Thursday, February 24, 2011

Today's Headlines

  • Qaddafi Urges End to Violence as Foes Increase Control in East. Libya’s Muammar Qaddafi, who has lost control of much of the country’s oil-rich east, appealed to citizens to end violence as his forces stepped up a crackdown on opponents and more than 100 people were reportedly shot dead. Qaddafi blamed the uprising against his 41-year rule on “drugged kids” and al-Qaeda, speaking by telephone on state television today for the first time since a Feb. 22 speech in which he vowed to fight “until his last drop of blood.” He said he regretted the deaths during the unrest. “You want to change the government -- you can do it any day through the revolutionary committees,” Qaddafi said, referring to his own state structures. He said protesters had no demands of their own and were echoing those of Osama bin Laden.
  • Gasoline, Heating Oil Reach 29-Month Highs on Libya Revolt. Gasoline and heating oil surged to 29-month highs on concern that Libya’s political uprising threatens fuel supplies and that unrest will spread across North Africa and the Middle East. Futures rose as the turmoil in Africa’s third-biggest oil producer sent crude traded on the New York Mercantile Exchange above $100, with Brent reaching $119.79 in London. Foreign governments began discussing intervention as opponents of Libyan leader Muammar Qaddafi consolidated control over cities in the oil-rich east while he clamped down on Tripoli. “We’re still looking at the biggest threat to oil supplies in my lifetime,” said Phil Flynn, vice president of research at PFGBest in Chicago. “That’s what’s keeping us up. This is all about what’s going on in the Middle East” and North Africa. Gasoline for March delivery gained 5.24 cents, or 1.9 percent, to $2.7673 a gallon at 12:30 p.m. on the New York Mercantile Exchange. Prices touched $2.856, the highest level for the front-month contract since Sept. 12, 2008. Futures have risen 11 percent since anti-government protests began Feb. 15 in Libya, a member of the Organization of Petroleum Exporting Countries. Gasoline is the day’s biggest gainer, followed by crude oil and heating oil, on the Thomson Reuters/Jefferies CRB Index of 19 raw materials.
  • Sales of New U.S. Homes Fell More Than Forecast in January. Purchases of new houses in the U.S. fell more than forecast in January, reflecting declines in the West and South that indicate a California tax credit and bad weather may have played a role. Sales declined 13 percent to a 284,000 annual pace, figures from the Commerce Department showed today in Washington. The median estimate of economists surveyed by Bloomberg News projected a decrease to a 305,000 rate. Demand dropped 37 percent in the West and 13 percent in the South.
  • Saudi Man Arrested in Texas on Weapons Charge May Have Been Targeting Bush. A 20-year-old Saudi man was arrested in Texas on charges he purchased chemicals to make an explosive device and researched potential U.S. targets, including the Dallas address of former President George W. Bush, according to the Justice Department. Khalid Ali-M Aldawsari, was arrested yesterday by FBI agents on a charge of attempted use of a weapon of mass destruction, the Justice Department said in a statement today. Aldawsari allegedly wrote in a journal that he was inspired by al-Qaeda leader Osama bin Laden and that he was planning for jihad, according to court papers filed by the government.
  • India's Sensex Falls Most Since November 2009 on Inflation, Oil Concerns. India’s benchmark stock index tumbled the most in more than 15 months as food-price gains accelerated and surging oil prices stoked concern inflation will lead to higher interest rates. Tata Motors Ltd., the nation’s biggest truck-maker, sank 7.8 percent, the most in 22 months. Larsen & Toubro Ltd., the largest engineering company, slid 5.3 percent. An index of wholesale farm-product prices rose 11.49 percent in the week ended Feb. 12 from a year earlier, after climbing 11.05 percent the previous week, the commerce ministry said today. Oil surged to the highest in 30 months in London as Libya’s violent uprising cut supplies from Africa’s third-biggest producer. The Bombay Stock Exchange Sensitive Index, or Sensex, slid 545.92, or 3 percent, to 17,632.41 at the 3:30 p.m. close in Mumbai, the biggest drop since Nov. 3, 2009.
  • Greek, Irish Bonds Fall as Crude Oil Gain Damps Demand for Riskier Assets. Greece and Ireland led declines in the bonds of the euro region’s most-indebted nations as escalating violence in Libya pushed the price of oil to a 30- month high, sapping demand for assets perceived to be risky. Greek 10-year yields climbed 11 basis points, or 0.11 percentage point, to 11.86 percent at 4:24 p.m. in London, after reaching 11.89 percent, the highest level since Jan. 11. The Irish 10-year yield surged 17 basis points to 9.32 percent. Portuguese 10-year yields added four basis points to 7.50 percent, while Italian 10-year yields gained one basis point to 4.84 percent.
  • OPEC to Cut Exports on Declining Fuel Demand, Oil Movements Says. The Organization of Petroleum Exporting Countries will ship less crude this month because of declining demand for winter fuels and as refineries halt for maintenance, according to tanker-tracker Oil Movements. Loadings will slip to 23.88 million barrels a day in the four weeks to March 12, down 1.3 percent from 24.19 million a day in the equivalent period to Feb. 12, the tanker-tracker said today in a report. In the four weeks to March 12 exports from Middle Eastern producers, including non-OPEC members Oman and Yemen, will fall by 1.7 percent to 17.81 million barrels a day, Oil Movements’ data show.
  • Wheat Resumes Plunge as Unrest Across North Africa Drives Away Speculators. Wheat extended a collapse and corn and soybeans also fell as traders speculated that a jump in energy costs caused by protests across North Africa and the Middle East will curb growth and demand for grains. Riots already ousted leaders in Egypt, the world’s biggest wheat importer, and in Tunisia, and opposition groups have seized control of eastern cities in Libya. While wheat traded in Chicago dropped 10 percent in the past four sessions, crude oil traded in New York jumped 15 percent.
  • Fed May Need to Taper $600 Billion in Purchases, Bullard Says. The Federal Reserve’s planned $600 billion in Treasury purchases helped improve the U.S. economic outlook and the policy debate may turn to whether to reduce the program scheduled through June, St. Louis Fed President James Bullard said. “The natural debate now is whether to complete the program, or to taper off to a somewhat lower level of asset purchases,” Bullard said in the text of a speech today in Bowling Green, Kentucky.

Wall Street Journal:
  • U.S. Fears Tripoli May Deploy Gas As Chaos Mounts. The government of Col. Moammar Gadhafi hasn't destroyed significant stockpiles of mustard gas and other chemical-weapons agents, raising fears in Washington about what could happen to them—and whether they may be used—as Libya slides further into chaos. Tripoli also maintains control of aging Scud B missiles, U.S. officials said, as well as 1,000 metric tons of uranium yellowcake and vast amounts of conventional weapons that Col. Gadhafi has channeled in the past to militants operating in countries like Sudan and Chad. Current and former U.S. officials said in interviews that Washington's counterproliferation operations against Libya over the past decade have scored gains, in particular the dismantling of Tripoli's nascent nuclear-weapons program and its Scud C missile stockpiles. But the level of instability in Libya, and Col. Gadhafi's history of brutality, continues to make the U.S. focus on the arms and chemical agents that remain, they said.
  • Gadhafi Blames al Qaeda; Rebels Promise Offensive. Libyan leader Moammar Gadhafi accused his opponents of being under the sway of al Qaeda Thursday, as rebels controlling large swathes of the country promised an offensive against the capital, Tripoli. Speaking by telephone to state television, the increasingly isolated leader directed his 23-minute address to citizens of al-Zawiya, an industrial town just 30 miles west of Tripoli where gun battles raged Thursday. "What is this farce? You in al-Zawiya turn to bin Laden?" he said. "He brainwashed your sons."
  • Saudis Stand Ready to Fill Oil Gap. Saudi Arabia said it is in "active talks" with European oil companies to make up the shortfall in Libyan oil production that has helped push oil prices towards $120 a barrel and raised fears for the global economic recovery. A senior Saudi petroleum official said the kingdom is in talks with refiners on "whether they need extra oil, and if so, what quality and quantity and on what kind of time scale." He added: "We can supply it immediately."
  • Issa Subpoenas Obama Administration. House Oversight Chairman Darrell Issa (R., Calif.) has issued his first subpoenas to the Obama administration, seeking testimony from two Department of Homeland Security employees about their handling of freedom-of-information requests, according to committee Democrats who objected to the move.
Business Insider:
Zero Hedge:
New York Times:
  • Gasparino: Nasdaq's Bob Greifeld Feeling "Incredible Shareholder Pressure". FOX Business Network Senior Correspondent, Charlie Gasparino, is reporting this morning that NASDAQ's (NASDAQ: NDAQ) Chief, Bob Greifeld, is feeling “incredible shareholder pressure” to do something about the merger of the New York Stock Exchange (NYSE: NXY) and Deutchse Boerse. This includes exploring a hostile bid for the NYSE.
LA Times:
Rasmussen Reports:
  • Lobbyists: White House Sends Meetings Off-Site to Hide Them. Caught between their boss’ anti-lobbyist rhetoric and the reality of governing, President Barack Obama’s aides often steer meetings with lobbyists to a complex just off the White House grounds — and several of the lobbyists involved say they believe the choice of venue is no accident. It allows the Obama administration to keep these lobbyist meetings shielded from public view — and out of Secret Service logs kept on visitors to the White House and later released to the public.
  • Libya Placed Billions of Dollars at U.S. Banks - WikiLeaks. Libya's secretive sovereign wealth fund has $32 billion in cash with several U.S. banks each managing up to $500 million, and it has primary investments in London, a confidential diplomatic cable shows. The cable, obtained by WikiLeaks and revealing the details of a January meeting between the head of the Libyan Investment Authority (LIA) and the U.S. ambassador in Tripoli, comes as the United States and European governments explored the possibility of freezing assets belonging to the Libyan government.
Caixin Online:
  • China's Housing Inventory Valued at 75% of GDP. Beijing-based UBS economist Wang Tao singled out the country's property bubble as the largest macroeconomic risk in the coming few years. As the debate over the real estate bubble continues to simmer, some have estimated that China's housing inventory value could be as high as 350 percent of last year's GDP, similar to Japan's 20 years ago just before the property bubble burst.
Economic Observer:
  • About 58% of a total 447 coal power stations under China's five major power generation groups made losses by the end of October last year, citing China Electricity Council.

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