Today's Headlines

Bloomberg:

• China's Equities Plunge Most in a Month as Volatility Reignites. (video) China’s stocks tumbled the most in a month as surging money-market rates signaled tighter liquidity and the offshore yuan declined for a fifth day. The Shanghai Composite Index sank 6.4 percent at the close, with about 70 stocks falling for each that rose. Industrial and technology companies led losses. The overnight money rate, a gauge of liquidity in the financial system, climbed the most since Feb. 6. The plunge in equities underscores the challenge for China’s policy makers as they seek to project an image of stability in the nation’s financial markets as the economy slows. Finance chiefs and central bankers from the Group of 20 will meet in Shanghai on Friday, while the annual meeting of the legislature begins in Beijing next week.
• MKM's Chief Economist: China Has Serious Challenges. (video)
• Cheapest-Ever Chinese Banks Aren't Cheap Enough. It’s going to take more than record-low valuations to convince David Herro that now’s the time to buy shares of Chinese banks. The manager of about $30 billion at Harris Associates LP, who’s been scouring global markets for beaten-down stocks during this year’s selloff, says lenders from Asia’s biggest economy aren’t cheap enough after they sank to all-time lows relative to net assets, earnings and dividends this month. While such gauges of value would normally be irresistible to bargain-hunting investors, these aren’t normal times for Chinese banks. Bad debts are surging after the economy slowed to its weakest pace in a quarter century last year, and analysts say the problem will only get worse after banks ramped up lending to record levels in January. As loan losses erode capital buffers, shareholders face the unpleasant prospect of lower dividend payouts, dilution from the issuance of new equity, or a combination of both. “We still have concerns about credit quality,” Herro, one of Morningstar Inc.’s money managers of the decade in 2010, said in an e-mailed reply to questions.
• China's Slump Casts a Pall on Dealers of Asian Art. Dealers prepare for Asia Week New York. Lally has a fairly bearish outlook for Asia Week, a 10-day event during which 45 dealers and multiple auction houses throw an Asian-art selling bonanza. “I think we’ve already seen a moderation in activity on the international market for Chinese art,” he said. “The buyers are not as euphoric as they were five years ago.”
• Europe’s Economies React to China’s Slowdown. (video)
• Citi: Here Comes a Global Recession. (video) Growth is likely to fall apart. After a few years of reasonably calm markets and stable growth around the world, Citigroup Inc. says the chances of a global recession are already high and only going up. "In our view, global growth is at a highly precarious point, after 2-3 years of relative calm," the team of economists led by Willem Buiter said in their note, which is likely to exacerbate concerns about the world's ability to withstand a pause in China's stunning economic growth. "The long-standing fragilities in the world economy relate to the structural and cyclical slowdowns in China and its unsustainable exchange rate regime, the excessive level of debt across many countries and sectors and ongoing regional and geopolitical uncertainty," the economists said. The economists have accordingly revised their forecast for growth this year in advanced economies, from a 2.4 percent in January 2015 to 1.6 percent currently, and warned that the 2016 figure "could well be lower."  
• Most-Volatile February for Currencies in Six Years Hints at More. Currency traders are enduring the most-volatile February in six years, and implied price swings suggest more fluctuations ahead. Realized three-month volatility for the yen has risen to 10.5 percent, the highest since March, and a measure of future volatility is approaching the highest since 2013. For the British pound, historic volatility has shot up to 9 percent and implied fluctuations are nearing 12 percent, the highest in almost a year.
• Lloyds Leads Lender Gains to Help Europe Stocks Snap 2-Day Drop. (video) Gains in lenders after earnings from Lloyds Banking Group Plc pushed European stocks higher for the first time in three days. Lloyds jumped 14 percent after raising its dividend and introducing a special payment. RSA Insurance Group Plc surged 9.8 percent after its annual operating profit rose 43 percent. The Stoxx Europe 600 Index added 2 percent at the close of trading.
• Stock Strategists' Optimism Dims as Well Fargo Cuts Estimates. Add Wells Fargo Securities LLC to the list of equity forecasters reining in optimism as losses mount in U.S. stocks. Gina Martin Adams, equity strategist at the world’s largest bank by market value, lowered her target for the Standard & Poor’s 500 Index by 6.5 percent. Tumbling oil prices, tighter credit conditions and a flatter yield curve spurred Martin Adams to lower her forecast for the benchmark in the next 12 months to 2,100, down from a previous call of 2,245. Her projection still implies about a 9 percent jump from the benchmark’s current level of 1,930. “Stocks will move higher over the next 12 months, but perhaps not as robustly as we forecast in early December,” Martin Adams wrote in a research note to clients Thursday. “There is likely also a lid on multiples given deteriorating credit quality. It will thus likely be largely up to the earnings recovery to drive the index price higher.” In 2016, nine of 22 strategists tracked by Bloomberg have already lowered projections for the S&P 500.
• U.S. Consumers See Rising Unemployment Risk, New York Fed Says. U.S. consumers have become increasingly concerned over the last year about the possibility of the unemployment rate reversing its downward trend, according to new data from the Federal Reserve Bank of New York. In January, consumers on average saw a 38 percent chance that the unemployment rate would be higher in a year, up from 33 percent in December 2014 and a high of 44 percent in October 2013. The increase was mostly accounted for by respondents under the age of 40 and those with college degrees, according to data going back to mid-2013 which the New York Fed has been collecting as part of a monthly survey. It published the new data for the first time Thursday.

Wall Street Journal:

• Chinese Share Selloff Drags Down Copper. Fears for health of world’s second largest economy hit prices for base metals. Copper prices fell along with other base metals on Thursday, driven down by a selloff in Chinese equity markets. Copper futures for May delivery fell 1.2% to $2.0760 a pound at the COMEX division of CME Group. Prices were higher in London before giving back the gains.

CNBC:

• Recession sign is in play and has 81% accuracy. (video)

Zero Hedge:

• A Teachable Moment: The Young Person Complaining About Her Job At Yelp Discovers Real Minimum Wage Is $0.
• Here Is The Reason For The Sudden Buying Spree. (graph)
• Where Negative Interest Rates Will Lead Us.
• Treasury Yields Are Crashing (Again). (graph)
• Do-Over Election Looms In Spain, As Dueling Leftists Can't Decide Who's A Better Socialist. (graph)
• Why Traders Are Frustrated: "At Any Given Time There Are No Rational Explanations For What’s Going On".
• Business Is "Worst Since The 80s Recession" - Kansas City Fed Survey Crashes To 7-Year Lows. (graph)
• Is The Selling Over? An Answer In 4 Charts. (graph)
• NatGas Tumbles To 16-Year Lows. (graph)
• U.S. Unable To Halt ISIS March Towards Libyan Oil.
• Durable Goods Stage Strong January Rebound After December Collapse; CapEx Shipments Continue To Drag. (graph)
• If Initial Jobless Claims Are So Awesome, Explain This. (graph)
• The WSJ's Modest Proposal: The Bank Of Japan Should Buy Oil.

Business Insider:

• Sears(SHLD) chairman says every retailer is screwed.
• The hottest hedge fund strategy tells you everything you need to know about markets right now.
• Mitt Romney invokes Shakespeare to fire back at Donald Trump. Either he's not anywhere near as wealthy as he says he is, or he hasn't been paying the kind of taxes we would expect him to pay. Or perhaps he hasn't been giving money to the vets or the disabled, like he's been telling us he's been doing.
• A GOP congressman is pleading for Ted Cruz or Marco Rubio to drop out to stop Donald Trump. He said one of the two must drop out and join together with the other as the vice president on their ticket. "For the sake of our country, the conservative cause, and future generations, we adjure you both to unite," he wrote. "Only time will tell" whether Trump remains as conservative as his campaign rhetoric. "Accordingly, the stakes are too high to make his first public office President of the United States," he wrote.  In contrast, Franks said Cruz and Rubio both have "proven, full spectrum conservative records".
• ISIS is using a metal tool called 'the Biter' to clip the flesh of women who disobey its dress code.
• This chart shows very clearly why people are disappointed by Apple(AAPL) Watch sales.
• Volunteering in America is at its lowest level in over a decade.

Quartz:

• Donald Trump polls dead last among US Latinos. (graph) Republican presidential frontrunner Donald Trump reportedly won the Latino Republican vote in the Nevada primary, but that doesn’t mean Latinos nationwide like him much. A recent poll conducted by The Washington Post and Spanish-language broadcaster Univision shows that Trump is resoundingly unpopular among Latino voters. Though he polls second, behind Florida senator Marco Rubio, among Republican Latinos, most Latinos support Democratic candidates, leaving Trump with a net unfavorability of -64%.

The Blaze: 

• John Kerry: Terrorist Released From Guantanamo Who Rejoined Al Qaeda Is ‘Not Supposed to Be Doing That’.

Reuters:

• Brazil's Vale reports worst loss in 20 years on commodity slump. Brazilian miner Vale SA reported a fourth-quarter net loss of $8.57 billion, its worst ever as a private company, as weak commodity prices and hefty writedowns heaped further pressure on the world's largest producer of iron ore. The loss, reported early Thursday, is Vale's fifth in the past six quarters, with the company hit by a collapse in the price of its principle profit driver, iron ore, just as it entered a period of heavy investment in large projects. Falling far short of a loss of $56 million predicted by analysts in a Reuters poll, the result is Vale's worst since at least 1997 when it was privatized. It comes despite record iron ore and nickel production, highlighting treacherous market conditions.

Telegraph:

• The EU is like the Titanic, and we need to jump off before it sinks. 
• Energy price war spreads to gas as US shale storms global market, stalks Russia.