Bloomberg:
- BMW Denied in China Seen Signaling Outlook Dimming for Carmakers. Bayerische
Motoren Werke AG (BMW)’s failure to win government approval to expand a
factory in China is fueling concern global automakers could find it
increasingly difficult to win regulatory approval on projects in the
country. Shares of BMW partner Brilliance China Automotive Holdings
Ltd. (1114) fell the most in almost four weeks in Hong Kong yesterday
after China’s Ministry of Environmental Protection said it sent
back an application, citing inadequate wastewater analysis and
the plan’s failure to meet government anti-pollution targets.
- China Iron-Pore Production Jumps 10.7% in June, Near Record.
- Brazilian Real Falls to Four-Year Low, Stoking Inflation Concern.
Brazil’s real dropped to a four-year low, adding to concern
accelerating inflation will undermine efforts to stimulate Latin
America’s largest economy. Swap rates rose on speculation the central
bank will maintain the pace of increases in borrowing costs even as a
report showed inflation slowed. The real has tumbled 11 percent in the past three months, the biggest drop among 24 emerging-market dollar counterparts tracked
by Bloomberg. The depreciation pushes up the price of imports and
threatens to further fuel inflation, which helped spark nationwide
street protests last month. “The central bank seems to have a blank
check to combat inflation,” Daniel Cunha, the chief economist at XP
Investimentos in Sao Paulo, said in a telephone interview. “The
fight against inflation seems to have greater weight than
economic growth.”
- What Happens If the BRICs Sink Like One? In the case of India and Brazil, I think the answer is “sad, with
regional implications.” Growth in those countries has pulled millions of
people out of dire poverty, but many remain. And solid economic growth
in any large country has regional spillover effects through migration
and trade. But these are still economies where agriculture plays
an outsized role. Brazil’s growth has been driven by agricultural
exports such as soy and beef, while India’s GDP is still measurably
affected by the monsoon, which drives crop yields. A growth slowdown in
an agricultural economy may play havoc with individual commodity prices,
but it doesn't have, say, the enormous impact on global manufacturing
networks that a Chinese slowdown would have.
- Deutsche Bank(DB) to Cut Assets $332 Billion as Profit Slides. Deutsche
Bank AG (DBK), continental Europe’s biggest bank, said it will shrink
its balance sheet by 250 billion euros ($332 billion), joining Barclays
Plc (BARC) and UBS AG (UBSN) in seeking to comply with stricter capital
rules. Deutsche Bank will reduce leverage by changing the way it
accounts for derivatives and by winding down a 73 billion-euro portfolio
of assets, Chief Financial Officer Stefan Krause told investors on a
conference call today. Krause announced the plan after the bank said net
income slid 49 percent to 334 million euros, missing the average 767.6
million-euro estimate of nine analysts.
- European Stocks Advance as EDF, Alcatel-Lucent Rally.
European stocks advanced as investors weighed corporate earnings from
Electricite de France SA to Barclays Plc and the Federal Reserve began a
two-day policy meeting. EDF, Europe’s biggest power generator, and
Alcatel-Lucent (ALU) SA, a French maker of phone equipment, jumped more
than 7 percent as profit beat analysts’ estimates. Barclays sank the
most in 13 months after announcing a rights offering and saying
income fell. K+S AG, Europe’s largest potash producer, plunged
24 percent as OAO Uralkali ended a deal that controlled supplies
of the fertilizer ingredient from the former Soviet Union. The Stoxx Europe 600 Index added 0.1 percent to 299.43 at
the close of trading, as two stocks rose for every one that
fell.
- Crude Drops to Three-Week Low as U.S. Growth May Slow. WTI for September delivery declined $1.46, or 1.4 percent, to $103.09 a barrel at 12:57 p.m. on the New York Mercantile Exchange. It fell to $102.78 in intraday trading, the lowest price since July 9. The volume of all futures traded was 3.8
percent below the 100-day average for the time of day. Prices
are up 6.8 percent in July, set for a second monthly gain.
- Fed Decision-Day Guide From QE Tapering Guidance to Dissents. Here’s what to look for when the Federal Open Market Committee releases a statement at 2 p.m. tomorrow
after a two-day meeting in Washington. Unlike last month, the
policy-making panel will not release economic forecasts, and Chairman
Ben S. Bernanke will not be briefing the press afterwards.
- Achuthan Says U.S. Economy Has Faltered Since Last Recession. U.S.
economic growth has been
lacking since the last recession, said Lakshman Achuthan, the Economic
Cycle Research Institute co-founder who maintains that the U.S. reverted
to a slump last year. “Growth is not there,” Achuthan said, speaking on Bloomberg Television with Tom Keene and Sara Eisen. The section
of the population aged 35 to 54 “has lost almost 1 million
jobs since the recovery began,” he said. Achuthan today reiterated his view that a recession began
last year and that data will eventually show this. In a previous
interview with Bloomberg Television on March 7 he said he was
basing his opinion on the “stall speed” in gross domestic
income in 2012, and on the weakness in indicators such as output
and income.
Wall Street Journal:
- Home Prices Jump, but Headwinds Build. Rising Mortgage Rates, Potential for More Supply Threaten Pace of Gains Shown in Two Indexes. Home prices during the first half of 2013 posted their largest gain
since the housing boom peaked seven years ago, but rising mortgage rates
and the potential for more supply could eventually slow the run-up. Nationally, home values rose by 5.8% in June from one year ago,
according to Zillow Inc., the real-estate website, the largest gain
since 2006. So far this year, prices are up 2.7%, the strongest
year-to-date gain in June since 2005.
- Goodyear's(GT) Net More Than Doubles.
Goodyear Tire & Rubber Co.'s GT +9.45% second-quarter net income
more than doubled on higher profit in all of its regions, including
Europe where many auto-related companies continue to struggle. The
largest U.S.-based tire maker also slightly
raised its full-year outlook, now expecting operating profit on the
higher end of its forecast of $1.4 billion to $1.5 billion.
Barron's:
Fox News:
- Gov't Knows Best? White House creates 'nudge squad' to shape behavior. The federal government is hiring what it calls a "Behavioral Insights
Team" that will look for ways to subtly influence people's behavior,
according to a document describing the program obtained by FoxNews.com.
Critics warn there could be unintended consequences to such policies,
while supporters say the team could make government and society more
efficient. While the program is still in its early stages, the document shows
the White House is already working on such projects with almost a dozen
federal departments and agencies including the Department of Health and
Human Services and the Department of Agriculture.
- Appeals court rules against NYC soda ban. Another court ruling has taken the fizz out of New York City's ban on big, sugary sodas. A New York appeals court on Tuesday ruled that the city Board of
Health exceeded its legal authority and acted unconstitutionally when it
tried to put a size limit on soft drinks served in city restaurants.
CNBC:
- Look out below! Work more, get less in Obamacare 'cliff'. Be careful you don't fall off the Obamacare "cliff" when the boss asks you to put in some overtime. Working
more could ultimately mean thousands of dollars less for you under a
quirk in the new health-care law going into effect this fall. This could
prompt some people to cut back on their hours to avoid losing money.
"Working more can actually leave you worse off," the price-comparison
site ValuePenguin.com notes in a new analysis. "It's sort of an absurd
scenario," said Jonathan Wu,
ValuePenguin.com's co-founder. "It's something for people to be aware
of."
- Shares in fertilizer makers plunge on price shock. Russia's
Uralkali has dismantled one of the world's largest potash partnerships
by pulling out of a venture with its partner in Belarus, a move it
expects
will cause global prices to plunge by 25 percent.
Zero Hedge:
Business Insider:
IBD:
alpha:
Reuters:
- Coach Inc(COH) sees weakness in North America; two more executives leave. Coach Inc on Tuesday again reported soft sales at its North American stores as it
continued to face tough competition for handbag shoppers, and the
leather goods maker announced the departures of two more executives.
Shares of New York-based Coach, which is known for its Poppy handbags, fell 6.2 percent to $54.25 in premarket trading.
- METALS-Copper falls to 3-week low on fears of gloomy China data. Copper slid to its weakest in nearly three weeks
on Tuesday as expectations of weak manufacturing data from top consumer China dimmed prospects for growth in metals demand. Benchmark copper on the London Metal Exchange (LME) lost 2.1 percent
to close at $6,735 a tonne, the lowest since July 10.
Financial Times:
- US biotech stocks ride wave of investor euphoria. Biotechnology
companies are raising money at the fastest rate since the dotcom boom,
underscoring the renewed appetite for one of Wall Street’s riskiest bets
despite the high chance that the investments will turn sour.
Telegraph:
- Swedish warning. (graph) The
hard data is in. Sweden's GDP fell by 0.1pc in the second
quarter, astonishing everybody who relies on soft PMI confidence
surveys. Year-on-year growth has been just 0.6pc, half the level
expected, and Sweden is supposed to be a star performer in Europe. By the way, this is what Sweden's manufacturing PMI has been doing:
Echoing fears that
European policymakers remain in a state of cognitive dissonance –
recognizing the need for root-and-branch overhaul of peripheral banks,
but backtracking on joint liability plans – Christopher Flowers, the
legendary FIG investor who now runs the £2.3 billion ($3.5 billion)
private equity group JC Flowers, sounded the alarm over the negative
sovereign-bank feedback loop.
In a shot across the bows of market bulls, who cite the return of
capital flows to weaker eurozone states, Flowers issued a stark warning:
"There is a scenario where we have a Lehman-type event: we wake up some
Thursday and a big country is in trouble.
"And the ECB will have to decide to support banks x, y, z. And then the
ECB will, in fact, decide to own bank x, y, z.
Vedomosti:
- Russia Has 70,000 Railcars Idled as Cargoes Drop. The country's
largest railcar operators asked Russian Railways to limit supply of
idled railcars making them available at certain stations only, citing
letter from operators.
Xinhua:
- China May Adjust Consumption Taxes This Year. China is studying a
reform plan for consumption taxes and may introduce measures geared
towards energy-saving consumption this year, citing Jia Kang, director
of the Finance Ministry's fiscal science research center.
- China Listed Bank Profit Growth May Slow. Chinese listed banks
may see net income growth slowing to around 8% this year, citing a
report released by the China Banking Association today.
