- Ukraine Fortifies Russian Border as Death Toll Climbs. Ukraine’s government said it’s deploying heavy weaponry and armored vehicles to strengthen its border with Russia and halt an influx of fighters after skirmishes with separatists claimed another dozen lives. Authorities in Kiev are also moving personnel and equipment to the western border with Transnistria, the breakaway Moldovan region where hundreds of Russian troops are stationed, State Border Service chief Mykola Lytvyn told reporters in Kiev today, without being more specific.
- Bond Yields Lowest Since Napoleon Are No Comfort to Europe Amid Deflation Fight. Europe’s lowest government bond yields since the Napoleonic Wars are signaling investors want more action from Mario Draghi. Instead of a vote of confidence, the most pronounced rally in 200 years suggests the European Central Bank president needs to stave off the risks of stagnation and deflation. Austria, Belgium, France (GFRN10) and Germany can borrow at lower rates (GDBR10) than the U.S. as inflation less than half the ECB’s target stokes concern the euro zone will take many years to recover from its longest-ever recession.
- U.S. Rebuked by Israel for Continuing Palestinian Aid. The U.S. said it will maintain financial aid to the Palestinian Authority even under a new government backed by the Islamic Hamas movement, earning a rebuke from Israel. Secretary of State John Kerry called Israeli Prime Minister Benjamin Netanyahu yesterday to discuss continuing U.S. support for the Palestinian Authority, according to State Department spokeswoman Jen Psaki.
- Brazil Debt Suffering Social-Spend Promises With Election. As President Dilma Rousseff’s lead narrows in polls before October’s election, she and her top opponent are courting voters with spending promises that would undermine the fiscal discipline investors say is needed to restore confidence in the economy.
- Chinese Stocks Fall for Third Day as Property Developers Decline. China’s stocks fell, with the benchmark index reversing gains in the last minutes of trading, as property and consumer staple companies declined. China Vanke Co. (000002), the nation’s biggest developer, slid 1.8 percent after SouFun Holdings Ltd. said the nation’s home prices fell in May for the first time in two years. Inner Mongolia Yili Industrial Group Co. plunged the most in six months to lead declines by milk companies. SDIC Power Holdings Co Ltd. added 2.8 percent after gauges of manufacturing output increased and the government took steps to boost lending at some banks. The Shanghai Composite Index (SHCOMP) fell less than 0.1 percent to 2,038.31 at the close, with about five stocks dropping for every three that rose.
- European Stocks Fall as Investors Weigh ECB Rate Outlook. European stocks declined from a six-year high as a report showing lower-than-estimated inflation in the euro area prompted investors to weigh the outlook for interest rates before Thursday’s European Central Bank meeting. Pennon Group Plc lost 3 percent after saying pretax profit at its Viridor waste management unit fell about 20 percent. Eutelsat Communications SA slipped 3.7 percent as Abertis Infraestructuras SA sold its holding in the French satellite operator. Wolseley (WOS) Plc rose 1.6 percent after posting higher sales on improved demand in the U.S. and Nordic region. The Stoxx Europe 600 Index retreated 0.5 percent to 343.48 at the close of trading.
- ECB Officials Anxious About Impact of U.S. Fines on EU Banks. Central Bank Considers Adding Element to Stress Tests to Estimate Possible Damage.
- Half of Americans can’t afford their house. As the housing market slowly recovers, a majority of homeowners and renters are finding it hard to meet rising rents and mortgage payments, new research finds.
- Obama calls for more spending on military presence, training in Europe. On the first day of a four-day European trip that will include a remembrance of D-Day and much discussion about the ongoing crisis in Ukraine, President Obama called on Congress to approve up to $1 billion in spending on additional U.S. air and ground forces in Europe.
- Traded Taliban leaders free to roam in Middle East? Claim undercuts Obama assurance. President Obama's claim Tuesday that the U.S. would "be keeping eyes" on five hardened Taliban leaders traded for Sgt. Bowe Bergdahl's freedom was immediately challenged by a Middle East official quoted as saying they'd actually be allowed to move freely -- and even "go back to Afghanistan if they want to."
- Silicon Valley rents soar as tech gobbles space. Asking rents in Palo Alto now average $83 a square foot annually. That's nearly triple the national average, according to Amber Schiada of Jones Lang LaSalle, a real estate services company. In the last four years, commercial real estate prices are up 75 percent in Palo Alto and in nearby Sunnyvale and Mountain View, prices are up 68 percent and 115 percent, respectively.
- Two Ukraine Helicopters Shot Down: Watch As Gunship Engages Eastern Militia In Intense Fighting. (video)
USAToday:
- VA scandal exposes greedy socialism. Phony lists and dead patients wouldn't fly in a free-market health care system.
Telegraph:
- Europe remains a jobless swamp, despite the Spanish miracle. Italy lost 68,000 jobs in April, according to the country’s data agency ISTAT. The total employed fell to 22,295,000. Italian unemployment rose to 13.6pc. For youth it has climbed to a modern-era high of 43.3pc, implying very serious damage to Italy’s long-term economic dynamism due to labour hysteresis. The employment rate dropped to 55.2pc. Ageing workers are giving up the search for jobs – chiefly in the Mezzogiorno – and returning to their patches of land in impoverished early retirement.
- Ukraine May Confiscate Russian Assets After Crimea. Ukrainian Justice Ministry proposed confiscating Russian companies' assets in Ukraine and abroad to compensate for $92b losses from Crimea annexation, citing Minister Pavlo Petrenko as speaking in Kiev.
- Brazil Vehicle Sales Fall 7% Y/Y in May.
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