Today's Headlines

Bloomberg:

• Ukraine Truce Shudders as PM Warns of Possible ‘Default’. Pro-Russian rebels killed three Ukrainian soldiers, jolting a two-day-old truce in the nation’s east as Prime Minister Arseniy Yatsenyuk called for an international donor conference to avoid a possible “default.” The casualties follow Ukraine’s Dec. 9 decision to halt hostilities in an attempt to start new talks with insurgents its it’s fighting in the Donetsk and Luhansk regions. Ukraine needs to expand a $17 billion international bailout program that’s keeping its economy afloat after bonds fell to a record, Economy Minister Aivaras Abromavicius said yesterday, adding it’s too early to say how much more aid Ukraine requires.

• Ruble Touches Record Low as Interest-Rate Rise Seen Inadequate. The ruble touched a record low and government debt rallied as the central bank steered clear of an aggressive rate increase to avoid driving the economy into recession. The Russian currency lost as much as 1.4 percent to 55.5955 per dollar before trading 1.3 percent weaker at 5:13 p.m. in Moscow. The Micex Index (INDEXCF) of equities slid 2.2 percent, while the dollar-denominated RTS Index dropped 3.5 percent. Yields on 10-year government bonds, known as OFZs, dropped 29 basis points to 12.42 percent.
• Greek Stock Rout Means ASE Index Is 2014 Worst After Russia. Anxiety that voters will kick out leaders committed to Greece’s bailout wreaked havoc on markets for a third day, extending losses in stocks to 20 percent and making them this year’s worst performers behind Russia. The ASE Index (ASE) dropped 7.4 percent to 827.98 today, its lowest level since July 2013. That’s brought its loss for the year to 29 percent. Only Russia’s RTS Index did worse, with a 43 percent slump. The rout also spread to Greek bonds, with rates on three- and five-year notes jumping to the highest level since the nation restructured its debt in 2012. 

• Blankfein Says ‘I Don’t Know’ If China Manipulates Economic Data. Lloyd Blankfein said he isn’t sure he can trust China’s official economic data. “I don’t know; how do I know?” the Goldman Sachs Group Inc. chief executive officer said today when asked at a DealBook conference in New York if he thinks China manipulates government statistics. “I’m not taking it that they are.” 

• Gulf Shares Plunge After OPEC as Dubai Declines Most Since 2008. Dubai stocks dropped the most since October 2008 and equity markets across the oil-producing Gulf Cooperation Council tumbled after OPEC reduced its estimate for crude demand in 2015. The DFM General Index (DFMGI) slumped 7.4 percent to the weakest since Jan. 15 at the close. In neighboring Abu Dhabi, home to almost 6 percent of the world’s proven oil reserves, the ADX General Index fell 4.7 percent, the most since November 2009. Oman’s MSM 30 Index lost 4.2 percent, becoming the third GCC gauge to enter a bear market in two weeks. Qatar’s QE Index slid 4.3 percent and Saudi Arabia’s Tadawul All Share Index retreated 0.2 percent.

• European Stocks Are Little Changed as Greece’s ASE Index Slides. European stocks were little changed, after swinging between gains and losses, as U.S. data showed the world’s biggest economy is strengthening. Greek shares slid a third day, sending the ASE Index down 20 percent this week. The Stoxx Europe 600 Index lost less than 0.1 percent to 339.31 at the close of trading, having fallen as much as 0.8 percent and gained as much as 0.3 percent.

• WTI Oil Drops Below $60 After Saudis Question Need to Cut. WTI for January delivery dropped as much as $1.09 to $59.85 a barrel at 2:19 p.m. on the New York Mercantile Exchange. Total volume was 14 percent above the 100-day average for the time of day. The U.S. benchmark is down 38 percent this year.

• Fed Bubble Bursts in $550 Billion of Energy Debt: Credit Markets. The danger of stimulus-induced bubbles is starting to play out in the market for energy-company debt. Since early 2010, energy producers have raised $550 billion of new bonds and loans as the Federal Reserve held borrowing costs near zero, according to Deutsche Bank AG. With oil prices plunging, investors are questioning the ability of some issuers to meet their debt obligations. Research firm CreditSights Inc. predicts the default rate for energy junk bonds will double to eight percent next year. “Anything that becomes a mania -- it ends badly,” said Tim Gramatovich, who helps manage more than $800 million as chief investment officer of Santa Barbara, California-based Peritus Asset Management. “And this is a mania.” 

• Stock Traders Ignoring the Message From Junk Bond Traders. Perhaps 2014 will go down in history as the year that junk bonds sent a warning signal as oil plummeted and stocks just kept rallying. Prices on high-yield bonds have declined 2.4 percent this month and 5.7 percent since the end of August, even as U.S. equities have climbed to new highs. The dollar-denominated debt is now yielding the most relative to a comparable measure on the Standard & Poor’s 500 index since 2011. The divergence may signal junk-bond traders are picking up on a fundamental problem of overvalued energy companies in frothy markets fueled by six years of record Federal Reserve stimulus -- and that stock investors should pay attention. While falling oil prices mean consumers have extra cash to deploy elsewhere, boosting the economy, the price plunge may also crimp the capital spending by energy companies that has been a driver of growth in recent years.

ZeroHedge:

• Russell Napier: This Has Never Happened Before Without A Drop In Stock Prices. (graph)

• 3 Things Worth Thinking About. (graph)

• A Gentle "Deja Vu" Reminder For Today's Energy Stock Traders. (graph)

• After 11 Quarters In A Row, US Households See Net Worth Tumble $141 Billion In Q3. (graph)

• How Wal-Mart(WMT) Fabricated And Lied About Its "Strong" Chinese Sales For Years.

• Continuing Claims Surge To 4Mo. Highs, Biggest Spike Since Lehman. (graph)

• US Imports Most Deflation From Japan Since 2010. (graph)

• Car-Buying Surge Sparks Best Retail Sales Rise Since April. (graph)

• Greek Stocks Crash, Default Risk Spikes After PM GREXIT Comments. (graph)

• Norway Central Bank, Slammed By Oil Plunge, Warns Of "Severe Downturn", Unexpectedly Cuts Rates. (graph)

ArmyTimes:

• U.S. readying military, economic options to Russian missile treaty violation. Pentagon and State Department officials are reviewing what military and economic options they can employ if Russia continues development of a cruise missile it has tested in violation of a cornerstone nuclear weapons treaty between Washington and Moscow, senior U.S. officials say.

iMFdirect:

• Managing House Price Booms in Emerging Markets. Is this steady increase in housing prices a cause of worry? History teaches us to be wary when house price surges are accompanied by booms in the availability of credit. Such ‘twin booms’ in house prices and credit are more likely to end in busts, and the recovery from those busts is slower and more costly in terms of lost income.

Telegraph: 

• Opec veteran says oil price a 'disaster' and cartel powerless. Senior adviser to Qatar's emir and former Opec president tells the Telegraph the global oil market is now over-supplied by as much as 2m barrels per day of crude.

Bear Radar

Style Underperformer:

• Mid-Cap Value +.85%

Sector Underperformers:

• 1) Steel -1.64% 2) Gold & Silver -1.47% 3) Construction -.30%

Stocks Falling on Unusual Volume:

• CLDN, BFAM, OXM, MEI, FGP, CMTL, RMT, JMEI, XLRN, NLSN, ARMK, SSL, NOAH, ZSPH, ABY, CIB, KPTI, IOC, KOF, BTI, TCK, RVT, SAVE, BAP, GPRO, JONE and TCO

Stocks With Unusual Put Option Activity:

• 1) EMR 2) DLTR 3) PSX 4) SD 5) COH

Stocks With Most Negative News Mentions:

• 1) UTHR 2) OI 3) FCX 4) MAC 5) CONN
  

Charts:

• ETFs Falling on Unusual Volume

• Stocks Falling on Unusual Volume

Bull Radar

Style Outperformer:

• Small-Cap Growth +1.39%

Sector Outperformers:

• 1) Retail +2.51% 2) Oil Service +2.29% 3) Networking +2.05%
  

Stocks Rising on Unusual Volume:

• SPLS, LULU, RH, ABCO, MRH, CIEN, ATLS, BLUE, TGTX, SGMO, URBN, ATHN, AGIO, LLY, WAG and AWI

Stocks With Unusual Call Option Activity:

• 1) RH 2) EBAY 3) INVN 4) WLL 5) WAG
  

Stocks With Most Positive News Mentions:

• 1) MYL 2) COP 3) URBN 4) COST 5) LLY
  

Charts:

• ETFs Rising on Unusual Volume 

• Stocks Rising on Unusual Volume

Thursday Watch

Evening Headlines 
Bloomberg: 

• Ukraine Seeks Bigger IMF Package as Bonds Slump to Record. Ukraine said it needs an expansion of a bailout program that’s keeping its economy afloat as bonds fell to a record and government forces continued to come under attack from pro-Russian separatists in the east. Economy Minister Aivaras Abromavicius said yesterday it’s too early to say how much more aid Ukraine requires. The country may need to almost double its $17 billion emergency loan “within weeks” to avoid bankruptcy, the Financial Times reported, citing unidentified officials. Representatives from the International Monetary Fund arrived in Kiev this week to discuss further payments under the existing program and a possible expansion. Concerns are growing that the government in Kiev will be unable to repay its debts as the months-long fighting in two breakaway regions takes its toll on Ukraine’s economy. 

• Putin’s Friends Reap Billions in Deals as Economy Teeters. The new prize from the Kremlin arrived in eastern Siberia. On the plains near the city of Yakutsk, trumpets sounded as President Vladimir Putin signed his name in white ink on a stretch of black pipeline, the symbolic starting point of a $400 billion natural gas link to the Far East. It was little more than show.

• Russians Fall Behind on Dollar Loans After Ruble Plunge. Anatoly Ivanov, a 39-year-old software engineer who lives in a 53 square-meter (570 square-foot) St. Petersburg apartment with his wife and child, said he feels boxed in. The ruble’s collapse this year has caused a headache for Anatoly, who bought his Soviet-era home with a dollar mortgage in 2008 from Absolut Bank OAO. At the time, a dollar was 23 rubles and the interest rate on the mortgage was 4 percentage points lower than on loans in rubles. Yesterday, the rate was about 55 to the dollar, and Ivanov is considering paying a penalty to switch the mortgage into rubles. “Our $800 monthly payment has jumped to 38,000 rubles from 26,000 rubles since the start of the year,” Ivanov, who is paid in rubles, said by phone. “If my wife didn’t work, it would be difficult to make the increase in repayments.”

• Bank of Korea Holds Rate Even as Weak Yen Threatens Recovery. The Bank of Korea kept its benchmark rate unchanged for a second month, opting to gauge the impact of recent cuts on an economy that faces headwinds from a weak Japanese yen. The central bank held the seven-day repurchase rate at a four-year low of 2 percent, it said in Seoul today, after cuts in August and October. The decision was forecast by 17 of 20 analysts surveyed by Bloomberg News, while the rest predicted a reduction to a record low of 1.75 percent. 

• Europe IPOs Shunned as Skeptics Seek Stability: Chart of the Day.

• Asia Stocks, Ringgit Drop After S&P 500 Falls; Bonds Gain. Asian stocks dropped and Malaysia’s ringgit weakened after oil’s collapse to a five-year low triggered the biggest loss for U.S. stocks since October. Sovereign bonds followed Treasuries higher as Asian credit risk climbed to a three-week high. The MSCI Asia Pacific Index fell 0.3 percent by 11:01 a.m. in Tokyo, heading for a seven-week low as benchmark gauges in Tokyo and Hong Kong fell more than 0.7 percent.

• Oil-Driven Junk-Bond Selloff Spreads as Risk Gauge Climbs. The rout in junk bonds driven by tumbling oil prices is getting worse as one of the high-yield market’s largest sector weighs on other industries. The risk premium on the Markit CDX North American High Yield Index, a credit-default swaps index tied to the debt of 100 speculative-grade companies, jumped by the most in two months. BlackRock Inc.’s $13.8 billion exchange-traded fund that buys high-yield debt slid to the lowest level in more than two years. The Markit high-yield gauge rose as much as 20.2 basis points to 375.9 basis points, the biggest surge since Oct. 9. The index typically rises as investor confidence deteriorates and falls as it improves. A basis point is 0.01 percentage point. BlackRock’s iShares iBoxx High Yield Corporate Bond ETF, the largest fund of its kind, dropped 1.2 percent to $88.77, the lowest level since June 2012. The extra yield investors demand to own energy-company bonds instead of Treasuries has jumped to 942 basis points, up from less than 450 basis points in September, according to data compiled by Bloomberg.

• Oil Plunge Rips Through Markets as Investors Seek Bottom. Oil’s collapse is rippling through financial markets, broadening a selloff in stocks beyond energy companies and leaving investors with few havens as assets from metals to corporate debt sink. Brent crude fell below $65 for the first time since 2009 as OPEC cut its forecast for 2015 demand, raising concern over the strength of the global economy and leaving investors contemplating when oil’s plunge will reach a bottom.

• Roubini Global Predicts Sub-$60 Iron Ore Amid Massive Surplus. Iron ore may drop to less than $60 a metric ton next year as the largest mining companies press on with raising supply, deepening a glut just as demand growth in China falters, according to Roubini Global Economics LLC. The commodity will average $65 a ton in 2015, with weaker prices in the first half before a recovery as some higher-cost capacity is closed, Director of Commodities Helen Henton said in an interview. While producers won’t fare well in an environment of falling prices, it does make sense for low-cost suppliers to keep expanding in the expectation that less-competitive mines will be shuttered, she said.

Wall Street Journal:

• Hong Kong Police Begin Clearing Main Protest Site in Admiralty. Demonstrators Give Little Resistance to Authorities. Authorities met little resistance as they began clearing the main Hong Kong protest site Thursday, effectively ending an occupation that has stretched out over more than 10 weeks. Crowds thinned at the site before the action began around 10:30 a.m., and those who stayed said they would likely allow themselves to be arrested peacefully. The situation was in contrast to violent confrontations that occurred two weeks ago when police cleared another protest site and more recently, when protesters tried to expand the main site only to be beaten back by police.

• Brazil Indicts Executives in Petrobras(PBR) Case. Charges Stem From Allegations That Several Companies Formed a Cartel to Drive Up the Value of Contracts With Petrobras.

• Senate Democrats and 9/11 Amnesia. The Intelligence Committee’s report on CIA interrogations fails to acknowledge the Pearl Harbor-esque emergency following the terror attack. 

Fox News:

• Fox News Poll: 81 percent expect ISIS attack on US, majority says keep Gitmo open. A majority of American voters want any ISIS terrorist captured by the United States sent to Guantanamo Bay rather than a federal prison.  That’s a key finding of the latest Fox News poll, as President Obama wants to close Gitmo amid widespread fears ISIS will try to strike the homeland soon. A large 81-percent majority expects the Islamic extremist group ISIS to attempt a U.S. attack in the near future, including 48 percent who think it is “very” likely, according to the poll released Wednesday.

• Cheney defends CIA interrogation techniques, calls Senate report 'deeply flawed'. (video)

MarketWatch.com:

• Restoration Hardware(RH) profit more than doubles. Restoration Hardware Holdings Inc.'s profit more than doubled as sales growth accelerated in the third quarter, topping Wall Street's view. The Corte Madera, Calif., retailer of luxury home goods raised its financial projections for the year that ends Jan. 31, saying it expects to record its fifth consecutive year of net revenue growth above 20%. Shares rose 5% to $90.83 in recent after-hours trading.

• Oil’s slide means these companies need to slash budgets.

CNBC: 

• Massive security flaw in Alibaba(BABA) marketplace. A major security flaw in an Alibaba marketplace exposed millions to hackers, according to an Israeli research firm. 

Zero Hedge: 

• "Some Market Folks Are Turmoiling..." As 6th Hindenburg Omen Spotted. (graph)

• About That $40 Billion Uber-Valuation: Mapping Where Uber Has Been Banned Around The World.

• Deflation Is Winning (And Central Banks Are Running Scared). (graph)

• Name That Chart? Oil Supply Or Demand Edition. (graph)

• Venezuela Default Probability Has Never Been Higher; Maduro "Working To Raise Oil Prices". (graph)

• It's Different This Time... Rig-Count Edition. (graph)

• FX Traders Are "Fighting The PBOC" As Yuan Tumbles. (graph)

• Pimping Passports For Chinese Capital: America's Ingenious Ploy To Raise CapEx From China's Oligrachs.

Business Insider:

• REPORT: eBay Will Cut Thousands Of Jobs Early Next Year.

• MAULDIN: 2015 Is When Macroeconomics Gets Interesting.

• The BRICs Are Fizzling Out.

• The Oil Crash Has Done Nothing To Slow The American Shale Boom.

Reuters:

• Japan bears bet on Abe victory followed by yen disaster. An election sweep for Japanese Prime Minister Shinzo Abe this weekend looks like a safe bet, but some are betting that the consequences for Japan could be calamitous - a collapse in the yen and uncontrolled inflation.The continuation of 'Abenomics', a programme of money printing and debt-funded spending to lift Japan from two decades of deflation and stagnation, is, they say, not j ust failing, but heading for disaster. "The endgame of this could be an inflationary depression," said Arne Espe, vice president of mutual fund portfolios at USAA in San Antonio, Texas.

• U.S.-based stock funds post $2.7 bln outflows in latest week - ICI.

• U.S. OK's more commercial drone use as Congress probes risks. The U.S. Federal Aviation Administration on Wednesday granted four more companies exemptions to use drones commercially, further opening the airspace to unmanned aircraft even as lawmakers raised questions about the risks.

Telegraph:

• Greek candidate willing to call European leaders’ bluff. Alexis Tsipras told Greek voters as recently as last week that his government would cease to enforce the bail-out demands.

Evening Recommendations 

• None of note

Night Trading

• Asian equity indices are -1.25% to -.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 106.0 +1.25 basis points.

• Asia Pacific Sovereign CDS Index 67.75 +2.25 basis points.

• S&P 500 futures +.18%.

• NASDAQ 100 futures  +.13%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (CIEN)/.13

• (ADBE)/.30

Economic Releases
8:30 pm EST

• Retail Sales ADvance MoM for November are estimated to rise +.4% versus a +.3% gain in October.

• Retail Sales Ex Autos for November are estimated to rise +.1% versus a +.3% gain in October.

• Retail Sales Ex Autos and Gas for November are estimated to rise +.5% versus a +.6% gain in October.

• The Import Price Index for November is estimated to fall -1.8% versus a -1.3% gain in October.

• Initial Jobless Claims are estimated at 297K versus 297K the prior week.

• Continuing Claims are estimated to fall to 2344K versus 2362K prior.
  

10:00 am EST

• Business Inventories for October are estimated to rise +.2% versus a +.3% gain in September.
  

12:00 pm EST

• 3Q Household Change in Net Worth.

Upcoming Splits

• None of note

Other Potential Market Movers

• The $13B 30Y bond auction, weekly EIA natural gas inventory report, Bloomberg Dec. US Economic Survey, weekly Bloomberg Consumer Comfort Index, (UTX) anslyst meeting, (DAL) investor day, (KBR) investor day, (LOW) investor conference, (DHR) analyst meeting, (MET) business update, (YUM) investor conference, (AET) investor confernce, (ATHN) investor meeting and the (FB) Q&A event could also impact trading today.

BOTTOM LINE: Asian indices are lower, weighed down by industrial and technology shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing modestly lower. The Portfolio is 25% net long heading into the day.

Stocks Falling into Final Hour on Surging Emerging Markets/European Debt Angst, Global Growth Fears, Yen Strength, Homebuilding/Commodity Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Almost Every Sector Declining
  

• Volume: Below Average

• Market Leading Stocks: Underperforming

Equity Investor Angst:

• Volatility(VIX) 18.43 +23.77%

• Euro/Yen Carry Return Index 153.47 -.78%

• Emerging Markets Currency Volatility(VXY) 9.05 +.56%

• S&P 500 Implied Correlation 68.95 +3.34%

• ISE Sentiment Index 86.0 +26.47%

• Total Put/Call .99 -5.71%

• NYSE Arms 2.76 +146.11% 

Credit Investor Angst:

• North American Investment Grade CDS Index 68.39 +5.70% 
• America Energy Sector High-Yield CDS Index 603.0 +4.03%

• European Financial Sector CDS Index 61.50 +3.19%

• Western Europe Sovereign Debt CDS Index 29.84 +10.2%
• Asia Pacific Sovereign Debt CDS Index 65.87 +.59%

• Emerging Market CDS Index 352.44 +7.13%

• China Blended Corporate Spread Index 330.79 +.73%
• 2-Year Swap Spread 23.0 +.75 basis point

• TED Spread 21.25 -1.25 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap 7.0 +2.75 basis points

Economic Gauges:

• 3-Month T-Bill Yield .03% +2.0 basis points

• Yield Curve 159.0 -1.0 basis point

• China Import Iron Ore Spot $69.14/Metric Tonne +.12%

• Citi US Economic Surprise Index 18.10 +.2 point
• Citi Eurozone Economic Surprise Index -19.40 -2.3 points

• Citi Emerging Markets Economic Surprise Index -7.1 -.6 point

• 10-Year TIPS Spread 1.71 -3.0 basis points

Overseas Futures:

• Nikkei Futures: Indicating -172 open in Japan

• DAX Futures: Indicating -52 open in Germany

Portfolio: 

• Slightly Higher: On gains in my index hedges and emerging markets shorts

• Disclosed Trades: None

• Market Exposure: 25% Net Long

Today's Headlines

Bloomberg: 

• Russia Set to Raise Main Lending Rate. Russia’s central bank will probably raise borrowing costs to avert threats to financial stability as oil prices near the lowest in more than five years and sanctions over Ukraine risk the collapse of the ruble. The Bank of Russia will increase its key rate to 10.5 percent from 9.5 percent, according to the median estimate of 34 economists surveyed by Bloomberg. Nine analysts predict a bigger increase. Fifty of 77 traders polled by brokerage Tradition project a rate increase of between 100 and 400 basis points. The regulator will announce the decision at about 1:30 p.m. tomorrow in Moscow, followed by a news conference.
• Greece Reruns Doomsday Scenario. (video) Political tumult in Greece, plunging stock and bond markets, the threat of default and exit from the euro: the script is eerily similar to the nightmare scenarios of 2010 and 2011. Debt-infested Greece skidded close to the edge then, saved by 240 billion euros ($297 billion) in emergency loans improvised by European governments led by a reluctant Germany. Now, after achieving some signs of economic recovery, the government in Athens is again teetering, provoking a fresh round of doomsday speculation. 
• Bank of Canada Says Home Prices Overvalued as Much as 30%. Canada’s housing prices are overvalued by as much as 30 percent, the central bank said in its latest assessment of a financial risk that’s built up over years of rising prices and low interest rates. Home prices are 10 percent to 30 percent above where the bank’s model suggests they should be, according to the Ottawa-based bank’s Financial System Review. Today’s report is the first time the central bank has published such a direct calculation of housing overvaluation. 
• Bank of Canada Warns of Liquidity Risk in Corporate Bonds. Canadian corporate bond investors may be underestimating the difficulty of selling their holdings in a market downturn, leaving them open to greater losses, the Bank of Canada said. Rising holdings of corporate bonds in mutual and exchange-traded funds could exacerbate price swings if the funds are forced to sell in a rout, the central bank said in its semi-annual Financial System Review. Some market participants also believe dealers are reducing market-making activity, or acting as the middleman between trades, which may make it harder to unwind large positions. 
• Airbus Slumps Most in Six Years on Muted Earnings Outlook. Airbus Group NV (AIR) fell the most in more than six years after saying earnings will be “rather flat” in 2016 and that generating cash will be tough as it spends more to upgrade aircraft and turn around its military unit.
• Europe Stocks Drop Third Day as OPEC Outlook Weighs on Oil Firms. (video) A drop in oil and gas companies sent European stocks down a third day after OPEC said it sees demand for crude in 2015 at the weakest level in 12 years. The Stoxx Europe 600 Index declined 0.3 percent to 339.32 at the close of trading, erasing an earlier advance of as much as 0.9 percent. A measure of energy stocks retreated to a three-year low, posting the worst performance among 19 industry groups on the Stoxx 600. Royal Dutch Shell Plc, BP Plc and Total SA lost more than 1 percent. 
• Brent Crude Drops Below $65 as OPEC Sees Less Demand. Brent fell below $65 for the first time in more than five years as OPEC cut the demand forecast for its crude oil to a 12-year low. West Texas Intermediate dropped as U.S. inventories grew.
• Copper Drops as Lower Chinese Producer Prices Damp Demand. Copper futures fell the most in a week on concern that demand is ebbing in China, the world’s top consumer of industrial metals. China’s producer-price index in November fell 2.7 percent from a year earlier, government data showed today. The record 33rd straight decline was the biggest since mid-2013. Copper has dropped 15 percent this year, heading for a consecutive annual decline for the first time since 2001.
• Corn, Soybeans Decline as USDA Raises Forecast for World Crops. Corn futures fell after the U.S. government raised its outlook for global supplies as an expanding grain glut drives down global food costs. Soybeans declined for the first time in six sessions.
• JPMorgan(JPM) Sees ‘High Teens’ Decline in Trading Revenue. JPMorgan Chase & Co. (JPM) probably will report a “high teens” percentage drop in fourth-quarter trading revenue from a year ago, Chief Financial Officer Marianne Lake said. The shares fell as much as 2.3 percent. Most of the revenue decline will stem from the sale of the bank’s physical-commodities business and higher interest costs from the issuance of preferred stock, Lake said today at an investor conference in New York. The “core performance” of the trading business probably will slip 4 percent, she said.

Wall Street Journal:

• Oil Price Fall Deepens BOJ Policy Board Rift. Opponents to October’s Easing May Reject Push to ‘Mechanically’ Ease. The continued fall in crude oil prices is deepening a rift among Bank of Japan policy-board members, indicating that some of them may reject any push for extra stimulus next year.

ZeroHedge:

• Here Are America's Most Levered Energy Companies. (table)
• Is Insider Trading Legal Following Appeals Court Tossing Out Two Hedge Fund Convictions.
• European QE Postponed Indefinitely? Leaked EU Draft Shows "Lack Of Political Cover" For Draghi.
• WTI Crude Crashes To $60 Handle As Saudis Shun Cuts. (graph)
• Ukraine Bonds Crash To Record Low After Economy Minister Asks For More IMF Bailouts. (graph)
• Central Banks Have Failed Because They Can't Push Wages Higher.
• Saxobank's 10 Outrageous Predictions For 2015 - A Reckoning's Coming.
• GREXIT Fears Spark European Peripheral Contagion, Silver Surging.

ValueWalk:

• Junk Bonds, Debt Spreads: There Will Be Blood!!

Business Insider: 

• An OPEC Minister Just Made A Surprising Statement About Who Controls Oil Prices.
• The Party In Macau Is All But Over.
• NYPD Union Boss Says Obama 'Absolutely' Threw Police Under The Bus.

interfax:

• Russian Companies Lost Tens of Billions of Rubles on FX Derivatives. Russian cos. lost tens of billions of rubles on OTC forex derivatives, citing Sergey Moiseev, head of the financial stability debt at Bank of Russia. Central bank has seen tens of billions of rubles in losses at large Russian cos. on FX side of contracts, he said. Central bank doesn't know size of "shadow" derivatives market, or actual amount of losses.