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R.T.M. ~ Frontrunning ~ 32nd Ed., Vol.2 ~ August 8th - 12th

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#1
S&P To Open At New Record High As Commodities Rise, China Trade Disappoints


by Tyler Durden
Aug 8, 2016 6:29 AM

The meltup continues with the S&P500 set to open at new all time highs as futures rise 0.2% overnight, with European, Asian stocks higher, as job data pushed MSCI Asia Pacific Index towards highest close since Aug. 2015. Germany, U.K. economic data seen positive, with dollar, oil rising, and gold declining.

Global equities advanced with commodities and emerging markets on speculation the U.S. economy is strong enough to sustain growth while only triggering a gradual increase in interest rates; that said we have seen that narrative many times before and so far at least the market still refuses to price in a full rate hike for 2016, opting instead to have its record high market cake while "eating" the Fed's ongoing inability to hike.

Despite some speculation that the Fed may hike in December (certainly not in September ahead of the presidential election), over the weekend Fed board member Jerome Powell warned that America is trapped in a prolonged period of subdued growth that requires lower official rates than initially expected, the Financial Times reported.

Still, today's action suggests that the S&P's next stop is likely 2,200 despite ongoing please by Goldman for clients to sell stocks for the next 3 months, and really for the next year as Goldman sees the market going nowhere over the next 265 days. “There’s a positive follow-through from Friday’s payroll numbers as it shows strength in the U.S. economy,” said Michael Hewson, a market analyst at CMC Markets in London.

The MSCI All-Country World Index climbed 0.4% in early trading. The Index was headed for its highest close in almost a year, extending Friday’s advance that was spurred by a strong seasonally-adjusted payrolls report. Ignored amid the euphoria was the latest Chinese trade data which showed China's exports and imports fell more than expected in July in a rocky start to the third quarter, pointing to further weakness in global demand in the aftermath of Britain's decision to leave the European Union. Imports fell 12.5 percent from a year earlier, the biggest decline since February and suggesting China's domestic demand may be faltering despite a flurry of measures to stimulate economic growth. Exports fell 4.4 percent on-year, the General Administration of Customs said on Monday, while adding that it expects pressure on shipments likely will start to ease in October. That resulted in a trade surplus of $52.31 billion in July, the biggest since January, versus June's $48.11 billion. China's imports have now declined for 21 straight months, while exports have fallen for 12 of 13 months, helping to drag economic growth to its slowest in a quarter of a century.



As BBG summarizes the key market events, investment-grade corporate credit risk fell to the lowest in about a year. The pound dropped and U.K. government bonds rose as the Bank of England begins its latest round of quantitative easing. Thailand’s shares gained after voters backed a new constitution, while South Korean assets were buoyed by a debt-rating upgrade. Crude traded above $42 a barrel, the highest in two weeks, and aluminum advanced.

The Stoxx Europe 600 Index rose 0.2 percent, taking its three-day rebound to 2 percent in another low volume session. The number of shares changing hands on the Stoxx 600 was 37 percent below the 30-day average. A gauge of banks led gains, with Barclays Plc adding 3.3 percent after Exane BNP Paribas upgraded the U.K. lender to outperform, similar to buy, from neutral. BHP Billiton Ltd. and Anglo American Plc climbed 3.4 percent, pushing miners higher as commodity prices increased. PostNL NV surged 12 percent after the Dutch mail-delivery company forecast a resumption of dividend payments in 2017. Mediobanca SpA gained 3.2 percent after La Stampa reported that French investor Vincent Bollore may increase his 7.9 percent stake in the Italian investment bank to as much as 23 percent. Airbus Group SE fell 0.9 percent after saying that the the U.K. Serious Fraud Office has opened a criminal investigation into allegations of fraud, bribery and corruption relating to some of the planemaker’s third-party consultants.

S&P 500 futures added 0.2 % after the U.S. gauge hit an all-time high. Nasdaq 100 contracts also rose 0.3 percent. The Nasdaq Composite Index closed at a record Friday for the first time in a year.

The Bloomberg Commodity Index rose as much as 0.4 percent to the highest since Aug. 1 as West Texas Intermediate crude oil gained 1.3 percent to $42.34 a barrel, amid speculation OPEC may once again consider to halt supply at its upcoming September meeting.

Market Snapshot
  • S&P 500 futures up 0.3% to 2182
  • Stoxx 600 up 0.2% to 342
  • FTSE 100 up 0.2% to 6806
  • DAX up 0.9% to 10462
  • German 10Yr yield up 1bp to -0.06%
  • Italian 10Yr yield up 2bps to 1.15%
  • Spanish 10Yr yield up 1bp to 1.03%
  • S&P GSCI Index up 0.9% to 345.2
  • MSCI Asia Pacific up 1.3% to 138
  • Nikkei 225 up 2.4% to 16651
  • Hang Seng up 1.6% to 22495
  • Shanghai Composite up 0.9% to 3004
  • S&P/ASX 200 up 0.7% to 5538
  • US 10-yr yield down 1bp to 1.58%
  • Dollar Index up 0.12% to 96.31
  • WTI Crude futures up 1.2% to $42.31
  • Brent Futures up 1% to $44.73
  • Gold spot down 0.4% to $1,331
  • Silver spot down 0.2% to $19.68
Top Global News
  • Delta Grounds Planes ‘Nationwide’ After Computer System Crashes: Responding to complaints from passengers on Twitter starting at 4am EST, Delta said it was experiencing a system outage “nationwide.”
  • Wal-Mart’s Jet.com Deal Said to Hinge on Keeping Founder: Cos. trying to agree to $3b deal as soon as today that will require Jet founder Marc Lore to head retailer’s online division for several years.
  • Steinhoff to Acquire Mattress Firm for About $2.4b: Steinhoff offered $64/share in cash, more than double Friday’s $29.74 closing price for Houston-based Mattress Firm.
  • Apple Said to Buy AI Startup Turi for About $200m: Turi helps developers create, manage software & services that use a form of AI called machine learning.
  • Google Self-Driving Car Research Head Chris Urmson Leaves: Under his watch, Google vehicles racked up 1.8 million miles of driving.
  • Buffett Sees Redemption of Wrigley Pref Stake With 5% Div.: Half of investment in Wrigleys can be redeemed over 90-day period starting Oct. 6.
  • NBC Olympic Audience at Opening Drops 35% vs London 2012: Broadcast was viewed by ~26.5m people; preliminary audience rating of 17.2 dropped vs London’s initial rating of 23.0
  • ‘Suicide Squad’ Opens at No. 1 Film as Fans Ignore Critics: New superhero movie starring Will Smith, Margot Robbie collected est. $135.1m in U.S. and Canada: ComScore.
  • Hacked Bitcoin Exchange Users to Lose 36%, to Receive Tokens: To compensate its customers, Bitfinex said users will receive tokens that may later be redeemed or exchanged for shares in its parent co.
  • Southwest Airlines Board Tells Unions CEO Not Going Anywhere: Unions said CEO, COO should go due to flight disruptions caused by aging computer systems, too-narrow focus on cutting costs, stock buybacks rather than upgrading reservation system.
  • Trump to Propose Moratorium on New Financial Regulations: Donald Trump will propose a temporary moratorium on new financial regulations in an economic speech Monday in Detroit; Clinton Plans Economic Speech Thursday to Counter Trump’s
  • China Foreign-Currency Reserves Stabilized at $3.2t: Reserves edged down by $4.1b to $3.2t, PBOC said in statement Sunday; was in line with median estimate of economists surveyed by Bloomberg.
Looking at regional markets, Asia started the week in positive territory as the region took the impetus from last Friday's record high close in US stocks, following better than expected NFP numbers. Nikkei 225 (+2.4%) outperformed its counterparts and was buoyed by JPY weakness. ASX 200 (+0.8%) also traded higher, with energy and financials leading the region as participants await a record profit to be announced this week by Commonwealth Bank. Chinese markets conformed to the positive tone with the Hang Seng (+1.5%) edging firm gains while the Shanghai Comp (+0.9%) initially lagged its peers following mixed trade data which showed better than expected CNY-denominated Export and Trade Balance figures, while Imports highlighted subdued domestic demand and USD denominated Exports also disappointed. However, the index staged somewhat of a turnaround heading into the close. 10yr JGBs tracked the decline seen in T-notes amid the enhanced appetite for riskier assets in Japan, while the BoJ was also absent from the market in terms of buying operations.

BoJ Summary of Opinions for July 28th and 29th meeting stated that the economy has continued a moderate economy trend and that Japan's economy has maintained its resilience. The Summary of Opinions added that the government stimulus package is expected to be extremely large in scale which will considerably support growth and inflation, while it showed the board was divided regarding limits to monetary easing.

Top Asian News
  • China Exports Remain Subdued as Import Drop Fuels Demand Concern: Imports drop 12.5% in dollar terms
  • South Korea’s Credit Rating Raised One Level to AA by S&P: Won gains, bonds pare back losses after S&P’s upgrade
  • Goldman Hails Modi Triumph as August Jinx Threatens Rupee Rally: Goldman says rupee among its top EM picks for carry returns
  • DBS 2Q Net Income Falls on S$150m Swiber Group Charge: 2Q net income down 6% y/y to S$1.05b, est. S$1.07b
  • Hostile Raid on China Developer Flashes Shadow-Banking Warnings: Baoneng using risky AMP structures to amass 25% of Vanke stock
  • Japan’s Emperor Signals Readiness to Step Down in Video Address: Abdication would require change in Imperial House Law
In Europe, stocks have traded positively at the start of the session after traders continue to digest the better than expected jobs data from the US on Friday and last week's stimulus efforts by the BoE. The Euro Stoxx 50 cash is currently up 0.8% as financials outperform with Barclays trading higher by 3.6% after a broker move from BNP Paribas boosted the Co.'s share price and has subsequently helped lift the FTSE to 14-month highs. In fixed income markets, Bunds opened softer but as the session continued prices came back to fill the gaps and Bunds are now trading near flat only down 9 ticks. Elsewhere on the German curve analysts at Informa have noted some decent buying demand for Schatz. Also in fixed income markets, the Bank of England is due to kick start the asset purchase facility which will be a significant event for Gilts as this will continue to add to liquidity into the asset.
  • Top European News
  • Airbus Says U.K. Fraud Office Starts Criminal Bribery Probe: Co. had flagged in 2016 “misstatements and omissions” involving outside contractors in some export financing applications, found through an internal probe.
  • Vinci to Acquire Lamsac, Pex From Invepar in EU1.5b Deal: Co. agreed to buy Lima toll-road operator Lamsac and its PEX electronic-toll operator from Brazilian owner Investimentos & Participacoes em Infraestrutura SA.
  • Denmark Pursues Brexit Concessions as Politics Trumps Economics: Danish PM Lars Loekke Rasmussen dead-set on forcing an escape from having to foot welfare bill for EU workers, a key feature of the bloc’s freedom of movement principle.
  • Bank of France Sees Economy Gaining Momentum in 3Q: GDP to rise 0.3% in 3Q, Bank of France said Monday.
  • U.K. Consumers’ Brexit Anxiety Temporarily Quelled by Summer Sun: Consumers spent more on new clothes, meals out, day trips in July, according to card transaction data analyzed by Visa, Markit.
In FX, the Japanese yen slid 0.5 percent and New Zealand’s dollar lost 0.3 percent as the Bloomberg Dollar Spot Index held near a one-week high. Odds on the Fed increasing rates by December rose to 47 percent in the futures market after the U.S. payrolls report, up from 37 percent on Thursday. While America’s jobs report surprised on the upside, Chinese data on Monday showed exports from the world’s biggest trading nation declined 4.4 percent in dollar terms from a year earlier in July and its imports dropped 12.5 percent. Russia’s ruble strengthened 0.7 percent, leading gains among the currencies of oil-exporting nations. The won advanced 0.2 percent, having recovered from a loss of as much as 0.6 percent after S&P raised South Korea to AA, its third-highest ranking. The pound headed for its longest run of declines since before the U.K.’s decision to leave the European Union. Sterling slid 0.2 percent to $1.3051, falling for a fourth day.

In commodities, the Bloomberg Commodity Index rose as much as 0.4 percent to the highest since Aug. 1 as West Texas Intermediate crude oil gained 1.3 percent to $42.34 a barrel. Copper climbed 0.6 percent in London, aluminum was up 0.7 percent and nickel headed for the highest close in a year. Gold fell 0.4 percent extending Friday’s losses. The prospect of higher U.S. interest rates dim the appeal of the precious metals versus yield-paying assets. Soybeans climbed as much as 1.5 percent in Chicago amid strong demand for U.S. exports. Wheat also advanced amid concern about the outlook for European crops.

Aside from a 10am update on Labor Market Conditions, an index which the market focuses on when it's good and ignores when flashing a warning sign, there is nothing on the US calendar.

* * *

Bulletin Headline Summary From RanSquawk and Bloomberg
  • European and Asian equities have started the week on the front-foot in a continuation of the moves seen since last week's BoE announcement and NFP release
  • In FX, Monday trade has proved to be a quiet one again, exacerbated by the lack of drivers in the form of data or major events/news over the weekend
  • Looking ahead, there is little in the way of key economic releases or notable speakers
  • Treasuries on the long-end rally in overnight trading along with global equities and oil while gold drops in what some call a “positive follow-through” from Friday’s better than expected payroll report.
  • China’s exports remained sluggish last month, signaling tepid global demand, while deteriorating imports raise concern domestic conditions may be weakening anew
  • Treasury benchmark 10Y note yields held close to a four- month high versus their G7 peers after U.S. employers added more jobs than economists forecast. The spread widened to 111bp on Friday, the most since late March
  • Last month, yields on U.S. 10Y notes turned negative for Japanese buyers who pay to eliminate currency fluctuations from their returns, something that hasn’t happened since the financial crisis. It’s even worse for euro-based investors
  • Warren Buffett just took another step to simplify Berkshire Hathaway’s stockpile of derivatives by paying $195 million in July to wind down the last contract in which it provided protection against losses on bonds
  • German industrial production increased 0.8% m/m in June, signaling that Europe’s largest economy gained momentum ahead of the U.K.’s Brexit vote
  • South Korea’s credit rating was increased one level by Standard & Poor’s, which cited the nation’s steady economic performance, sound fiscal position and flexible fiscal and monetary policies for the improvement
  • The Hong Kong-based bitcoin exchange that lost about $71 million to hackers said it is beginning to bring its system back online, after telling users they will lose 36% of their deposits
US Event Calendar
  • 10am: Labor Market Conditions Index Change, July (prior -1.9)
* * *

DB's Jim Reid concludes the overnight wrap

The US economy is refusing to conform to any traditional path at the moment as Friday's strong payrolls (255k vs. 180k expected; 292k previous) added to the confusing mix of data we've seen of late. A reminder that the previous Friday confirmed that at the end of H2, real and nominal YoY GDP had slipped to 1.2% and 2.4% respectively, the latter at levels not seen since the end of the Great Recession. Without nominal growth there's a cap on how much delevering the global economic can achieve and also a cap on earnings growth. However the strong employment numbers bring the 3 and 6 month average back up to 190k and 189k after oscillating around the 150k mark recently. This is still below the 2014 and 2015 average of 251k and 229k but healthier than it was. Our view that the US labour market is appearing late cycle is looking less clever than it did 2 months ago. Since then the US economy has added 547k jobs!!

However we would share DB's Joe Lavorgna's view that the upshot of strong labour market growth and weak GDP growth is depressed productivity. Maybe we'll get more evidence backing this up tomorrow with the preliminary US Q2 productivity report (+0.5% vs. -0.6%). Also out is the unit labor costs number (+2.0% vs. +4.5%) and the concern is that weak productivity growth implies that the ULC at these levels will continue to impact profit margins. If companies try to protect margins they could still reduce labour demand and the late cycle labour hypothesis could remain intact. Interestingly Joe thinks current-quarter real GDP is only likely to be at 1.2% which is way below say the Atlanta Fed GDPNow of 3.8%. If Joe is correct these themes aren't going to go away.

What the job report does do is wake the Fed Funds up from its stupor. Before the payroll number September and December probability (based on Bloomberg) was at 18% and 20% respectively. They now sit at 26% and 47%. Before the number to get a higher than 50% probability you needed to stretch out to December 2017. Now it's March 2017. We've long felt that the Fed would struggle to raise rates in this cycle (we've been wrong once last December) and still think they'll find it very tough to go any further. However as the Fed want to raise rates and as we've repeatedly got close to more hikes, it's never made sense to price it as low as markets have of late. Janet Yellen's Jackson Holes's speech on August 26th will now be a bit more interesting.

Markets liked the number as we're still at a point where growth fears outweigh interest rate rising fears for now. The S&P500 (+0.86%) and the NASDAQ (+1.06%) rose to all time highs. In Europe the effects of US data appeared to build on the BoE’s aggressive policy package from the previous day as the STOXX (+1.05%) and the FTSE (+0.79%) continued to gain on Friday. It was a good day for European banks as well (STOXX Banks +2.21%) which were the second best performing sector in Europe.

The risk-on sentiment was also evident in credit markets as iTraxx Main and Crossover spreads tightened by -2bps and -8bps respectively on Friday, ending the week tighter by -1bps and -2bps after widening earlier in the week. iTraxx Fin Senior and Sub also tightened by -4bp and -14bps on Friday. In the US we saw CDX IG and HY follow suit, tightening by roughly -2bps and -8bps on Friday, with both ending the week roughly -1bp tighter.

At the other end of the risk spectrum, German and US 10Y yields rose by +3bps and +9bps respectively in the broader risk on move, thus ending the week +5bps and +14bps higher.

Asia has started the week well with the Nikkei +1.95%, the Hang Seng +1.25% and the Shanghai Comp +0.25% as we type. It's interesting that last August markets were shook from their holidays by China's stealth devaluation and fears over fx reserves. Over the weekend the latest reserve numbers were out and unlike last year they were a bit of a non event and in-line with expectations at $3.2Tn. This morning the latest trade numbers were out and in dollar terms exports fell slightly more than expected (-4.4% vs -3.5% YoY expected). Meanwhile imports fell much more than forecast (-12.5% vs -7%). This perhaps talks to the still tepid global economy and the weaker Yuan that originally stemmed from last August's shenanigans.

This morning we published our latest HY monthly taking a look back on a month of strength for credit markets in the aftermath of the Brexit vote in the UK. GBP HY remains a notable underperformer and we question whether it therefore provides a relative opportunity. We provide some analysis looking at the performance relative to other parts of the credit market as well as assessing the main sources of weakness within the market. We also assess whether the latest actions by the BoE could provide some support for GBP HY For data completeness the other US numbers on Friday showed the unemployment rate holding steady at 4.9% and marginally missing expectations (4.8% expected). Wage growth also marginally beat expectations as hourly earnings grew +0.3% mom (vs. +0.2% expected; +0.1% previous) while the work week extended marginally as well. The trade balance number was weak and saw the deficit widen more than expected to a near one-year high in June (-44.5b vs. -43.0b expected; -41.0b previous).
Friday was fairly quiet in terms of data out of Europe. We saw German factory orders data for June fall into negative territory (-0.4% mom vs. +0.5% expected; +0.1% previous) and thus miss estimates for a third consecutive month. Much of the drag was created by Euro Area orders and demand for investment goods falling by -8.5% and -13.6% mom respectively. Over in France we saw trade deficit widen by less than expected (-3.44bn vs. -3.9bn expected; -2.717bn previous). In the UK we saw house prices slide more than expected in July (-1.0% mom vs. -0.2% expected; +1.2% previous) which could be a sign of Brexit weighing on markets.

Turning over to the week ahead now. It’s a quiet start to the week today with data due in Europe limited to Germany industrial production, France business sentiment data and Euro area investor confidence. In the US this afternoon there’s nothing of note. We kick off in China on Tuesday where the July inflation report will be worth watching. In Europe we’ll get industrial and manufacturing production numbers in the UK covering June, along with Germany trade data. In the US on Tuesday we’ve got the NFIB small business optimism reading for June, Q2 nonfarm productivity and unit labour costs, wholesale inventories and trade sales and finally the IBD/TIPP economic optimism reading. In Asia on Wednesday we’re due to get the latest machine orders and PPI data in Japan. Over in Europe there’s more industrial production data due out, this time from France, while in the US the June JOLTS job opening report and July Monthly Budget Statement is due. It’s another fairly quiet day on Thursday with France and Italy CPI highlighting the morning session, while initial jobless claims and the import price index reading are the only releases on the other side of the pond. Things finally pick up on Friday with a busy end to the week. Firstly in China we’ll get the industrial production, retail sales and fixed asset investment data for July. Turning to Europe we’ll firstly get Germany CPI for July and Q2 GDP, followed by France wage data and then Euro area industrial production for June and also Q2 GDP. It’s a bumper session in the US too with July retail sales data, last month’s PPI report, June business inventories and finally the first estimate of the University of Michigan consumer sentiment reading.

Away from the data there’s no Central Bank speak to highlight, while earnings season winds down. In the US just 23 S&P 500 companies will report including Allergen (today), Walt Disney (Tuesday) and Macy’s and Kohl’s (both Thursday). In fact 88% of the index has now reported. In Europe Deutsche Telekom and Zurich Insurance report.

http://www.zerohedge.com/news/2016-...high-commodities-rise-china-trade-disappoints
 

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#2
Frontrunning: August 8


by Tyler Durden
Aug 8, 2016 7:24 AM

  • Global stocks, dollar gain as payrolls fuel risk-on trades (Reuters)
  • Suicide bomber kills at least 50 at Pakistan hospital (Reuters)
  • Oil Rises Despite Supply Glut (WSJ)
  • Waiting Forever for Fed Model Bull Case on Stocks to Come True (BBG)
  • Fed's Powell urges patience on U.S. rates, citing growth risks (Reuters)
  • Trump to Propose Moratorium on New Financial Regulations (BBG)
  • Bond Market’s Big Illusion Revealed as U.S. Yields Turn Negative (BBG)
  • American, Australian kidnapped in Afghan capital: officials (Reuters)
  • How a Hairdresser’s Lawsuit Could Spell Trouble for Brexit (BBG)
  • The Seven-Year Short (BBG)
  • Saudi-led coalition air strike kills nine civilians in Yemen market (Reuters)
  • More records fall as Phelps collects 19th gold (Reuters)
  • NBC Audience for Olympics Opening Drops 35% From London 2012 (BBG)
  • Japan's emperor speaks to public in remarks suggesting he wants to abdicate (Reuters)
  • Draghi Jumps Brexit Hurdle to Find Oil Damping Price Outlook (BBG)
  • New IPhone Said to Have Dual Camera, Pressure-Sensitive Button (BBG)
  • State Dept: 2,340 Syrian Refugees Resettled in the U.S. in July (Fox)
  • Transocean Rig Runs Aground Off Scottish Isles Amid Storms (BBG)
  • Japan urges China not to escalate East China Sea tension (Reuters)
  • Jets pound rebels after they break Aleppo siege (Reuters)
  • Jack Ma Is Opening His Wallet to Europe But Not to Europeans (BBG)

Overnight Media Digest

WSJ

- Steinhoff International Holdings NV, Africa's retailing giant but little-known outside the continent, has made its first foray into the United States, agreeing to pay $2.4 billion for Sleepy's owner Mattress Firm Holding Corp .(http://on.wsj.com/2b6yNHW)

- Britain's top corruption investigator has opened a formal probe into plane maker Airbus Group's use of consultants, escalating an investigation that has been simmering for months. (http://on.wsj.com/2b6yIUE)

- Belgian authorities have opened a probe following a weekend machete attack on two police officers in the city of Charleroi, the latest assault in what has become a relentless summer-long barrage. (http://on.wsj.com/2b6zBg5)

- Bitfinex, the digital-currency exchange that lost $65 million to hackers last week, plans to spread the losses among all its users, including those not directly affected by the hack. (http://on.wsj.com/2b6zH7r


FT

Britain's Serious Fraud Office has launched a formal investigation into suspected fraud, bribery and corruption in connection with commercial plane sales by Airbus, parent company Airbus Group said on Sunday.

South African retailer Steinhoff International Holdings NV will buy Mattress Firm Holding Corp, the largest specialty bedding retailer in the United States, for $3.8 billion including debt, both companies said on Sunday.

British payments processor Worldpay Group Plc has obtained a licence to process payments in Australia, setting its push into the country as part of its global expansion plans.


Britain

The Times

Serious Fraud Office launches criminal inquiry into Airbus

Britain's Serious Fraud Office has launched a criminal inquiry into alleged fraud, bribery and corruption in relation to commercial jet sales by Airbus, the European aircraft maker disclosed on Sunday. The formal investigation comes after Airbus admitted in April that it was in talks with the SFO over the use of third-party agents in aircraft deals which it was asking the British government to cover with financing guarantees. http://bit.ly/2b5rq6P

Chinese line up 7 billion stg swoop on Holiday Inn

Anbang Insurance Group Co, a secretive conglomerate with a sprawling empire of top hotels and leisure assets, has held talks with City bankers about a potential takeover bid of InterContinental Hotels Group Plc. http://bit.ly/2bcIFiq

The Guardian

Third Heathrow runway would push up air fares, say campaigners

Passengers would be forced to pay substantially higher air fares if a new runway was built in the southeast and Britain kept to its carbon targets, according to an analysis of the Airports Commission's backing for a third runway at Heathrow. A report published by the Campaign for Better Transport claims that carbon pricing, a measure the commission suggested could be needed to ensure British aviation emissions remain on target, would add hundreds of pounds to air fares by 2050, spelling the end of low-cost flights. http://bit.ly/2b6dpCu

UK's top bosses received 10 pct pay rise in 2015 as average salary hit 5.5 mln stg

The bosses of Britain's largest public companies earned an average of 5.5 million pounds last year, and have enjoyed a 10 percent pay rise while wages in the rest of the economy lag far behind. Rapid inflation for the country's best-paid executives is being driven by a small, all-male group at the top of the corporate tree, according to the High Pay Centre, which published its annual survey on earnings at FTSE 100 companies on Monday. http://bit.ly/2bcSIUN

The Telegraph

Chinese eye Aspinal after fall in sterling

Aspinal, the British leather goods brand, is being circled by Chinese and European buyers after the recent fall in the pound. The company, which has followed Mulberry's lead by naming its 1,000 pound handbags after celebrities, could be valued at up to 75 million pounds, City sources said. http://bit.ly/2aMYrzF

Sky News

Comparethemarket owner picks banks for 2 bln stg float

The owner of Britain's biggest price comparison site has picked a pair of Wall Street giants to oversee a stock market listing valuing it at up to 2 billion pounds. BGL Group, the parent company of Comparethemarket, has lined up JP Morgan and Morgan Stanley to take the lead roles on an initial public offering in the first few months of next year. http://bit.ly/2b4rGCW

Clydesdale Owner Joins Suitors For RBS Unit

The owner of the Clydesdale and Yorkshire banks is drawing up plans to buy more than 300 branches that Royal Bank of Scotland will sell to a rival after failing to carve them out into a standalone lender. CYBG has asked investment bankers at Morgan Stanley to help it explore a bid for an asset portfolio that would rank as Britain's seventh-largest bank. http://bit.ly/2aZ3LEE

http://www.zerohedge.com/news/2016-08-08/frontrunning-august-8
 

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#5
Futures Flat; Global Stocks, Bonds Rise As Sterling Slides For Fifth Day


by Tyler Durden
Aug 9, 2016 6:44 AM

S&P500 index futures were unchanged (up less than 0.1%) following another modest, low-volume levitation in European, Asian shares in a mostly eventless overnight session; oil comes off following gaining overnight with WTI trading just around $43.

Government bonds advanced around the world, now that rate locks from the deluge of corporate issuance appear to have been priced in, spurred by central banks’ commitments to boost growth and a dimming outlook for inflation as commodities declined. The pound fell for a fifth day as the Bank of England resumes debt purchases to combat the fallout from Britain’s Brexit vote.

Speaking of inflation, overnight China reported its July CPI, which printed at 1.8% Y/Y, in line with expectations, and just lower than the 1.9% in June, despite concerns that severe summer flooding, which has disrupted public infrastructure and agricultural production, would increase inflationary pressures. Food prices continued to moderate, rising 3.3 percent in July compared with a 4.6 percent gain in June. Prices of pork rose only 16.1% versus a 30.1% increase in June as demand for the Chinese staple meat continued to cool from peaks hit earlier this year. Non-food inflation, however, rose 1.4 percent, compared with June's 1.2 percent gain.


CPI inflation moderated while PPI inflation was higher in July

Meanwhile, China's producer prices contracted for the 53rd month in a row at 1.7% on a year-on-year basis in July, modestly better than the -2.0% expected, and up from last month's -2.6% drop. Analysts expect producer price inflation to turn positive this year for the first time in more than four years, but the recovery at the factory gate is unlikely to lead to a rebound in private investment, which has fallen to record low growth rates.

While low inflation means Beijing has room to loosen monetary policy if needed, policymakers appear to have disparate views over how much stimulus is needed to stoke economic growth, if any, and what form it should take. Strengthening producer prices mean there is likely less need to ease in the short-term, analysts say. China's central bank has not adjusted interest rates since October 2015. According to newswires overnight, China is not likely to inject liquidity into the market on a mass scale as policy makers have promised a neutral monetary environment for supply-side reforms.

The subdued inflationary print was seen as favorable for bonds: “Investors are more interested in government bonds as the slowing economy has reduced risk appetite and as default risks were exposed in the corporate debt market,” said Liu Dongliang, senior analyst at China Merchants Bank Co. in Shenzhen. “The bull market will continue for the rest of the year, as supporting factors will continue to exist and as the market may still expect the central bank to ease monetary policy to support growth.” Sure enough, China 10-year government bond yield falls to the lowest level since 2009, as investors prefer safety of sovereign bonds after a second Chinese shipbuilder defaults on bond payment.

There was more action in Europe, where yields on benchmark 10-year debt touched all-time lows in the U.K and Spain and matched the least in seven years in China. They also dropped in India, following a central bank meeting where the RBI kept rates unchanged. Sterling slipped to a four-week low after BOE policy maker Ian McCafferty said more easing is likely to be required, while copper reached its weakest level since July 12. European stocks rose on better-than-estimated results.

According to Janu Chan, senior economist at St. George Bank in Sydney, “We could see some short-term weakness in the pound. It was an extensive stimulus program that the BOE announced. The economy has been hit in the short-term, and could face a minor recession." As the chart below shows, he is right: the pound sank 0.4 percent to $1.2990,adding to a five-day loss of 2.7 percent.



As Bloomberg puts it, bonds are in demand and volatility in financial markets is sliding as central banks boost quantitative easing and cut interest rates to spur inflation. The BOE resumed gilt purchases on Monday, India’s central bank Governor Raghuram Rajan said its policy stance remains accommodative and analysts forecast the Reserve Bank of New Zealand will lower its benchmark rate later this week. Supportive monetary policy has also pushed Band of America Merrill Lynch’s Market Risk index to the lowest level since early January.



The Stoxx Europe 600 Index added 0.3%. The benchmark has climbed more than 2% since the fresh stimulus measures were announced by the Bank of England. Munich Re rose 3.7 percent after the world’s second-biggest reinsurer reported quarterly net income that was more than double the average analyst projection. Altice rallied 14 percent after its profit increased amid gains in the U.S. and Portugal. Wm Morrison Supermarkets Plc boosted a gauge of retailers, adding 2.2 percent after extending an agreement with Ocado Group Plc that will enable its online grocery business gain national coverage. S&P 500 futures were little changed.

In commodities, the Bloomberg Commodity Index fell 0.3%, dragged down by metals. Copper declined as much as 0.8 percent, falling to the lowest in four weeks, while zinc retreated from a one-year high. Gold slipped 0.1 percent to $1,333.74 an ounce. Crude was little changed at $43.06 a barrel in New York, after jumping 2.9 percent in the last session as the Organization of Petroleum Exporting Countries predicted the current bear market in the commodity would be short-lived.

Meanwhile in bonds, despite recent concerns about an inflationary spike, things are largely back to (ab)normal: “There is so much demand for U.S. Treasuries that it is difficult for the Fed to raise longer-term rates substantially,” Philip Marey, a strategist at Rabobank International in Utrecht, Netherlands, said, referring to the Federal Reserve. Quantitative easing from central banks elsewhere means “there will be increased scarcity of safe assets, including U.S. Treasuries. This will limit the upside potential in yields.”

The yield on Treasuries due in a decade, the global benchmark, declined two basis points to 1.58 percent at 10:48 a.m. London time. While it jumped nine basis points on Friday after better-than-expected U.S. jobs data, it’s still below the year-to-date average of 1.77 percent.

U.K. 10-year gilt yields dropped to a record low of 0.59 percent and Spain’s reached 0.97 percent, having fallen below 1 percent for the first time on Monday. Indian bonds advanced and the rupee weakened after Rajan left benchmark interest rates unchanged at his final review. The yield on sovereign notes due January 2026 dropped six basis points, the most since July 28, to 7.12 percent, prices from the RBI’s trading system show.

Investors will look Tuesday to data on wholesale inventories for June for indications of the strength of the world’s biggest economy and the likely trajectory of interest rates. Earnings will also be in focus, with Walt Disney Inc. among companies reporting.

Market Snapshot
  • S&P 500 futures up less than 0.1% to 2176
  • Stoxx 600 up 0.3% to 342
  • FTSE 100 up 0.3% to 6832
  • DAX up 0.5% to 10489
  • German 10Yr yield down less than 1bp to -0.07%
  • Italian 10Yr yield down less than 1bp to 1.12%
  • Spanish 10Yr yield down 1bp to 0.98%
  • S&P GSCI Index down less than 0.1% to 346.8
  • MSCI Asia Pacific up 0.6% to 138
  • Nikkei 225 up 0.7% to 16765
  • Hang Seng down 0.1% to 22466
  • Shanghai Composite up 0.7% to 3026
  • S&P/ASX 200 up 0.3% to 5553
  • US 10-yr yield down 2bps to 1.57%
  • Dollar Index down 0.05% to 96.35
  • WTI Crude futures down 0.2% to $42.92
  • Brent Futures down 0.3% to $45.24
  • Gold spot down less than 0.1% to $1,334
  • Silver spot down 0.2% to $19.70
Top Global Headlines
  • Randstad to Acquire U.S. Jobs Site Monster for $429m: Randstad will pay $3.40/share in cash for Monster, cos. said in statement Tues.; implies 23% premium to last close.
  • Genesys Said in Talks to Acquire Interactive Intelligence: Genesys, which received $900m investment last month from PE firm Hellman & Friedman, is looking to use recent cash infusion to expand its business.
  • Amazon Japan Office Said to Be Searched by Fair Trade Agency: Japanese antitrust agency looking into whether AMZN sought deals with sellers that gave it more favorable conditions over other e-commerce companies.
  • Twitter Seeks to Sublease Part of San Francisco Headquarters: Co. offering about 1/4 of the space at its S.F. headquarters complex for sublease, adding to growing amount of excess offices available as technology industry cools.
  • Alibaba Offers to Help Global Tech Companies Navigate China: New AliLaunch program makes use of co.’s cloud platform, can help clients with JVs, marketing; it’s biggest customer so far is SAP, which will sell its Hana data-software and services on Alibaba’s cloud.
  • U.S. Bond Retreat Confounds Analysts as Fed Rate Bets Revive: Yield on benchmark 10-year U.S. sovereign debt is above median of year-end ests. compiled by Bloomberg for first time.
* * *

Looking at regional markets, Asia initially traded relatively mixed in the wake of the subdued lead from the US where stocks slightly pulled back from last week's record highs, amid light news flow and summer-quietened trade. However, price action then staged a turnaround heading into the European session to conform with the tone set by Europe. Nikkei 225 (+0.7%) was higher as it continued to benefit from JPY weakness, while ASX 200 (+0.3%) was led by financials with ANZ shares gaining as much as 3% amid earnings. Chinese markets were mixed with choppy trade seen in Shanghai Comp (+0.7%) and the Hang Seng (-0.1%) following inflation data which suggested weak demand with CPI at a 6-month low and PPI contracted for a 53rd consecutive month. 10yr JGBs traded higher on a rebound from recent losses, while today's 30yr auction saw mixed results, in which the b/c increased and tail in price narrowed, but the lowest accepted price and average price fell from last month.

Top Asian News
  • Rajan Holds India Rates in Final Move as Inflation Quickens: Decision was predicted by 27 of 29 economists in survey
  • Bank of Japan Limits Foreign Profits on Negative-Yielding Bonds: BOJ boosts dollar funding facility to ease domestic costs
  • China’s Factory Deflation Narrows in Further Stabilization Sign: July PPI -1.7% y/y vs June -2.6%
  • Hong Kong Property Stocks Are Hottest Since Eve of 1997 Collapse: Gains outstrip Hang Seng Index despite supply, rate concerns
  • China Auto Sales Rising Most in 17 Months Spurs Inventory Relief: Passenger-vehicle sales rose 23% to 1.6m units in July
  • ANZ Rises to 7-Month High as Bank Reports Capital, Asset Growth: 9-mo. cash profit drops 3% to A$5.2b
European stocks trade in the green this morning amid quiet newsflow with basic material names outperforming in the wake of Iron ore reaching 2 year highs. The Dax cash trades up around 0.5% with data flow continuing to remain light at the start of the week and as such traders will be looking towards the end of the week whereby markets will see the release of the latest US PPI, retail sales and Uni. Of Michigan data. Markets may be particularly sensitive to these releases given that markets are 50/50 over whether the Fed will hike rates this year and therefore may use the releases as an opportunity to establish a bias on this front. In terms of fixed income markets the Spanish and UK 10 years have hit fresh record low yields with participants overlooking political deadlock in Spain and markets continuing to digest the latest stimulus efforts by the BoE. Furthermore, mounting stimulus expectations for the ECB have also helped to lift peripheral paper and Spanish paper remains preferable to that of Italy amid the concerns surrounding the Italian banking sector.

Top European News
  • Brexit Red Lines Drafted by EU-27 as U.K. Plans Its Strategy: U.K. PM Theresa May faces daunting array of demands from EU nations when time comes to negotiate Britain’s future relationship with bloc, analysis shows.
  • U.K. Regulator’s Bank ‘Shake Up’ With Cap Fails to Create Stir: CMA recommended banks set their own limits on overdraft charges, with grace period for customers to avoid them, rather than have overdraft fees “centrally regulated,” agency said in a statement.
  • Munich Re Profit Beats Estimates on Currency, Investments: 2Q profit beat analysts’ expectations as gains from currencies, investments cushioned higher claims from natural disasters, also restructuring charges at its Ergo primary- insurance unit.
  • Drahi’s Altice Boosts Profit as U.S. Purchases Bring Growth: Earnings were “strong,” and co.’s projection for growth is “reassuring,” says Goldman analyst Andrew Lee.
  • Italy Bank Bad Loans at EU197.9b in June: Bank of Italy: Banks’ gross bad loans rose 1.1% in June from yr earlier
In FX, the pound sank 0.4 percent to $1.2990, contributing to a five-day loss of 2.7 percent. As well as cutting interest rates for the first time since 2009, the Bank of England on Aug. 4 exceeded economists’ expectations with an announcement that it would increase its gilt-purchase program by 60 billion pounds to 435 billion pounds, starting this week. “We could see some short-term weakness in the pound,” said Janu Chan, a senior economist at St. George Bank Ltd. in Sydney. “It was an extensive stimulus program that the BOE announced. The economy has been hit in the short-term, and could face a minor recession.” Taiwan’s dollar gained as much as 0.4 percent to its strongest level in a year after trade data released Monday showed exports increased in July for the first time in 18 months. Global funds boosted their holdings of the island’s shares by about $400 million in the first two trading sessions of this week, according to data compiled by Bloomberg

In commodities, the Bloomberg Commodity Index, which measures returns on raw materials, fell 0.3 percent, dragged down by metals. Copper declined as much as 0.8 percent, falling to the lowest in four weeks, while zinc retreated from a one-year high. Gold slipped 0.1 percent to $1,333.74 an ounce. Crude was little changed at $43.06 a barrel in New York, after jumping 2.9 percent in the last session as the Organization of Petroleum Exporting Countries predicted the current bear market in the commodity would be short-lived. The group said Monday its members will hold informal talks next month and that there are “constant deliberations” over stabilizing the market. “Nobody seriously thinks that OPEC will come up with anything that will tighten supply,” said Michael McCarthy, chief strategist at CMC Markets in Sydney. “Having bounced off the support near $40, and without any further supply coming online, we’re moving toward the middle of the trading range of about $44 to $45.”

On to the calendar, where it is a busier day over in the US. First up we have the NFIB small business optimism reading for July which came in modestly less than expected at 94.6, below the 94.7 expected; up from 94.5 previous. Following that we will see the preliminary Q2 estimates for nonfarm productivity (+0.4% expected; -0.6% previous) and unit labor costs (+1.8% expected; +4.5% previous). The weak rebound in productivity growth is disappointing as it had declined in the previous two quarters. The current weakness in productivity is unprecedented in the post-WWII era and has bleak implications for future economic growth. Finally we’ll see the wholesale inventories number for June which is expected to be unchanged on the month (+0.0% expected; +0.0% previous).

* * *

Bulletin Headline Summary
  • European equities enter the North American crossover modestly higher amid light newsflow with the FTSE 100 remaining at post-Brexit highs
  • GBP remains out of favour with GBP/USD below 1.300 amid dovish comments from BoE's McCafferty and disappointing UK data releases
  • Looking ahead, highlights include API Crude Oil Inventories and a US 3yr Auction
  • Treasuries rallied in overnight trading along with global equities as commodities slide and U.K. and Spanish 10Y yields hit all-time lows; week’s auctions begin with $24b 3Y notes, WI 0.855%; sold at 0.765% in July, lowest 3Y auction stop since 0.715% in Feb. 2014.
  • Oil dropped from the highest close in two weeks amid doubts that informal talks between OPEC members next month will lead to any action to tighten supplies. Futures slid as much as 1.2% in New York after rising 2.9% Monday
  • U.K. industrial production barely grew in June as the economy lost momentum before the Brexit referendum. Output rose 0.1% following a 0.6% drop in May, the Office for National Statistics said in London
  • Bank of England policy maker Ian McCafferty said that officials will likely ease policy again if the economy develops in line with the central bank’s forecasts -- though they should take a gradual approach
  • European bankers exploited pledges by G20 and European Union finance ministers to avoid boosting capital requirements as they campaigned against the plans during earnings calls in past weeks
  • Presiding over his final interest-rate review, Rajan’s announcement of more open-market debt purchases revived a rally that had been losing steam in recent days after benchmark 10-year notes capped their best month since 2013 in July
  • Chinese bonds advanced, with the 10-year yield dropping to match the lowest levels since 2009, as foreign inflows increase and investors seek safety from a rising number of corporate failures
  • Hong Kong real estate shares haven’t been this hot since the city’s last housing bubble burst almost two decades ago. The industry’s benchmark equity gauge has surged 37% from this year’s low in January
US Event Calendar
  • 6am: NFIB Small Business Optimism, July, est. 94.5 (prior 94.5)
  • 8:30am: Non-farm Productivity, 2Q P, est. 0.4% (prior -0.6%)
  • 8:55am: Redbook weekly sales
  • 10am: Wholesale Inventories, June, est. 0.0% (prior 0.1%, revised 0.1%)
  • 10am: IBD/TIPP Economic Optimism, Aug. (prior 45.5)
  • 4:30pm: API weekly oil inventories
DB's Jim Reid concludes the overnight wrap

With limited data to respond to yesterday, price action across global equity markets was largely muted. The STOXX (+0.04%) and the S&P500 (-0.09%) were both essentially flat on the day. In Europe banks (+1.4%) and insurance (+1.5%) sectors were two of the top three performing sectors of the day, while basic resources (+1.7%) was the top performer. Oil climbed around +2.5% with some looking to an announcement yesterday that OPEC would have an informal side meeting next month at the International Energy Forum in Algeria with hopes of a renewed push for a production freeze. These things often come to nothing and tend to be discussed after a decent fall in the price but it created some attention.

Oil has given up some of its gains in Asia (-0.8%) but equity market are all fairly quiet with the Nikkei +0.35%, Hang Seng -0.19% and Shanghai Comp +0.29%. The main data has been Chinese inflation with the PPI falling less than expected at -1.7% (-2% forecast) which is actually the highest for nearly 2 years. This number was stuck near -6% in Q4 last year. CPI came in inline with estimates at 1.8%.

Back to yesterday and credit markets over in Europe saw decent performance as iTraxx Main and Crossover tightened by -2bps and -8bps respectively over the course of the day. US credit markets failed to see similar moves as CDX IG and HY were largely unchanged on the day. The latest ECB CSPP numbers (as of Aug 5th) saw purchases holding up impressively in this holiday season with the €1.764bn higher than the previous two weeks and not far off the average weekly number seen since the program started.

The other end of the risk spectrum also saw little action. German 10Y yields held steady on the day, while US 10Y yields edged marginally lower by -1bps after rising significantly on Friday. 10Y Gilt yields saw bigger moves as they fell by -6bps as markets continued to digest BoE’s aggressive policy package unveiled last week. Over in currency markets, the pound (-0.26%) continued to slide for the fourth straight day while the dollar index rose marginally by +0.27%. Gold was unchanged on the day.

In terms of data it won't surprise you to learn that it was quiet. Over in Europe we saw German industrial production numbers for June rebound back into positive territory and come in marginally above expectations (+0.8% mom vs. +0.7% expected; -0.9% previous). However the bounce only served to reverse the decline seen in May as the demand for capital goods rebounded. It will be more interesting to watch next month’s number to see how production responds to the Brexit vote. Other data points out of Europe included French business sentiment data for July which ticked up marginally to beat expectations at 98 (vs. 97 expected; 97 previous) while the Sentix Eurozone investor confidence indicator for August rose to 4.2 (vs. 3.0 expected; 1.7 previous). There were no material data releases out of the US yesterday.

Turning over to today's calendar now. In Europe we’ll get the UK industrial (+0.1% expected; -0.5% previous) and manufacturing (-0.2% expected; -0.5% previous) production numbers for June, with data expected to demonstrate little improvement with most of the data pre-Brexit. We’ll also see UK and German trade balance data for June, with the UK trade deficit expected to widen (-£2.55bn expected; -2.263bn previous) while the German trade surplus is expected to increase to EUR23.0bn (21.0bn previous).

It’s a busier day over in the US. First up we have the NFIB small business optimism reading for July which is expected to hold steady (94.5 expected; 94.5 previous). Following that we will see the preliminary Q2 estimates for nonfarm productivity (+0.4% expected; -0.6% previous) and unit labor costs (+1.8% expected; +4.5% previous). The weak rebound in productivity growth is disappointing as it had declined in the previous two quarters. Our Chief US economist Joe LaVorgna notes that the current weakness in productivity is unprecedented in the post-WWII era and has bleak implications for future economic growth. Finally we’ll see the wholesale inventories number for June which is expected to be unchanged on the month (+0.0% expected; +0.0% previous).

http://www.zerohedge.com/news/2016-...ise-commodities-dip-sterling-slides-fifth-day
 

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Frontrunning: August 9


by Tyler Durden
Aug 9, 2016 7:43 AM

  • Search for yield drives stocks higher, pound falls vs dollar (Reuters)
  • China's slowing wholesale deflation takes pressure off central bank (Reuters)
  • Rajan Holds India Rates in Final Move as Inflation Quickens (BBG)
  • Brent above $45 on U.S. inventories, producer action speculation (Reuters)
  • Republican national security experts: Trump would be 'dangerous' president (Reuters)
  • House Speaker Paul Ryan faces primary test after belated Trump endorsement (Reuters)
  • China Warns U.K. That Relations Hang on Hinkley Point (BBG)
  • Spain’s Yield Curve Flattest in More Than a Year on ECB Stimulus (BBG)
  • Are Negative Rates Backfiring? Here’s Some Early Evidence (WSJ)
  • China Sees Second Shipbuilder Default This Year as Economy Slows (BBG)
  • Saudi-led air strikes on Yemen capital resume, nine civilians killed (Reuters)
  • Fannie, Freddie Could Need as Much as $126 Billion in Crisis (BBG)
  • Valeant Maintains 2016 Forecast Despite Sales, Earnings Miss (BBG)
  • Struggling Japan Display says state fund promises full financial support (Reuters)
  • U.K. SFO to Decide Charges in BOE Fraud Probe by Year-End (BBG)
  • Colorado Activists Submit Petitions for Referendums on Fracking (NYT)
  • Turkey says rising anti-Americanism can be calmed by Gulen extradition (Reuters)
  • Buffett Cash Pile Climbs to $72.7 Billion, Setting Record: Chart (BBG)

Overnight Media Digest

WSJ

- Online lender LendingClub Corp said Monday that its finance chief had resigned to pursue a new opportunity, a management shift that comes three months after the company ousted its founder and CEO. http://on.wsj.com/2ba0GyG

- A federal appeals court in Manhattan upheld a decision preventing Ecuadorean plaintiffs from enforcing a multibillion-dollar award against Chevron Corp, a significant win for the oil giant in a legal dispute that has lasted decades http://on.wsj.com/2b9ZvQ1

- Barclays PLC agreed to pay $100 million to end investigations by 43 states and the District of Columbia into its alleged manipulation of the London interbank offered rate benchmark in the mid-2000s. http://on.wsj.com/2ba0rUw

- A power outage at Delta Air Lines Inc grounded thousands of passengers world-wide during the height of the summer travel season, wreaking havoc on the carrier's reservations system and drawing attention to antiquated technology that has plagued many airlines. http://on.wsj.com/2ba0sI0

FT

China has warned Britain that bilateral ties stand at a "crucial historical juncture" over London's deferral of an 18 billion pound ($23.47 billion) nuclear power project, the Financial Times reported on Monday.

Wal-Mart Stores Inc, vying to better challenge Amazon.com Inc, will pay about $3 billion for internet retailer Jet.com and its innovative pricing software in the largest-ever deal for an e-commerce startup.

A German court will adopt a rarely used class-action style procedure to more efficiently process claims by investors seeking damages from Volkswagen over a diesel emissions cheating scandal, according to a ruling. The regional court in Braunschweig near Volkswagen's Wolfsburg headquarters said on Monday it will pick one case to act as a model to help resolve as many as 170 other damages claims, the closest thing Germany has to class-action lawsuits common in the United States


NYT

- In an effort to halt the advance of the oil industry in Colorado, environmental activists said they submitted enough signatures on Monday to place on November's ballot two initiatives aimed at severely limiting hydraulic fracturing. nyti.ms/2b2tQSf

- Starting in 2018, all eight "Harry Potter" films, and the coming films of the spinoff series "Fantastic Beasts and Where to Find Them," will be seen on the NBCUniversal stations Syfy and USA, the company announced on Monday. nyti.ms/2b2u4so

- Lawyers for former Fox News chairman Roger Ailes have agreed to keep the sexual harassment lawsuit brought against him by former anchor Gretchen Carlson in New Jersey, according to a court filing on Monday. nyti.ms/2b2uAXu

- Fifty of the nation's most senior Republican national security officials, many of them former top aides or cabinet members for President George W. Bush, have signed a letter declaring that Donald J. Trump "lacks the character, values and experience" to be president and "would put at risk our country's national security and well-being." nyti.ms/2b2vkeV


Britain

The Times

Thousands of retail investors are likely to be denied the chance of buying shares in Lloyds at a discount as the government is expected to abandon the plan in the aftermath of market uncertainty caused by Brexit. http://bit.ly/2aVoZB1

At least 30 international trade deals worth more than $20 billion to American businesses are stuck in limbo because of a political spat over the fate of the US Export Import bank. http://bit.ly/2aVsSWD

The Guardian

Warm weather and heavy discounts have helped drive a rebound in retail sales, potentially tempering fears of the UK economy grinding to a halt following the Brexit vote. http://bit.ly/2aVoWF1

EDF's decision to invest in the 18 billion pound ($23 billion) Hinkley Point should be declared invalid, French trade unions have said, as pressure builds against the troubled nuclear power plant project. http://bit.ly/2aVpFpO

The Telegraph

Barclays is paying $100m to 44 U.S. states to settle an investigation into interest rate manipulation. http://bit.ly/2aVp5se

Britain's pension system is facing a monumental shake-up as a select committee investigates the powers of the Pensions Regulator and the future of defined-benefit pension funds. http://bit.ly/2aVpBqc

Sky News

Trains across London, East and West Sussex, Kent, Surrey, Buckinghamshire and Hampshire are affected by the strike, which started on Monday morning. http://bit.ly/2aVpomK

UK supermarket chain Wm Morrison is likely to announce within days that it has reached a deal with the online grocer, Ocado, to take capacity at its warehouse in Erith, Kent. http://bit.ly/2aVpElF

The Independent

Three of the UK's biggest banks have paid out billions of pounds in dividends to investors while turning a blind eye to huge capital holes in their balance sheets, researchers argue. http://ind.pn/2aVqezS

Companies in London and the South East were most severely impacted by the shock vote to leave the EU, according to a manufacturing survey. http://ind.pn/2aVq0sJ

http://www.zerohedge.com/news/2016-08-09/frontrunning-august-9
 

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#8
Mornings With "V" : 08.09.16
ROGUE MONEY


Streamed live 1 hour ago
V Keeps it real running down the latest news and info.
 

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Nothing to see. If interested your best bet is to listen in one window, play around on GIM or surf the web in a different window. Approx 1 hour and 14 minutes long.

A Conversation with Steve Forbes
FinanceAndLiberty.com


Published on Aug 9, 2016
This video was posted with permission from http://FTMDaily.com

FINANCE AND LIBERTY:
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DISCLAIMER: The financial and political opinions expressed in this video are not necessarily of "Finance and Liberty" or its staff. Opinions expressed in this video do not constitute personalized investment advice and should not be relied on for making investment decisions.
 

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#11
US Futures Flat; Bonds Rise, Dollar And Oil Slide Over US Productivity Collapse Fears


by Tyler Durden
Aug 10, 2016 6:47 AM

Following yesterday's muted action which saw the S&P500 close unchanged, it has been more of the same listless trading overnight, with US equity index futures little changed as the Nikkei fell on the back of a stronger Yen, while government bonds rose and European stocks reversed early gains following the BOE's expalantion in the aftermath of yesterday's failed bond monetization operation that the bank will "incorporate the shortfall into the second half of its 6 month program." WTI dropped for a second day after API data showed U.S. oil inventories resumed expansion, while Saudi Arabia told OPEC that it pumped a record 10.67 million barrels of oil a day, an increase that as Bloomberg puts it, "will do nothing to endear OPEC’s leading exporter to other members seeking output limits to shore up prices."



The dollar weakened against all its major peers, dragging the Bloomberg Dollar Spot Index down for a second day. Metals were also boosted by the dollar’s retreat, with palladium, tin and zinc rising to the highest in a year. U.K. government bonds extended gains after the Bank of England indicated it will stick with its current quantitative-easing plans. European stocks were little changed and most Asian shares fell.

A reason for the dollar weakness was yesterday's disappointing economic productivity data which showed an unprecedented, third consecutive quarterly drop. As DB's Jim Reid said, "with productivity so low not only does it not bode well for growth but the risk is that companies eventually reduce their demand for labour. They could invest in capital instead but waiting for that has proved elusive in recent years. So in spite of the recent payroll boost we still think the US looks late cycle and think profits will continue to be subdued and that employment will edge weaker over the coming months."

So as the light dimmed in one of the few bright spots in the world economy, the United States, demand for bonds firmed - a factor highlighted by the Bank of England's failure on Tuesday to prise enough debt from investors to meet its bond-buying target under plans to stimulate Britain's economy. With sub-par global growth and inflation keeping the onus on looser central bank policy, New Zealand, one of the 55 monetary authorities to ease policy since the start of 2015, was broadly expected to cut rates further on Thursday.

Others piled on: "low U.S. productivity growth could suggest the third- quarter growth can't be fantastic. That in turn would mean the Fed will not need to raise rates," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.

As a result, "Central banks look increasingly accommodative and no one seems to be going against that trend ... which supports all asset prices," said Anton Heese, head of European rates strategy at Morgan Stanley in London. "The growth prospects for the U.S. economy are probably weaker than many anticipate."

So in light of continued slow economic growth how did markets response? Well, the MSCI's world stock index covering 46 markets advanced to its highest level seen in a year at 419.77, trumping a level hit on Tuesday. MSCI's broadest index of Asia-Pacific shares excluding Japan rose 0.3 percent to the highest level since August 2015.

With little to do in developed countries, investors have shifted their attention to emerging-market assets where demand is surging, supported by loose DM central bank policy and after the Fed turned more “dovish,” said Owi Ruivivar, managing director in Singapore who helps oversee about $1 trillion for the Wall Street firm. A gauge of emerging-market currencies climbed to the highest level since July 2015.



European stocks reversed earlier gains to fall for first day in six with Norwegian, Finnish, German bourses underperforming, following some notable weak earnings. The Stoxx Europe 600 Index fell 0.1 percent, after reaching its highest close since Britain’s June vote to leave the European Union. The number of shares changing hands was 34 percent lower than the 30-day average. Germany’s DAX Index slipped 0.1 percent after entering a bull market. 13 out of 19 Stoxx 600 sectors fall with utilities, oil & gas underperforming and insurance, banks outperforming. 55% of Stoxx 600 members decline, 42% gain.

Among the more prominent European moves, EON SE dragged European utility companies to the worst performance of the Stoxx 600’s 19 industry groups, sliding 5.5% as it posted a first-half loss because of charges linked to the listing of its Uniper unit. Prudential Plc rose 1.9 percent after reporting first-half profit that beat analyst estimates, boosted by higher earnings at its Asia and U.S. units. Danish biotech company Novozymes A/S sank 9.2 percent as it reported profit that missed estimates and cut its sales outlook. Brenntag AG dropped 2.1 percent after the profit forecast of the world’s largest distributor of chemicals missed some analyst projections.

S&P 500 futures rose 0.1% after U.S. equities closed little changed near a record high on Tuesday.

So as stocks went nowhere, bonds were bid and yields on 10- and 30-year U.K. bonds fell to record lows - as expected - after the central bank made no changes to its gilt-purchase plan after its first uncovered QE operation since beginning the program in 2009. Fixed-income markets are rallying on speculation central banks will continue to keep interest rates low. Japan’s 10-year bond yield fell two basis points to minus 0.11 percent, Germany’s declined one basis point to minus 0.09 percent and that on similar-maturity Treasuries dropped by one basis point to 1.54 percent. The rate on New Zealand’s notes fell five basis points ahead of Thursday’s monetary policy review. Emerging-market bonds rose, with the yield on South Africa’s 10-year security dropping 11 basis points to 8.42 percent, and Turkey’s rate sliding three basis points to 9.58 percent. China sold five-year debt at a 2.43 percent yield, less than the median forecast of 2.51 percent in a Bloomberg survey.

The cost of insuring corporate debt against default rose for the first time in five days. The Markit iTraxx Europe Index of credit-default swaps on investment-grade companies climbed one basis point to 66 basis points. It remains near the lowest in a year. The Markit iTraxx Europe Crossover Index of swaps tied to sub-investment grade corporate debt rose three basis points to 308 basis points.

Investors will look to earnings from companies including Ralph Lauren Corp. for indications of the health of corporate America. Stocks have benefited from better-than-forecast earnings this season, particularly among technology companies. With about 90 percent of S&P 500 members having posted results, 78 percent have beaten profit predictions and 55 percent have topped sales projections. The only data of note out of the US is the June JOLTS survey, where number of job openings is expected to hold steady on the month (5.5mn expected; 5.5mn previous).

Market Snapshot
  • S&P 500 futures up 0.1% to 2180
  • Stoxx 600 down less than 0.1% to 345
  • FTSE 100 down less than 0.1% to 6851
  • DAX down 0.2% to 10669
  • German 10Yr yield down 2bps to -0.09%
  • Italian 10Yr yield down 2bps to 1.1%
  • Spanish 10Yr yield down 2bps to 0.98%
  • S&P GSCI Index down less than 0.1% to 345
  • MSCI Asia Pacific up 0.3% to 139
  • Nikkei 225 down 0.2% to 16735
  • Hang Seng up 0.1% to 22492
  • Shanghai Composite down 0.2% to 3019
  • S&P/ASX 200 down 0.2% to 5544
  • US 10-yr yield down less than 1bp to 1.54%
  • Dollar Index down 0.59% to 95.61
  • WTI Crude futures down 1.1% to $42.31
  • Brent Futures down 0.8% to $44.63
  • Gold spot up 0.9% to $1,353
  • Silver spot up 2.3% to $20.31
Top Global Headlines
  • Disney Reshapes TV With $1b Streaming Deal, ESPN Online: Co. said it will pay $1b for a 1/3 stake in BAMTech, a technology, streaming business formed by MLB, and launch new web-based ESPN service this year.
  • Abbott Says Alere Denies Key Access; Not Sure Deal Will Close: Co. provided detailed list of issues that have materialized since purchase agreement was signed on Jan. 30: SEC filing.
  • SolarCity Growth Slows Even More as Musk Details Energy Vision: Co. developing rooftop product that incorporates solar technology, storage system that uses Tesla batteries at customers’ homes to provide power-management services to utilities.
  • SunPower Plunges After Solar Manufacturer Scraps Profit Goal: Co. scrapped a target to at least break even this year, in part because of challenging conditions in its power-plant business.
  • Gold at ‘Rich Level’ to Struggle as Fed May Hike 3 Times: Gold may have met its match after stellar start to 2016 as probable trio of rate hikes from Fed through end-2017 means there’s little room for further rally.
  • SunEdison Gets $144m Bid for Some Assets From NRG Renew: Bankrupt renewable energy co. agrees to sell solar, wind projects in Utah, California, Maine, Hawaii, Texas at auction where NRG would make opening bid.
  • Green Plains May Spend $275m to Get Into Food Business: Distiller signed non-binding agreement to pay $225m-$275m for a “complementary” part of a food ingredients co.
  • Viacom Outlook Cut by Moody’s Due to Poor Performance, Divs.: Co. was spared an immediate downgrade of its Baa2 rating during the ongoing dispute over control.
  • Saudi Said to Pump Record Oil Output to Meet Summer Usage: pumped record 10.67mbbl/d in July to meet a summer surge in domestic demand.
  • ‘Peppa Pig’ Owner Entertainment One Rejects Takeover Offer: Canadian co., owner of popular preschool cartoon character “Peppa Pig,” said in statement that the bidder may come back.
  • NBC Says Olympics Audience Is Bolstered by Counting Web Viewers; 31.5m people tuned in on TV, online to watch Olympics on Monday night, about as those who watched only on TV 4 years ago.
  • BlackRock Targeted by Gay Activists for Investing in Firearms: Gays Against Guns to target BlackRock to kick off campaign pressuring investors to cut ties with firearms industry.
  • Clinton Up 6 on Trump in Two-Way Race in Bloomberg National Poll
  • House Speaker Ryan Defeats Political Unknown in Primary
* * *

Looking at regional markets, we start in Asia which traded mixed following the flat close on Wall St. and weakness in energy, in which NatGas declined nearly 5%. Nikkei 225 (-0.2%) was initially negative as a firmer JPY dampened exporter sentiment but then recovered on short covering ahead of tomorrow's market closure. ASX 200 (-0.2%) was pressured by energy losses with financials also subdued after Big-4 Commonwealth Bank missed on its earnings, despite posting a record FY net. Shanghai Comp (-0.2%) traded with mild losses, while Hang Seng (+0.1%) outperformed on earnings releases. 10yr JGBs saw minor gains as they tracked T-notes higher amid the indecisiveness seen in the region, while the BoJ were in the market for JPY 1.14trl of government debt.

Top Asian News
  • RBA’s Stevens Urges Budget Fix, Says Monetary Policy Not Enough: Australian central bank governor says inflation target has flexibility to allow undershooting
  • Hong Kong Exchange Profit Falls on Lower Securities Trading: Timing of less critical projects deferred to control costs
  • CBA Profit Growth Slowest Since 2009, Bad-Debt Charges Climb: Bad-debt provisions jump on exposure to commodities sectors
  • DBS Head Fails to Ease Analyst Discomfort on Energy Exposure: Credit Suisse, CIMB downgrade ratings on Singaporean bank
  • India Said to Clarify Apple’s Path to Opening Own Retail Stores: Officials say company can now reapply to open retail outlets
  • Nomura ‘Lost Control’ in Firing Salesman Over $40 Million Loss: Nomura disciplinary process had “multiple defects,” judge says
European equities are trading within a tight range this morning (Euro Stoxx: 0%), with once again not too much in the way of fundamental news flow to drive prices in what has been a week thus far void of tier 1 data releases. In terms of notable movers, earnings have dictated play so far this morning, with DAX heavyweight E.ON among the worst performers (-5.7%) after their pre-market release. On a sector specific basis, material names outperform as upside in the commodities complex remains favourable for the sector while utilities underperform amid E.ON's aforementioned earnings. Fixed income newsflow has been dictated so far by the fallout of yesterday's BoE purchases, whereby they failed to hit their target. Gilt yields hit fresh record lows this morning after the central bank announced that they will add yesterday's shortfall to the second half of their 6-month program and therefore will not write off yesterday's disappointing operation. Bunds this morning continue to trade above 167.50, with markets having recently digested EUR 5bIn of the Buba's 0.0% Bund auction which drew a modest b/c of 1.4 but above the previous of 1.2.

Top European News
  • Brexit Bites Back as Peugeot Joins Dell in Lifting Prices: British consumers starting to bear costs of Brexit, with cos. raising prices of everything from cars to carpets to counter weaker pound.
  • Prudential Rallies After Asia Drives 1H Profit Beat: Co. delivered good progress “in a period of heightened macro- economic, geo-political and investment market uncertainty and volatility,” CEO Mike Wells said.
  • EON Posts Loss After Writing Off Billions on Plants, Storage: Impairments, contingency losses for its hydrocarbon-based power stations, natural gas storage assets led to net loss of EU3b.
  • Novozymes Shares Plunge as Danish Enzyme Maker Cuts Outlook: World’s biggest supplier of enzymes used in everything from detergent to biofuel plunged as much as 9.8%.
  • Eurostar U.K. Union Plans Seven Days of Strikes Over Schedules: A 4-day walkout will begin in early hours of Friday, last through midnight on Monday, union said in statement.
  • Fired Deutsche Bank Manager Says Superiors OKed Deal Lists: Former Deutsche Bank executive who’s suing bank for unfair dismissal arguing that payments to Chinese JV which got him fired were based on approvals by other top managers in Asia.
  • BOE to Include Shortfall From Uncovered Auction in 2H of Plan: Details of these purchases to be announced on Nov. 3.
  • Italian Banks Reel; Monti Has No Regrets for Avoiding Bailout: Immediate problem is EU360b of bad debt on Italian banks’ books.
  • Spain Yield Gap Tightest in More Than a Year on ECB Stimulus: Spread between Spain’s 2-, 30-yeargovt bonds narrowed to least since April 2015.
In FX, the Bloomberg Dollar Spot Index, which tracks the greenback against 10 major peers, fell 0.5 percent in early trade. The yen added 0.5 percent to 101.40 per dollar. New Zealand’s dollar strengthened 0.9 percent, while Australia’s currency advanced 0.6 percent. “The U.S. dollar is unlikely to rally significantly against the commodity-sensitive currencies,” said Elias Haddad, a senior currency strategist at Commonwealth Bank of Australia in Sydney. “Monetary policy settings around the world are going to be loose or looser going forward, and fiscal policy is expected to be more accommodative. That will support the global economic recovery and underpin commodity prices.” The MSCI Emerging Markets Currency Index rose 0.6 percent, extending its five-day gain to 1.7 percent. The gauge has climbed 10 percent from this year’s low set in January. The won led gains on Wednesday, appreciating 1.1 percent to the strongest since May 2015, followed by gains of at least 0.8 percent for Malaysia’s ringgit and Taiwan’s dollar.

In commodities, the Bloomberg Commodity Index, which measures returns on raw materials, climbed 0.3 percent as metals advanced on the weaker dollar. Gold rose 0.9 percent to $1,352.41 an ounce, while silver and platinum added at least 2.3 percent. Palladium, used in the pollution control systems of cars, jumped as much as 7.7 percent, the most since May 2010, after data showed Chinese vehicle sales accelerated by the most in 17 months. On the London Metal Exchange, copper for delivery in three months rose 0.9 percent to $4,824 a ton, while zinc, lead and tin rose at least 0.9 percent. Crude oil fell 1.1 percent to $42.30 a barrel in New York on signs of higher supply. It slid 0.6 percent on Tuesday as American Petroleum Institute data indicated U.S. stockpiles rose by 2.09 million barrels last week. Saudi Arabia pumped 10.67 million barrels of oil a day in July to satisfy the summer surge in domestic demand, according to two people with knowledge of the data.

On today's calendar, it’s a quiet day ahead across the globe in terms of data releases today. In Europe the only notable data points are the June industrial (+0.1% mom expected; -0.5% previous) and manufacturing production (+0.2% mom expected; +0.0% previous) numbers from France, where growth is expected to be marginally positive. The only data of note out of the US is the June JOLTS survey, where number of job openings is expected to hold steady on the month (5.5mn expected; 5.5mn previous).

* * *

Bulletin Headline Summary from RanSquawk and Bloomberg
  • European equities trade with little firm direction amid another quiet session and lack of tier 1 data releases across the continent
  • In FX markets, USD has seen some selling pressure in recent trade as participants continue to raise concerns over US productivity ahead of Friday's key US data releases
  • Looking ahead, highlights include RBNZ Rate Decision and Press Conference, DOEs and the OPEC Monthly Report
  • Treasuries higher in overnight trading while global equities mixed and gold surges as Germany auctions 10Y debt at record low yield of -0.09%; UST auctions continue with $23b 10Y notes, WI 1.535%; last sold at 1.516% in July, lowest auction stop since 1.459% in July 2012.
  • The Bank of England’s plan is to keep calm and carry on buying. The central bank said Wednesday it will deal with a 52 million-pound shortfall ($60.8 million) in an operation on Tuesday at a later date
  • Pimco’s Total Return Fund increased its stake in U.S. government debt to a 25-month high in July as a rally in Treasuries pushed yields to an all-time low and then fizzled
  • China’s official bad-loan ratio held at 1.75% in the second quarter after almost three years of increases, suggesting some progress as President Xi Jinping’s officials try to defuse risks from the nation’s explosion in credit
  • China’s central bank said it plans to push the yuan’s global use by seeking more cooperation with other countries and improving the infrastructure needed to support wider use of the currency
  • Brazil’s Senate voted 59 to 21 to put suspended President Dilma Rousseff on an impeachment trial that could seal her downfall and strengthen her successor’s hand as early as this month
  • Saudi Arabia told OPEC that it pumped a record 10.67 million barrels of oil a day in July to meet a summer surge in domestic demand, an increase that will do nothing to endear OPEC’s leading exporter to other members
US Event Calendar
  • 7am: Mortgage Applications, Aug. 5 (prior -3.5%)
  • 10am: JOLTS Job Openings, June, est. 5.59m (prior 5.5m)
  • 10:30am: DOE Energy Inventories
  • 2pm: Monthly Budget, July, est. -$115b (prior -$149.2b)
* * *

DB's Jim Reid concludes the overnight wrap

It remains a bit dull out there with no market double flips to get excited about but there were a few more things of interest yesterday with poor US productivity numbers and the BoE failing on only day 2 of their new QE program to buy all the securities they wanted.

On the former, both ourselves and our US economist Joe LaVorgna have been looking forward to yesterday's productivity and ULCs numbers. Q2 nonfarm productivity estimates indicated a weaker than expected drop (-0.5% vs. +0.4% expected; -0.6% previous). It was the 3rd quarterly decline something we haven't seen for 37 years. Joe once again noted that this slowdown in productivity growth will weigh on the US economy, with the year-over-year rate slipping to -0.4% which is the slowest rate since Q2 2013 (-0.6%). The Q2 estimates for unit labor costs came in marginally above expectations (+2.0% vs. +1.8% expected) but was largely offset by the previous quarter being revised down from a gain of +4.5% to a drop of -0.2%.

With productivity so low not only does it not bode well for growth but the risk is that companies eventually reduce their demand for labour. They could invest in capital instead but waiting for that has proved elusive in recent years. So in spite of the recent payroll boost we still think the US looks late cycle and think profits will continue to be subdued and that employment will edge weaker over the coming months.

We'll see more on employment today with the BLS releasing the JOLTS series. It's only for June so it will probably be decent given the payrolls summer surge and doesn't necessary say much for the future but given its one of Yellen's favourite series it's always closely watched. DB expect a rebound in the hiring rate, which was down three tenths from its post-recession peak (3.8%) in May. The quits rate is interesting as it has been a lead indicator of wage pressure in the past.

Global equity markets ticked up yesterday despite little in terms of positive economic data (more on Europe below). The STOXX 600 (+0.92%) ended the session in the green for the fifth consecutive day, while the DAX rallied by +2.5% on the day to nearly break even on a YTD basis. The FTSE shrugged off relatively weak industrial production and trade numbers to rise by +0.62% following some dovish comments by BoE policymaker Ian McCafferty suggesting that further rate cuts and additional QE may be required. This raised eyebrows as he was in favour of a hike at the start of the year and voted for one at every meeting since last August. Sterling fell for the 5th day and was back below $1.30 intraday for the first time for a month but closed just above and had climbed back a bit this morning to $1.307.

Government bond yields continued to drop, with German and US 10Y yields falling by -1bps and -4bps respectively. Gilts rallied as 10Y and 30Y yields fell by -3bps and -5bps to all time lows initially following soft data and BoE McCafferty's comment discussed above. The BoE also struggled to buy as much long Gilts (over 15 years) as it had planned despite higher than market prices in its new QE program. Only £1.118bn was bought rather than the £1.17bn planned. Monday's purchases were 3.63 times covered but were in the 3-7 year area. Today sees the 7-15 year part of the curve targeted. Yesterday's struggle, albeit at the notoriously technical long end, is a worry for the BoE given that it was only the second day of their new program, especially as they are already talking about having the room to increase it if required. 30 year Gilts are currently at 1.38% and if we have more days like yesterday then they start to look 'cheap' against 30 year Bunds (0.419%) and OATs (0.912%) and that's before we even talk about the Swiss equivalent at -0.1%.

Over in the US the S&P 500 (+0.04%) ticked up slightly. Price action was fairly subdued in credit markets with iTraxx Main largely unchanged on the day although Crossover tightened by -4bps. Over in the US CDX IG and HY were both flat on the day.

The Asian session is again quiet with the Nikkei +0.31%, the Hang Seng +0.41% and the Shanghai Comp -0.1%. There's not been a lot of data with June Japanese machine orders the highlight coming in at +8.3% mom against +3.2% expected. July PPI was flat against -0.1% expected. The Yen is up around 0.6% against the Dollar.

Now for the remainder of the data yesterday. In the US the NFIB small business optimism reading barely budged in July, coming in a hair above expectations of no change (94.6 vs. 94.5 expected; 94.5 previous). Wholesale inventories grew more than expected in June (+0.3% vs. +0.0% expected) and we also saw May’s number being revised up to +0.2% as well (+0.1% before revision).

In Europe we saw some numbers that painted a gloomy picture of the UK economy in the period straddling the referendum. Industrial production barely grew in June (+0.1% mom vs. +0.1% expected; -0.6% previous) while manufacturing production declined for a second straight month and actually fell by more than expected (-0.3% vs. -0.2% expected; -0.6% previous). The trade balance number for June (-£5.084bn vs. -2.55bn expected) also indicated a sharply widening trade deficit despite a weaker pound. Away from the UK we also got the German trade balance number for June that saw the surplus increase more than expected (24.9bn vs. 23.0bn expected; 21.0bn previous).

It’s a quiet day ahead across the globe in terms of data releases today. In Europe the only notable data points are the June industrial (+0.1% mom expected; -0.5% previous) and manufacturing production (+0.2% mom expected; +0.0% previous) numbers from France, where growth is expected to be marginally positive. The only data of note out of the US is the previously discussed June JOLTS survey, where number of job openings is expected to hold steady on the month (5.5mn expected; 5.5mn previous).

http://www.zerohedge.com/news/2016-...oil-slide-over-us-productivity-collapse-fears
 

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#12
Frontrunning: August 10


by Tyler Durden
Aug 10, 2016 7:30 AM

  • World stocks hit one-year peak, dollar sags on weak U.S. data (Reuters)
  • Trump's remarks on gun rights, Clinton unleash torrent of criticism (Reuters)
  • Newly Released Emails Highlight Clinton Foundation’s Ties to State Department (WSJ)
  • One-in-five U.S. Republicans want Trump to drop out: Reuters/Ipsos poll (Reuters)
  • Soaring Debt Has U.S. Companies as Vulnerable to Default as 2008 (BBG)
  • BOJ to defend QQE in Sept policy assessment (Reuters)
  • China’s Central Bank Plans Push to Increase Yuan’s Global Usage (BBG)
  • Tipsters Are Poised for Big Payouts (WSJ)
  • Nomura ‘Lost Control’ in Firing Salesman Over $40 Million Loss (BBG)
  • In recovering housing market, the starter home remains elusive (Reuters)
  • Palladium at Year High, Driving Precious Metals on Chinese Cars (BBG)
  • U.S. women dominate to win second straight team gold (NBC)
  • Games bus hit by gunfire, no one seriously hurt: witnesses (Reuters)
  • For Oil Companies $110 Billion Debt Wall Looms Over Next 5 Years (BBG)
  • Egypt closes 48 forex bureaus in black market crackdown (Reuters)
  • Vietnam moves new rocket launchers into disputed S.China Sea (Reuters)
  • Pimco Total Return Boosts Treasuries Stake to Most in 25 Months (BBG)
  • Out of sight, out of mind? Europe's migrant crisis still simmers (Reuters)
  • Eurostar U.K. Union to Strike for Seven Days Over Schedules (BBG)
  • House Speaker Ryan easily wins primary: media (Reuters)
  • WikiLeaks offers $20K for info on DNC staffer's killing (Hill)
  • Brazil's Senate indicts Rousseff, opens impeachment trial (Reuters)

Overnght Media Digest

WSJ

- Canadian film and television producer and distributor Entertainment One Ltd has rejected a takeover offer from U.K. broadcaster ITV PLC after the two sides could not agree on a price, according to a person familiar with the matter. http://on.wsj.com/2aKAj6d

- Facebook Inc is going to start forcing ads to appear for all users of its desktop website, even if they use ad-blocking software. The social network said it will change the way advertising is loaded into its desktop website to make its ad units considerably more difficult for ad blockers to detect. http://on.wsj.com/2aKz32V

- Investors are pressuring the Ratner family to loosen their grip on their nearly 100-year-old property empire, which owns high-profile urban properties such as the New York Times headquarters. http://on.wsj.com/2aKzF8G

- Procter & Gamble Co, the biggest advertising spender in the world, will move away from ads on Facebook that target specific consumers, concluding that the practice has limited effectiveness. http://on.wsj.com/2aKBpij


FT

British oil major BP is seeking buyers for its 50-percent stake in Chinese petrochemicals joint venture SECCO, its largest investment in China, in a deal said to fetch $2-$3 billion.

William Hill rejected a 3.16 billion pound ($4.11 billion) bid by smaller rivals Rank Group and 888 Holdings on Tuesday, saying a 16 percent premium "substantially undervalued" the British bookmaker.

Entertainment One Ltd will announce on Wednesday that it has rejected an offer from British commercial TV broadcaster ITV Plc. The purchase price of the deal and how much of the company ITV was seeking were not clear. Entertainment One had earlier said in April that it had not received any approach from ITV.


NYT

- On Tuesday, Facebook Inc flipped a switch on its desktop website that essentially renders all ad blockers useless. The change allows the Silicon Valley company to serve ads on its desktop site even to people who have ad-blocking software installed and running. http://nyti.ms/2aYdcC1

- After months of speculation, Walt Disney Co said on Tuesday that it had concluded a deal to spend $1 billion for a 33 percent stake in BamTech, Major League Baseball's fast-growing streaming division. As part of the agreement, Disney has the option to buy a controlling interest in BamTech in the coming years. http://nyti.ms/2aYdZm8

- A federal jury on Tuesday found California's major utility company, Pacific Gas and Electric, guilty of safety violations at the time of a 2010 gas pipeline explosion that killed eight people and destroyed a neighborhood in a San Francisco suburb. http://nyti.ms/2aYe5KQ

- Three prominent universities - the Massachusetts Institute of Technology, New York University and Yale - each have retirement plans holding more than $3 billion in assets and are being individually sued by a number of their employees in cases seeking class-action status. http://nyti.ms/2aYdWqE


Canada

THE GLOBE AND MAIL

** Bell Canada and its parent company BCE Inc's ratings were downgraded by DBRS Ltd. The downgrade came in light of the Canadian communications giant's plans to buy Manitoba Telecom Services Inc, which DBRS thinks is unlikely to fall through. (http://bit.ly/2b5Sgdw)

** The Liberal government has reversed a policy to increase the eligibility age for Old Age Security to 67, in spite of resistance from bureaucrats that the move would not be in line with what other developed countries are doing. (http://bit.ly/2aYLLbd)

NATIONAL POST

** TransAlta Corp's CEO Dawn Farrell said on Tuesday that tighter environmental controls for power generation companies are "here to stay". The comment was in light of new policies announced recently by the Alberta government. (http://bit.ly/2aYJTza)

** Albertan consumers will end up paying "closer to C$600 million ($461.22 million)", not the C$2.0 billion ($1.54 billion) alleged by the provincial government, on their electricity bills for power companies canceling controversial power contracts early. (http://bit.ly/2b5SfGw)


Britain

The Times

Britain's biggest bookmaker, William Hill, insisted that it had a strong independent future yesterday after rejecting a 3.2 billion pound joint takeover bid from Rank Group and 888 Holdings. http://bit.ly/2aXR6zd

Standard Life affirmed its decade-long commitment to growing its dividend, saying the latest payout demonstrated its confidence in the future despite tough economic times. http://bit.ly/2aXRayX

The Guardian

Uber has urged Transport for London to drop new requirements for drivers to pass a written English exam, saying thousands could be put out of business. http://bit.ly/2aXRyNU

The Bank of England's post-Brexit economic recovery plan got off to a stumbling start when it was unable to buy as many government bonds as it needed from major City investors. http://bit.ly/2aXQpWU

The Telegraph

Britain's Hinkley Point nuclear project is close to unravelling after France's ruling socialist party threw its support behind dissident trade union leaders and called for a fundamental review of the high-cost venture. http://bit.ly/2aXS4eY

ITV is understood to be in advanced talks to buy Entertainment One, the Canadian TV and film group. The deal is expected to be announced soon, and will see ITV take on the rights to shows including Peppa Pig, the cartoon character-turned global children's phenomenon. http://bit.ly/2aXQvhi

Sky News

The former head of Deloitte's operations in the UK, John Connolly, is plotting a string of takeover deals aimed at creating a rival to the accounting profession's powerhouse quartet. http://bit.ly/2aXQUQO

Billionaire landowner the Duke of Westminster, Gerald Cavendish Grosvenor, died at the age 64 on Tuesday afternoon at the Royal Preston Hospital in Lancashire. http://bit.ly/2aXR3Un

The Independent

If Britain crashes out of the European single market for goods and services in the wake of the Brexit vote the country could be permanently poorer by 4 per cent of GDP, according to estimates from the Institute for Fiscal Studies. http://ind.pn/2aXQnyd

http://www.zerohedge.com/news/2016-08-10/frontrunning-august-10
 

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#13

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#14
Asian Metals Market Update: August-10-2016
By: Chintan Karnani, Insignia Consultants
The good thing is that even after a good US July jobs numbers gold and silver have nearly pared most of their losses. Investors and everyone are buying gold and silver. The hallmark of the beginning of a bull market is the tendency to shrug off negative news and rise. I think gold and silver are on the verge of a repeat of 2004. Gold’s bull run started from August 2004 when prices were at $380.

THE COMING BREAKDOWN OF U.S. AND GLOBAL MARKETS EXPLAINED… What Most Analysts Miss
By: Steve St. Angelo, SRSrocco Report
The U.S. and world are heading toward an accelerated breakdown of their economic and financial markets. Unfortunately, the overwhelming majority of analysts fail to understand the root cause of this impending calamity. This is also true for the majority of precious metals analysts. The reason for this upcoming systemic collapse of the U.S. and Global markets is quite simple when you understand the information and are able to CONNECT THE DOTS. While it has taken me years of research to be able to finally put it all together, new information really put it all into perspective.
 

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#15
Bill Holter-World Facing Very, Very Dangerous Time
Greg Hunter


Published on Aug 9, 2016
So, is the world headed for a “Mad Max” future? Financial writer Bill Holter says, “I think the chances are better than a coin flip that we have societal breakdown. If you are asking should you hold cash, my opinion is yeah, you should have some cash and very little bank balances because that is going to go away. You are going to have to have some physical cash, which will actually . . . after the system shuts down, become more valuable. The dollar will purchase more real goods for several weeks simply because if all the banks are closed and nobody has cash, then cash is scarce. That will work up until, all of a sudden, the light switch gets flipped and people understand that cash has no real value. People are not going to trade real eggs or real tomatoes for dollars. They will say I want something real for something real. That’s where your dollar collapses.”

On gold, the math is simple. Holter says, “The punchline to this is the system has never been risker and more leveraged than it is today. Yet, the price or the cost of insurance (gold and silver) has never been cheaper than it is today with the exception of late last year in October, November and December of 2015.”

Holter goes on to point out, “They have purposely diluted the price of gold in order to portray a strong dollar. . . . The reason they need to portray a strong dollar is to continue confidence in the system. It allows dollars to continue to be accepted. It also allows the U.S. Treasury to turn around and continue to borrow. That’s not working so well because the Federal Reserve has had to step up and buy major portions of auctions.”

How does it end? Holter says, “I have said many times that we are going to have a reset of the system. All currencies, all bonds, all interest rates, stocks, commodities, gold, silver, etcetera. This is a very, very dangerous time.”

Join Greg Hunter of USAWatchdog.com as he goes One-on-One with Bill Holter of JSMineset.com.

All links can be found on USAWatchdog.com: http://usawatchdog.com/entering-perfe...
 

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#16
Nothing to see. Best bet if interested is to listen in one window, play around on GIM or surf the web in a different window. Approx 35 minutes long.

Ahead: COMEX GOLD DEFAULT | Jim Willie
FinanceAndLiberty.com


Published on Aug 7, 2016
IN THIS INTERVIEW:
- Switzerland exported a record amount of gold to the US in May ►1:22 Source: https://goo.gl/SsdMvS
- A clarification of Sharia law could mean that the 1.6 billion Muslims in the world would be able to purchase gold ►5:37 Source: https://goo.gl/WQBzqa
- Tokyo Commodities Exchange, along with the Shanghai Gold Exchange, is now trading physical gold. How will this impact the ability of the powers that be to manipulate the price of gold with paper gold contracts? ►7:19 Source: http://goo.gl/lMIQvO

Viewer Questions:
- How much gold does China have? ►13:04
- Why will people not fall for another fiat currency? ►20:37
- What is the minimum amount of silver I should own in order to weather the coming economic storm? ►23:46
- Should I take physical possession of of precious metal mining shares? ►26:10
- SUBSCRIBE (It's FREE!) to be notified when the rest of this interview is released ►http://bit.ly/Subscription-Link --- OR --- Watch the rest of the interview now ►https://youtu.be/A78saW7K4CQ?t=32m52s

FINANCE AND LIBERTY:
- SUBSCRIBE (it's FREE!) to "Finance and Liberty" for more interviews and financial insight ►http://bit.ly/Subscription-Link
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- Title and video graphics by Josiah Johnson Studios ►http://JosiahJohnsonStudios.com
- Sponsors: http://SilverDoctors.com & http://ReluctantPreppers.com

This interview was recorded on Aug 3, 2016.

DISCLAIMER: The financial and political opinions expressed in this interview are those of the guest and not necessarily of "Finance and Liberty" or its staff. Opinions expressed in this video do not constitute personalized investment advice and should not be relied on for making investment decisions.
 

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#17
Nothing to see. Best bet if interested is to listen in one window, play around on GIM or surf the web in a different window. Approx 30 minutes long.

Collapse Ahead - Where Should I Live? | Jim Willie
FinanceAndLiberty.com


Published on Aug 9, 2016
This is part 2, here is the link to start with part 1: https://youtu.be/NXXX7WM5Fkc

IN THIS INTERVIEW:
Viewer Questions:
- What are the odds of any western country to either ban the sale of gold or silver, attempt to confiscate gold or silver, or apply an onerous tax to the sale of one or both of the metals? ►0:37
- Platinum and palladium vs. gold and silver ►3:34
- What will be the future purchasing power of silver and gold? ►9:52
- What percent of my silver investments should be in junk silver? ►12:38
- Where is the best place to live when the collapse occurs? ►13:57
- When the imports fail over the dollar collapse, how bad will the oil/gas crisis be? ►22:48
- Will the power grids fail? ►26:21
- SUBSCRIBE (It's FREE!) to be notified when the rest of this interview is released ►http://bit.ly/Subscription-Link --- OR --- Watch the rest of the interview now ►https://youtu.be/A78saW7K4CQ?t=57m33s

FINANCE AND LIBERTY:
SUBSCRIBE (It's FREE!) for more ►http://bit.ly/Subscription-Link
Website ►http://FinanceAndLiberty.com
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DISCLAIMER: The financial and political opinions expressed in this video are not necessarily of "Finance and Liberty" or its staff. Opinions expressed in this video do not constitute personalized investment advice and should not be relied on for making investment decisions.
 
Last edited:

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#18
Mornings With "V"
ROGUE MONEY


Streamed live 33 minutes ago
V Runs down the news and what's ahead.
 

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#19
Michael Oliver Updates Gold, Bonds & Market Indicators
FinanceAndLiberty.com


Published on Aug 10, 2016
Michael Oliver gives the latest on his technical readings for gold, bonds and other significant market indicators.

This video was posted with permission from http://JayTaylorMedia.com

FINANCE AND LIBERTY:
SUBSCRIBE (It's FREE!) for more ►http://bit.ly/Subscription-Link
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Google Plus ►http://Gplus.to/FinanceLiberty

DISCLAIMER: The financial and political opinions expressed in this video are not necessarily of "Finance and Liberty" or its staff. Opinions expressed in this video do not constitute personalized investment advice and should not be relied on for making investment decisions.
 

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#21

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#22
Nothing to see. Best bet if interested is to listen in one window, play around on GIM or surf the web in a different window. Approx 56 minutes long.

Hump Day With Bix & V: 08.10.16
ROGUE MONEY


Streamed live 2 hours ago
OH, OH!!! Its a another HUMP DAY!!!!
 

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#23
Nothing to see. Best bet if interested is to listen in one window, play around on GIM or surf the web in a different window. Approx 40 minutes long.

China: "If We Build It, They Will Succumb" & Creditism Has Replaced Capitalism | John Rubino
Reluctant Preppers


Published on Aug 10, 2016
As China scrambles to hide their secret hard landing and debt crisis behind a wall of "investment-driven" capacity expansion - despite the fact that their tsunami of oversupply is overwhelming the exhausted global demand, and sovereign nations' bonds now forcing investors, insurance companies and pension funds to swallow the poison pill of negative interest rates, will the world's governments determined to pull out all the stops to prevent certain death of the modern Franken-financial system invoke the ultimate contingency of "helicopter money" and unlimited debt-driven spending-to-infinity to keep the bubble inflated on an "ocean of fiat", and are we entering the prophetic "crackup boom phase" predicted by Austrian economics? If so, how will this play out for the individual family - and what can the ordinary person do about it?

Straight-shooting financial analyst John Rubino, founder of DollarCollapse.com, returns to Reluctant Preppers to give his steady assessment of what's going on, where the present trend is headed, and what we can each do to return our domestic financial houses to sanity and relative safety, despite the turbulent times ahead!

See the video mentioned in this interview:
Richard Duncan: Creditism Has Replaced Capitalism
https://youtu.be/ScEJenrTH-U


Subscribe (it's FREE!) to Reluctant Preppers for more ► http://bit.ly/Subscribe-Free

Channel graphics by http://JosiahJohnsonStudios.com
Promotion by http://FinanceAndLiberty.com
 

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#25
Give Me Control Of …

-- Published: Wednesday, 10 August 2016

By Gary Christenson

“Give me control of a nation’s money and I care not who makes its laws.”

Supposedly this is a quote from Mayer Amschel Bauer Rothschild. Ignore the distinct possibility that he did not make this statement, but let’s assume the concept, if not the quote, is accurate.

The Federal Reserve and other central banks exercise considerable control over our economies via interest rates, debt creation, QE and more. They create massive profits for the financial industry that in turn purchases many politicians and Presidents.

Now expand the concept into other areas and see if the results ring true.
  • Give me control of a nation’s financial systems and I shall own the politicians who make the laws.
Print currencies and buy politicians. Same idea – it is easy!
  • Give me control of the FBI investigators and I can avoid prosecution and indictments.
Hmmmm. There was something in the news about this recently…
  • Give me control of the voting machines and I care not who the voters in the popular election actually wanted.
In Philadelphia in 2012, 59 districts cast 100.0% of their votes for Obama and the voting machines show that not one person cast their vote for Romney. Strange. Amazing. Unusual. It might happen once in the age of the universe, or again this November in Philadelphia. Still, a vote of 19,605 to zero in 59 districts is difficult to believe, even in strongly democratic districts in urban America.
  • Give me control of the DNC and I care not who the primary voters chose.
Hmmmm. Ask Bernie Sanders if he agrees.
  • Give me control of the media and I will tell the people of the world what I want them to know, but not necessarily the facts.
    • There is ample evidence that the media has an agenda and promotes certain ideas, regardless of facts. Examples include, “the economy is fine,” “that Presidential candidate is … fill in your favorite accusation,” “unemployment is less than 5% in the US,” “Social Security benefits are guaranteed and the system is solid,” “weapons of mass destruction,” and so many more.
    • Further, the media can control what is NOT reported as news.
  • Give me control of the statistics and I can assure the public that unemployment is either high or low, GDP is weak or strong, violent crime is getting better or worse, drug abuse is mild or extreme, illegal aliens are sneaking into the country or leaving, gang violence is becoming worse or better, or whatever is needed …
Lies, damned lies and statistics!
  • Give me control of the Fort Knox gold and Americans can rest assured that no gold will be reported missing and there is no need for an audit.
This is self-explanatory and consistent with observations over the past six decades.

Readers will have other suggestions for this list. I encourage you to add them as comments.

My books are available at Amazon and here.

Gary Christenson

The Deviant Investor

http://news.goldseek.com/GoldSeek/1470851586.php
 

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#26

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#27
US Futures Rebound, European Stocks Higher As Oil Rises


by Tyler Durden
Aug 11, 2016 6:42 AM

The summer doldrums continue with another listless overnight session, not helpd by Japan markets which are closed for holiday, as Asian stocks fell fractionally, while European stocks rebounded as oil trimmed losses after the the IEA said pent-up demand would absorb record crude output (something they have said every single month). S&P futures have wiped out almost all of yesterday's losses and were up over 0.2% in early trading.

Europe's Stoxx 600 rose 0.4% with miners and energy producers trimming losses, as crude pared a drop of as much as 1.5 percent after the IEA forecast, Bloomberg reports. Asian equities fell. New Zealand’s dollar surged to a one-year high after the country’s central bank cut interest rates and signaled a more gradual easing path than some investors had anticipated. Nickel snapped a four-day advance. Ukraine’s 2019 Eurobond fell the most since June amid signs tension is increasing with Russia.

The modest rebound in oil could not have come at a more important time, just as the black gold was sliding and set to retest the $40 support level, below which JPM believes SWF would resume liquidation. Crude entered a bear market last week and the outlook remains clouded as Saudi Arabia and Iran refuse to give ground in their war for market share, with both boosting output just days after OPEC announced an informal meeting to discuss ways to stabilize falling prices. Exacerbating the problem is global demand, which remains weak even as policy makers from Frankfurt to Tokyo engage in unprecedented stimulus to boost their economies. A strengthening jobs market in the U.S. has yet to convince traders that the world’s biggest economy is strong enough for the Federal Reserve to raise interest rates this year.

"The biggest risk to the market at the moment is a huge drop in oil prices,” James Woods, strategist at Rivkin Securities in Sydney, said by phone. “Recent gains, particularly in U.S. equities, are becoming exhausted. We’ll see some near-term weakness in the coming weeks. Investors are likely to be buying on these dips as central bank policies remain supportive of equities.”



In another reminder that Brexit may not be contained, a gauge of U.K. home sales pointed to the fastest decline in transactions since the global financial crisis in 2008, Royal Institution of Chartered Surveyors data showed on Thursday. As a result, sterling snapped lower and cable dropped below 1.3000, trading at 1.296 at last check. Singapore cut the top end of its 2016 growth forecast after the economy expanded less than previously estimated in the second quarter.

Asia started off on the wrong goot, with the MSCI Asia Pacific excluding Japan Index falling 0.2 percent, down from a one-year high. Australia’s S&P/ASX 200 Index dropped 0.6 percent as benchmarks lost ground in Shanghai and Taiwan. Hong Kong’s Hang Seng Index climbed 0.4%, led by financial companies, after the head of the city’s bourse operator told CNBC an exchange trading link with the Chinese city of Shenzhen will soon be announced. Hong Kong Exchanges & Clearing Ltd. jumped 2.9 percent, its biggest increase since May. The MSCI Emerging Markets Index slipped 0.1 percent after advancing five days to the highest close since July 2015. Gulf stocks declined on Thursday, with the Bloomberg GCC 200 Index losing 0.4 percent, trimming this week’s gain to 1.3 percent.

The rebound in the commodity complex translated into strength for European equities, as the Stoxx 600 rebounded from a decline of as much as 0.2%, as miners and oil companies came off session lows. Volume remains lethargic, and the number of shares changing hands was about a third less than the 30-day average according to Bloomberg. Zurich Insurance Group AG added 4.2 percent after saying earnings fell less than projected. KBC Group NV advanced 5.5 percent after posting better-than-expected profit and revenue and cutting its forecast for 2016 loan-loss provisions in Ireland. K+S AG, Europe’s biggest potash producer, plunged 9.2% after saying it expects lower earnings in 2016. Thyssenkrupp AG lost 0.7 percent after Germany’s biggest steelmaker reported a decline in quarterly profit.

S&P 500 futures rose 0.2% after the underlying equity benchmark declined 0.3 percent on Wednesday, retreating from a near-record high.

The yield on 10Y U.S. Treasuries rose two bps to 1.51%. It fell on Wednesday as 10-year notes were auctioned at the lowest yield in four years amid near-record demand from a group of buyers that includes foreign central banks and mutual funds. The U.S. is scheduled to sell $15 billion of 30-year bonds Thursday. U.K. 10-year bonds were little changed, after a three-day rally in the securities pushed yields to a record low on Wednesday. Gilts have been boosted this week on signs the Bank of England may need to pay higher prices to purchase enough to meet the target for its expanded quantitative-easing program.

Investors will look Thursday to earnings from retailers including Macy’s Inc. for indications of the health of the American consumer, as well as the latest weekly jobless claims report, where 265k Americans are expected to have filed unemployment benefits.

* * *

Markets Snapshot
  • S&P 500 futures up 0.2% to 2178
  • Stoxx 600 up 0.4% to 345
  • FTSE 100 down 0.4% to 6841
  • DAX up 0.5% to 10704
  • German 10Yr yieldunchanged at -0.11%
  • Italian 10Yr yield up less than 1bp to 1.08%
  • Spanish 10Yr yield down less than 1bp to 0.94%
  • S&P GSCI Index down less than 0.1% to 341.5
  • MSCI Asia Pacific down 0.2% to 139
  • Nikkei 225 closed
  • Hang Seng up 0.4% to 22581
  • Shanghai Composite down 0.5% to 3003
  • S&P/ASX 200 down 0.6% to 5508
  • US 10-yr yield up less than 1bp to 1.51%
  • Dollar Index up 0.18% to 95.82
  • WTI Crude futures down 0.6% to $41.47
  • Brent Futures down 0.4% to $43.88
  • Gold spot down less than 0.1% to $1,346
  • Silver spot up 0.2% to $20.20
Global Headline News
  • Valeant Reported to Be in Criminal Probe Over Pharmacy: Prosecutors are pursuing legal theory that Valeant, its mail-order pharmacy, Philidor Rx Services LLC, allegedly defrauded insurers by hiding their close relationship, WSJ said.
  • Wal-Mart Sells Mexico Clothing Chain to Liverpool for $1b: WMT’s Mexican unit agreed to sell Suburbia clothing chain to El Puerto de Liverpool in deal valued at MXN19b; WMT Said to Require Jet.com CEO to Stay for 5 Yrs: Recode
  • Williams Partners Sees $820m Upfront Cash From Chesapeake Pact: Co. says deal will bring back natural gas exploration there, make money-losing wells profitable again.
  • Cheap Loonie Not Helping Business Case for Canada: GM: Ford, Fiat Chrysler, GM are starting negotiations with Unifor, which represents ~23k workers those at 3 cos., against backdrop of declining production in Canada.
  • Marcato Pushes Goodyear to Return $4.5b to Investors: WSJ: Activst seeking returns over next 3 years.
  • Twitter Ruled Not Liable for ISIS Tweets Leading to Attack: U.S. law protects Twitter from being treated as publisher of any information provided by another content provider, federal judge in S.F. ruled.
  • Alphabet GV CEO Maris to Leave Venture Capital Arm: Maris’ last day to be Friday.
* * *

Looking at regional markets, we start in Asia which traded mixed following the energy-triggered weakness in the US, while Chinese markets outperformed on renewed Shenzhen-Hong Kong stock connect optimism. ASX 200 (-0.6%) was severely pressured and retreated below 5500 weighed on by declines in energy and financials after WTI crude futures suffered from an unexpected build in DoE inventories, while financials were down on bad loan concerns with Westpac stating its stressed assets rose in the June quarter. Chinese markets pared gains to close lower Shanghai Comp (+0.1%) and Hang Seng (+0.4%) despite reports the CSRC are to establish a team to organize preparations for the Shenzhen-HK stock connect. As a reminder, Japanese markets were closed for Mountain Day.

Top Asian News
  • Singapore Cuts Top End of 2016 GDP Forecast on Weak Outlook: Economy grew less than previously estimated in 2Q
  • New Zealand Cuts Interest Rates to Record Low; Kiwi Soars: Governor Wheeler signals at least one more rate reduction
  • BOK Holds Key Rate at Record Low as It Assesses Economy: Governor Lee Ju Yeol says central bank still has policy room
  • Australia Bars Power Grid Sale to Foreigners on Security Concern: State Grid Corp., CKI are vying for state distributor Ausgrid
  • China Mobile Profit Beats Estimates on 4G Subscriber Gains: World’s largest phone carrier added 116m 4G accounts
  • Pitfalls of Global Hunt for Yield Highlighted in Mongolia Crisis: Govt 2022 bonds fall most on record after FinMin warning
European bourses trade modestly higher with the Euro Stoxx 50 cash up 0.2%, despite the FTSE cash (-0.5%) being the laggard due to a large amount of ex -Dividends trimming around 36 points of the index. 12 out of 19 Stoxx 600 sectors rise with construction, food & beverages outperforming and basic resources, oil & gas underperforming. The SMI is up 0.2% after index heavy weight Zurich Insurance (+3.8%) exceeded expectations with their pre-market earnings update. Fixed income markets are still pushing higher with Bunds hitting 168.0 with a lack of supply and thin market conditions taking their toll. Elsewhere, Gilt yields on the long and short end of the curve marginally increased, after falling for three straight days with the 2, 10 and 30 year all climbing by 0.01 basis point.

Top European News
  • Brexit Hits U.K. Housing as
    Property Sales Drop Most Since 2008: Brexit undermining near-term
    outlook for U.K. housing market, with both demand, sales dropping in
    July.
  • Sports Direct Worker Exodus Adds to Woes for Founder
    Ashley: Turnover among Sports Direct’s salaried U.K. staff rose by more
    than 300bps last year to 22%.
  • Symrise Profit Beats as CEO
    Bertram Boosts Goal for Margins: Co. reported profit that beat analysts’
    estimates and said its target for profitability is now set at >20%
  • French
    Voters’ Islamism Fears Put Hollande in Political Bind: He’s stuck
    between desire for tougher measures to provide security amid historic
    reluctance by his own party to impinge on basic democratic freedoms.
In FX, the kiwi rose as high as 73.41 U.S. cents, its strongest level since May 2015, before trading 0.4 percent stronger on the day at 72.32 after the Reserve Bank of New Zealand reduced its key rate by 25 basis points to 2 percent. While the cut was expected by all 16 economists surveyed by Bloomberg, the swaps market had priced in a 20 percent chance of a half-point reduction. “Even though the 25 basis-point rate cut was fully priced in, there was uncertainty that the RBNZ could even have opted for a 50 basis-point rate cut,” said Angus Nicholson, a market analyst in Melbourne at IG Ltd. “Once the 50 basis-point fears turned out to be unfounded the kiwi dollar promptly rallied.” The Bloomberg’s dollar index, a gauge of the greenback versus 10 major peers, rose 0.1 percent. It ended the last session at a seven-week low as the probability of a U.S. interest-rate increase this year slipped by four percentage points to 41 percent in the futures market. The MSCI Emerging Markets Currency Index dropped 0.1 percent. South Korea’s won snapped a five-day advance, weakening 0.5 percent after reaching its strongest level in more than a year on Wednesday. Bank of Korea Governor Lee Ju Yeol kept the benchmark interest rate at 1.25 percent and said the authority has scope for more policy adjustments. The ringgit slid 0.5 percent as declines in crude prices dimmed prospects for Malaysia, the region’s only major net oil exporter. The MSCI currency gauge has climbed 3.6 percent since China’s surprise yuan devaluation a year ago roiled global markets. Brazil’s real led gains in the past 12 months, up 11 percent, followed by South Korea’s won with a 7.2 percent jump. The biggest loser was Argentina’s peso, declining 37 percent after the country scrapped currency controls. The yuan has dropped 4.8 percent in the period.

In commodities, The Bloomberg Commodity Index, which measures returns on raw materials, fell for a third day as oil and most base metals declined. West Texas Intermediate crude rebounded from session lows after dropping 1.2% to $41.21 a barrel in early London trading, as official data showed U.S. supplies increased by 1.06 million barrels last week. Analysts surveyed by Bloomberg had forecast a drop of 1.5 million barrels. Weakness in global crude markets may persist as demand slows seasonally and fuel inventories remain abundant, the Organization of Petroleum Exporting Countries said Wednesday. Saudi Arabia, the world’s largest crude exporter, boosted oil output to a record 10.67 million barrels a day in July, according to OPEC data published Wednesday. In Iran, production has risen to 3.85 million barrels a day -- the highest since 2008 -- according to comments from Oil Minister Bijan Namdar Zanganeh reported by the Fars news agency. Declines in oil hurt sentiment on demand for commodities, ending a four-day rally in nickel. The metal dropped 1.2 percent to $10,735 a metric ton after Monday touching a one-year high. Zinc and tin lost at least 0.3 percent. “Crude oil’s damping market sentiment for metals,” Zhao Qiannan, an analyst with Beijing Newnie E-commerce Co., said by phone from Shanghai.

On today's US calendar we will see the initial jobless claims numbers (265k expected; 269k previous) for the first week of August and the import price data for July (-0.4% mom expected; +0.2% previous). DB economist Joe LaVorgna notes that claims have hovered around multi-decade lows for the past four months, thus indicating that the labor market has likely reached full employment. Given the present stage of the business cycle, he advises keeping a close watch for any potential spike in claims given the existing pressure on corporate profit margins.

* * *

Bulletin Headline Summary from RanSquawk and Bloomberg
  • European equities trade mostly higher, albeit modestly so with newsflow once again remaining on the light side
  • The main mover in FX overnight was the NZD after the RBNZ cut rates by 25bps as expected but said there was no discussion of a 50bps cut
  • Looking ahead, highlights include the weekly US jobs data
  • Treasuries slightly lower in overnight trading, European equities near seven-week high (Japan closed for Mountain Day)while oil and gold move lower; auctions conclude with $15b 30Y bonds, WI 2.25%, last sold at 2.172% in July, lowest 30Y auction stop on record.
  • New Zealand’s central bank cut interest rates to a fresh record low of 2% and flagged more easing to combat low inflation, disappointing some investors who were looking for a more aggressive signal. The local dollar surged
  • The central bank said markets missed the downside risks to the outlook for interest rates in Thursday’s policy document and got ahead of themselves by driving the currency to a one-year high
  • The European Central Bank may need to rely more on asset purchases for monetary stimulus as its negative interest rates approach the limit of their effectiveness, economists at the International Monetary Fund said
  • BOE’s asset purchase plan has U.K. gilts storming down the path carved out by their Japanese peers as yield premium offered by 10-year gilts over similar-maturity Japanese bonds shrank to the lowest on record
  • South Korea’s central bank held its key interest rate at a record low 1.25% as board members deferred further policy action until they have a clearer picture of the economy’s path
  • Investors who piled into some of the world’s riskiest bonds to escape near-zero interest rates got a reality check on Wednesday when Mongolia sent its debt plunging by sounding the alarm on its economic crisis
  • Japanese distrust of Abenomics, negative interest rates and a rising yen have all combined to boost their investment in bars and coins, the World Gold Council said in a report
US Event Calendar
  • 8:30am: Import Price Index, July, est. -0.4% (prior 0.2%)
  • 8:30am: Initial Jobless Claims, Aug. 6, est. 265k (prior 269k)
  • 9:45am: Bloomberg Consumer Comfort, Aug. 7 (prior 43)
  • 10am: Freddie Mac mortgage rates
  • 10:30am: EIA natural-gas storage change
DB's Jim Reid concludes the overnight wrap

This time last year holidays were starting to be disturbed by China's stealth devaluation. A year on things are a lot quieter on a global scale but if there are any long Gilt traders and investors on holiday at the moment I suspect they'll be close to a phone or a screen. Or maybe they're all on holidays without phones which is why the BoE couldn't buy enough bonds back on Tuesday. In my first job 21 years ago I was a sales person on the sterling credit desk and the long Gilt traders were the scariest people on the floor. They were also the least likely to own a mobile phone. I suspect things have changed a lot over the years but I still sometimes have nightmares about them shouting at me.

Indeed Gilts continue to be the main story this week. 10Y and 30Y Gilt yields fell by -6bps and -13bps yesterday to hit fresh all-time lows as reverberations continued post Tuesday's failed reverse auction at the long-end. Yesterday we highlighted that given how much 30 year yields Gilts are above core European 30 year yields, and given how technical the long-end of the Gilt market is, and that the first reverse auction at this maturity failed it seems inevitable that further convergence is the order of the day for now.

We would highlight however that things are easier shorter down the curve for the BoE as it reported that it received offers for 4.71 times the debt it planned to buy yesterday in the 7-15 year range. Gilts yields briefly rose after the afternoon news of a more successful QE operation but rallied again into the close. There were even a couple of short-dated issues (March 2019 and March 2020) that briefly traded at negative yields yesterday thus welcoming a new member to a growing global club.

The BoE also noted that Tuesday’s shortfall would be incorporated into the second half of the six-month QE programme announced in November. Whether long end UK investors will have any additional appetite to sell at that point is debatable given how much liability matching goes on in this part of the curve in the UK.

The shenanigans in the Gilt markets have helped kicked start a fresh rally in government bonds this week with US 10yrs now reversing most of the post payroll 9bps sell-off. A slight risk-off tone helped yesterday as US 10Y and Bund yields both fell by -3bps on the day. This has coincided with markets repricing the next Fed rate hike to May 2017 (from March 2017) although we were at December 2017 before payrolls. This slight repricing helped see increased downward pressure on the dollar (-0.51%). Gold benefited from these moves as it rose by +0.4% on the day. Oil had a bad day though falling by around 2.5% as US crude inventories rose 1.06m barrels against a decline of -1.5m expected.

Oil has fallen another 0.5% in Asia which seems to have impacted sentiment to a degree. Headline index price action is again relatively subdued. The Hang Seng is +0.19% with the Shanghai Comp -0.23%. Japan is closed for a holiday.

The Kiwi dollar is at a 1-year high as its central bank signalled a less aggressive easing trajectory than expected after cutting rate 25bps as expected.

The Asian session follows a slightly negative session yesterday. The STOXX 600 (-0.20%) fell from its highest level since the Brexit vote while the S&P500 (-0.29%) also dipped below recent all time highs. German equities (DAX -0.39%) fell after posting strong gains on Tuesday. The FTSE (+0.22%) did however manage to stay in positive territory and post gains for the fifth consecutive day. Credit markets largely saw spreads widen as moves tracked equity markets. Over in Europe iTraxx Main and Crossover both widened by +2bps and +5bps respectively. CDX IG and HY also edged wider.

Yesterday had little to offer in terms of new data. In Europe we got some soft industrial production (-0.8% mom vs. +0.1% expected; -0.5% previous) and manufacturing production (-1.2% mom vs. +0.2% expected; +0.1% previous) numbers out of France, with both indicating an unexpected decline in June. Over in the US we saw the June JOLTS survey that saw job openings tick up marginally and clock in just shy of expectations (5.624mn vs. 5.675mn expected; 5.514mn previous). The hiring rate and quits rates were essentially the same as in May, clocking in at 3.6% (3.5% previous) and 2.0% (2.0% previous) respectively. We'd be impressed if Yellen can decipher too much from one of her favourite indicators.

Moving onto what looks like another fairly quiet day today now. Firstly in Europe we have the final July CPI numbers for France (-0.4% mom expected; -0.4% previous) and Italy (-0.1% YoY expected; -0.1% previous), both of which are expected to remain in deflationary territory. Over in the US we will see the initial jobless claims numbers (265k expected; 269k previous) for the first week of August and the import price data for July (-0.4% mom expected; +0.2% previous). Our Chief US Economist Joe LaVorgna notes that claims have hovered around multi-decade lows for the past four months, thus indicating that the labor market has likely reached full employment. Given the present stage of the business cycle, he advises keeping a close watch for any potential spike in claims given the existing pressure on corporate profit margins.

http://www.zerohedge.com/news/2016-08-11/us-futures-rebound-european-stocks-higher-oil-rises
 

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#28
Frontrunning: August 11


by Tyler Durden
Aug 11, 2016 7:38 AM

  • Stocks choppy, Kiwi soars after rate cut (Reuters)
  • Putin discusses Crimea security after alleged Ukrainian incursions (Reuters)
  • IEA Sees Oil Glut Easing (BBG)
  • Meanwhile: more oil - Iraq, oil companies agree to restart investment, boost output (Reuters)
  • U.S. Drillers Need $60 Oil to Stage Real Comeback, IEA Say (BBG)
  • Lopsided Housing Rebound Leaves Millions of People Out in the Cold (WSJ)
  • Clinton to Criticize Trump’s Economic Plan as Self-Serving (WSJ)
  • U.S. mutual funds boost own performance with unicorn mark-ups (Reuters)
  • Clinton’s Fiscal Prudence Runs Counter to Krugman’s Call to Borrow (BBG)
  • ECB negative rates at limit, should focus on asset buys, IMF economists say (Reuters)
  • German economy lost growth momentum in Q2: economy ministry (Reuters)
  • Alphabet Unit Google’s VC Chief Bill Maris to Exit (WSJ)
  • Alibaba's revenue jump 59 percent, GMV increases by a quarter (Reuters)
  • Alibaba Results Boosted by More Users, Mobile Growth (WSJ)
  • Romantic Relationship With Fannie Mae CEO Prompted Firing of Fifth Third Lawyer (WSJ)
  • Gold Price Surge Seen Cutting India’s Demand This Year, World Gold Council Says (BBG)
  • Brexit Bulletin: U.K. Home Sales Slump Most Since 2008 (BBG)
  • Investing in Venezuela Could Be Hugely Profitable or Potentially Lethal (BBG)
  • Libyan forces capture Sirte convention center from Islamic State (Reuters)
  • Cutting China’s Capital Down to Size (WSJ)
  • Fighting in Aleppo persists despite Russia ceasefire announcement (Reuters)

Overnight Media Digest

WSJ

- Federal prosecutors are investigating whether Valeant Pharmaceuticals International Inc defrauded insurers by shrouding its ties to a mail-order pharmacy that boosted sales of its drugs, people familiar with the matter said. http://on.wsj.com/2bgU5mp

- The chief executive of Delta Air Lines Inc took full responsibility for the computer failure that forced the airline to cancel more than 2,100 flights over three days, but he said it was a one-time event. http://on.wsj.com/2bgU81k

- Eli Lilly and Co said Wednesday its investigational cancer-fighting drug failed to meet efficacy criteria in an interim analysis of a phase-3 trial for treatment of breast cancer. http://on.wsj.com/2bgU41z


FT

Casino and bingo hall operator Rank Group Plc and online gambling company 888 Holdings Plc called on Wednesday for talks with the board of William Hill Plc after their proposed joint bid was rejected by the British bookmaker. William Hill rejected a 3.16 billion pound ($4.11 billion) bid by smaller rivals Rank Group and 888 Holdings on Tuesday, saying a 16 percent premium "substantially undervalued" the British bookmaker.

Chesapeake Energy Corp said on Wednesday that it would sell its Barnett shale acreage in Texas to private equity-backed Saddle Barnett Resources LLC and had renegotiated an expensive pipeline contract with Williams Partners LP , steps that should save more than $1.9 billion in future liabilities.

Tesla Motors Inc said on Wednesday that one of its cars had crashed in Beijing while in "autopilot" mode, with the driver contending sales staff sold the function as "self-driving", overplaying its actual capabilities.


NYT

- The world's biggest hedge fund, Bridgewater Associates, said it had resolved a harassment claim filed against it by an employee who recently left the firm. http://nyti.ms/2b7LEeE

- South Korean tech giant Samsung Electronics Co Ltd said on Thursday it will acquire U.S.-based luxury appliances maker Dacor Inc, seeking to boost high-end product sales. http://nyti.ms/2b7MHv8

- Bill Maris is stepping down as chief executive of GV, the venture finance arm of Google's parent company Alphabet Inc , according to a person who asked for anonymity because the details were private. http://nyti.ms/2b7MIyY

- A federal appeals court said on Wednesday the U.S. Federal Communications Commission could not block two states from setting limits on municipal broadband expansion, a decision seen as a win for private-sector providers of broadband internet and a setback for FCC Chairman Tom Wheeler. http://nyti.ms/2b7Mc4d


Britain

The Times

- Cavendish Fluor Partnership, a joint venture led by Babcock, the British defence and engineering company, has told the Nuclear Decommissioning Authority that the cost of cleaning up the 12 Magnox reactors will rise by 18 percent to more than 10 billion pounds ($13.02 billion). http://bit.ly/2b06POC

- Investors flocked to sell government bonds to the Bank of England, restoring confidence in its new 60 billion pound stimulus plan. The deal was a key test for the latest 60 billion pound of quantitative easing. http://bit.ly/2b07uzu

The Guardian

- Lloyds Banking Group has told its 75,000 staff that the chief executive has "no case to answer" over questions he may have breached the bank's expenses policy. The bank issued the memo after The Sun raised the questions about Antonio Horta-Osorio's expenses in a story about a business trip to Singapore where he was photographed with a female companion. http://bit.ly/2b07RK9

- The Scottish government is to redirect 100 million pounds from a budget underspend last year into a new initiative to help cushion the economy from the impacts of a post-EU referendum downturn. Nicola Sturgeon, the first minister, said the spending was needed to help stimulate the already weak Scottish economy in the wake of the "deep and widespread uncertainty" caused by the Brexit vote in June. http://bit.ly/2b07Q99

The Telegraph

- ITV faces pressure to improve on its £1bn bid for Entertainment One after it was immediately dismissed by the Peppa Pig maker's board. Britain's biggest commercial broadcaster wants to add eOne to its long list of television production takeovers, as chief executive Adam Crozier seeks to make the company less reliant on the UK's volatile advertising market, which is facing a downturn in the wake of the EU referendum. http://bit.ly/2b07D5U

- Eyal Shaked, the son of 888 co-founder Avi Shaked, has attacked William Hill for spurning the 3.2 billion pound joint takeover bid it made with Rank Group, claiming the strongly worded rejection would mark the troubled bookmaker's "downfall." http://bit.ly/2b08ym

Sky News

- San Leon Energy is close to finalising a $200 million fundraising to finance the acquisition of a near-10 percent stake in a major oil-producing asset in Nigeria. It would also announce the appointment of Mutiu Sunmonu, the former head of Shell Nigeria, as its new non-executive chairman. http://bit.ly/2b08pQc

- Local government leaders have accused the government of "looting" money from councils which sell homes under the Right To Buy scheme. The claim comes as new figures show that last year councils replaced less than 20 percent of homes sold under Right To Buy. http://bit.ly/2b08dkb

The Independent

- Royal Mail's "gold-standard" pension scheme could close by 2018 as the company readies itself for crunch talks with unions. The company wrote to employees saying that tough market conditions meant the cost of keeping the plan open would spiral to 900 million pounds, a figure it said was "simply unaffordable." http://ind.pn/2b087sz

- Prudential, the UK's largest insurer by value, has said it is considering shifting funds from M&G, its assets management business, to Dublin or Luxembourg following UK's vote to leave the EU. Anne Richard, the chief executive of M&G, said the decision to move assets will depend on the outcome of UK's negotiations with the EU. http://ind.pn/2b08GCT

http://www.zerohedge.com/news/2016-08-11/frontrunning-august-11
 

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#29

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#30
Gold and Silver Market Morning: Aug-11-2016 -- Gold and silver prices consolidating!
By: Julian D. W. Phillips, Gold/Silver Forecaster - Global Watch
In the last quarter of the year we expect U.S. demand for physical gold from investors in the shares of their Exchange Traded Funds to continue steadily. So far in 2016 investment demand for gold has overtaken the previous-ever high of 917 tonnes in 2009 [First half] to reach 1,064 tonnes.
 

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#31
Macy's will close ONE HUNDRED of its 675 big-box stores to focus on online sales
  • Macy's announced Thursday the plan to close 14 per cent of its stores
  • Department store chain is refocusing on online sales
  • Comes after profits and sales in the second quarter fell
  • Over the past year, the chain's stock has been on a downturn
  • But stocks went up after the announcement on Thursday, rising 14 per cent in early trading


Read more: http://www.dailymail.co.uk/news/article-3734684/Macys-plans-close-100-stores.html#ixzz4H2k6jXSZ
Follow us: @MailOnline on Twitter | DailyMail on Facebook
 

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#33
Worldwide Debt Bubble & Currency Collapse | Marc Faber
FinanceAndLiberty.com


Published on Aug 11, 2016
IN THIS INTERVIEW:
- Ahead: a crisis worse than 2008 ►0:54
- Young adults will earn less than their parents and die with less than their parents ►2:56
- How to weather the hard times ahead ►7:41
- How much gold is enough? ►11:01
- What form of precious metals is best? ►13:27
- U.S. presidential race ►15:12

FINANCE AND LIBERTY:
- SUBSCRIBE (it's FREE!) to "Finance and Liberty" for more interviews and financial insight ►http://bit.ly/Subscription-Link
- Website ►http://FinanceAndLiberty.com
- Like us on Facebook ►http://fb.com/FinanceAndLiberty
- Follow us on Twitter ►http://twitter.com/Finance_Liberty
- Google Plus ►http://Gplus.to/FinanceLiberty
- Title and video graphics by Josiah Johnson Studios ►http://JosiahJohnsonStudios.com
- Sponsors: http://SilverDoctors.com & http://ReluctantPreppers.com

This interview was recorded on Aug 9, 2016.

DISCLAIMER: The financial and political opinions expressed in this interview are those of the guest and not necessarily of "Finance and Liberty" or its staff. Opinions expressed in this video do not constitute personalized investment advice and should not be relied on for making investment decisions.
 

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#34
Futures Rise, Global Stocks Flat After Ugly Chinese Economic Data


by Tyler Durden
Aug 12, 2016 6:40 AM


One day after all three US indexes hit record highs for the first time since December 31, 1999, and global stocks headed for the biggest weekly gain in a month as gains in oil prices bolstered investor confidence, US equity index futures, European stocks and Asian equities are little changed after the Nikkei jumped on the back of a Yen weakness, while China reported disappointing economic data and the PBOC suggested that the flood of new debt is slowing which pushed Chinese stocks higher by 1.6% on hopes of more stimulus.

Ahead of today's main economic event, the US July retail sales report due out at 8:30 ET, China reported key economic data on retail sales, industrial production and fixed investment, all of which missed expectations. The summary:
  • Industrial production (IP): +6.0% yoy in July, missing consensus of +6.2%; ; June +6.2%
  • Retail sales: +10.2% yoy in July, missing consensus: +10.5%; June: +10.6% yoy.
  • Fixed asset investment (FAI): +8.1% ytd yoy in July, missing consensus: +8.9%); June yoy: +7.7%.
As Goldman noted, July activity data were all below expectations, with the NBS blaming both flooding and warmer weather for the disappointing data. Fewer working days this July compared with last July may also contributed to the weaker activity growth. Sequential IP growth slowed significantly from the high level in June. Export delivery, which was a main support of headline IP growth in recent months, decelerated in July (mom ann export delivery was -0.1% in July, vs +18.7% in June). Domestic demand was weak as well. FAI growth was a major disappointment. Except for the manufacturing sector, FAI growth in almost all sub-sectors moderated: Infrastructure FAI growth was 11.5% yoy in July, vs 21.6% yoy in June, and real estate FAI was 1.2% yoy, vs 3.6% yoy in June.

IP growth decelerated in July



FAI growth was very weak in July, especially in the private sector



Investment in the doldrums



Less aggressive policy support and the persistent floods impacting both southern and northern China made negative contributions to growth. There was also a small scale production and construction restriction around Chengdu for the ministerial level G20 Summit. High temperatures had mixed contributions to growth - on one hand, high temperatures supported utilities output (see EM Macro Daily - China: Cool weather likely contributed to weak August activity growth, Oct 9, 2014) on the other hand, it may discourage outdoor activities such as construction. Going forward, Goldman said it expected August and September growth to be sluggish, partially affected by the factories and construction site shutdowns around the G20 meeting in Hangzhou. Renewed policy easing to keep GDP growth in the target range is a strong possibility once this slowdown becomes more obvious.

Also overnight China reported weaker than expected new loan and Total Social Financing data,with the former rising CNY 463.6BN, below the 860BN expected, and the latter barely higher at CNY487.9BN, also well below the CNY1 trillion expected. As a result M2 rose 10.2%, below the 11.1% expected, if still roughly double the growth rate of M1, as China's liquidity trap continues to grow. Also as a result, Chinese bond yields dropped to the lowest since at least 2006. “China credit data will likely remain at a low level in coming months due to sluggish investment and stricter shadow banking regulation,” said Le Xia, chief Asia economist at Banco Bilbao Vizcaya Argentaria in Hong Kong. “The central bank will take action if it slips further.”

It wasn't just China reported weaker data: earlier today Italy’s economy stagnated in the second quarter in a major blow to prime minister Matteo Renzi’s government, which has been struggling to revive the country’s faltering economic recovery. Q2 GDP was unchanged on expectations of a 0.2% bounce. As the FT’s James Politi reported yesterday, Mr Renzi, who took office in 2014, is considering fresh stimulus to try and boost Italy’s economic recovery and to win over voters ahead of the November poll, including pension increases and additional funds for the poor.

The flipside was Germany, where Q2 GDP rose 0.4% Q/Q, double the expected 0.2%. This takes the year-on-year growth for Europe's largest economy to 1.8% on a seasonally adjusted basis, again beating expectations for 1.4% growth.

The full breakdown of today's European GDP figures is shown below, via the FT.



Then again, in recent years economic data has been all but useless, and so the momentum continues, with the MSCI All Country World Index holding near a one-year high on Friday, while U.S. equity index futures were slightly higher changed after all three key American indexes rallied to records on Thursday. Shanghai shares climbed the most in a month, buoyed by speculation of takeovers in the property industry and hopes for more stimulus. Crude headed for its biggest weekly advance since April, trading near $44 a barrel, amid speculation major producers will work together to stabilize prices.

The schizophrenic narrative continues with equities and bonds both higher on the week, buoyed by what Bloomberg calls "optimism central banks will retain or enhance supportive policies as the economy expands, but at a subdued pace" even as stronger US data hints at an upcoming rate hike, also interpreted as bullish by the market. Data Friday showed a 0.3 percent increase in euro-area gross domestic product, with growth in Italy grinding to a halt. Monetary authorities in Australia, New Zealand and the U.K. cut benchmark interest rates to records this month, while the Bank of Japan and European Central Bank are using unprecedented stimulus to spur expansion. In oil, speculation that informal OPEC talks next month will stabilize the market buoyed prices.

“The pessimism that had overwhelmed us at the start of the year and immediately post-Brexit is lifting,” said Nicolas Lopez, head of research at MG Valores in Madrid. “We should continue to see gains.”

MSCI’s global stocks gauge was little changed as of 10:40 a.m. London time, heading for a weekly advance of 1.2 percent.

In Europe, A.P. Moeller Maersk A/S rose 3.5 percent after Denmark’s biggest company said it increased efficiencies in the second quarter, reporting earnings before interest and tax of $656 million, beating an estimate of $551 million. The Stoxx Europe 600 Index was little changed overall, after Thursday recouping its pre-Brexit level. The volume of shares changing hands was 41 percent lower than the 30-day average at this time of day. Nordstrom Inc., the largest U.S. luxury department-store chain, surged in late trading after posting second-quarter profit that topped analysts’ estimates, helped by higher sales at its off-price Rack chain and its Anniversary promotional event.

The MSCI Emerging Markets Index climbed 0.1 percent, extending the advance since Aug. 5 to 2.6 percent in the fifth week of gains and the longest run since March 2014. Chinese stocks led the advance on Friday, with the Shanghai Composite Index climbing 1.6 percent as stake purchases by China Evergrande Group fueled optimism that the pace of merger activity in the property industry will accelerate.

In rates, U.K. gilts held a fourth weekly gain, as the Bank of England’s first week of its expanded bond buying plan drew to a close. The central bank has left its quantitative-easing shopping list broadly unchanged for next week, even after it failed to attract enough sellers of gilts due in more than 15 years to hit its purchase target at an operation on Tuesday. The yield on 10-year gilts touched a record-low 0.51 percent on Thursday, and has fallen 12 basis points since Aug. 5. Spanish and Italian government bonds also headed for their fourth weekly advance. The yield on Spain’s 10-year security was at 0.95 percent, after touching a record-low 0.913 percent on Thursday.

Market Snapshot
  • S&P 500 futures up less than 0.1% to 2184
  • Stoxx 600 down less than 0.1% to 347
  • FTSE 100 up 0.1% to 6923
  • DAX down 0.3% to 10707
  • German 10Yr yield down less than 1bp to -0.1%
  • Italian 10Yr yield up less than 1bp to 1.06%
  • Spanish 10Yr yield up 2bps to 0.94%
  • S&P GSCI Index down 0.2% to 348.9
  • MSCI Asia Pacific up less than 0.1% to 139
  • Nikkei 225 up 1.1% to 16920
  • Hang Seng up 0.8% to 22767
  • Shanghai Composite up 1.6% to 3051
  • S&P/ASX 200 up 0.4% to 5531
  • US 10-yr yield down 2bps to 1.54%
  • Dollar Index up less than 0.01% to 95.86
  • WTI Crude futures up less than 0.1% to $43.50
  • Brent Futures down 0.2% to $45.94
  • Gold spot down 0.1% to $1,337
  • Silver spot down 0.8% to $19.81
Top Global News
  • S&P 500, Dow, Nasdaq Hit Records Together First Time Since 1999: All 3 U.S. stock benchmarks rose together to record highs for the first time in 16 years amid surprising earnings.
  • HPE Buying Silicon Graphics in Deal Valued at $275m: HPE expects deal to be earnings neutral in first full year, will add to profit thereafter.
  • U.S. Banks Said to Ask Fed for 5 Yrs for Volcker Compliance: Reuters: Period would start next year, run through 2022; banks incl. Goldman, Morgan Stanley, JPMorgan requested.
  • Viacom CEO Dauman, Redstones Restart Talks on Co. Control: NYP: Several Viacom board members have moved closer to supporting move to name new CEO.
  • Russian Hackers of DNC Said to Nab Secrets From NATO, Soros: Security experts now say DCLeaks.com shows marks of same Russian intelligence outfit that targeted Democratic political organizations.
  • Wall Street Can’t Agree on When to Halt U.S. Stock Market: Major sticking point remains, according to official who spoke at an event hours after NYSE, Nasdaq, Bats Global Markets announced changes.
  • Russia Warns of Consequences From Deaths as Ukraine on Alert: Putin said Ukrainian intelligence officers killed 2 Russian servicemen during covert operations in Crimea.
* * *

Looking at regional markets, we find Asia traded higher following the record high closes across US indices as gains in energy underpinned risk-appetite. Nikkei 225 (+1.1%) returned from holiday to spearhead the advances as a weaker JPY lifted exporter sentiment. ASX 200 (+0.4%) was led by the energy sector after WTI prices rose above USD 43/bbl on yesterday's comments from Saudi's Energy Minister. Chinese markets are positive with the H ang Seng (+0.8%) and Shanghai Comp (+1.6%) conforming to the upbeat tone despite a slight miss on July Retail Sales and Industrial Profits, as the disappointing figures adds to calls for supportive measures while the PBoC also switched to a net weekly injection in its liquidity operations. Finally, 10yr JGBs were marginally lower amid increased demand for riskier assets, while the BoJ was also absent in regards to its bond buying operations.

Top Asian News
  • China Stability Falters as Factory Output, Investment Slow: Retail, investment, factory output all miss analyst forecasts
  • Yuan Free Float Seen a Decade Away as China Keeps Strict Control: True reserve currency needs free cross-border flows, JPMorgan says
  • Malaysia’s Growth Slows as Pressure to Add Stimulus Increases: Govt expects economy to grow between 4% and 4.5% in 2016
  • Cheung Kong’s Victor Li Says Open to Sale of City Buildings: CK Property will keep Cheung Kong Center, deputy chairman says
  • JPMorgan to Liquidate Japan Fund After ‘Significant’ Redemptions: Assets in Japan Market Neutral Fund fell to $17m
  • Lurking Credit Risks Make Babson Wary of Surging Indian Bonds: Little differentiation between strong and weak issuers, Posch says
  • SBI Profits Drop for Third Quarter as Bad-Loan Provisions Surge: Quarterly net income 25.2b rupees vs est. 25b
The final European session of the week has kicked off in a subdued manor, with equities trading without direction (Euro Stoxx: -0.1%) amid particularly light newsflow. Moller Maersk are the outperformer so far this morning in the wake of their pre-market earnings report, with little else of note happening on a stock specific basis. Fixed income markets have also traded in a relatively tight range, with Bunds hovering above 167.50 by mid-morning, paring early modest losses to trade relatively flat while the font end lags.

Top European News
  • Italian Economy Unexpectedly Stagnates in Threat to Renzi: 3Q GDP stalled unexpectedly in 3Q.
  • German Economy Slows Less Than Forecast as Exports Pick Up: GDP rose seasonally-adjusted 0.4% in 3Q.
  • Negative Rates for People Arrive as German Bank Gives In: From Sept., for savings >EU100k, a Raiffeisen bank will take back 0.4%.
  • Datwyler Says Still Reviewing Options for Pursuit of Premier: Datwyler said it’s still considering whether to pursue a takeover of Premier Farnell after U.K. co. agreed to GBP691m counter bid from Avnet Inc.
  • Maersk Gains as Company Meets Tough Market With Cost Cuts: Co. met punishing market conditions with cost cuts in order to create a leaner business.
  • Restaurant Group Soars After Ousting CEO for Ex-Paddy Power Head: Replaces CEO Danny Breithaupt with ex-Paddy Power head Andy McCue.
  • AstraZeneca Rides High, Fueled by Brexit, Bristol-Myers Failure: Drugmaker, once deemed a laggard, has rallied 37% since its June 14 low.
  • U.K. Stocks More Alluring Than Ever as BOE Sinks Gilt Yields: Cos. in FTSE All-Share Index return 3.8% in divs., near all-time high vs 10-year gilts.
  • Eurostar Scraps Eight Train Services as RMT Union Talks Kick Off: Service canceling 8 trains from Fri.-Mon. as talks continue with U.K. labor union RMT in protest about working hours.
In Commodities, crude added 0.8 percent to $43.83 a barrel in New York, headed for a 4.9 percent weekly jump. Informal discussions being held next month between members of the Organization of Petroleum Exporting Countries and non-OPEC producers may include possible action to stabilize the market, Saudi Arabia’s Energy Minister Khalid Al-Falih said in a statement, according to media reports, including Reuters. Global markets will continue to rebalance this year, the International Energy Agency said.“The Saudi comments gave the market some life,” said Jonathan Barratt, chief investment officer at Ayers Alliance Securities in Sydney. “The talk is all about pushing the price higher and the market will speculate on whether they can actually pull a deal together. Calls from the IEA that the glut will start to shrink and consumption will pick up are also supportive.” Copper fell 0.7 percent in London, trimming its weekly gain to 0.5 percent. Nickel lost 1.8 percent and aluminum was little changed.

In FX, after yesterday's USDJPY jump it has been a quieter, if choppy session in FX, with some familiar drivers early on that saw GBP under pressure again as the EUR cross rate returns through 0.8600 again while Cable is getting sold off ahead of the 1.3000 mark. UK construction output was a little mixed, though net in line with forecasts, so traders continue to trade off the longer term theme of uncertainty and bearish post Brexit sentiment. JPY weakness over the last 24 hours has been risk driven, but above the 102.00 mark we are running into resistance, with the lack of momentum down to the pre US retail sales caution — little else. A key driver of this positivity is the revival of Oil prices, with WTI back in the mid $43.00's to bolster CAD and MXN — the latter posting strong gains against the USD in recent weeks. USD/CAD is still holding off support in the low 1.2900's, but look heavy. Brent is now through $46.0 and along with the stronger inflation data in Norway has given the NOK a much firmer tone of late, with the EUR cross rate now eyeing the mid April lows just under 9.1500, while USD/NOK is sub 8.1000. SEK is also firmer these days but underperforms the NOK. AUD and NZD are out of the limelight for now, but the pullbacks look corrective for now — certainly in the case of AUD.

On today's calendar we will sees the first real potential market moving US data since last Friday's payroll. The main releases are July retail sales (+0.4% mom expected; +0.6% previous) and last month’s PPI number (+0.1% mom expected; +0.5% previous).

* * *

Bulletin Headline Summary from RanSquawk and Bloomberg
  • European equities enter the North American crossover relatively mixed as participants await tier 1 US data releases
  • Elsewhere, newsflow remains light with Eurozone GDP releases doing little to inspire price action
  • Looking ahead, highlights include US PPI, retail sales and U. of Michigan Sentiment
  • Treasuries rise in overnight trading, commodities slide and global equities head for biggest weekly gain in a month with MSCI All Country World Index near a one-year high.
  • China’s recent economic stabilization faltered in July as factory output, retail sales and investment all slowed, while the broadest measure of new credit rose the least in two years
  • Hong Kong’s economy grew at the fastest pace since March 2011 as a pick up in exports helped offset sluggish retail sales in the city. GDP expanded 1.6% in 2Q, the government said
  • Negative rates have arrived for German depositors. This week, a German cooperative savings bank in the Bavarian village of Gmund am Tegernsee -- population 5,767 -- said it’ll start charging retail customers to hold their cash
  • JPMorgan Chase’s investment unit said it will liquidate a Japan-focused fund after a surge of investor withdrawals following poor performance
  • Euro-area growth slowed in line with economists’ forecasts in the second quarter, leaving the currency bloc vulnerable to any fallout from Britain’s vote to leave the European Union
  • As the Bank of England seeks to ease Brexit angst by injecting money into the U.K. economy, pension managers and insurers are finding themselves caught up in a vicious circle as the bank’s QE program is crushing yields
  • Italy’s GDP unexpectedly stalled in the second quarter, which will further weigh on Prime Minister Matteo Renzi as he prepares for a referendum on which he has staked his political future
  • U.S. profit forecasts have turned negative for 2016 as the latest earnings season has failed to stem downgrades from analysts
US Event Calendar
  • 8:30am: Retail Sales Advance, July, est. 0.4% (prior 0.6%)
  • 8:45am: Bloomberg Aug. United States Economic Survey
  • 10am: Business Inventories, June, est. 0.1% (prior 0.2%)
  • 10am: U. of Mich. Sentiment, Aug. P, est. 91.5 (prior 90)
  • 12pm: Monthly World Agriculture Supply and Demand Estimates
  • 1pm: Baker Hughes rig count
DB's Jim Reid concludes the overnight wrap

Hope has been dashed a touch in China overnight with generally a soft monthly data dump. Industrial production rose 6% YoY (6.2% expected), Retail sales climbed 10.2% YoY (10.5% expected) with fixed-asset investment increasing 8.1% YTD YoY (8.9% expected) although property development investment seemed to firm. The positive tone from yesterday is having the most influence on Asian markets though even if China is underperforming a touch. The Nikkei (+0.97%), Hang Seng (+0.77%) and the Shanghai Comp (+0.24%) are all higher as we type. Oil is another +0.6% higher this morning after a bumper day yesterday

Before moving on here's a question for a quiet August Friday morning. What AAA investment at the start of 2016 that has been downgraded over the course of the year has returned over 54% YTD? The answer is of course the 50 year Gilt which remarkably has returned nearly 32% alone since the Brexit referendum. 2016 has provided the sort of return you'd normally expect from reinvesting 13 years of coupons. So if you were lucky enough to just invest in 50 year Gilts at the start of January you might as well sell and do nothing until the market catches up with you in 2029!!

Having said that you may be missing out on even more returns in the short-term as the long-end Gilt rally continues even with global Government bonds ending their 3 day rally yesterday. German and US 10Y yields ticked up by +2bps and +7bps respectively. Fed expectations repriced a bit more hawkishly after an up and down week post San Francisco Fed's Williams' reiteration of support for a rate hike this year. Higher import prices (see below) and higher Oil both contributed.

The UK yield curve flattened with yields rising up to the 10Y point (2Y: +5bps; 10Y: +1bps) while longer dated yields (15+ years) fell to new lows (15Y: -2bps; 30Y: -3bps). The 30 year Gilt has now returned 34% this year. Even 30 year Bunds are up 29%.

Before we look at the rest of markets it's worth pointing out that after a quiet data week, today sees the first real potential market moving US data since last Friday's payroll. The main releases are July retail sales (+0.4% mom expected; +0.6% previous) and last month’s PPI number (+0.1% mom expected; +0.5% previous). DB’s Chief US Economist Joe LaVorgna expects an above consensus headline retail sales number with growth at +0.9% mom, noting that the 6%+ increase in July motor vehicles sales (17.77M vs. 16.69M) bodes well for headline retail sales. He also notes that, while the retail sales number will likely overshadow the PPI number, the healthcare component of the latter is a key input into the core PCE deflator and should be watched.

Global equities rallied yesterday to rebound from Wednesday’s dip. European markets were broadly in positive territory with the STOXX (+0.78%), FTSE (+0.70%) and DAX (+0.86%) all hitting new post-Brexit highs. Over in the US the S&P500 (+0.47%) jumped to a fresh new all-time high. In fact the S&P500, Dow and Nasdaq all hit record closing highs on the same day for the first time since 1999! What could possibly go wrong? Oil was one of the main stories with WTI up nearly +4.5% as the optimism from earlier in the week about an Oil producers side meeting at next month's energy meeting in Algiers resurfaced. Saudi Arabia's energy minister suggested that the Kingdom could be part of some kind of stabilsation accord. Although we've been here before, investors were obviously less keen to be short with these comments backing up speculation from earlier in the week.

Elsewhere European credit markets were a bit more subdued, with iTraxx Main flat on the day while Crossover (+1bps) edged marginally wider. US markets however performed better with CDX IG and HY tightening by -1bps and -5bps respectively on the day.

Taking a look now at yesterday's data, over in Europe we saw the final July inflation numbers for France print in line (-0.4% mom vs. -0.4% expected) while Italy slipped further into deflationary territory (-0.2% YoY vs. -0.1% expected; -0.1% previous).

Over in the US we saw the initial jobless claims data for the first week of August come in pretty much in line with expectations (266k vs. 265k expected; 267k previous) but still around the multi-decade lows that highlight the tightness in the job market. Import price inflation for July did not fall into negative territory as expected (+0.1% mom; -0.4% mom expected) but did slide from a month ago (+0.6% previous). The low import price inflation can primarily be attributed to a stronger dollar and dropping oil prices, and will likely contribute to keeping consumer price inflation low in the near term as well.

Things finally pick up on the data front today after a relatively quiet week. We've already discussed US retail sales and PPI. Thereafter we will get June business inventories data for June (+0.1% mom expected; +0.2% previous) and the preliminary estimate of the UMichigan sentiment indicator for August (91.5 expected; 90.0 previous). Joe LaVorgna once again notes that inventories number should watched, as it has the potential to impact expectations for revisions to Q2 GDP.

Before all this, in Europe we’ll first get preliminary Q2 GDP growth numbers for Germany (+0.2% QoQ expected; +0.7% previous) and Italy (+0.2% QoQ expected; +0.3% previous), both of which are expected to indicate a slowdown in growth. The Q2 GDP growth number for the Eurozone is expected to hold steady (+0.3% QoQ expected; +0.3% previous). We will also see the final July inflation numbers for Germany (+0.4% mom expected; +0.4% previous) and Spain (-1.3% mom; -1.3% previous). Finally we’ll get Euro area industrial production for June where growth is expected to head back into positive territory (+0.5% mom expected; -1.2% previous).

http://www.zerohedge.com/news/2016-...-stocks-flat-after-ugly-chinese-economic-data
 

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#35
Frontrunning: August 12


by Tyler Durden
Aug 12, 2016 7:39 AM

  • Stocks Hit New Highs, and That Could Be Just the Start (WSJ)
  • China Slows as Stimulus Impact Wanes (WSJ)
  • How the China Shock, Deep and Swift, Spurred the Rise of Trump (WSJ)
  • Italian Economy Unexpectedly Stagnates in Threat to Renzi (BBG)
  • Clinton disparages Trump's economic plan, vows to help workers (Reuters)
  • Email Questions Haunt Hillary Clinton (WSJ)
  • Congressional leaders were briefed a year ago on hacking of Democrats (Reuters)
  • Senior Justice Official Raised Objections to Iran Cash Payment (WSJ)
  • Fidelity Plans Non-Transparent Exchange-Traded Product (WSJ)
  • Broker-dealer TradeZero launches first 'dark pool' exchange for bitcoin (Reuters)
  • Turkey prosecutors seek five years in jail for pro-Kurdish party leader (Reuters)
  • Fast and furious? China's stalling box office points to consumer slowdown (Reuters)
  • JPMorgan to Liquidate Japan Fund After ‘Significant’ Redemptions (BBG)
  • Merkel support slips as attacks put spotlight on migrant policy (Reuters)
  • Wall Street Can’t Agree on When to Halt the U.S. Stock Market (BBG)
  • Steve Wynn Gets Far Fewer Tables Than He Wants for Macau Casino (BBG)
  • Wall St. banks ask Fed for 5 more years to comply with Volcker rule (Reuters)

Overnight Media Digest

WSJ

- The European Union's antitrust authority opened a full-blown investigation into the proposed merger of Dow Chemical Co and DuPont, which could require the companies to make bigger concessions to clear their blockbuster deal. http://on.wsj.com/2aPKYwu

- Macy's Inc said it would close 100 stores, admitting that some locations were worth more as real estate than retail outlets as shoppers continue to spend more online and at discount chains. http://on.wsj.com/2aPLqe8

- Hewlett Packard Enterprise Co agreed to pay about $275 million to buy Silicon Graphics International Corp, a once-influential pioneer in computing hardware that wound up settling into a small industry niche. http://on.wsj.com/2aPM7E4


FT

EU antitrust regulators have opened a full investigation into Dow Chemical and DuPont's proposed $130 billion merger, saying the deal may reduce competition in crop protection, seeds and some petrochemicals.

The European Central Bank and German banking watchdog Bafin have given a green light to China's Fosun International for its planned takeover of German private bank Hauck & Aufhaeuser, two sources familiar with the situation said on Thursday.

Russia's anti-monopoly watchdog said on Thursday Google would have to pay a 438 million rouble ($6.81 million)fine for pre-installing applications on mobile devices running its Android operating system.


NYT

- Arania Huffington's abrupt announcement on Thursday that she is stepping down as editor in chief of The Huffington Post and leaving the company to focus on her new venture, a health and wellness start-up called Thrive Global, leaves the publication in an unfamiliar position. http://nyti.ms/2b2FGKJ

- Macy's Inc, the country's largest department store, said on Thursday that it would close 100 stores, saying they were more valuable as real estate properties. http://nyti.ms/2b2FlaW

- A judge on Thursday rejected Citigroup Inc's bid for a preliminary injunction to stop AT&T Inc from using the phrase "AT&T thanks" on a customer loyalty program, which the bank called too similar to its trademarked "thankyou". http://nyti.ms/2b2F7AJ

- Bill Miller, the veteran stock picker whose market-beating wisdom defined an earlier era of mutual fund dominance, split ways on Thursday with Legg Mason Inc, his professional home for 35 years. http://nyti.ms/2b2FGdM

- More leading universities - Duke, Johns Hopkins, the University of Pennsylvania and Vanderbilt - have been sued on claims that their retirement plans charged employees excessive fees, following a series of similar suits filed earlier this week. http://nyti.ms/2b2FN93


Canada

THE GLOBE AND MAIL

** Dream Office REIT became the most recent property owner to suffer a material impact from Alberta's woes by slashing the fair value of its portfolio there with a C$675-million ($520 million ) writedown Thursday. The real estate investment trust deepened a rout that has seen more than C$1.5 billion ($1.16 billion) in property value vanish from Alberta's office tower market amid the downturn in energy prices. (http://bit.ly/2b34Icw)

** Chief Justice Beverley McLachlin says she's concerned about the time it is taking to fill a coming vacancy on the Supreme Court of Canada and hopes a new judge is named as soon as possible. Chief Justice McLachlin's comments come on the heels of the Liberal government's pledge to change the way Supreme Court justices are selected, in an attempt to make the process more accountable and to diversify the bench. (http://bit.ly/2b35CpF)

NATIONAL POST

** A report released by Canada's telecom regulator revealed that Canadian citizens continue to pay more for wireless services than the majority of their counterparts living in G7 countries and Australia. Canada won gold for the most expensive low-end wireless telephone service and landed silver for premium mobile phone services that include more minutes and data. (http://bit.ly/2b34d2u)

** Mark Machin, Canada Pension Plan fund's new chief executive, says even though Brexit may have affected the fund's performance this quarter, it is also creating opportunities to invest. He said there are at least two deals in the works that popped up in Brexit's aftermath. (http://bit.ly/2b38L8Y)


Britain

The Times

Steinhoff International, the acquisitive South African conglomerate, has increased its offer for Poundland in a bid to secure a takeover of the discount UK retailer. http://bit.ly/2b9ExlX

The Guardian

The Duke of Westminster's death has led to calls from tax campaigners to reform the system of trusts which has allowed Britain's wealthiest families to preserve fortunes through generations by avoiding death duties. http://bit.ly/2b9GGhw

Media mogul turned self-help guru Arianna Huffington is to leave the Huffington Post to launch a health-focused startup called Thrive Global to tackle stress and burnout. http://bit.ly/2b9Gmzn

The Telegraph

Sky and Channel 4 have made a joint investment in a new online service that aims to make it easier for television producers to sell their programmes to foreign broadcasters. http://bit.ly/2b9EfeM

The European Commission is launching a probe into the $130 bln mega-merger between US titans Dow Chemicals and DuPont. http://bit.ly/2b9FiLD

Sky News

Restaurant Group, the struggling owner of the restaurant chains Garfunkel's and Frankie & Benny's, is to announce on Friday that CEO Danny Breithaupt will leave after less than two years in charge. http://bit.ly/2b9FIlc

State-owned energy giant China General Nuclear Power (CGN) allegedly used a Chinese-born U.S. citizen to access sensitive information - with the aim of speeding up the progress of reactor technology in China. http://bit.ly/2b9EYg0

The Independent

The Treasury's Debt Management Office sold debt at a new record low interest rate, underlining the massive appetite from investors for British Government bonds in the wake of the Brexit vote and sparking fresh calls for the Chancellor to take advantage by ramping up its infrastructure investment. http://ind.pn/2b9FNFv

Kentucky Fried Chicken owner, Yum! Brands, has faced renewed pressure from campaigners and investors to stop using chicken routinely treated with antibiotics, a factor in the emergence of drug-resistant superbugs such as MRSA. http://ind.pn/2b9FP05

http://www.zerohedge.com/news/2016-08-12/frontrunning-august-12
 

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#37
Mornings With "V" (08/12/2016)
ROGUE MONEY


Streamed live 1 hour ago
V breaking it down like no else can!!!
 

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#39
Olympic Sized Manipulations
bigdad06


Published on Aug 12, 2016
Please subscribe! Market update on the current market manipulations, bad news is good news and good news is good news, as we grind through the summer months. As I was in the process of posting this video we see over at Zerohedge that someone has decided it was a good time to dump over $5 billion worth of paper gold contracts as the European markets closed and the link is here http://www.zerohedge.com/news/2016-08... . So the prices of gold and silver have just taken a nose dive just in time for the weekend. Don't you just love it! LOL! Take care and have a great weekend anyway!