Bloomberg:
- World Bank Sees Slower Growth in Developing East Asia. Developing East Asian economies will grow slightly slower this year, the World Bank said, with China’s moderating expansion overshadowing the benefits of lower oil prices and a recovery in rich countries, China’s growth will cool to 7.1 percent in 2015, slower than the 7.2 percent predicted in October and last year’s 7.4 percent expansion, the World Bank said in its East Asia and Pacific Economic Update. Developing East Asia will expand 6.7 percent, easing from 6.9 percent in 2014, it said.
- China, Russia, Saudi Arabia Increased Defense Most as U.S. Cut. Chinese, Russian and Saudi Arabian defense spending increased the most last year, while U.S. expenditures declined, according to a report by the Stockholm International Peace Research Institute. China’s defense spending rose 9.7 percent from a year earlier to $216 billion, and Russia’s increased 8.1 percent to $84.5 billion, the research group said in its annual report on global defense spending adjusted for inflation. Saudi Arabia had the biggest percentage increase among the top 15 spenders worldwide, rising 17 percent to $80.8 billion.
- Greed Never Felt So Good to Hong Kong Bulls Chasing Stock Gains. Hong Kong options traders have never been so bullish on the city’s stock market after surging inflows from mainland China propelled the Hang Seng Index to the biggest rally worldwide last week. Wagers on gains for the benchmark gauge increased to the most expensive level on record versus bearish ones Friday as the measure completed a 7.9 percent weekly advance, the most among national equity gauges.
- Hundreds of Thousands March Against President Across Brazil. Brazilians took to the streets for the second time in a month to protest the country’s biggest corruption scandal and government austerity measures aimed at preserving the nation’s investment grade rating. Demonstrators marched in cities throughout the nation, with the biggest gathering occurring at Avenida Paulista, the heart of Brazil’s largest city, Sao Paulo. The state’s military police estimated attendance at 275,000 people. Thousands more thronged Rio de Janeiro’s Copacabana beach, all wearing green and canary yellow shirts as 3,000 joined a protest in Belo Horizonte.
- Boko Haram Forces 800,000 Children to Flee Violence, UN Says. The number of children fleeing the Boko Haram insurgency in Nigeria doubled in the past year to about 800,000, with women and girls targets of abduction for sexual abuse by the militants, according to a United Nations Children’s Fund report. Boko Haram’s six-year campaign to impose Islamic law in Nigeria has forced more than 1.5 million people from their homes, according to Unicef. The number of displaced includes 1.2 million inside Nigeria, with about 200,000 crossing into neighboring Cameroon, Chad and Niger, stretching social services, health care and other facilities in host communities.
- Asian Stocks Fluctuate After Biggest Weekly Gain in Five Months. Asia’s benchmark stock gauge swung between gains and losses, after posting its biggest weekly rally in more than five months, as advances by phone companies countered declines for utilities. SoftBank Corp. jumped 2.1 percent after a report that SnapDeal.com, in which the Japanese phone company owns a stake, is planning a U.S. listing. Mesoblast Ltd. surged 25 percent in Sydney after the biotechnology company said it’ll enter into an equity placement pact with Celgene Corp. Tokyo Gas Co. dropped 3.9 percent to lead a decline by utilities after the Japanese power producer said it missed its full-year profit target on impairment charges. The MSCI Asia Pacific Index slipped 0.1 percent to 152.14 as of 9:48 a.m. in Tokyo after climbing less than 0.1 percent.
- The $9 Trillion Short That’s Seen Sending the Dollar Even Higher. Investors speculating the dollar rally is fizzling out may be overlooking trillions of reasons why it will keep on going. There’s pent-up demand for the U.S. currency that will underpin years of appreciation because the world is “structurally short” the dollar, according to investor and former International Monetary Fund economist Stephen Jen.
- BHP(BHP), Rio(RTP) Faulted by Barnett on Iron as Citigroup Sees $30s. The biggest iron ore producers including BHP Billiton Ltd. and Rio Tinto Group are pursuing a flawed strategy by flooding an oversupplied market and they should slow down expansion plans, according to the premier of Western Australia. “The signal’s going out to the market that there’s going to be ever-increasing amounts of iron ore available even at lower prices,” Colin Barnett said in an interview. “The market signal is wrong, and I believe the major companies have a flawed strategy. I don’t think it’s good business for them or their shareholders,” said Barnett, whose state includes the ore-rich Pilbara, where the bulk of Australian supply is concentrated.
- Druckenmiller Recounting Soros Experiences Blasts Fed Policies. The billionaire investor, who has one of the best long term track records in money management, told an audience at the Lost Tree Club in North Palm Beach, Florida, on Jan. 18 that trouble is looming. “I just have the same horrific sense I had back in ’04,” Druckenmiller said, according to a transcript obtained by Bloomberg News. “Our monetary policy is so much more reckless and so much more aggressively pushing the people in this room and everybody else out the risk curve that we’re doubling down on the same policy that really put us there.”
- It’s Getting Expensive to Be a Bear as U.S. Rules Pinch Options. More than just a casino for day traders, the options market is where institutions pay millions of dollars a day to hedge investments. Lately, amid a crackdown on risk-taking, they’ve been paying a little more. Prices for Standard & Poor’s 500 Index put contracts, the options that act like insurance policies on stocks because they gain value when shares sink, have jumped this year to the highest levels on record relative to bullish calls, six-month data compiled by Bloomberg show. In one example, an option that appreciates if the market slides 10 percent by July has seen its cost shoot more than 120 percent above the corresponding bet on a rally. That’s twice the average spread since 2005. In a bull market that hasn’t seen a 10 percent correction since 2011, it makes sense that prices are higher to protect equity holdings. But more may be at work. Rocky Fishman, an equity derivatives strategist at Deutsche Bank AG, says hedging costs are going up as dealers are crimped by regulations and self-imposed risk controls stemming from the financial crisis.
- Bloomberg Politics Poll: Democrats and Independents Don’t Want a Hillary Coronation. Exclusive: nationwide poll also shows the vast majority of Americans say they won’t be more or less inclined to vote for Clinton because she represents the idea of America electing its first female president.
- Bloomberg Politics National Poll: Rand Paul, Jeb Bush Face Primary Obstacles. Republican presidential candidate Rand Paul may have a problem with women, and Jeb Bush already has been written off by a large share of potential primary voters, according to a new Bloomberg Politics national poll that underscores the wide-open nature of the race four months before the first primary debate. Just 11 percent of Republican and independent women in the poll said they'd seriously consider supporting Paul, a U.S. senator from Kentucky who announced his presidential bid last week, compared to 22 percent of men. No other Republican contender has a worse spread. Among all Republicans and independents in the poll, 42 percent said they would never consider voting for Bush, a former Florida governor and brother and son to former presidents.
- U.S. Widens Role in Saudi-led Campaign Against Yemen Rebels. Washington has concerns about Riyadh’s goals in the conflict. The U.S. is expanding its role in Saudi Arabia’s campaign in Yemen, vetting military targets and searching vessels for Yemen-bound Iranian arms amid growing concerns about the goals of the Saudi-led mission, according to U.S. and Arab officials.
- U.S. Consumer Shares Cause Sticker Shock. After sector’s surge in past six months, some investors think prices have climbed too far. U.S. consumer stocks have been flying off the shelves, but some investors are beginning to suffer from sticker shock. Consumer discretionary stocks in the S&P 500—a diverse swath of companies that includes retailers like Macy’s Inc. and Target Corp., as well as auto makers and media companies—have risen 18.8% in the last six months, outpacing the 10.3% gain in the broader S&P 500. Investors are betting the tumble in oil...
- Wells Fargo(WFC) Warms Up to Risk. Investment banking plays a growing role for traditionally conservative lender. Wells Fargo & Co., the largest bank in the U.S. by market value, has been rewarded for keeping its business simple. Now it is slowly creeping into more complex—and riskier—territory. While many rivals retreat from risk amid regulatory pressures, the bank is expanding into a range of businesses a step removed from its long history as a Main Street lender. Among
- The Hillary Machine. Democrats are falling in line because they feel they have no choice.
- The Dirty Secret of Obama’s Carbon Plan. Taking one-third of U.S. coal-fired power plants off the grid by 2020 simply isn’t workable. Here’s why.
- Clinton announces 2016 White House bid, asks to be 'champion' of America's middle class. (video) Former Secretary of State Hillary Clinton on Sunday officially announced her 2016 presidential campaign, ending months of speculation over her political plans and immediately elevating her as a target for the field of Republican contenders.
Zero Hedge:
- VIX Closes At 5-Month Lows, BofA Warns Volatility Term Structure Is A "Significant Concern". (graph)
- Dollar Soars By Most In 43 Months; Stocks, Oil Surge In Week After Worst Payrolls Since 2013. (graph)
- Greek Negotiator "Shocks" Eurozone Officials, Behaves Like "Taxi Driver": Hope Of Greek Deal "Blown".
- Red Flags. (graph)
Business Insider:
- This was not a good week for Obama's Iran policy. Reports of a French fact-sheet that differed from a US government-issued statement suggested that there are no fewer than four different official versions circulating as to what was agreed to in Lausanne, Switzerland, on April 2nd, and that there are key differences between the US, Iranian, French, and EU-Iranian documents.
Reuters:
Telegraph:- Most Brazilians favor impeachment, but few see Rousseff gone: poll. Almost two thirds of Brazilians favor the impeachment of President Dilma Rousseff over a corruption scandal at state-run oil company Petrobras, but roughly as many doubt it would drive her from office, according to a poll released on Saturday. The survey by polling firm Datafolha showed 63 percent of respondents support impeachment in light of the widening police investigation into a huge kickback scheme at Petroleo Brasileiro SA, as the oil giant is formally known. Still, 64 percent said they did not expect the scandal would be enough to cut short Rousseff's second term, which began in January.
- Japan machinery orders fall, uncertain outlook keeps BOJ on edge. Japan's core machinery orders fell for a second straight month in February in a sign that business investment remains soft, and analysts say the smaller-than-expected decline won't necessarily allow policymakers to relax given an uncertain economic outlook. The 0.4 percent monthly fall in core machinery orders, a highly volatile data series, came as a recent run of weak indicators raised doubts about a sustainable economic rebound following a recession last year.
- The eurozone’s economic crisis is far from over. As the eurozone has continued to disappoint, more and more commentators have come to see it as resembling, or in danger of coming to resemble, Japan, writers Roger Bootle.
- BlackRock(BLK): Fed tightening to trigger market tremors as liquidity evaporates. Complacent investors will be hurt as Fed raises rates, says BlackRock, as
managing director warns central banks are running out of ammunition to deal
with next crisis.
- Greece Not Moving on Structural Reforms in Aid Talks. Euro-region govt representatives "disappointed" about talks so far with Greece on structural reform measures, citing officials familiar with the matter. Greek side isn't moving at all, isn't ready to discuss a reduction of public service pensions, according to the report. Greek representative at April 8 deputy finance ministers' meeting said his country will be insolvent shortly. Greece has until April 20 to submit acceptable list of reforms, only then can EU Commission, ECB, IMF assess the measures in advance of EU finance ministers' meeting April 24 in Riga.
- China Economy Faces Increasing Downward Pressure. Resources sectors face stronger downward pressure, Pan Jiancheng, an official with China's statistics bureau writes in an article.
- China March Power Consumption Growth May Slow. Power use may grow less than 2% in 1Q, lower than the 2.5% growth in the first two months, citing Ouyang Changyu, deputy secretary-general of the China Electricity Council.
- Asian indices are -.25% to +.50% on average.
- Asia Ex-Japan Investment Grade CDS Index 104.25 +.25 basis point.
- Asia Pacific Sovereign CDS Index 58.50 +.25 basis point.
- S&P 500 futures -.08%.
- NASDAQ 100 futures -.05%.
Earnings of Note
Company/Estimate
- (CBSH)/.58
- (OZRK)/.46
- (PBY).00
2:00 pm EST
- The Monthly Budget Deficit for March is estimated at -$43.4B versus -$36.9B in February.
- None of note
- The China FDI report could also impact trading today.
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