- U.S. Weighs Aid Drops, Airstrikes on Islamist Militants in Iraq. The U.S. is considering airdrops of aid for thousands of refugees driven from their homes by Islamist militants in Iraq, and possible airstrikes against the insurgents, according to a defense official. Aircraft dropping food and other humanitarian supplies to the refugees would be accompanied by military planes, the official said, asking not to be identified because discussions are private. If the insurgents target the planes, the U.S. and Iraq would consider a larger air campaign against them, the official said. The potential escalation in U.S. involvement comes as the Islamic State, the group that seized swathes of northern Iraq in June, extended its advance today by seizing the Mosul dam, the country’s largest. They have also driven tens of thousands of people from their homes during an offensive in the past week, many from minority Yezidi and Christian communities.
- Putin Ban Hits Cold War Foes as Developing Nations Gain. President Vladimir Putin countered U.S. and European sanctions over Ukraine with a ban on a range of food products, opening the door for developing nations such as Brazil to fill the $9.5 billion hole created by the curbs. The restrictions include all cheese, fish, beef, pork, fruit, vegetables and dairy products, Prime Minister Dmitry Medvedev told ministers today in Moscow, fulfilling a presidential decree issued yesterday. The curbs hit nations that have penalized or supported measures against Russia, including Canada, Australia and Norway. Russia may also introduce “supportive measures” for the car, shipping and aerospace industries, Medvedev said.
- Russian Retail Stocks Slide on Putin Import Ban as Ruble Weakens. Most Russian stocks dropped as OAO Magnit slid the most in five months on concern food-import bans imposed in retaliation for U.S. and European sanctions will hurt earnings of retailers. The ruble fell for a sixth day. Magnit, the nation’s largest supermarket chain, retreated 5.2 percent and its shares in London slumped. OAO Dixy Group and Lenta Ltd. lost 1.8 percent and 4.1 percent. The Micex Index (INDEXCF) slid as much as 2.1 percent before trimming declines after an unconfirmed report that a leader of a pro-Russian separatist group in Ukraine resigned. The ruble weakened 0.3 percent versus the dollar by 6 p.m. in Moscow, when the central bank stops market operations.
- Israel, Hamas Trade Threats Amid Truce Countdown, Cairo Talks. Israeli officials and Hamas leaders exchanged warnings with a three-day cease-fire set to expire early tomorrow and negotiations in Cairo resuming to reach a long-term deal to end the Gaza conflict and rebuild the area.
- Draghi Says Geopolitical Risks to Economy Increasing. Mario Draghi said risks to the euro area’s economic recovery are increasing because of conflicts such as the Ukraine crisis. “Heightened geopolitical risks, as well as developments in emerging-market economies and global financial markets, may have the potential to affect economic conditions negatively,” the European Central Bank president told reporters in Frankfurt today after policy makers kept interest rates unchanged. “We are strongly determined to safeguard the firm anchoring of inflation expectations over the medium to long term.”
- Germany’s Bond Advance Sends 2-Year Note Yield Below Zero. German bond gains sent the two-year rate below zero for the first time since May 2013 and 10-year yields to an all-time low as the European Central Bank kept interest rates at a record low today. German securities have rallied this year, with higher returns than stocks, as the ECB cut borrowing costs and introduced stimulus measures including targeted longer-term loans to banks to try to counter the threat of deflation. Now they’re extending gains with bonds from Austria to Finland as investors seek haven assets after Russia massed troops along its border with Ukraine and data points to slower growth in the 18-nation currency bloc.
- European Stocks Decline as Munich Re Misses, Draghi Warns. European stocks fell to their lowest level in more than three-and-a-half months as European Central Bank President Mario Draghi warned that geopolitical risks in countries such as Ukraine could hurt the economic recovery, while Munich Re’s earnings missed forecasts. Munich Re slipped 2.3 percent. Adidas AG lost 4.5 percent after cutting its profit forecast for 2014. Commerzbank AG rose after saying second-quarter profit more than doubled as it shed unwanted assets. Nestle (NESN) SA added 3.4 percent after it announced plans for a share buyback as first-half revenue growth beat analysts’ estimates. The Stoxx Europe 600 Index retreated 0.7 percent to 326.96 at the close of trading, for a second day of declines. The benchmark posted its first back-to-back monthly losses in two years in July as the crisis in Ukraine escalated. The measure has fallen 6.5 percent from a six-year high on June 10.
- HSBC Sage Flags Emerging-Market Pullback on Dollar. HSBC Holdings Plc (HSBA), which in February foresaw the longest emerging-market currency rally in five years, says it’s time to pull back as increasing signs of U.S. growth support the dollar. HSBC, which operates in 74 countries worldwide and gets more than half its revenue from emerging markets, recommends clients reassess their investments in South Africa’s rand, Russia’s ruble and Mexico’s peso. A Bloomberg index of 20 developing currencies has slipped 2.2 percent in the past two weeks, retracing half its gains from February to July. “The tide is turning,” David Bloom, HSBC’s global head of currency strategy in London, said in an Aug. 5 phone interview. “It’s a mini-wobble in emerging markets. Be careful.”
- Default Risk Rises on 20% of Boom-Era Home-Equity Loans. As much as 20 percent of home equity lines of credit worth $79 billion are at increased risk of default as their payments jump a decade after the loans were made during the U.S. housing boom, according to TransUnion Corp. Borrowers face rate shocks as payments on the credit lines, known as HELOCs, switch from interest-only to include principal, causing monthly bills to surge more than 50 percent, according to a report today by the Chicago-based credit information company.
- China Tightens Restrictions on Messaging Apps. Beijing Says Rules Aim to 'Help Build a Clean Cyberspace' and Safeguard National Security.
- Cash-rich spending spree is sign of a growing tech bubble. Insight: Tech giants throwing money at products and people.
ZeroHedge:
- It Begins: Canada To Send Military Equipment To Ukraine.
- Pentagon Confirms Russia Violated US Airspace 16 Times In Last 10 Days, "Not Just Training Missions".
- Separatist Donetsk People's Republic Gets A New Leader "To Beef Up The Military Wing".
- Germany's DAX Slumps Into "Correction" - Down 10.25% From Highs. (graph)
- Nigeria Declares State Of Emergency: "Everyone In The World Is At Risk" From Ebola, CDC Issues Level 1 "All-Hands Call".
- Initial Claims Four-Week Average Slides To 2006 Lows. (graph)
- American Apparel's Provocative Back To School Ads Are Igniting Fury.
- ISIS, Which Might Control Iraq's Most Important Dam, Compared Itself To Noah's Flood In Its English Language Magazine.
- ISIS Militants Have Overrun Iraq's Largest Christian Town And Are 30 Minutes From The Kurdish Capital.
- Goldman Sachs(GS) Economist Dashes Our Hopes For A Big US Business Spending Boom.
- 'Panic Selling' In London Drives Fear That The UK Housing Bubble Is About To Burst.
Bild:
- German Exports to Russia Declined Almost 16% in 2014. Exports to Ukraine down 32%. German automakers' sales volume in Russia fell 23% in June. Federation of German Wholesale, Foreign Trade and Services expects 20% slump in demand in wake of sanctions.
- World Ignores Christian Exodus from Islamic World. While the world fixates on the conflict between Israel and Hamas—and while most mainstream media demonize Israel for trying to survive amid a sea of Arab-Islamic hostility—similar or worse tragedies continue to go virtually ignored.
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