Evening Headlines
Bloomberg:
Bloomberg:
- Bank of England's Carney Sees China Bank Risk in Rebalancing Act. Mark Carney warned that the slowdown in China as it tries to rebalance its economy risks hurting its banking sector as well as threatening growth in economies such as the U.K. “These processes never proceed smoothly and we’ll all have to deal with the bumpiness that comes with it,” the Bank of England governor said in an interview with Bloomberg on Thursday. “It’s the second-biggest economy in the world.”
- China's Bonds Set for Worst Week Since May as PBOC Seen on Hold. China’s 10-year sovereign bonds headed for the biggest weekly drop in five months on speculation investors are taking profits amid signs the central bank is done cutting borrowing costs for now. The People’s Bank of China has lowered benchmark deposit and lending rates six times since November and reduced lenders’ reserve ratios in an attempt to spur a slowing economy. The monetary authority will leave its policy rates unchanged through the end of next year, a Bloomberg survey showed last week. China’s local-currency sovereign debt rallied for five months through October and the 10-year yield fell to a six-year low last week. The yield on the notes due October 2025 climbed six basis points from Oct. 30 and two basis points on Friday to 3.14 percent as of 10 a.m. in Shanghai, according to National Interbank Funding Center prices. That’s the biggest weekly increase for a benchmark of that maturity since May.
- Risk of Japan Recession Seen by Economists in Data Torrent. Economists are lowering their projections for Japan’s third-quarter gross domestic product after a batch of weak data, with some signaling that the economy may have contracted and pushed the nation into another recession.
- Egypt Bomb Theories Spotlight Insider Threat to Aviation. The possibility that Islamic terrorists smuggled a bomb onto a Russian jet flying home from Egypt highlights a new area of worry for aviation security: the insider threat. Instead of focusing on a small cadre of al-Qaeda forces trying to place explosives on planes, aviation security agencies may have to defend against far greater numbers of radicalized enemies -- including some who may be working at airports -- if suspicions about the crash prove true, according to a U.S. Congressman and two former security officials.
- The Greece Debt Watch.
- Standard Chartered's Shares Plunge 7% After Fitch Downgrade. Standard Chartered Plc shares slumped in Hong Kong after Fitch Ratings downgraded the bank, citing “unfavorable profitability and asset quality trends.” The London-based lender this week unveiled plans to tap investors for $5.1 billion, eliminate thousands of jobs and cut risky assets across Asia. The bank’s shares fell as much as 7.1 percent Friday in Hong Kong. They were down 5 percent as of 10:06 a.m. local time, extending this year’s decline to 35 percent. The benchmark Hang Seng Index slipped 0.9 percent.
- Most Asian Stocks Rise as Investors Await U.S. Employment Report. Most Asian stocks advanced as investors awaited U.S. jobs data to gauge whether the economy is strong enough to withstand the first Federal Reserve interest-rate increase in almost a decade. About three shares rose for every two that fell on the MSCI Asia Pacific Index, which traded little changed at 134.81 as of 9:01 a.m. in Tokyo.
- Gilead(GILD), AbbVie(ABBV) Asked by U.S. for Hepatitis C Pricing Options. Drugmakers including Gilead Sciences Inc. and AbbVie Inc. were contacted by the U.S. government’s Medicaid agency to discuss options for how to pay for hepatitis C cures whose costs have eaten into state budgets. The companies, along with Johnson & Johnson and Merck & Co., were asked in letters from the Centers for Medicare and Medicaid Services to provide information on arrangements they make with health insurers to link payments to the outcomes of their treatments. Such arrangements may affect the prices drugmakers are required to offer under the Medicaid program, the agency said Thursday.
- Gundlach Says Fed Shouldn't Start Liftoff Amid Economic Weakness. Jeffrey Gundlach, whose $50.5 billion DoubleLine Total Return Bond Fund has outperformed 94 percent of peers this year, says the Federal Reserve shouldn’t raise rates because the economy is showing more signs of fragility and support for the move is limited. “It’s a coin flip as to whether the Fed’s going to raise rates in December, which means they should not do it,” Gundlach, co-founder of DoubleLine Capital, said Thursday at an investment conference in Newport Beach, California. “You should not set monetary policy with coin flips.”
- Facebook(FB) Says Ad-Blocking Technology Could Have Impact on Sales. Facebook Inc. warned investors in a regulatory filing that its revenue could be adversely affected by technology that blocks advertisements. Ad-blocking tools, which people use to screen out marketing messages, have occasionally affected Facebook’s revenue, especially on desktop computers, the company said in a quarterly filing with the U.S. Securities and Exchange Commission on Thursday.
- Questions Surround Valeant CEO Pearson. Ackman’s comments stoke uncertainty about Pearson’s tenure. The crisis around Valeant Pharmaceuticals International Inc. deepened Thursday, as questions swirled about the future of Chief Executive Officer Michael Pearson and the company’s shares fell to their lowest level in 2½ years.
- Agricultural Giants Look to Join Forces. DuPont explores agriculture deals with Syngenta, Dow as low crop prices pressure profits.
- Giants Tighten Grip on Internet Economy. Facebook(FB), Amazon(AMZN) and others have built ecosystems that help them extract extraordinary value.
- Obama’s Middle East Escapism. The region is descending into disorder while John Kerry holds talk in Vienna that will achieve little. Secretary of State John Kerry’s new diplomatic process for dealing with Syria’s harrowing civil war involves convening a series of talks in Vienna. The effort is probably well-intentioned. But I cannot conceive of what he expects to accomplish.
Fox News:
- GOP candidate line-up announced for Fox Business Network/WSJ debate. (video) Fox Business Network on Thursday announced the candidate line-up for the Nov. 10 Republican presidential debates. The candidates qualifying for the prime-time, 9 p.m. ET debate are: Billionaire businessman Donald Trump; retired neurosurgeon Ben Carson; Florida Sen. Marco Rubio; Texas Sen. Ted Cruz; former Florida Gov. Jeb Bush; former HP CEO Carly Fiorina; Ohio Gov. John Kasich; and Kentucky Sen. Rand Paul.
- What to watch in the October jobs report.
- Disney(DIS) profit boosted by stronger revenue. Walt Disney Co. said its profit rose 7.3% in the latest quarter, helped by stronger revenue in its media networks and resorts businesses. Still, shares fell 2% in after-hours trading as revenue didn't rise as much as analysts had expected.
- Chances of 'unexpected recession' rising: Jim Paulsen. (video) With few of the traditional indicators pointing to a recession, this could be just the time investors should start preparing for ... a recession. Under ordinary circumstances, factors such as liquidity, the yield curve, gross domestic product growth, and fiscal and monetary stimulus would be key indicators to suggest the direction in which the economy is heading.
- NY Attorney General Launches Crack Down On Exxon Over Global Warming Denial.
- Ceasefire Is Over: Kurds Call Time After Erdogan Engineers Election Victory.
- For WHO, Red Meat Is A Red Herring.
- "There's A Total Lack Of Confidence" McCain Warns Obama Of Growing "Military Dissatisfaction".
- Another Abenomics Fail: New Survey Shows Inequality Growing In Japan.
- Monetary Bazookas Or Not, "Global Crisis Is Inevitable".
- Medicaid Chief Demands "Affordable Prices" From Major Drug Suppliers.
- ObamaTrade Details Unveiled, Officials Warn "It's Worse Than We Thought".
- JPM(JPM) Head Quant Is Back: The Rally Drivers Are Gone With "Downside Risk" Ahead, But No Flash Crash Unless...
- Breadth Breaking Bad - Where It All Went Wrong For The Fed.
- FedSpeak & Fireworks Day Leave Crude Crushed, Copper Clubbed, Stocks Soft, & Bonds Bruised. (graph)
- U.S.-based stock funds attract $5.7 bln in latest week -Lipper.
- Junk-rated and oil and gas loans worry U.S. bank regulators. Banks' exposure to junk-rated companies and the oil and gas sector remains high, according to an annual report on loan quality by U.S. bank regulators released Thursday. The regulators gave a negative classification to $372.6 billion out of $3.9 trillion in loans impacted by the review, or 9.5 percent of the loans. Classified loans increased 9.4 percent from a year earlier.
- Shake Shack(SHAK) restaurant sales jump in third quarter. Shake Shack Inc, known for its antibiotic-free hamburgers and indulgent side dishes, said on Thursday that restaurant sales growth and profit jumped more than expected in the third quarter, sending shares up 7 percent in extended trade.
Evening Recommendations
- None of note
- Asian equity indices are -.75% to +.25% on average.
- Asia Ex-Japan Investment Grade CDS Index 124.5 unch.
- Asia Pacific Sovereign CDS Index 69.25 +1.0 basis point.
- Bloomberg Emerging Markets Currency Index 71.88 -.13%.
- S&P 500 futures -.11%.
- NASDAQ 100 futures -.05%.
Earnings of Note
Company/Estimate
- (MT)/-.12
- (CI)/2.20
- (EBIX)/.51
- (HUM)/2.13
- (WLH)/.38
- (BRK/B)/2658.91
8:30 am EST
- The Change in Nonfarm Payrolls for October is estimated to rise to 184K versus 142K in September.
- The Unemployment Rate for October is estimated to fall to 5.0% versus 5.1% in September.
- Average Hourly Earnings for October are estimated to rise +.2% versus unch. in September.
- Consumer Credit for September is estimated to rise to $18.0B versus $16.018B in August.
- None of note
- The Fed's Bullard speaking, Fed's Brainard speaking, UK Production data and the (ATVI) investor day could also impact trading today.
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