Bloomberg:
- Putin Paints a Besieged Russia, Says U.S. Wants to 'Rip Out Its Teeth and Claws'. Vladimir Putin is digging in. Blaming the U.S. and Europe for an economic crisis gripping his country of 144 million and warning the slump could drag on for two years,Putin today signaled a sustained standoff over Ukraine. “He believes that the economy is capable of withstanding the shock,” said Alexei Makarkin, deputy director of the Moscow-based Center for Political Technologies. “Putin’s psychology is very simple. From his point of view Russia has made concessions for years and to no effect.” Putin held his annual press conference, speaking to hundreds of reporters for more than three hours. The event took on heightened importance as a 40-percent plunge in the ruble evoked memories of the country’s 1998 default and talk of hoarding staples.
- U.S. Weighs ‘Proportional Response’ to Hack of Sony Pictures. The Obama administration is weighing a “proportional response” to the cyber-attack on Sony Pictures Entertainment computers and is wary that the intrusion may have been designed to provoke a large-scale U.S. reaction, White House spokesman Josh Earnest said. Earnest refused to say whether the U.S. had concluded that North Korea was behind the attack, which crippled Sony’s computers and forced the studio to pull its movie “The Interview” from its planned released. The attack was “initiated by a sophisticated actor” and the U.S. investigation is making progress, he said. The character of the intrusion makes it a national security matter, not just an economic one, he said.
- BOJ Keeps Record Easing as Oil’s Fall Challenges Kuroda. The Bank of Japan maintained unprecedented stimulus, as Governor Haruhiko Kuroda’s bid to stoke inflation faces increasing challenges from the tumble in oil prices. The central bank will boost the monetary base at an annual pace of 80 trillion yen ($671 billion), it said in a statement, as forecast by all 33 economists surveyed by Bloomberg News. Exports have shown signs of picking up, while production has started to bottom out, the BOJ said, striking a more upbeat tone in its view of the world’s third-largest economy. Oil has lost more than a quarter of its value since the central bank boosted easing on Oct. 31 to end a “deflationary mindset.”
- China’s Shandong Province First to Step Up Curbs on LGFV Debt. Authorities in Shandong said they won’t bail out the borrowings of cities or counties in the region, becoming the first province in China to follow the central government’s campaign to curb regional debt. Shandong province, on the country’s east coast, banned all new debt raisings by local government financing vehicles, according to a statement dated Dec. 10 and posted on its website yesterday. Local governments should reasonably control financing demand for projects under construction, it said.
- China Money Rate Jumps Most Since 2013 Cash Crunch on New Shares. The seven-day repurchase rate, a gauge of interbank funding availability in the banking system, surged 154 basis points, or 1.54 percentage points, today and 213 basis points this week to 5.94 percent, according to a fixing released by the National Interbank Funding Center at 11 a.m. in Shanghai. That’s the biggest increase since June 20, 2013, when the rate touched a record 10.77 percent.
- Yuan Forwards Sink to Biggest Discount to PBOC Fixing Since 2008. Yuan forwards are trading at the biggest discount to the official exchange rate in six years as China’s economic growth slows and the dollar surges amid expectations for higher U.S. interest rates. Twelve-month non-deliverable forwards dropped 0.5 percent, the most since March 10, to 6.3482 a dollar on Thursday in New York, according to data compiled by Bloomberg. The contracts, which traders use to speculate on or hedge against moves in the yuan, are 3.6 percent weaker than the central bank’s reference rate, the most since December 2008.
- China Stocks Fall Most in Week as Smallcaps Slump on IPO Concern. China’s stocks fell, trimming a weekly gain, amid concern recent gains have been excessive as new share offerings may divert funds from existing equities. Citic Securities Co. (600030) and China Merchants Securities Co. led declines for brokerages with losses of more than 3 percent after more than doubling over the past month. The ChiNext index of smaller companies dropped 3.3 percent as money-market rates rose on the biggest initial public offering sales this year. BYD Co. rebounded 18 percent in Hong Kong after the electric carmaker said it confirmed with shareholder Berkshire Hathaway Inc. that it has no intention to reduce its stake. The Shanghai Composite Index (SHCOMP) retreated 0.8 percent to 3,033.49 at 1:07 p.m.
- Asian Stocks Extend Global Rally on Fed as Oil Pares Drop. Asian stocks rose, extending a global surge in equities as the regional index headed for its steepest two-day advance in 13 months. Crude oil pared a fourth weekly decline, the euro traded near a two-year low and wheat fell. The MSCI Asia Pacific Index jumped 1.7 percent by 11:44 a.m. in Tokyo, after a 0.7 percent gain yesterday. Japan’s Topix index (TPX) climbed 1.9 percent as the yen traded near a one-week low.
- Oil Crash Exposes New Risks for U.S. Shale Drillers. Tumbling oil prices have exposed a weakness in the insurance that some U.S. shale drillers bought to protect themselves against a crash. At least six companies, including Pioneer Natural Resources Co. (PXD) and Noble Energy Inc. (NBL), used a strategy known as a three-way collar that doesn’t guarantee a minimum price if crude falls below a certain level, according to company filings. While three-ways can be cheaper than other hedges, they can leave drillers exposed to steep declines.
- OPEC’s Loss of Control Creates Contagion Fears, Mitsui Says. OPEC has lost control of the oil market, casting a shadow over the world economy, Japan’s top crude trader says. It could take oil company bankruptcies, production stoppages at higher-cost OPEC members, or a widespread shutdown of shale output in the U.S. to stabilize prices, said Joji Okada, chief financial officer at trading house Mitsui & Co., which has $107 billion in assets spanning 66 countries. Oil’s plunge is hitting hardest in Russia, the world’s biggest energy producer, which has seen the government sell foreign exchange reserves in an attempt to stem a ruble collapse. The big risk now is contagion, said Okada. “I’m really concerned for the global economy,” Okada said in an interview at the company’s Tokyo headquarters this week. Russia’s woes alone wouldn’t hurt Mitsui’s profits “but a spillover from the Russian economy will impact other countries and that’ll come back to us. That, I am afraid of.”
- MetLife(MET) Gets Risk Tag From U.S. Panel, Weighs Options. MetLife Inc. (MET), the biggest U.S. life insurer by assets, was labeled a systemically important financial institution by a council of regulators and said it will consider whether to sue the government over the decision. The Financial Stability Oversight Council voted to designate New York-based MetLife a SIFI, the insurer said today in a statement. The ruling subjects MetLife to stricter Federal Reserve oversight that could include tougher capital, leverage and liquidity requirements. The company can appeal in U.S. district court within 30 days.
- U.S. Struggles for Response to Sony Hack. White House Walks Fine Line to Find Way to Retaliate for North Korea’s Apparent Attack. The U.S. government is looking for ways to retaliate for North Korea’s apparent hacking of Sony Pictures but is struggling for an appropriate solution, according to people familiar with the discussions.
- Oil’s Drop Hits Big Investors Hard. Icahn, Paulson Suffer Large Losses as Energy-Related Bets Sour.
- Suspected Boko Haram militants kidnap at least 185 in Nigeria, witnesses say. Suspected Islamic militants -- believed to be Boko Haram -- stormed a village in Nigeria and captured at least 185 young men, women and children, witnesses revealed Thursday.
Zero Hedge:
- 3 Things Worth Thinking About. (graph)
Reuters:
- Security experts fear Sony attack to fuel more company extortion. Sony Pictures' decision to shelve the film "The Interview" in the face of cyberattacks has set a worrying precedent and is sending companies scrambling to guard sensitive data, security experts said on Thursday. Sony's capitulation could mean that more businesses will be targeted for cyberwarfare and extortion, they said.
- Apple's(AAPL) Cook makes 'substantial' donation for gay rights in U.S. South. Apple Inc Chief Executive Tim Cook, the highest-profile U.S. business leader to publicly acknowledge being gay, has made a "substantial" donation to a gay rights effort in his native Alabama and two other southern U.S. states, activists said on Thursday.
- Fed calls time on $5.7 trillion of emerging market dollar debt. World finance is rotating on its axis. The stronger the US boom, the worse it will be for those countries on the wrong side of the dollar.
- Nine charts showing why Greece has to leave the euro. The Greek tragedy has yet to morph into a recovery. Here are the numbers that prove it remains shackled by monetary union.
- None of note
- Asian equity indices are +.75% to +1.75% on average.
- Asia Ex-Japan Investment Grade CDS Index 105.0 -1.0 basis point.
- Asia Pacific Sovereign CDS Index 68.5 -30 basis points.
- S&P 500 futures +.42%.
- NASDAQ 100 futures +.62%.
Earnings of Note
Company/Estimate
- (BBRY)/-.06
- (KMX)/.54
- (CCL)/.21
- (FINL)/.01
- (PAYX)/.46
11:00 am EST
- The Kansas City Fed Manufacturing Activity Index for December is estimated to remain at 7.0 versus 7.0 in November.
- None of note
- The Fed's Evans speaking, Fed's Lacker speaking and the German Consumer Confidence Index could also impact trading today.
No comments:
Post a Comment