Today's Headlines

Bloomberg:

• Goldman(GS) Sticks to Ukraine Currency Rout Call: East Europe Credit. As Ukraine investors greeted the ouster of President Viktor Yanukovych with the biggest bond rally this year, calls by interim leaders for as much as $35 billion in aid are weighing on the currency. The yield on Ukraine’s dollar bonds due in 2023 dropped 93 basis points yesterday to a four-week low of 9.26 percent, the biggest decline since Dec. 17, before rising 12 basis points today. The hryvnia weakened 6.4 percent to 9.8 per dollar at 2:57 p.m. in Kiev, data compiled by Bloomberg show. That extended this year’s decline to 16 percent, the most among currencies tracked by Bloomberg after the Argentine peso and the Kazakh tenge. 

• Ukraine Central Bank Seeks to Halt Deposit Outflow After 7% Drop. Ukraine is considering measures to stem withdrawals after as much as 7 percent of deposits were taken from banks during last week’s deadly clashes in the capital, according to the new governor of the central bank. Withdrawals peaked between Feb. 18-20 as police and anti-government demonstrators fought in the center of Kiev, Stepan Kubiv, who was appointed yesterday, said in his first interview. As much as 30 billion hryvnias ($3.1 billion) were withdrawn during the three-day period, he said.

• Nomura Risk Rises in Early Warning for Abenomics: Japan Credit. Nomura Holdings Inc.'s bond risk has risen this year even as its borrowing costs fell, as doubt emerge over the prospects for Prime Minister Shinzo Abe's stimulus policies. The cost to insure the debt of Japan's biggest brokerage against non-payment has climbed 24 basis points in 2014 to 99.3 on Feb. 24, according to CMA. That compared with an 8.3 point increase in the Markit iTraxx Japan index to 75.8, while the gauge for U.S. financial companies was unch. at 74.0.

• Emerging Market CDS Trading Jumps 31% in 2013, EMTA Says. Trading in emerging market credit default swaps increased to $1.064 trillion in transactions, according to a survey of 12 major dealers conducted by EMTA. 4Q trading up +94% from the same period in 2012 to $276 billion. Largest CDS volumes in 4Q were in Brazil, at $65 billion. "Sovereign CDS has increasingly become more widely used as a hedging tool, especially as the EM corporate market has exploded over the last several years," EMTA wrote, citing Jeff Williams, a strategist at Citigroup. 

• China’s Stocks Fall on Property Concerns as Yuan Weakens. China’s stocks dropped, sending the benchmark index to its biggest retreat in five months, amid speculation a weaker property market and falling currency will curb corporate earnings. The yuan sank the most since 2010. The Shanghai Composite Index (SHCOMP) declined 2 percent to 2,034.22, extending its four-day retreat to 5.1 percent. China Vanke Co.’s B shares tumbled 8 percent, leading declines among developers. Qingdao Haier Co. (600690), the nation’s biggest refrigerator maker, lost 3.9 percent. The yuan depreciated 0.46 percent, the steepest drop since Nov. 1, 2010, to close at 6.1266 per dollar.

• Tepco Says Fukushima Radiation ‘Significantly’ Undercounted. Tokyo Electric Power Co. (9501) is re-analyzing 164 water samples collected last year at the wrecked Fukushima atomic plant because previous readings “significantly undercounted” radiation levels. The utility known as Tepco said the levels were undercounted due to errors in its testing of beta radiation, which includes strontium-90, an isotope linked to bone cancer. None of the samples were taken from seawater, the company said today in an e-mailed statement.

• Caixa Said to Curb Lending as Brazil Seeks to Avoid Rating Cut. Caixa Economica Federal, the bank owned by Brazil's government, will slow lending growth this year by about 40% to help protect the nation's credit rating, said a person familiar with the matter. The bank expects to expand its loan book by 22% this year, after 37% growth in 2013, said the person.  

• European Stocks Are Little Changed With Vivendi Declining. European stocks were little changed, paring earlier losses in the last hour of trading and closing at its highest level since January 2008. Jyske Bank A/S (JYSK) rallied 11 percent after buying BRFkredit A/S. Vivendi SA (VIV), the French company preparing to spin off its phone business SFR, slipped 1.1 percent after posting fourth-quarter revenue that missed analysts’ estimates. Fresenius Medical Care AG slumped 5.7 percent after the world’s biggest provider of kidney dialysis forecast a decline in 2014 profit. The Stoxx Europe 600 Index gained less than 0.1 percent to 338.39 at the close of trading in London after earlier falling as much as 0.5 percent.

• Copper Extends Losses on Weaker Yuan, Tighter Property Financing. 

• WTI Crude Falls on China Growth Concern Amid Ample Supply. WTI for April delivery decreased $1, or 1 percent, to $101.82 a barrel at 2:07 p.m. on the New York Mercantile Exchange. The volume of all futures traded was 20 percent below the 100-day average. Futures are up 3.5 percent this year. 

• Gold Advances to 16-Week High on U.S. Consumer Confidence Index. Gold futures for April delivery rose 0.2 percent to $1,341 an ounce at 11:17 a.m. on the Comex in New York, after touching $1,343, the highest for a most-active contract since Oct. 31.

• Rail Stocks to Lag Behind Earnings as U.S. GDP Help Fades: EcoPulse. Shares of U.S. railroad companies are poised to lag behind the broader market after more than a decade of outpacing it, as the boost to earnings from U.S. growth could start to wane. The relative performance of the Standard & Poor’s Supercomposite Railroads Index -- which includes Union Pacific Corp. (UNP), Norfolk Southern (NSC) Corp. and CSX Corp. -- has stalled in the last 12 months, leading the S&P 500 Index by 2.9 percentage points after being ahead by almost 500 percentage points since 2000. 

• JPMorgan Sees 8,000 Consumer, Mortgage Bank Job Cuts in 2014. JPMorgan Chase & Co. (JPM:US), the biggest U.S. bank, said it would eliminate about 8,000 jobs in the consumer and mortgage banking units this year as demand for refinancings declines. The reductions would bring total staffing cuts to 24,500 in the two divisions since the start of 2013, New York-based JPMorgan said in a presentation today. Last year, the firm said it would eliminate as many as 19,000 in the two divisions by the end of 2014. 

• Polar Air to Lock on Eastern U.S. at Least to Mid-March. The eastern U.S. will be locked into a pattern of cold air, boosting energy use, through the first half of March, forecasters say. Frigid weather will dominate from the Midwest to the Northeast as well as eastern Canada for at least the next two weeks and possibly beyond, said Matt Rogers, president of Commodity Weather Group LLC in Bethesda, Maryland.

• Biggest Banks Said to Face Asset Tax in Republican Plan.

Wall Street Journal:

• Fed's Tarullo Sees Signs of Market Risks. The Federal Reserve's leading bank supervisor, Daniel Tarullo, said Tuesday that he is seeing modestly increased risks in credit markets, particularly in corporate bonds and leveraged loans. Mr. Tarullo said the U.S. central bank shouldn't rule out using monetary policy to fight potentially damaging asset bubbles, but stressed it should first try to employ and refine current existing regulatory tools for spotting such threats to financial stability. "High-yield corporate bond and leveraged loan funds, for instance, have seen strong inflows, reflecting greater investor appetite for risky corporate credits, while underwriting standards have deteriorated, raising the possibility of large losses going forward," Tarullo told a conference sponsored by the National Association for Business Economics. "At present, our monitoring does find some evidence of increased duration and credit risk, but the increases appear relatively moderate to date--particularly at the largest banks and life insurers," Mr. Tarullo said. "Monetary policy action cannot be taken off the table as a response to the build-up of broad and sustained systemic risk."

ZeroHedge:

• Consumer Confidence Drops Most In 4 Months. (graph)

• Ukraine Bonds Re-Collapse As Russia Warns Of "High Chance Of Default". (graph)

• Ukraine Calls Russia's Bluff, Slashes Nat Gas Imports By 80%.

• Tesla(TSLA) Enterprise Value Just 25% Below That Of General Motors(GM).

• Meanwhile, On The Main Square In Sevastopol: Live Webcast.

Business Insider: 

• The Pentagon Is Killing A Combat-Proven Aircraft That Most Troops Totally Love.

• Volunteering In America Is At Its Lowest Level In At Least A Decade.

• Syrian Al Qaeda Group Gives An Ultimatum To Its Islamist Rivals.

• IBM Employees Fear Company Will Begin Up To 13,000 Layoffs Tomorrow.

Digital Journal:

• TransUnion: Auto Loan Debt Rises for 11th Straight Quarter; Delinquencies Remain Subdue. Auto loan debt per borrower increased for the 11^th straight quarter, moving up 4.4% from $16,060 in Q4 2012 to $16,769 in Q4 2013. On a quarterly basis, auto loan debt also increased from $16,685 in Q3 2013. The auto loan delinquency rate (the ratio of borrowers 60 days or more delinquent on their auto loans) increased to 1.14% in Q4 2013, up on both a quarterly and yearly basis (from 1.04% in Q3 2013 and 1.09% in Q4 2012).

Reuters: 

• U.S. Fed says stress test results to be released on March 20.

Telegraph:

• French to break deficit promise to EU. EU says France's deficit will climb to 4pc of output this year and remain at 3.9pc in 2015.

US-China Perception Monitor: 

• China Not Afraid of Conflict. China "is not only unafraid of war, but also courageous in welcoming reasonable and lawful conflict".