • Nikkei 225 up 3.2% to 16911.1
  • Hang Seng up 0.8% to 21337.8
  • Kospi up 1.7% to 2015.9
  • Shanghai Composite up 0.5% to 3082.4
  • France 10yr yield up 3bps at 0.5%
  • Greece 10yr yield up 4bps at 9.34%
  • Dollar Index up 0.17% to 94.9
  • US 10Yr yield up 1bps to 1.77%
  • Brent Futures down 0.5% to $44/bbl
  • WTI Futures down 0.6% to $41.5/bbl
  • Gold spot down 0% to $1242/oz
Top Global News

  • IEA Sees Oil Oversupply Almost Gone in Second Half on Shale Drop: surplus to dwindle to 200,000 barrels a day from 1.5m
  • Brexit Chance Seen at 24% by Election Analyst Who Beat the Polls: Matt Singh based forecast on likely movement of polls
  • London Property Prices Feel Pressure of Brexit, Pound’s Slide: RICS says prices in the U.K. capital expected to keep falling
  • U.K. Said to Be Resisting Full Disclosure on Trusts Post- Panama: British official says trusts are commonly-used vehicle in U.K.
  • Burberry Sees Profit Setback Amid Declining Luxury-Goods Demand: Full-year profit will be at low end of analysts’ ests
  • BP CEO’s 20% Jump in Pay Seen Sending ‘Wrong Message’ Before AGM: All shareholders should scrutinize remuneration deal, IoD says
Looking at regional markets, Asia stocks extended on recent gains following the positive lead from Wall St. where the S&P 500 closed at YTD highs, underpinned by strength in financials after JPMorgan earnings. The optimism in the banking sector supported Nikkei 225 (+3.23%) towards 17000, while ASX 200 (+1.26%) was lifted by material names after the continued increase in copper and iron ore prices. Chinese markets have conformed to the upbeat sentiment after further quasi-measures from the PBoC which provided CNY 285.5bIn of funds under its medium term lending facility. 10yr JGBs were initially higher despite the heightened risk-sentiment across the region, with prices gaining in the super long-end as the 30yr and 40yr yields fell to fresh record lows. However, prices then reversed in late trade following a poor 30yr auction in which the lowest accepted price missed expectations, b/c dropped and tail in price significantly widened.

Top Asian News

  • Singapore Adopts 2008 Crisis Policy as Growth Grinds to Halt: Central bank moves to zero appreciation stance on currency
  • China’s Mysterious Stock-Market King Reveals Its Trading Secrets: State rescue fund prefers banks, SOEs, consumer cos.
  • Nomura Reorganizes Asia Equities Team as Nagai Starts Job Cuts: Brokerage said to cut up to 30 jobs in Asia ex-Japan equities
  • RBNZ Says Journalist Leaked Surprise Rate-Cut Move in March: RBNZ to discontinue embargoed lockups for media, analysts
  • TSMC Forecasts Sales Below Estimates Amid Smartphone Slowdown: Chipmaker’s net income fell for 3rd straight qtr
European equities trade mostly on the back-foot albeit in somewhat choppy fashion, with energy names underperforming in the first half of the European session amid weakness in crude futures, which has since been reversed. The initial bout of weakness was in part driven by Russia signalling that there would only be little commitments at the meeting, while the IEA noted that a production freeze will have a limited impact on physical oil supplies, how it was the same IEA comments which hinted at an earlier than expected rabalancing due to a hoped for drop in US supply which then helped oil rebound. The SMI has outperformed for much of the morning following strong earnings from Nestle. Elsewhere, Bunds have reversed the initial upside to trade in the red, underpinned by the weakness in USTs ahead of the 30y bond auction due later today.

Top European news

  • ITV Said to Pursue Takeover of Canada’s Entertainment One: Entertainment One also owns rights to Peppa Pig cartoons
  • Rocket Internet Drops in Frankfurt Amid $222m Net Loss: losses widen at startups including HelloFresh, Lazada
  • Swiss Re, L&G Said to Mull Bids for Deutsche Bank Abbey Life: Abbey Life could fetch about GBP1b in a sale
  • Steinhoff Convertibles Sale Has Interest for 60% of Deal Size: according to an emailed statement from BofAML
  • Kuoni Says EQT Offer Successful as 72.6% of B Shares Tendered: additional acceptance period to start on April 20
In FX, The Bloomberg Dollar Spot Index rose 0.2 percent at 10:43 a.m. in London. The pound fell for a second day against the dollar as investors awaited the Bank of England’s latest policy decision, with analysts forecasting that the central bank will leave its key rate at a record-low 0.5 percent. Investors may focus on whether officials discussed a looser monetary policy to counter the potential economic pain of Britain voting to quit the European Union in a June referendum. The MSCI Emerging Markets Currency Index fell 0.2 percent, dropping for the first time in six days as Singapore surprised markets by easing monetary policy, spurring speculation other central banks will follow suit. Bank of Canada Governor Stephen Poloz said this week that a stronger loonie may put export growth at risk.

“Everyone else will try to push back,” said Stephen Jen, the co-founder of hedge fund SLJ Macro Partners LLP and a former International Monetary Fund economist. “The global currency war is alive and well. You can see how unhelpful the whole process is.”

Following the latest grind higher in the USD, we have seen some consolidation/profit taking going through, and after hitting lows around 1.1232, EUR/USD is now back around 1.1270 or so, but expected to hold off 1.1300 after yesterday's break under this level. A data light morning so far, with only the Australian jobs numbers to work off, but the above forecast headline rise was tempered the composition (part time rise much of this). AUD has been relatively well supported in the meantime, and has been edging back towards the high .7600's again. The USD/JPY recovery has stalled ahead of 109.60 resistance, but positive stocks should support for a 110.00 test unless the US inflation read later today comes in on the weaker side. EUR/JPY sales have also weighed, but recent mid 122.00 lows have held. GBP has also been recovering, with today's BoE meeting likely to see a familiar cautious tone maintained. Cable back in the mid 1.4100's after a dip under the figure level lower down. EUR/GBP ranging in the .7900's for now. CAD unmoved despite a small recovery in Oil.

In commodities, heading into the North American open WTI and Brent crude futures have largely reversed early losses and trade near unchanged on the session, as market participants remain hopeful of a deal between oil producing nations to support prices. On that note, Russian Energy Minister stated that the Doha oil freeze deal will be loosely framed with few detailed commitments, according to two sources at the briefing. While the IEA expects limited impact from any potential freeze deal in Doha. As a guide, energy traders will get to digest the release of the latest EIA natural gas storage change report.

Industrial metals in London declined on concerns that recent price gains could tempt producers to restart capacity and add to global oversupply, while a stronger dollar also weighed on all commodities. Copper dropped 0.5 percent to $4,808 a metric ton, while zinc and nickel lost at least 0.8 percent.

On the US calendar today are the latest initial jobless claims data and more notably the March inflation report. Expectations for the latter are sitting at +0.2% mom for both the headline and core. Away from the data we’ll hear from the Fed’s Lockhart and Powell today, as well the IMF’s Lagarde. The highlight from the earnings releases due today are Bank of America and Wells Fargo, while Delta Airlines will also release their latest quarterly.

Bulletin Headline Summary from RanSquawk and Bloomberg

  • Stocks in Europe traded choppy for much of the session as market participants digested a round of mixed earnings, with recovery in oil prices proving positive for the underlying sentiment
  • The USD/JPY recovery has stalled ahead of 109.60 resistance, but positive stocks should support for a 110.00 test unless the US inflation read later today comes in on the weaker side
  • Looking ahead, highlights include BoE Rate Decision & Minutes, US CPI, Initial Jobless Claims, as well as comments from Fed Powell and Lacker
  • Treasuries lower in overnight trading while a stronger dollar weighs on commodity prices; week’s auctions conclude with $12b 30Y bonds, WI 2.59%, last sold at 2.72% in March.
  • Global oil markets will “move close to balance” in the second half of the year as lower prices take their toll on production outside OPEC, the International Energy Agency said
  • Brexit is casting a long shadow over Bank of England policy with more than two months still to go before the referendum
  • Nomura Holdings Inc. is eliminating about 60 jobs at its investment banking division outside Japan as it scales back operations in markets including Switzerland and Eastern Europe
  • Chinese companies canceled almost four times the amount of bond offerings in April compared with a year earlier, as defaults by state-owned enterprises increased financing costs
  • Brazilian President Dilma Rousseff’s political future hangs on a vote that will take place Sunday in the lower house of Congress. Many analysts say it will be difficult for the government to block the motion in the Senate if it passes
  • Hedge funds and private equity firms took the least amount of office space in central London since the start of 2012 in the first quarter as sputtering global growth and increased regulation deterred startups
  • Sovereign 10Y bond yields little changed; European equity markets mixed, Asia higher; U.S. equity-index futures drop. WTI crude oil steady, precious metals and copper drop


US Event Calendar

  • 8:30am: Initial Jobless Claims, April 9, est. 270k (prior 267k)
    • Continuing Claims, April 2, est. 2183k (prior 2.191m)
  • 8:30am: CPI m/m, March, est. 0.2% (prior -0.2%)
    • CPI Ex Food and Energy m/m, March, est. 0.2% (prior 0.3%)
    • CPI y/y, March, est. 1.1% (prior 1%)
    • CPI Ex Food and Energy y/y, March, est. 2.3% (prior 2.3%)
    • CPI Index NSA, March, est. 238.544 (prior 237.111)
    • CPI Core Index SA, March, est. 246.331 (prior 245.925)
    • Real Avg Weekly Earnings y/y, March, (prior 0.6%, revised 0.7%)
  • 9:45am: Bloomberg Consumer Comfort, April 10 (prior 42.6)
  • 10:30am: EIA natural-gas storage change
Central Banks

  • 7:00am: Bank of England bank rate, 0.5% (prior 0.5%)
  • 10:00am: Fed’s Lockhart speaks in Chicago
  • 10:00pm: Fed’s Powell testifies to Senate Banking Committee
DB's Jim Reid concludes the overnight wrap

Moving onto markets, China has been much less of a negative influence since the devaluation risk lessened after the PBoC Governors' remarks a couple of months back calming fears of a big fx move. The weakness in the dollar since has also helped take the pressure off. However yesterday was one of the few days it's been a positive influence this year as the better than expected trade numbers we reported yesterday gave Europe a big boost at the open which was then aided further by a beat from JP Morgan which calmed some of the worst fears over bank earnings and pushed the rally on further.

Indeed JPM exceeded both earnings and revenue street expectations in its Q1 report as some improved trading conditions in March and better than expected cost control helped the bank to set an early positive tone ahead of the Bank of America and Wells Fargo results today. Combined with a massive rally for Italian banks too - seemingly in further response to the bank bailout fund announcement after PM Padoan weighed in with some positive comments - equity markets surged higher with the Stoxx 600 (+2.52%) rising for the fourth consecutive session and by the most in over a month. The Italian FTSE MIB gained +4.13% (Banks were up over +8%) before the S&P 500 capped off an overall positive day for equities with a +1.00% gain. European credit wasn’t left behind with Crossover rallying 11bps, although a weak late hour of trading across the pond saw credit indices in the US give up early gains to close flat.

In fact and in what feels like a rare occurrence, yesterday’s rally didn’t even get the benefit of an oil-injected boost as WTI retreated back below $42/bbl and down close to 1% on the day after Russia’s oil minister suggested that any deal signed at the Doha meeting this Sunday will be loosely framed. The announcement that coal mining giant Peabody Energy has filed for bankruptcy in the US also did little to dampen the overall mood (but in fairness it was expected), neither did some softer retail sales data which came out in the early afternoon.

More on some of those snippets shortly, but first to the latest in markets this morning where the focus is back on Central Banks and specifically in Singapore after the MAS delivered a surprise easing. The MAS has announced that it is to slow the pace of appreciation in the Singapore Dollar by moving to a neutral policy of zero percent (after the Bank had previously allowed the currency to appreciate) with policy makers warning that the ‘Singapore economy is projected to expand at a more modest pace in 2016 than envisaged in the October policy review’. According to Bloomberg only 6 of 18 economists had expected a change in policy and you have to go back to 2008 to find the last time the MAS moved to a 0% appreciation rate – this is also the first time they have done so outside a recession. The Singapore Dollar has weakened close to 0.9% post the news, the biggest decline in three months while other currencies in the Asia region have weakened similar amounts (with the Kiwi Dollar in particular under pressure after the RBNZ confirmed that the March rate cut announcement was leaked early).

Notably our FX strategists highlight that this Singapore move could have implications for the region giving the forward looking nature of the MAS. They note that MAS’ views on weaker trade-related activity and moderating growth momentum in China could refocus attention on the challenges for Asia, and the need for currency adjustment to be part of policy situations.

Meanwhile, despite our earlier comments regarding China’s calmer FX policy of later, the strength yesterday in the US Dollar has in fact seen the PBoC react by fixing the reference rate for the CNY 0.46% weaker and by the most since January 7th. So let's hope we haven't spoken too soon.

Weaker currencies and the positive lead from Wall Street last night has seen Asian bourses extend gains again this morning however. It’s the Nikkei leading the way again, currently up +2.93%, while the Hang Seng (+0.89%), Shanghai Comp (+0.17%), Kospi (+1.32%) and ASX (+1.26%) are also flashing green with another strong bounce for base metals this morning also helping to keep the tone positive. Credit markets in the region are a touch tighter.

Back to those retail sales numbers out of the US yesterday. Headline sales were reported as declining -0.3% mom in March and well below market expectations of +0.1% mom. There were downside misses also for the ex auto (+0.2% mom vs. +0.4% expected), ex auto & gas (+0.1% mom vs. +0.3% expected) and control group (+0.1% mom vs. +0.4% expected) components – the latter of course which goes into the GDP accounts. On the plus side there were upward revisions to those previously weak February numbers but that doesn’t take away from the data this month being clearly disappointing. Also soft were the March PPI data. Headline producer prices came in below market at -0.1% mom (vs. +0.2% expected), with the core of 0.0% also missing by a tenth. That means headline PPI is now back in negative territory (-0.1%) on a YoY basis for the first time since October last year.

The only other data out of the US yesterday was February business inventories which offered no surprises after printing at -0.1% mom. Later in the evening saw the release of the Fed’s Beige Book with a mixed assessment probably being a fair refection. The report showed that ‘economic growth was in the modest to moderate range’ but on a district by district basis there was alot more variation. Labour market conditions were cited as strengthening along with expansion in business spending, although prices were only seen as increasing ‘modestly’. A positive takeaway we noted was the overall pickup in manufacturing which appears to be benefiting from the recent softness in the Dollar.

Staying with the macro, with one eye on the ECB policy meeting in just a week’s time, negative rates appeared to be a topical discussion for ECB officials yesterday. Nowotny played up the impact of how the implementation of a negative deposit rate in Europe has helped spur lending in the Euro area, before later in the evening we heard from Constancio. The ECB official appeared to cool expectations of the overall impact of negative rates in Europe, citing that it is ‘important to recall that there are clear limits to the use of negative deposit facility rates as a policy instruments’ and that ‘tier systems that simply pass direct costs at the margin can mitigate this concern but cannot dispel it altogether’. Constancio also went on to say that the early signs of the ECB’s easing measures are showing positive effects for the Euro area, but that the full effects have yet to fully materialize.

Moving on. Peabody Energy – the world’s largest private sector coal producer by output – became the latest name to buckle under the pressure of tumbling coal prices after the announcement that it has filed for Chapter 11. According to the FT, that announcement now means that 50 US coal miners have filed for bankruptcy protection since 2012. The move now means that the company will look to restructure its roughly $10bn debt load, and seek to reorganize its US operations.

Just wrapping up the data yesterday and specifically in Europe where we saw the Euro area industrial production reading come in a tad softer than expected at -0.8% mom (vs. -0.7% expected). That was in fact the single largest monthly decline in 18 months. Meanwhile, the other data yesterday was out of France where we saw the final March CPI report confirmed at +0.7% mom, unchanged on the earlier initial estimate.

Turning our focus to the day ahead now then, this morning in Europe will see the final confirmation of the March CPI report for the Euro area as well as the inflation numbers out of Italy. Around lunchtime we’ll get the Bank of England rate announcement where we’re not expecting any surprises, before attention turns to the US session with the latest initial jobless claims data and more notably the March inflation report. Expectations for the latter are sitting at +0.2% mom for both the headline and core, while our US economists expect a similar headline number but just +0.1% mom gain for the core. Away from the data we’ll hear from the Fed’s Lockhart (3.00pm BST) and Powell (3.00pm BST) today, as well the IMF’s Lagarde (2.30pm BST). As noted earlier the highlight from the earnings releases due today are Bank of America and Wells Fargo, while Delta Airlines will also release their latest quarterly.

http://www.zerohedge.com/news/2016-...l-erases-overnight-losses-dollar-drivers-seat
 

searcher

Mother Lode Found
Sr Site Supporter
Mother Lode
Joined
Mar 31, 2010
Messages
86,496
Likes
35,915
#39
Here's The First "Panama Papers" Fallout In The Resources Sector


Submitted by Tyler Durden on 04/14/2016 08:06 -0400


Submitted by Dave Forest via OilPrice.com,

Readers the world over are still busy crawling through information from the “Panama Papers” leak - which has revealed how high-profile persons around the globe used corporate havens to dodge taxes.

And in Zimbabwe, they’re turning their attention to one particular name leaked in the documents: the country’s largest platinum miner.

That’s Zimplats — the local subsidiary owned 87 percent by major miner Impala Platinum. Which the Panama Papers say used offshore accounts to dodge tax rules in Zimbabwe.

The leaked documents note that Zimplats established a company in the Isle of Man, called HR Consultants. Which was used to pay the salaries of Zimplats’ senior managers.

The offshore firm thus eliminated the need for salaries to be routed through Zimbabwe. Almost certainly simplifying payments, and possibly avoiding local taxes on these monies.

But such a strategy is illegal under Zimbabwe rules. With reports suggesting that the Reserve Bank of Zimbabwe was never notified of the payment scheme, constituting a major breach of tax legislation.

As one local expert interviewed by BDLive noted, “As long as the central bank was not involved in this‚ Zimplats would be committing a serious crime of money laundering‚ externalization and tax evasion.”

For its part, Zimplats has denied that it took part in any such arrangements — with a spokesperson saying the company has “no relationship” with any of the companies mentioned in the Panama Papers leak.

There are indeed some details missing from the story. Such as the method Zimplats used to transfer cash from the parent company to the offshore firm, to then be forwarded to executives as payment.

But Zimbabwe’s government said it will now take a hard look into the matter. With the country’s central bank governor John Mangudya warning, “Violation of exchange control rules and regulations is a punishable offence.”

This could be an especially big story given that Zimplats is a key player in the global platinum sector — being the largest operator in the world’s third-largest producing nation. Watch for more details emerging as investigations proceed.

http://www.zerohedge.com/news/2016-04-14/heres-first-panama-papers-fallout-resources-sector