Bloomberg:
- Russia Risks Recession as Oil Drop Seen Squeezing Budget. The easing of tensions in Ukraine will offer little respite to Russia as the lowest oil prices in more than two years threaten to tilt the $2 trillion economy toward recession, according to a Bloomberg survey of analysts. Russia needs Urals, its main export crude blend, to trade at $100 per barrel or higher to avoid a recession, according to 58 percent of respondents in a survey of 19 economists. Given the level of U.S. and European sanctions over Ukraine, at least 19 percent of analysts said the current price is sufficiently low to put Russia’s financial stability at risk.
- Inflation Slowing More Than Forecast Shows Risk for BOJ: Economy. Japan’s inflation slowed more than expected in August, highlighting the risks facing Bank of Japan Governor Haruhiko Kuroda in his push for prices to rise 2 percent. Consumer prices excluding fresh food rose 3.1 percent from a year earlier, the statistics bureau said today in Tokyo, undershooting the median projection for a 3.2 percent increase in a Bloomberg News survey of 31 economists. Stripped of the effect of April’s sales tax increase, inflation was 1.1 percent, according to the BOJ’s estimates.
- Yen Drop Erodes Japan Banks’ Advantage on Overseas Risks. The yen’s 20 percent depreciation since the end of 2012 has seen Japanese banks’ balance-sheet superiority against overseas competitors vanish. Mitsubishi UFJ Financial Group Inc. (8306), Japan’s largest lender, has an adjusted core capital ratio of 9.4 percent, as the size of its overseas risk assets swelled, below the 11.5 percent for Deutsche Bank AG and 10.5 percent for Citigroup Inc., according to Bank of America Merrill Lynch calculations. The prices of subordinated U.S. dollar bonds sold by Sumitomo Mitsui Financial Group Inc. (8316) and Mizuho Financial Group Inc. that count as capital fell to three-month lows last week.
- China Raises Death Toll From Xinjiang Bombs, Riots to 50. The death toll from violence that erupted in China’s turbulent far western region of Xinjiang last weekend was raised to 50 from two, state media reported, saying most of the dead were either killed by suicide bombs or shot by police. Forty “rioters,” six civilians and four police personnel died when several bombs exploded at places including a farmers’ market, two police stations and a shop in Luntai county at 5 p.m. on Sept. 21, news website Tianshannet reported. Another 54 people were injured, with 32 belonging to the Uighur ethnic minority and 22 Han Chinese, it said, citing the Xinjiang police investigation. The jump in confirmed casualties comes after Radio Free Asia yesterday reported that the original death toll of two given by authorities was too low, citing interviews with local officials and eyewitnesses.
- Alibaba(BABA) Bears Emerge to Short 8.9 Million Shares. Short sellers are making their first bets on a retreat in Alibaba Group Holding Ltd. (BABA) a week after the company priced the world’s biggest-ever initial public offering. Bears who profit from price declines have sold short 8.9 million shares, or about 2.4 percent of Alibaba’s listed stock, according to data compiled by Bloomberg and Markit, a London-based provider of financial information. The Hangzhou-based company, China’s biggest e-commerce operator, sold 368.1 million shares in the IPO. The stock fell 1.8 percent to $88.92 in New York yesterday.
- China’s H Shares Drop to Lowest in Two Months as ICBC Retreats. Chinese stocks slumped in Hong Kong, dragging the benchmark index down to its lowest level since July 21, as banks and energy producers declined. Industrial & Commercial Bank of China Ltd. (601398), the nation’s largest lender, headed for a third straight weekly loss. PetroChina Co.,the country’s largest oil and natural gas producer, slid 1.2 percent. Tencent Holdings Ltd. (700) led declines by Chinese technology shares. The Hang Seng China Enterprises Index (HSCEI) fell 0.8 percent to 10,553.89 at 9:46 a.m. local time, taking its decline for the week to 2 percent. The gauge has lost 7.4 percent from this year’s Sept. 8 high on concern the government will refrain from major stimulus to spur growth.
- Asian Stocks Drop After U.S. Tumble as Aussie Bonds Rally. Asian stocks fell, with Japanese shares retreating from a six-year high, after the Standard & Poor’s 500 Index dropped the most in almost two months. Gold rallied with sovereign bonds as the cost of insuring debt against default climbed. The MSCI Asia Pacific Index (MXAP) lost 1 percent by 12:38 p.m. in Tokyo, as the Topix index dropped 1.1 percent from its highest close since June 2008. Indonesian stocks plunged the most in four months after the country scrapped direct regional elections.
- Brent Crude Heads for Weekly Decline on Ample Supply; WTI Steady. WTI for November delivery was 2 cents higher at $92.55 a barrel in electronic trading on the New York Mercantile Exchange. It fell 27 cents to $92.53 yesterday. The U.S. benchmark crude was at a discount of $4.47 to Brent, compared with $6.74 at the end of last week.
- U.S. Turns Up the Heat on Turkey Over Islamic State. Obama, Biden, Arab Officials Push Ankara to Join Campaign Against Extremists. Turkey is showing signs of shifting to a more active role in the campaign against extremist group Islamic State as the government faces pressure from impatient U.S. and Arab officials. President Barack Obama called Turkish President Recep Tayyip Erdogan from Air Force One on Thursday and the two leaders agreed to consult more closely on the Islamic State threat. Vice President Joe Biden met Mr. Erdogan in New York on...
- Junkets That Fuel Macau Casinos Are on a Losing Streak. Businesses That Bring Affluent Chinese Gamblers to Macau and Provide Credit Face Growing Pressure.
- FDIC's Hoenig Keeps Wall Street on Edge. Straight-Talking Bank Regulator Leads Crusade to Ensure No Institution Is Too Big to Fail.
CNBC:
- Nike(NKE) earnings: $1.09 per share, vs. expected EPS of 88 cents. Nike shares spiked after the sports apparel maker easily blew past expectations. The company reported earnings of $1.09 a share versus estimates of 88 cents a share, on revenue of $7.98 billion, exceeding expectations of $7.84 billion.
- "The Gig Is Up". (graph)
- Future Bull. (graph)
NY Times:
- Military Path Opened for Young Immigrants. A small number of young immigrants who grew up in the United States without legal status will be allowed to join the military and have a fast-track pathway to citizenship, Pentagon officials announced Thursday, the first time those young people have been able to enlist.
- None of note
- Asian equity indices are -1.0% to unch. on average.
- Asia Ex-Japan Investment Grade CDS Index 94.50 -.5 basis point.
- Asia Pacific Sovereign CDS Index 65.25 +1.5 basis points.
- FTSE-100 futures -.02%.
- S&P 500 futures +.10%.
- NASDAQ 100 futures +.09%.
Earnings of Note
Company/Estimate
- (BBRY)/-.17
- (FINL)/.60
8:30 am EST
- 2Q GDP is estimated to rise +4.6% versus a prior estimate of a +4.2% gain.
- 2Q Personal Consumption is estimated to rise +2.9% versus a prior estimate of a +2.5% gain.
- 2Q GDP Price Index is estimated to rise +2.1% versus a prior estimate of a +2.1% gain.
- 2Q Core PCE is estimated to rise +2.0% versus a prior estimate of a +2.0% gain.
- Final Univ. of Mich. Consumer Confidence for September is estimated to rise to 84.8 versus a prior estimate of 84.6.
- (COLM) 2-for-1
- The German Consumer Climate Index could also impact trading today.
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