Bloomberg:
- Germany Toughens Tone With Greece Before EU Meetings. (graph) Germany and Greece drew battle lines ahead of an emergency meeting of official creditors today, setting the stage for a clash. German Finance Minister Wolfgang Schaeuble doused expectations of a positive outcome for Greece at the meeting in Brussels, saying there are no plans to discuss a new accord or give the country more time. Greece’s new Prime Minister Alexis Tsipras was defiant, saying there is “no way back” for his government, and that he wants a new agreement that won’t subject his people to more pain. Tsipras said in a speech before a vote of confidence in parliament that he wants an accord “that is in the mutual interest of Greece and its partners, one that will end punitive terms and the destruction of the Greek economy.”
- Volatility Climbs With Dollar as Germany Douses Greek Optimism. Currency volatility surged along with the U.S. dollar as Germany and Greece head for a showdown that is spurring traders to take out insurance against euro declines. The premium to protect against a drop in the euro versus the greenback rose to the highest since Jan. 23 -- the day after the European Central Bank announced it would purchase sovereign bonds -- before Greece’s official creditors hold an emergency meeting. A gauge of the dollar closed at its highest level in data going back to 2004 as comments from regional Federal Reserve presidents suggested policy makers could raise interest rates by mid year. “The outcome of the Greek bailout saga is highly uncertain,” said Imre Speizer, a markets strategist at Westpac Banking Corp. in Auckland. “You’ll get pre-positioning and repositioning after the event, depending on whether it’s a positive or negative surprise. It might cause some volatility,” and that would support dollar buying, he said.
- Ukraine Cease-Fire Talks Continue With All Sides Face Conflicting Pressures. Officials from Ukraine, Russia, the Organization for Security and Cooperation in Europe and pro-Russian separatists will continue negotiations in Belarus Wednesday on a cease-fire to stem 10 months of bloodshed. Despite earlier reports from Itar-Tass, no agreement was reached Tuesday, according to two officials representing members of the so-called contact group, which includes all four parties. The Russian news service, citing an unidentified person, said the cease-fire includes the withdrawal of heavy weapons, monitoring and implementation.
- Brazil Real Drops to Lowest Level in Decade as Commodities Sink. Brazil’s real declined to a 10-year low as falling commodities prices damped the outlook for growth in Latin America’s biggest economy. The real dropped 2.2 percent to 2.8324 per dollar at the close of trade, the weakest level on a closing basis since November 2004. The drop was the biggest among 31 currencies tracked by Bloomberg. Swap rates, a gauge of expectations for changes in Brazil’s borrowing costs, increased 0.12 percentage point to 13 percent on the contract maturing in January 2016.
- Won Leads Declines in Asia as Fed’s Lacker Backs June Rate Rise. South Korea’s won led declines in Asian currencies after a Federal Reserve policy maker said U.S. data support the case for raising interest rates in June. Fed Bank of Richmond President Jeffrey Lacker, who has sought tighter monetary policy in the past, said on Tuesday the world’s largest economy is growing at a faster and “more sustained pace” than a year ago. South Korea’s unemployment rate fell to 3.4 percent in January, the statistics office said Wednesday, lower than 3.5 percent in December and the median forecast of economists surveyed by Bloomberg. The won declined 0.7 percent, the most since Feb. 2, to 1,097.19 a dollar as of 10:30 a.m. in Seoul, according to data compiled by Bloomberg. Bloomberg-JP Morgan Asia Dollar Index, which tracks the region’s 10 most-active currencies excluding the yen, retreated for a second day.
- Asia Stocks Fall as Earnings Concern Offsets Greek Deal Optimism. Asian stocks fell as concern about corporate earnings offset optimism that a compromise will be reached over Greece’s debt obligations. CSL Ltd. tumbled 8.1 percent, dragging Australia’s S&P/ASX 200 Index lower, after the maker of blood-based drugs and vaccines cut its profit forecast. Suncorp Group Ltd. declined 2.5 percent in Sydney after profit at the insurer missed estimates. China Shenhua Energy Co. retreated 1.2 percent in Hong Kong after sales declined. The MSCI Asia Pacific Excluding Japan Index slipped 0.1 percent to 477.73 as of 9:36 a.m. in Hong Kong. Japan’s stock market is closed for a holiday.
- Oil Is Going to Be Lower for Longer: Gordon. (video) UBS Wealth Management, CIO Office Executive Director and Commodities Strategist Wayne Gordon discusses oil's volatility and where the market is heading with Bloomberg's Rishaad Salamat on "On The Move."
- Record Iron Ore Glut Seen by ANZ as Price Forecasts Cut to 2018. The global iron ore surplus will more than double to a record this year as low-cost producers keep on expanding, according to Australia & New Zealand Banking Group Ltd., which cut price forecasts as much as 30 percent. The raw material will average $58 a metric ton this year, down from an earlier estimate of $77, and $60 next year, down from $85, analysts including Head of Commodity Research Mark Pervan wrote in a report on Wednesday. The surplus will expand to 85 million tons this year from 39 million tons in 2014, the bank forecast. Price forecasts for 2017 and 2018 were also cut.
- A Record Number of Americans Are Renouncing Their Citizenship. The number of Americans renouncing U.S. citizenship increased 37 percent in the three months through December and the annual total reached a record level, data published Tuesday showed.
- Death of Kayla Mueller, American Held by Islamic State, Is Confirmed. President Obama Vows to Find and Bring Justice to Those Responsible for Death. Kayla Jean Mueller, the last American hostage known to be held by Islamic State extremists, was confirmed dead by her relatives and the White House on Tuesday. Ms. Mueller’s parents received what U.S. officials described as private communications from Islamic State over the weekend, including photographs. Based on the images, U.S. intelligence agencies concluded they proved she had been killed, officials said.
- Federal Reserve Works to Cultivate Stronger Ties to GOP. Bank’s Lone Republican Governor Tries to Blunt Proposal He Says Risks Curbing Fed Independence.
- Currency Warriors Get Boost at G-20 Meeting. Stimulus is Vital for Boosting Weak Global Economy, Leaders Say.
- U.S. Firms in China See Rising Anti-foreign Sentiment. Survey by American Chamber of Commerce in China Found Companies Believe Foreign Firms Have Been Targeted in Investigations. U.S. businesses in China have voiced increased concerns over what they see as rising anti-foreign sentiment and increasingly difficult operating conditions as the economy posts slower growth. An annual survey released on Wednesday of about 500 members of the American Chamber of Commerce in China found that most companies believe that...
- NBC suspends Brian Williams for 6 months. Brian Williams, anchor and managing editor of "NBC Nightly News," has been suspended without pay for six months following his continued misrepresentation of events surrounding his coverage of the Iraq War, NBC said Tuesday night. "We have decided today to suspend Brian Williams as managing editor and anchor of NBC Nightly News for six months," NBC News president Deborah Turness said in a memo to staff sent to FoxNews.com. "The suspension will be without pay and is effective immediately. We let Brian know of our decision earlier today. Lester Holt will continue to substitute anchor the NBC Nightly News."
- Top oil analyst: The worst is yet to come. Oil prices will get a heck of a lot worse before they get better, a top industry analyst said on Tuesday. Tom Kloza, chief oil analyst at Oil Price Information Service, predicted that oil prices would bottom during the second quarter of the year "simultaneously to one of the expirations of the WTI contracts."
Business Insider:
Reuters:
- Akamai(AKAM) revenue beats Street as security product sales swell. Akamai Technologies Inc's quarterly profit and revenue beat market estimates as demand jumped both for its security products and mainstay content delivery businesses. Akamai shares shot up 5 percent in extended trading on Tuesday before shedding some gains after it issued a cautious forecast for the current quarter.
- Trick or treat? India's strong GDP figures mask economic reality. For Indian business, the government and the central bank, data revisions that have transformed the country's $2.1 trillion economy into one of the world's fastest growing are too good to be true. Now, the search is on for reliable indicators of underlying activity, vital for Finance Minister Arun Jaitley as he draws up his annual budget and for Reserve Bank of India (RBI) Governor Raghuram Rajan as he weighs whether to cut interest rates again.
- For the third time in a century, America will have to ride to Europe's rescue. From the sidelines, the US is watching the unfolding Greek tragedy with growing horror. It must stand ready to assist as the euro breaks apart.
- None of note
- Asian equity indices are -.50% to +.50% on average.
- Asia Ex-Japan Investment Grade CDS Index 110.0 +1.0 basis point.
- Asia Pacific Sovereign CDS Index 69.25 unch.
- S&P 500 futures -.07%.
- NASDAQ 100 futures -.02%.
Earnings of Note
Company/Estimate
- (OC)/.41
- (ZTS)/.36
- (TWX)/.93
- (LPX)/-.14
- (WCG)/.66
- (PEP)/1.08
- (MOS)/.86
- (AOL)/.71
- (MDLZ)/.43
- (NVDA)/.36
- (NTAP)/.77
- (CAKE)/.60
- (PNRA)/1.81
- (MET)/1.35
- (TSO)/1.53
- (CXW)/.65
- (FEYE)/-.49
- (WFM)/.45
- (TSLA)/.32
- (CSCO)/.51
- (AMAT)/.27
10:30 am EST
- Bloomberg consensus estimates call for a weekly crude oil inventory build of +3,612,500 barrels versus a +6,333,000 barrel gain the prior week. Gasoline supplies are estimated to rise by +100,000 barrels versus a +2,335,000 barrel gain the prior week. Distillate supplies are estimated to fall by -987,500 barrels versus a +1,788,000 barrel gain the prior week. Finally, Refinery Utilziation is estimated to fall by -.09% versus a +1.9% gain the prior week.
- The Monthly Budget Deficit for January is estimated at -$19.0B versus -$10.3B in December.
- None of note
- The Fed's Fisher speaking, China New Loan/Money Supply data, Australia Employment data, $24B 10Y T-Note auction, weekly MBA Mortgage Applications report, BB&T Transport Conference and the Stern Agee Financial Institutions Conference could also impact trading today.
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