- Rousseff Rout Still Leaving Ibovespa Overvalued to UBS. For all the stock declines investors have seen in Brazil under President Dilma Rousseff, her re-election means there’s more losses in store before equities look attractive to UBS AG and USAA Investment Management Co. After Brazil entered a recession this year and inflation soared past the top end of policy makers’ target, the Ibovespa is trading at a seven-month low of 9.8 times forecast earnings. Stocks won’t be attractive until valuations fall to about 8 times, according to UBS and USAA. The Ibovespa lost 5 percent today at 11 a.m. in Sao Paulo, poised for the biggest drop since 2011 and leaving the index set to enter a bear market.
- Petrobras Leads Emerging-Market Losses After Rousseff’s Win. Petroleo Brasileiro SA (PETR4) fell the most in six years as President Dilma Rousseff’s re-election dashed hopes of repealing price and project restrictions that have made it the world’s most-indebted oil producer. The shares tumbled 13 percent to 14.11 reais at 3:13 p.m. in Sao Paulo, leading losses on the MSCI Emerging Markets Index, which retreated 0.7 percent. Petrobras, as Rio de Janeiro-based Petroleo Brasileiro is known, now trades at 6.3 times its forecast earnings, the cheapest since March. “Today’s losses may get worse in the next few days,” Sandro Fernandes, a trader at brokerage firm Geraldo Correa, said in a phone interview from Belo Horizonte, Brazil. “Shares may move closer to 12 reais soon.”
- China Fake Invoice Evidence Mounts as HK Figures Diverge. The gap between China’s reported exports to Hong Kong and the territory’s imports from the mainland widened in September to the most this year, suggesting fake export-invoicing is again inflating China’s trade data. China recorded $1.56 of exports to Hong Kong last month for every $1 in imports Hong Kong registered, leading to a $13.5 billion difference, based on government data compiled by Bloomberg. Hong Kong’s imports from China climbed 5.5 percent from a year earlier to $24.1 billion, figures showed yesterday; China’s exports to Hong Kong surged 34 percent to $37.6 billion, according to mainland data on Oct. 13.
- Europe Stocks Drop with Italian Lenders Amid ECB Stimulus. A slide in Italy’s lenders sent European stocks lower, after their best weekly jump of the year, as investors weighed stress-test results and central-bank stimulus measures. The Stoxx Europe 600 Index fell 0.6 percent to 325.1 at the close of trading in London, paring a decline of as much as 1.1 percent as the European Central Bank said it settled more than 1.7 billion euros ($2.2 billion) of covered-bond purchases last week. A gauge of lenders lost 1.7 percent, reversing a gain of 1.4 percent this morning, as Banca Monte dei Paschi di Siena SpA sank the most since at least 1999.
- Commodities Drop to Five-Year Low Led by Gasoline, Sugar. Commodities slumped to a five-year low led by gasoline and agriculture products grown in Brazil on speculation a slump in the country’s currency will fuel exports. The Bloomberg Commodity Index dropped 0.6 percent at 1:56 p.m. in London after falling to the lowest since July 2009. Raw sugar futures fell 1.6 percent and soybeans dropped 0.4 percent. Brazil is the biggest exporter of both commodities.
- Five-Year-Old Boy Being Tested for Ebola in New York; Has Fever, in Isolation. (video)
- IMF Sees Risk of Plunge in GCC Surplus Amid Oil Decline. Gulf Cooperation Council countries may see their current-account surplus decline by $175 billion next year if oil prices stay about $80 a barrel, according to the International Monetary Fund. The projected surplus for the six GCC countries may plunge from $275 billion to about $100 billion next year, Masood Ahmed, director of the Middle East and Central Asia department at the IMF, said in an interview in Dubai. The extended drop in prices would also “translate into an 8 percent reduction in the fiscal revenues of the GCC as a whole,” he said.
- Junk Market Stressed by Fed Stress Test as Banks Cut Debt. When the Federal Reserve examines the trading books of the world’s largest banks, regulators may find surprisingly little exposure to one risky market: junk bonds. Wall Street’s biggest debt dealers have been dumping speculative-grade securities at the fastest pace on record ahead of annual stress tests by the Fed. They reduced their holdings by 68 percent in the week ended Oct. 15 as the market posted losses of 1.5 percent that week alone, according to data released by the Fed last week.
- Tesla(TSLA) Unveils Lower-Cost Lease Program. Electric-Car Maker Looks to Lift Sagging U.S. Sales Through New Incentives. Tesla Motors Inc. is offering sales incentives on its $71,000 and up Model S electric sedan, promising to lower the lease price of the sedan by 25% and to give buyers 90 days to return a vehicle if they are unhappy with it. The move comes amid a sales decline in the U.S. for the Palo Alto, Calif.-based Tesla. The auto maker sold 10,335 Model S sedans through September, down 26% from the first nine months in 2014, according to WardsAuto.com, an industry publication that closely tracks sales and production.
- UBS Executive: Sanctions Pain on Russia Has Only Just Begun. There’s been little progress resolving the Ukraine crisis, and Russia’s pain from sanctions could be just beginning. Russian President Vladimir Putin and Western leaders are trading blame over continued bloodshed in Eastern Ukraine. And German Chancellor Angela Merkel said Friday that sanctions against Russia would stay in place.
- Short this ‘cult stock’? Trader's case against Tesla(TSLA). (video)
- Cheap mortgages could fuel credit bubble: Ex-Bear Stearns CEO. Moves to boost the U.S. housing market could fuel the next credit bubble, warned Alan Schwartz, the former head of Bear Stearns, which collapsed during the 2008 subprime mortgage crisis.
- Can't Find Any Inflation? Here's A Place To Start. (graph)
- In Historic Shift, NATO-Member Poland Is Moving Thousands Of Troops To Its Eastern Border.
- Copper Surges After Report Mysterious London Buyer Has Cornered Up To 90% Of Market. (graph)
- Pentagon To Quarantine Troops Returning From West Africa For 21 Days.
- We Don't Have One Problem - We Have Three Interlocking Sets Of Problems.
- ECB Bought Just EUR1.7 Billion Covered-Bonds Last Week.
- Pending Home Sales Disappoint As 15% of Realtors Report Clients Unable To Obtain Financing. (graph)
- Service PMI Slides To 6 Month Low, Implies Slide In Q3 GDP To 2.5%; Ebola, Ukraine Blamed. (graph)
- When Stress Tests Fail - Italian Banks Are Collapsing. (graph)
Telegraph:
- Why Germany's households are more fragile than you think. Stress tests on Europe's households show a severe economic shock would hurt Germany more than France.
- Stock markets threatened by collapse in Chinese consumer demand. A shocking slump in Chinese consumer demand will undermine World economic growth and stock markets.
- German business sentiment plunges to 2 year low, says Ifo Institute. Business sentiment in Germany hit a nearly two-year low after sliding for six consecutive months. The prestigious Munich-based think tank, the Ifo Institute, reported on Monday that its Ifo Business Climate Index for industry and trade in Germany slid in October to 103.2 points, compared to 104.7 in September. The news put a dampener on the initial surge in European bank share prices on Monday following Sunday’s publication of the ECB and EBA stress test results. Not only did expectations of the current business situation in the country fall, but predictions for the next six months turned more negative too. “The outlook for the German economy deteriorated once again,” Ifo wrote.
No comments:
Post a Comment