- U.K. Construction Output Declines to Lowest Since 1998. U.K. construction output fell to its lowest level in more than 14 years in the first quarter as work on new building projects declined across the industry. Output measured by volume dropped 2.4 percent from the previous three months to its lowest since the fourth quarter of 1998, the Office for National Statistics in London said today. That compares with the 2.5 percent decline estimated in gross domestic product data on April 25.
- European Stocks Rally for a Third Week; BT Group Climbs. European stocks rallied for a third week, closing at their highest level in almost five years, as companies from BT Group Plc to Hochtief AG posted earnings that beat estimates, while economic data exceeded expectations.
- Carson Block Says He’s Shorting Debt of Standard Chartered. Carson Block, the short seller who runs Muddy Waters LLC, said he is betting against the debt of Standard Chartered Bank Plc because of the “deteriorating” quality of its loan book. Block said the London-based bank’s $1 billion loan to Samin Tan, chairman of Bumi Plc (BUMI), the coal company at the center of a dispute between co-founders Nathaniel Rothschild and Indonesia’s Bakrie family, and loans to Far East Energy Corp. (FEEC), were ‘red flags.’ Standard Chartered will also come under stress when China’s economy slows down, Block said. “We believe the quality of Standard Chartered’s loans are deteriorating,” Block said at the SkyBridge Alternatives Conference in Las Vegas today.
- Mexico Industry Output Falls Three Times More Than Forecast. Output slid 4.9 percent from a year earlier, the biggest decline since the end of the 2009 recession and more than the 1.4 percent median estimate of 16 economists surveyed by Bloomberg. Manufacturing contracted 5.8 percent and construction fell 5.2 percent, the national statistics institute said on its website today.
- Dollar Rally Spurs Commodity Selloff as U.S. Stocks Fluctuate. The Dollar Index extended its biggest two-day rally since July, triggering plunges in oil and gold, and Treasuries tumbled. U.S. stocks retreated, trimming a third straight weekly gain. The Dollar Index, a gauge of the currency against six major peers, added 0.6 percent to 83.27 at 12:37 p.m. in New York to extend its two-day advance to 1.7 percent.
- OPEC Crude Production Rises to Five-Month High on Saudi Increase. OPEC boosted crude output in April to the highest in five months as Saudi Arabia increased production, helping lower oil prices amid concern that global economic growth is slowing. The Organization of Petroleum Exporting Countries produced 30.46 million barrels a day last month, up from 30.18 million in March, the group’s Vienna-based secretariat said today in its Monthly Oil Market Report. That’s the most since November. The estimates are based on secondary sources.
- Gold Extends Weekly Drop as Stronger Dollar Curbs Demand. Gold declined to a two-week low and headed for the biggest drop in more than three weeks in New York as a stronger dollar curbed demand for the metal as an alternative investment.
- Bernanke Sees Important Risks in Wholesale Funding. Federal Reserve Chairman Ben S. Bernanke said risks persist in wholesale funding markets used frequently by Wall Street brokers to finance securities trading. “Important risks remain in the short-term wholesale funding markets,” Bernanke said today in a speech at a Chicago Fed banking conference. “One of the key risks is how the system would respond to the failure of a broker-dealer or other major borrower.”
- Credit Pinch for Small Business Impedes U.S. Job Growth. Tighter lending standards among U.S. community banks help explain why small businesses are adding jobs at only half the pace of large employers. The Federal Deposit Insurance Corp. says the 6,900 institutions it classifies as community banks supply almost half of small business loans.
- Investors Rediscovering Margin Debt. Small investors are borrowing against their portfolios at a rapid clip, reaching levels of debt not seen since the financial crisis. The trend—driven by a combination of rising stock values and rock-bottom interest rates—is sparking a growing debate among market watchers. To some, this trend in so-called margin debt is a sign of investors' increasing confidence in a bull market for stocks that has already lifted the Dow Jones Industrial Average 15.1% in 2013. But to others it is a warning sign that the Federal Reserve's easy-money policies are creating a bubble mentality among stock investors.
- U.S. Expects Record Corn Crop. U.S. corn futures added to their losses Friday after the government forecast a record crop. The U.S. Department of Agriculture, in a monthly crop report, forecast that greater-than-expected domestic supplies in the next year. As of Aug. 31, 2014—the end of the crop year that will begin with this autumn's harvest—the report predicts stockpiles will total 2.004 billion bushels. Analysts in an earlier Dow Jones Newswires poll had on average expected a forecast of 1.973 billion bushels. The projection would mark the highest level for late-summer corn stockpiles since 2005.
- Texas officials launch criminal investigation into fertilizer plant explosion that killed 14. Texas law enforcement officials on Friday launched a criminal investigation into the massive fertilizer plant explosion that killed 14 people last month. Investigators have largely treated the West Fertilizer Co. blast that killed 14 people as an industrial accident, but the Texas Department of Public Safety said in statement that the agency has now instructed the Texas Rangers and the McLennan County Sheriff's Department to conduct a criminal probe.
- Jack Lew: Debt Ceiling Won't Be Reached Until Labor Day. U.S. Treasury Secretary Jack Lew told CNBC on Friday that the U.S. debt ceiling would not be reached until September, though he said it was not an excuse for Congress to relax. "The debt limit will be reached in just a few days when it expires on May 18 but because of the cash flows we can predict that we will be okay until Labor Day," Lew told CNBC in an interview in London.
- Zell on Market: A 'Giant Game of Musical Chairs'. Sam Zell looks at the stock market and doesn't like what he sees: Zooming prices that normally would come with economic prosperity are hard to find in the current environment.
- Credit Shock Dead Ahead: China Money Formation Soars To 2-Year High As Delinquent Loans Surge By 29%. (graphs)
LA Times:
Reuters:
- US prime money funds raise euro zone exposure in April-JPMorgan. U.S. prime money market funds slightly increased their holdings of euro zone bank debt in April after Cyprus received a bailout to manage its bank problems, according to a report by JPMorgan Securities released on Friday.
- European development bank cuts growth forecast for emerging economies. Europe's development bank slashed its 2013 growth forecasts for emerging Europe and North Africa on Friday by almost a full percentage point, saying a sharp slowdown in Russia would drag down the regional economy.
- US junk bond market ignites as money keeps pouring in. The US junk bond market is back in full swing, with investors embracing riskier assets in the hunt for yield and issuers getting away with historically tight pricing - and increasingly aggressive structures.
- IRS apologizes for targeting conservative groups. The Internal Revenue Service apologized Friday for inappropriately flagging conservative political groups for additional reviews during the 2012 election to see if they were violating their tax-exempt status. Lois Lerner, who heads the IRS unit that oversees tax-exempt groups, said organizations that included the words "tea party" or "patriot" in their applications for tax-exempt status were singled out for additional reviews. Her remarks came at an American Bar Association gathering.
- Exclusive: Benghazi Talking Points Underwent 12 Revisions, Scrubbed of Terror Reference. When it became clear last fall that the CIA’s now discredited Benghazi talking points were flawed, the White House said repeatedly the documents were put together almost entirely by the intelligence community, but White House documents reviewed by Congress suggest a different story. ABC News has obtained 12 different versions of the talking points that show they were extensively edited as they evolved from the drafts first written entirely by the CIA to the final version distributed to Congress and to U.S. Ambassador to the U.N. Susan Rice before she appeared on five talk shows the Sunday after that attack.
- Spain is officially insolvent: get your money out while you still can. I'd not noticed this until someone drew my attention to it, but the latest IMF Fiscal Monitor, published last month, comes about as close to declaring Spain insolvent as you are ever likely to see in official analysis of this sort. Of course, it doesn't actually say this outright. The IMF is far too diplomatic for such language. But that's the plain meaning of its latest forecasts, which at last have an air of realism about them, rather than being the usual dose of wishful thinking.
- G7: US warns Japan to stick to rules on currency. Japan is pushing the boundaries of international agreements to avoid competitve currency devaluations, the US Treasury Secretary has warned, as the International Monetary Fund said unprecedented monetary easing could lead to a "serious boom and bust".
- China Banks Face More Curbs On Wealth Products. People's Bank of China and China Central Depository & Clearing notified banks that their wealth management product accounts can't trade among themselves or with the bank's own proprietary trading account, citing traders. New regulations will make the process of how banks are allowed to offload assets underlying wealth products more complicated.
No comments:
Post a Comment