- ‘Imminent Attack’ in U.S. Prompted Airstrikes on Khorasan. Airstrikes in Syria against the extremist Khorasan group were prompted by planning for an “imminent” terror attack on U.S. soil, the Pentagon said. “We believe the individuals plotting and planning it were eliminated” in the eight U.S. airstrikes overnight, Rear Admiral John Kirby, the Pentagon spokesman, said today in an interview with ABC’s “Good Morning America” program. Amid attention on the threat from Islamic State in Iraq and Syria, Khorasan has emerged in recent weeks as a more immediate peril in the view of the U.S. intelligence community because it’s more focused on attacking America and Europe.
- Israel Shoots Down Syrian Warplane After Flight Over Golan. Israel shot down a Syrian fighter jet after it flew over the Golan Heights, the Israeli army said today, the first such incident in almost 30 years and the neighbors’ most serious clash since the start of Syria’s civil war.
- U.S. Estimates 1.4 Million Ebola Cases in Worst Scenario. Without better containment of the Ebola outbreak, there may be 550,000 to 1.4 million cases in Liberia and Sierra Leone by January, according to a new estimate published today by the U.S. Centers for Disease Control and Prevention. The range is based on how well cases have been reported and identified, the Atlanta-based CDC said. It also assumes a failure of public health efforts and a lack of additional resources to control the outbreak, aspects governments and international aid agencies are working to improve.
- German Factory Growth at 15-Month Low in Sign of Uneven Economy. German manufacturing expanded at the slowest pace in 15 months in September as new orders fell, signaling uneven momentum in Europe’s largest economy. Markit Economics said its Purchasing Managers Index fell to 50.3 from 51.4 in August, the weakest since June 2013. Economists surveyed by Bloomberg News predicted a drop to 51.2.
- Ready for Rate Riot? Emerging Markets Set to Follow Fed. Investors bracing for higher interest rates from the Federal Reserve in 2015 need to expand their horizons or risk being caught off-guard. Bank of America Merrill Lynch economists suggest 12 of the 16 inflation-targeting emerging-market central banks they monitor will raise rates in the next year, and many will do so by more than markets anticipate. Mexico, Thailand, Hungary, and Israel are among the most likely to surprise, economists Marcos Buscaglia and Ana Madeira said in a Sept. 12 report to clients. Following the Fed, even at the risk of crimping growth, would represent an effort to prevent a spike of inflation and keep attracting foreign cash.
- Europe Stocks Fall Most in 11 Weeks as AstraZeneca Drops. (video) European stocks fell the most in eleven weeks as health-care companies tumbled amid concern tougher American tax rules will erode their takeover appeal and as manufacturing growth slowed in the euro area. All the 19 industry groups on the Stoxx Europe 600 Index declined. Shire Plc and AstraZeneca Plc lost at least 2.5 percent after the U.S. made it harder for companies to move their tax base abroad. Raiffeisen Bank International AG (RBI), the foreign lender with most at risk in Ukraine and Russia, plunged the most since September 2011 after predicting an annual loss. Tate & Lyle Plc (TATE) tumbled the most in almost seven years after forecasting annual profit that missed analysts’ estimates. The Stoxx 600 slid 1.4 percent to 341.89, its biggest retreat since July 8.
- Iron Ore Falls Below $80 to Lowest Since 2009 on China. Iron ore slumped below $80 a metric ton for the first time in five years on speculation that China’s slowing economic growth will curb demand in the world’s biggest user, exacerbating a global surplus. Ore with 62 percent content delivered to Qingdao, China, fell 0.5 percent to $79.69 a dry ton, the lowest level since Sept. 16, 2009, according to data from Metal Bulletin Ltd. The drop followed seven weeks of declines as the steelmaking raw material had the longest run of losses since May.
- Gold Rebounds From Eight-Month Low Amid Syria Airstrikes. Gold futures for December delivery added 0.3 percent to settle at $1,222 an ounce at 1:37 p.m. on the Comex in New York. Prices reached $1,208.80 yesterday, the lowest for a most-active contract since Jan. 2, and ended 2013 at $1,202.30.
- Adding Off-Balance Sheet Leverage to Increase Loan Gains. It’s widely known that corporate-loan buyers want bigger returns. What’s less known is that they’re increasingly using methods that may mask the extra risk they’re assuming. An example can be found in a suddenly popular creation called a senior secured loan program, which allows a couple of investment firms to pool money to lend to speculative-grade companies and then divvy up risk and return. The firms involved range from small -- places like Solar Senior Capital Ltd. and New Mountain Finance Corp. -- to giants like Pacific Investment Management Co. and General Electric Co.’s GE Capital unit. The off-balance sheet facilities also effectively “distort leverage” ratios reported by BDCs, according to a Fitch Ratings report published yesterday. While these firms are restricted in how much they can borrow directly, they can invest in structures such as these loan partnerships that typically use leverage to enhance returns.
- Bullard Says ‘Natural’ to Drop Fed’s Rate Pledge Next Month. Federal Reserve Bank of St. Louis President James Bullard said the central bank may need to drop its pledge next month to keep interest rates low as so-called quantitative easing is brought to a close. “I thought it was premature to try to remove ‘considerable time’ from the statement because QE hasn’t ended yet,” Bullard told reporters at a conference in St. Louis, referring to the last meeting of the Federal Open Market Committee on Sept. 16-17. “A more natural juncture would probably be the October meeting” when “QE is projected to end.”
- U.S. Reports Significant Damage in First Wave of Syria Strikes. American, Arab Warplanes Hit Targets Around Iraq-Syria Border.
- New U.S. Inversion Rules Drag Down Shares of Deal Targets. Inversion Deal-Making Has Been Especially Prevalent in the Pharmaceutical Sector.
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- WTO cuts world trade growth forecasts for 2014 and 2015. Global goods trade will grow less than hoped this year and next, and factors including regional conflicts and the Ebola outbreak are putting a quick return to stronger growth at risk, the World Trade Organization said on Tuesday. Trade in goods will grow by 3.1 percent this year, much less than the 4.7 percent the WTO forecast in April. It cited "weaker-than expected GDP growth and muted import demand in the first half," according to a statement. Trade was likely to grow 4.0 percent in 2015 rather than the 5.3 percent expected previously, still far below the 20-year average of 5.2 percent and "risks abound in the form of geopolitical tensions, regional conflict and health crises (Ebola)".
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