Style Outperformer:
Sector Outperformers:
- Homebuilders +5.77% 2) Gold & Silver +4.87% 3) Coal +3.89%
Stocks Rising on Unusual Volume:
- PBR, BPI, ALNY, AB, APOL, YY, CELG, ADTN, GOLD, FFIV, TOL, LEN, RIO, DHI, KBH, MAS, ACRX, ACAS, PANW and LPX
Stocks With Unusual Call Option Activity:
- 1) BPI 2) RMTI 3) GDP 4) CELG 5) NRG
Stocks With Most Positive News Mentions:
- 1) COP 2) ADTN 3) LLTC 4) ADI 5) NOC
Charts:
Evening Headlines
Bloomberg:
- BOJ Refrains From Adding to Stimulus as Recovery Signs Seen. The
Bank of Japan refrained from adding to unprecedented monetary stimulus
and raised its assessment of the economy, referring to a recovery for
the first time since before a record 2011 earthquake. Governor Haruhiko
Kuroda’s board stuck with an April pledge to expand the monetary base by
60 to 70 trillion yen ($709 billion) per year, a statement released in
Tokyo today showed. The decision was in line with the forecasts of all
20 economists surveyed by Bloomberg News. The economy is starting to
recover moderately, the central bank said. Economic gains increase the
odds of Kuroda holding fire for the rest of this year, after a Bloomberg
News survey
this week showed analysts abandoning predictions for further easing in
October.
- Australian Unemployment Rises to 2009 High in Challenge for Rudd.
Australia’s unemployment rate rose to the highest since 2009,
underscoring the challenge newly-installed Prime Minister Kevin Rudd
faces as he crafts a re-election pitch centered on economic management. The jobless rate rose to 5.7 percent in June, the highest since September 2009 and up
from a revised 5.6 percent a month earlier, the statistics bureau said
in Sydney today.
- Stocks Rally on Bernanke as Metals Soar Amid Dollar Slump.
Asian stocks, Treasuries and metals rose, while the dollar retreated
after Federal Reserve Chairman Ben S. Bernanke said the world’s biggest
economy will continue to need stimulus. The yen climbed against the
greenback as the Bank of Japan kept its bond-buying program unchanged. The MSCI Asia Pacific Index advanced 1.7 percent to 134.65 at 12:18 p.m. in Tokyo.
- Rajoy
Punishes Exporters Sustaining Spain's Economy: Euro Credit. Aliberico
SL survived Spain's economic crisis by expanding sales of aluminum
panels in the U.S., Brazil and Morocco. Prime Minister Mariano Rajoy's
plan to raise corporate taxes may undermine the company's efforts. "The
fiscal pressure is intense, Clemente Gonzalez Soler, CEO and founder of
the Madrid-based manufacturer, said in a telephone interview. "The
changes mean a loss of competitiveness for Spanish companies just at the
moment when we need to export more."
- Juncker Says His Luxembourg Government Will Resign Tomorrow.
Luxembourg Prime Minister Jean-Claude Juncker, the European Union’s
longest-serving head of government, said he’ll resign tomorrow after he
was implicated in a probe into spying by his security service. Juncker, 58, who led the group of euro-area finance
ministers until January, is stepping down after his socialist
party coalition ally called for early elections. The move came
after a July 5 report to Parliament that said Juncker is
“politically responsible” for failing to inform lawmakers of
“irregularities and supposed illegalities” by the State
Intelligence Service.
- Brazil Raises Rate to 8.5% as Inflation Undermines Growth. Brazil’s central bank raised
borrowing costs by half a percentage point for a second straight
meeting, as the fastest inflation in 20 months undermines
economic growth and fuels social unrest. The bank’s board, led by President Alexandre Tombini, today
voted unanimously to raise the benchmark Selic rate by 50 basis
points to 8.50 percent, as forecast by all 51 economists
surveyed by Bloomberg. “The committee considers that this decision will
contribute to put inflation on a decline and assure that this
trend will persist next year,” policy makers said, according to
their statement posted on the central bank’s website. The
statement was virtually identical to their May 29 communique. Rising prices helped spark the largest street protests in
decades last month that also saw President Dilma Rousseff’s
approval ratings plunge by almost half. Above-target inflation
has undercut months of government stimulus by reducing consumer
confidence and curbing retail sales and industrial output. After
a quarter-point rate increase in April, policy makers doubled
the pace in May and reiterated warnings that the outlook for
inflation remains unfavorable. “The diffusion of inflation remains widespread,” Andre Perfeito, chief economist at Gradual Investimentos, said by
phone from Sao Paulo before today’s decision. “A higher Selic
also seeks to boost credibility after the government implemented
a loose fiscal policy.”
- Rubber Rebounds From Two-Week Low as Oil’s Rally Boosts Appeal. Rubber climbed from the lowest level
in two weeks after oil in New York surged to a 15-month high,
boosting the appeal of the commodity as an alternative to synthetic products used in tires. Rubber
for delivery in December on the Tokyo Commodity Exchange advanced as
much as 2.1 percent to 239.5 yen a kilogram ($2,408 a metric ton) and
traded at 239.2 yen at 10:23 a.m.
Futures reached the lowest settlement since June 27 yesterday.
- Rebar Rises to Highest in Eight Weeks as China’s Stocks Rally. Steel reinforcement-bar futures in
Shanghai advanced to the highest in more than eight weeks after
a rally in the local stock market buoyed sentiment. Rebar for delivery in January on the Shanghai Futures
Exchange rose as much as 0.7 percent to 3,663 yuan ($597) a
metric ton. That’s the highest since May 14 for a most-active
contract. Futures traded at 3,645 yuan at 10:05 a.m. local time.
- Crude-by-Rail
Profits Fall as WTI-Brent Narrows: Energy Markets. Profits from
shipping oil by rail are shrinking as U.S. and global benchmarks
converge to the narrowest since 2010, making pipeline deliveries more
attractive and slowing the demand for train cargoes like the one that
derailed and exploded in Quebec.
Wall Street Journal:
- Weak Trade Points to China Slowing. Premier
Repeats Commitment to Avoid Fresh Stimulus Despite Falling Exports and
Cooling Growth. Chinese Premier Li Keqiang has repeated his commitment
to steer clear of stimulus for the world's second-largest economy, even
as the government reported contracting
exports, amid concern about a continuing general slowdown. Coming after a raft of disappointing data in April and May, June's
weak trade results added to fear that economic growth in the second
quarter continued to slow.
- Pig virus migrates to US, threatens pork prices. Pork prices may be on the rise in the next few months because of a new virus
that has migrated to the U.S, killing piglets in 15 states at an alarming rate
in facilities where it has been reported.
Fox News:
- Did Justice Department support anti-Zimmerman protests after Martin shooting? A conservative watchdog group accused the Justice Department of
helping manage the "pressure campaign" last year against George
Zimmerman in the wake of the Trayvon Martin shooting, citing documents
that show an obscure agency spent thousands assisting local
demonstrations. The little-known agency, the Community Relations Service, is
described by the Justice Department as their "peacemaker" for community
conflicts over race. The protests last spring over Martin's death certainly qualified as
such a conflict. But while the department claims its "peacemaker" agency
does not "take sides" in such disputes, Judicial Watch said the
documents and public accounts show otherwise.
MarketWatch.com:
CNBC:
- Sharp Jump in US Gasoline Seen Within Days. Gasoline
is expected to jump 10 to 20 cents per gallon in the next several days,
as rising oil prices and peak driving season create a perfect storm for
higher prices.
- Don't Rely on Business Investment to Spur Recovery. Capital expenditure across the world is expected to decline this year
and next, according to a new report by rating agency Standard &
Poor's (S&P), which warned that hopes of it driving an economic
recovery were unfounded.
Zero Hedge:
Business Insider:
New York Times:
- Diverging Debate at Fed on When to End Stimulus. The Federal Reserve Chairman, Ben S. Bernanke, said on Wednesday that
the Fed was likely to extend the centerpiece of its campaign to bolster
the economy — keeping short-term interest rates close to zero — even as
it prepares to wind down another key stimulus program that faces
mounting internal opposition.
Real Clear Markets:
Reuters:
- Ackman may struggle to raise $1 billion in less than 10 days. Hedge fund
manager William Ackman's strong returns have made him into one of Wall
Street's biggest managers, but even he may struggle to raise $1 billion
in the next week for a single stock fund whose target he won't identify, say investors.
One of his clients, the Public Employees Retirement Association of New
Mexico, which first invested with Ackman's Pershing Square Capital
Management in 2010, has already said it will take a pass on the new
special investment vehicle, unwilling to hand over so much cash for such
a long
time.
Financial Times:
- US banks to shuffle assets over leverage rules. US
banks believe they will be able to meet a new regulatory requirement on
debt levels by shuffling assets between their subsidiaries and using
other “optimisation” strategies to reduce the amount of leverage they
report. “We’re going to be able to pull a lot of levers,” said an
executive at a large US bank on Wednesday, a day after bank regulators
proposed a new “leverage ratio” to limit the industry’s reliance on
debt.
- Senator raises US food security fears in Smithfield(SFD) deal. The
largest-ever Chinese takeover of a US company came under scrutiny in
Washington after a group of bipartisan lawmakers said Shuanghui’s
proposed $4.7bn purchase of Smithfield, the pork producer, raised
unsettling questions about American food security and economic fairness.
“Smithfield might be the first acquisition of a major food and
agricultural company, but I doubt it will be the last,” Debbie Stabenow,
the
Democratic senator from Michigan who heads the powerful agriculture
committee, said before the hearing.
Telegraph:
- The wheels are coming off the whole of southern Europe. Europe’s debt-crisis strategy is near collapse. The long-awaited recovery has
failed to take wing. Debt ratios across southern Europe are rising at an
accelerating pace. Political consent for extreme austerity is breaking down
in almost every EMU crisis state. And now the US Federal Reserve has
inflicted a full-blown credit shock for good measure.
WantChinaTimes:
- Shopping malls glut in China might create real estate bubble. "Compared with the residential market, the commercial real-estate
market is more likely to face bubbles," a vice chairman of a Hong
Kong-listed real-estate firm told the China Business News. According to real-estate services company DTZ, the total floor area
for new shopping malls slated to open in Shanghai during the second half
of this year will reach 2.49 million square meters. In comparison, the
total floor area of retail property transactions from the year 2000 to
June 2013 was pegged at 10.9 million square meters. As of 2011, there were 2,812 shopping malls in China. By 2015, the
number will grow to 4,000, according to the China Chain Store and
Franchise Association.
Evening Recommendations
Susquehanna:
- Rated (TRIP) Negative, target $50
- Rated (PCLN) Positive, target $1,080.
- Rated (GOOG) Positive, target $1,090.
- Rated (LNKD) Positive, target $232.
- Rated (P) Positive, target $25.
- Rated (AMZN) Positive, target $370.
Night Trading
- Asian equity indices are +.5% to +2.0% on average.
- Asia Ex-Japan Investment Grade CDS Index 156.50 +4.0 basis points.
- Asia Pacific Sovereign CDS Index 118.75 +4.75 basis points.
- NASDAQ 100 futures +.95%.
Morning Preview Links
Earnings of Note
Company/Estimate
Economic Releases
8:30 am EST
- The Import Price Index for June is estimated unch. versus a -.6% decline in May.
- Initial Jobless Claims are estimated to fall to 340K versus 343K the prior week.
- Continuing Claims are estimated to rise to 2955K versus 2933K prior.
2:00 pm EST
- The Monthly Budget Statement for June is estimated at $115.0B versus -$59.7B in May.
Upcoming Splits
Other Potential Market Movers
- The Fed's Tarullo speaking, BoJ decision/Kuroda press conference, USDA Crop report, weekly EIA natural gas inventory report, Bloomberg US Economic Survey for July and the weekly Bloomberg Consumer Comfort Index could also impact trading today.
BOTTOM LINE: Asian indices are mostly higher, boosted by commodity and real estate shares in the region. I expect US stocks to open higher and to maintain gains into the afternoon. The Portfolio is 50% net long heading into the day.
Broad Equity Market Tone:
- Advance/Decline Line: Slightly Higher
- Sector Performance: Mixed
- Market Leading Stocks: Underperforming
Equity Investor Angst:
- Volatility(VIX) 14.39 +.28%
- Euro/Yen Carry Return Index 134.66 -.11%
- Emerging Markets Currency Volatility(VXY) 10.57 +.09%
- S&P 500 Implied Correlation 51.73 +1.85%
- ISE Sentiment Index 67.0 -32.32%
Credit Investor Angst:
- North American Investment Grade CDS Index 82.15 +.52%
- European Financial Sector CDS Index 157.97 +2.69%
- Western Europe Sovereign Debt CDS Index 96.0 +1.05%
- Emerging Market CDS Index 337.67 +4.07%
- 2-Year Swap Spread 17.0 unch.
- 3-Month EUR/USD Cross-Currency Basis Swap -9.75 unch.
Economic Gauges:
- 3-Month T-Bill Yield .03% -1 bp
- China Import Iron Ore Spot $123.90/Metric Tonne +.16%
- Citi US Economic Surprise Index -10.20 +1.8 points
- Citi Emerging Markets Economic Surprise Index -33.70 -3.5 points
- 10-Year TIPS Spread 2.05 unch.
Overseas Futures:
- Nikkei Futures: Indicating -25 open in Japan
- DAX Futures: Indicating -10 open in Germany
Portfolio:
- Slightly Higher: On gains in my tech and biotech sector longs
- Disclosed Trades: Added to my (IWM)/(QQQ) hedge
- Market Exposure: Moved to 25% Net Long
Bloomberg:
- Junk Sales Halt as Morgan Stanley(MS) Recommends Hedge: China
Credit. The risk of a hard landing in China's economy has caused the
longest drought in dollar-denominated junk bond sales in a year and
encouraged Morgan Stanley to recommend buying credit-default protection.
Amid the nation's worst cash crunch on record, no Chinese
speculative-grade companies have marketed dollar notes since Central
China Real Estate Ltd. raised $400 million selling five-year securities
on May 22, according to Bloomberg. That is the longest stretch since the
market went quiet for 95 days through July 24 last year amid economic
concerns, according to Bloomberg. "The export data is another sign of a
slowdown in domestic demand," Nishant Sood, a Hong-Kong-based credit
strategist at Morgan Stanley said in a phone interview. Slowing orders
and falling producer prices "increase the risk of a bear-case outcome in
China and makes the case for a less optimistic view on Chinese credit."
- China Seen Widening Car-Purchase Limit to Fight Pollution. China, the biggest emitter of greenhouse gases, plans to widen the number of cities curbing auto purchases to fight pollution and congestion, threatening
vehicle sales, the government-backed car association said. Eight cities -- Chengdu, Chongqing, Hangzhou, Qingdao,
Shenzhen, Shijiazhuang, Tianjin and Wuhan -- will probably
introduce measures limiting auto purchases, Shi Jianhua, deputy
secretary general of the China Association of Automobile
Manufacturers, said in a briefing in Beijing today, without
being more specific about the timing.
- Italy’s Industrial Output Rises Less Than Forecast in May.
Italian industrial output rose less than expected in May, indicating
the country is struggling to emerge from its longest recession in more
than two decades. Production rose 0.1 percent from April, when it
fell 0.3 percent, national statistics office Istat said in Rome today.
Economists had forecast output to rise 0.3 percent, according to
the median of 11 estimates in a Bloomberg News survey.
- Italian, Spanish Bonds Fall After S&P Cuts Italy’s Credit Rating. Italian government bonds declined
for a second day after Standard & Poor’s cut the nation’s credit
rating, citing a weakening of the country’s economic prospects. The nation’s 10-year yield climbed the most in a week as
the New York-based rating company also referred to the nation’s
impaired financial system in its assessment released late
yesterday. Spanish 10-year bonds dropped for a fourth day, the
longest run of declines in almost two months. Italy’s cost of
borrowing for one year rose as it sold 9.5 billion euros ($12.2
billion) of bills due in 367 and 160 days. Germany auctioned
two-year notes. “It’s quite normal that when you get news like that it
puts immediate pressure on the market,” said Allan von Mehren,
chief analyst at Danske Bank A/S (DANSKE) in Copenhagen. “The rating
action reflects an overall picture, that things are still
looking weak.”
- Italy’s Baretta Says Budget Crunch May Require More From Rich.
Italian Finance Undersecretary Pier Paolo Baretta said the government
is considering shifting the tax burden to the wealthy in order to
satisfy demands for broad-based fiscal easing and meet its 2013 deficit
target. “The truth is we’ve got a real bottleneck of issues to deal
with” this year, Baretta said yesterday in an interview in his office in
Rome. In order to raise funds, Italy is seeking spending cuts and may
limit the tax deductions higher-income households take on medical visits
and other expenses, he said.
- OPEC Sees U.S. Shale Boom Eroding Demand for 2014 Crude. The Organization of Petroleum Exporting Countries forecast
the world will need less of its crude next year, even as global oil
demand growth rebounds to its strongest pace since 2010, amid competing
supply sources. Demand for OPEC’s crude will slip by 300,000
barrels a day next year to 29.6 million a day next year, or about 2.6
percent less than the 12-member group is pumping now, the organization
said in its first set of forecasts for 2014. The need for OPEC’s crude
will diminish even as global oil demand growth recovers to 1 million
barrels a day in 2014, from 800,000 a day this year, amid rising output
in the U.S. (DOETCRUD) and Canada. “The strong growth trend seen
in 2013 is expected to continue in 2014” for production from outside
OPEC, the organization’s Vienna-based secretariat said in its monthly
market report today.
- WTI Oil Surges to 15-Month High on U.S. Supply Decline. West Texas Intermediate crude rose
to a 15-month high after U.S. supplies tumbled for a second week
as refinery operating rates gained, boosting speculation that a
glut in the central part of the country is dissipating. Futures
climbed as much as 3 percent after the Energy
Information Administration said inventories dropped 9.87 million barrels
to 373.9 million, three times more than was forecast by analysts
surveyed by Bloomberg. Stockpiles at Cushing, Oklahoma, the delivery
point for WTI, fell the most since 2009 as refinery utilization
increased to the highest level this year. WTI has moved into
backwardation, with futures closest to expiration
becoming more expensive than those for later delivery.
- Gold Heads for Longest Rally in Two Months on Physical Purchases. Gold climbed for the third session,
heading for the longest rally since late April, as physical
purchases rose and the dollar’s decline increased demand for the
metal as an alternative investment. The dollar fell as much as 0.4 percent against a basket of
six major currencies, after reaching the highest since July 2010
yesterday.
- U.S. Banks Seen Freezing Payouts as Harsher Rules Loom. The biggest U.S. banks, after years of building equity, may
continue hoarding profits instead of boosting dividends as they face stricter capital rules than foreign competitors.
The eight largest firms, including JPMorgan Chase & Co.
(JPM:US) and Morgan Stanley (MS:US), would need to retain capital equal
to at least 5 percent of assets, while their banking units would have to
hold a minimum of 6 percent, U.S. regulators proposed yesterday. The
international equivalent,
ignoring the riskiness of assets, is 3 percent. The banks have until
2018 to fully comply. The U.S. plan goes beyond rules approved by
the Basel Committee on Banking Supervision to prevent a repeat of the
2008 crisis, which almost destroyed the financial system. The changes
would make lenders fund more assets with capital that can absorb losses
instead of using borrowed money. Bankers say this could trigger asset
sales and hurt their ability to lend, hamstringing the nation’s economic
recovery.
Wall Street Journal:
- Key Passages From Fed Minutes. A number of Fed officials wanted to end the central bank’s $85 billion per month bond-buying program late this year ….
- China’s Very Real Slowdown, Out in the Open. China’s
economy is slowing down. China reported that both exports and imports
fell in June, something that hadn’t happened since October 2009 during
the depths of the global recession.
Fox News:
- Egypt orders arrest of Muslim Brotherhood leader as group rejects cabinet offer. Egypt ordered the arrest of the Muslim Brotherhood's spiritual leader
and nine others for allegedly instigating violent clashes with the
military this week that left more than 50 Brotherhood supporters dead,
hours after the group rejected a plan to be part of the government's new
cabinet. The general prosecutor's office said in a statement Wednesday that it
issued arrest warrants for the general guide of the Muslim Brotherhood,
Mohammed Badie, as well as his deputy and strongman, Mahmoud Ezzat.
Eight other leading Islamists also were ordered to be taken into
custody. The prosecutor's office says the Islamist leaders are suspected of
inciting the violence outside the Republican Guard building in Cairo on
Monday that left 54 people dead.
CNBC:
- Fed Minutes: Some Participants Felt Fed Will Need to Explain QE Exit Relatively Soon. Federal Reserve officials expressed concern about how
well the
central bank was conveying its policy intentions to a jittery investing
public, according to minutes from the most recent meeting. The
June FOMC session was significant in that Chairman Ben Bernanke followed
it by telling the media that the Fed was prepared to start winding down
its bond-buying program by the end of 2013. The minutes indicated a clear concern from committee members, who
gave marching orders to Bernanke about what to say at the media
gathering. "At the conclusion of the discussion, most
participants thought that the Chairman, during his postmeeting press
conference, should describe a likely path for asset purchases in coming
quarters that was conditional on economic outcomes broadly in line with
the Committee's expectations," the minutes said. "In addition,
he would make clear that decisions about asset purchases and other
policy tools would continue to be dependent on the Committee's ongoing
assessment of the economic outlook." "A few stated their view that a prolonged period of low interest rates
would encourage investors to take on excessive credit or interest rate
risk and would distort some asset prices," the minutes said. "However,
others suggested that the recent rise in rates might have reduced such
incentives."
- Dire Predictions For Housing Recovery. (video) The housing recovery is in for a major pause due to higher mortgage
rates. It is not in the numbers now, and it won't be for a few months,
but it is coming, according to one noted analyst. The market has seen
rising rates before, but never so far so fast; there is no precedent for
a 45 percent spike in just six weeks. The spike is causing a sense of
urgency now, a rush to buy before rates go higher, but that will be
short term. Home sales and home prices will both come down if rates
don't return to their lows, and the expectation is that they will not. Where is the proof of this? We only need look to the $8,000 home buyer
tax credit that expired in 2010. The falloff was dramatic.
Zero Hedge:
Business Insider:
New York Times:
- Greek Unions Call Strike to Protest Cuts. Greek unions stepped up their opposition Wednesday to a new round of
austerity measures promised to the country’s foreign creditors, calling a
24-hour general strike for Tuesday while local government employees
occupied city buildings to protest plans for wage cuts and layoffs.
@RonnieSpence:
Reuters:
- Brazil's real hits weakest level since April 2009. The Brazilian real added
to losses on Wednesday afternoon, hitting its weakest level in
over four years, as investors feared the U.S. Federal Reserve
could signal later in the day that it is about to cut back on
its stimulus program.
The real lost 0.7 percent to
2.2781 per dollar, its weakest level since the beginning of April, 2009.
Investors fear that the withdrawal of U.S. stimulus may reduce the flow of dollars to emerging-market countries such as Brazil.
- U.S. wholesale inventories fall, likely drag on GDP growth. U.S. wholesale inventories
fell in May by the most in a year and a half, the second
straight monthly decline and a sign that restocking by
businesses could weigh against economic growth in the second
quarter. The Commerce Department said on Wednesday wholesale
inventories dropped 0.5 percent during the month, confounding
the expectations of analysts polled by Reuters, who expected an
increase.
- Brazil set for another steep interest rate rise to tame prices. Brazil
is expected to raise its benchmark interest rate by another 50 basis
points on Wednesday, maintaining the pace of monetary tightening to
prevent high inflation from hampering a slow-moving economic recovery. The Brazilian central bank, one of the first in the world to
tighten monetary policy, has raised its Selic rate
twice since April to 8 percent to battle high inflation that has
curbed consumption and industrial output.
The Tennessean:
CNN:
- Hedge funds can now advertise.
What it really means. The Securities and Exchange Commission today
voted 4-1 to end a
decades-old ban on "general solicitation" by many private issuers,
including hedge funds, private equity funds and start-up companies. The
recommendation to do so first appeared in the JOBS Act, a piece
of bi-partisan capital markets legislation that became law in March
2012. In short, this means that all sorts of private issuers soon will be
able to publicly discuss and advertise investment opportunities. They
also can do things like publicize past performance, which previously had
been prohibited.
Financial Times:
- Portugal’s political turmoil risks debt restructure. Portugal’s
government almost disintegrated last week but has now managed to shore
up its support, bringing some calm to the country’s bond market. But the
political chaos could still have far-reaching implications. Its
chances of regaining full market access now look much slimmer. That
means the country will need more money from its troika of international
lenders. But that could lead to a debt restructuring – potentially
upsetting the tentative peace that the
European Central Bank has brought to the continent’s bond markets.
Telegraph:
Echoing fears that
European policymakers remain in a state of cognitive dissonance –
recognizing the need for root-and-branch overhaul of peripheral banks,
but backtracking on joint liability plans – Christopher Flowers, the
legendary FIG investor who now runs the £2.3 billion ($3.5 billion)
private equity group JC Flowers, sounded the alarm over the negative
sovereign-bank feedback loop.
In a shot across the bows of market bulls, who cite the return of
capital flows to weaker eurozone states, Flowers issued a stark warning:
"There is a scenario where we have a Lehman-type event: we wake up some
Thursday and a big country is in trouble.
"And the ECB will have to decide to support banks x, y, z. And then the
ECB will, in fact, decide to own bank x, y, z.
While we want you to share, we ask you use the functions on-site rather than copy/paste. See T's & C's for details. http://www.euromoney.com/Article/3211790/CurrentIssue/88924/Restructuring-Flowers-slams-Europe-over-inaction.html?copyrightInfo=true
China National Radio:
- China Premier Says 2H Economic Situation Complicated. China
Premier Li Keqiang made comment on 2H economic situation after hearing
feedback from small companies during visit to the southern Chinese
province of Guangxi.
Xinhua:
- China Sets Timetable for Local Govt to Disclose Spending. China's
State Council issued timetable today for local governments to disclose
information on receptions, vehicles and overseas trips spending, citing a
State Council plan. Provincial governments should disclose their
spending on receptions, vehicles and overseas trips starting from 2013,
citing the plan. The municipal- and county-level governments should
strive to disclose similar information by 2015, according to the report.
State Council also identified nine categories of information that
should be disclosed to improve government transparency, including
subsidized housing, food and drug safety, environmental protection, land
appropriation and demolition, the report said.
Style Underperformer:
Sector Underperformers:
- 1) Coal -1.82% 2) Banks -1.51% 3) Homebuilders -.93%
Stocks Falling on Unusual Volume:
- ALJ, EVC, BAP, CRZO, HBAN, WFC, FMX, IMMU, TWTC, KYN, ADTN, FLY,
BRLI, PRAA, BTI, RAX, IPCM, FAST, NBR, GMCR, PNRA, OPEN, ALDW, P, CIB, AWAY, PRFT, YELP, NLSN, ZOLT, GMT, SXT and POT
Stocks With Unusual Put Option Activity:
- 1) MDY 2) FITB 3) KRE 4) INTC 5) AMAT
Stocks With Most Negative News Mentions:
- 1) NBR 2) CB 3) NSC 4) PNC 5) FAST
Charts:
Style Outperformer:
Sector Outperformers:
- Biotech +.54% 2) Drugs +.50% 3) Computer Services +.45%
Stocks Rising on Unusual Volume:
- PCYC, NIHD, EROC, PERI, NUS, FDO, MDRX, CTRP and AMAT
Stocks With Unusual Call Option Activity:
- 1) YELP 2) ADT 3) TAP 4)PEP 5) ISRG
Stocks With Most Positive News Mentions:
- 1) NOC 2) CXW 3) BEAT 4) FDO 5) PSX
Charts:
