Bloomberg:
- Xi Says GDP Not Officials’ Sole Focus in Signal on Growth. China’s President Xi Jinping said officials shouldn’t be judged solely on their record in boosting gross domestic product, the latest signal that policy makers are prepared to tolerate slower economic expansion. The Communist Party should instead place more importance on achievements in improving people’s livelihood, social development and environmental quality when evaluating the performance of officials, the Xinhua News Agency reported June 29, citing Xi at a meeting on personnel management on the eve of the 92nd anniversary of the party’s founding.
- Chinese Manufacturing Gauges Fall as Slowdown Persists: Economy. Two gauges of China’s manufacturing fell in June, underscoring a sustained slowdown in the nation’s economy as policy makers seek to rein in financial speculation and real-estate prices. An official Purchasing Managers’ Index (CPMINDX) dropped to 50.1 from 50.8, the National Bureau of Statistics and China Federation of Logistics and Purchasing said today in Beijing. A private PMI from HSBC Holdings Plc and Markit Economics was 48.2, the weakest since September. Readings above 50 signal expansion.
- China’s June Home Prices Jump on Increasing Sales, SouFun Says. China’s new home prices jumped in June by the most since they reversed declines in December, defying the government’s tightened property curbs as increased sales supported developers’ efforts to avoid price cuts. Prices surged 7.4 percent last month from a year earlier to 10,258 yuan ($1,671) per-square-meter (10.76 square feet), SouFun Holdings Ltd. (SFUN), the country’s biggest real estate website owner, said in a statement today after a survey of 100 cities. Last month’s increase was the biggest since December, when prices climbed 0.03 percent, reversing a 0.46 percent decline in November.
- China Orders Armed Patrols in Xinjiang After Violence Killed 35. China ordered paramilitary troops to patrol around the clock in the western Xinjiang province after unrest killed at least 35 people in one of the region’s worst outbreaks of violence in four years. The stepped-up security, announced on the Ministry of Public Security’s website yesterday, comes before the fourth anniversary of clashes between Uighurs and Han Chinese in the regional capital Urumqi on July 5, 2009 that killed 200 people.
- China Stocks Fall After Manufacturing Data Show Slower Expansion. China’s stocks fell, led by material and financial companies, after an official gauge of manufacturing expanded at the slowest pace in four months in June. The Purchasing Managers’ Index was at 50.1, the National Bureau of Statistics and China Federation of Logistics and Purchasing said. That was down from May’s 50.8 reading and matched the median forecast of 33 analysts in a Bloomberg News survey. Readings above 50 signal expansion. The Shanghai Composite Index (SHCOMP) slid 0.8 percent to 1,963.04 at 9:33 a.m. local time, extending last week’s 4.5 percent slump, the biggest loss since the five days ended Feb. 22.
- Pawnbrokers Thrive as Poorest Aussies Bear Brunt of Slowdown. On a sidewalk in Sydney’s Bankstown neighborhood, where unemployment is more than double Australia’s average, Dave Cox pulls the starter cord of an edge trimmer to prove it works as he tries to sell it to pawnbroker Cash Converters International Ltd. (CCV) “The economy is pretty crap right now,” 38-year-old truck driver Cox, who’s between jobs, said after he offloaded the snipper for A$30 ($28). In the past month, he sold an iPhone and got a loan at Cash Converters, whose sales last year grew faster than any other Australian retailer that didn’t make a major acquisition. “It just feels bad out there.”
- Asian Stocks Outside Japan Decline on China Manufacturing. Asian stocks outside Japan fell, with a regional index heading for its first decline in four days, after an official gauge of manufacturing activity in China expanded at the slowest pace in four months. Commonwealth Bank of Australia, the nation’s largest lender, fell 1.8 percent. Toyota Motor Corp., the world’s No. 1 carmaker, gained 0.5 percent as the yen weakened against the dollar. Hisamitsu Pharmaceutical Co. (4530) surged 5.8 percent in Tokyo after its Noven unit won U.S. approval for its drug to ease hot flushes associated with menopause. The MSCI Asia Pacific Excluding Japan Index fell 0.4 percent to 430.67 as of 12:06 p.m. in Hong Kong, with eight of the 10 industry groups on the measure falling.
- Europe Stocks Addicted to Emerging Markets Stretching Valuations. For the first time ever, European companies are relying on emerging markets for a third of all revenue, stretching equity valuations as Chinese growth slows and protests turn violent from Turkey to Brazil.
- Draghi’s One Size Fits All Rescue Fuels Northermost Debt. The European Central Bank’s attempt to resuscitate the 17-member euro economy with record-low interest rates is fueling a debt boom in its most creditworthy country and exposing a growing disconnect in monetary policy. In Helsinki, about 1,500 kilometers (930 miles) northeast of the Frankfurt offices of ECB President Mario Draghi, household debt has surged to a record as Finns take advantage of the lowest mortgage rates in the euro area to buy property. Citizens of crisis-stricken countries from Greece to Portugal are either unable to get loans or forced to pay much higher rates.
- Rebar Declines as Pace of Manufacturing Growth in China Slows. Steel reinforcement-bar futures in Shanghai fell as two gauges of China’s manufacturing fell in June, underscoring a slowdown in the nation’s economy. Rebar for delivery in January on the Shanghai Futures Exchange declined as much as 1 percent to 3,501 yuan ($571) a metric ton before trading at 3,518 at 10:28 a.m. local time. Futures fell 6.8 percent last quarter, the most since the three months ended in September.
- Rubber Falls First Day in Three After China Manufacturing Slows. Rubber futures in Tokyo declined for the first time in three days after manufacturing expanded at the slowest pace in four months in China, the largest consumer of the commodity used in tires. The contract for delivery in December slipped as much as 1 percent to 233.9 yen a kilogram ($2,356 a metric ton) on the Tokyo Commodity Exchange and was at 234.8 yen at 12:13 p.m. local time. Futures lost 14 percent last quarter, the biggest decline in a year.
- U.S. Should Show Some Ambition on Bank Leverage. U.S. regulators are showing encouraging signs of coming to a crucial understanding: If they want the financial system to be more resilient and beneficial for the economy, they’ll have to make sure the largest banks’ shareholders have more skin in the game. This week, Federal Reserve officials are expected to vote on new rules for bank capital -- shareholders’ equity and other forms of financing that, as opposed to debt, can absorb losses and prevent insolvency in times of trouble. According to Bloomberg News, U.S. authorities have been considering increasing the requirement to $6 in capital for every $100 in assets, a “leverage ratio” of 6 percent. That’s double the international minimum set by global regulators in Basel, Switzerland. The current U.S. minimum is 4 percent. A higher leverage ratio would be a welcome step toward strengthening the U.S. banking system.
- Hedge Funds Cut Gold Bets as Goldman Lowers Outlook: Commodities. Hedge funds cut wagers on a gold rally to a five-year low as a record quarterly drop drove prices below $1,200 an ounce for the first time since 2010 and Goldman Sachs Group Inc. forecast more declines. Money managers reduced their net-long position by 20 percent to 31,197 futures and options by June 25, U.S. Commodity Futures Trading Commission data show. That’s the lowest since June 2007. Holdings of short contracts climbed 5 percent to 77,027, the second-highest on record. Net-bullish wagers across 18 commodities tumbled 9 percent, the most in 12 weeks.
- Immigration Bill Faces Uphill Climb in House. For all the battles in Congress over immigration, the issue isn't likely to be a decisive one in many individual campaigns for House seats in 2014, strategists for both parties say. That is likely to affect the debate in the House as it weighs the sweeping immigration bill passed by the Senate last week.
- Health-Insurance Costs Set for a Jolt. For the Healthy, Rates Could Soar Under New Law; Sicker Consumers to See Relief. Healthy consumers could see insurance rates double or even triple when they look for individual coverage under the federal health law later this year, while the premiums paid by sicker people are set to become more affordable, according to a Wall Street Journal analysis of coverage to be sold on the law's new exchanges.
Fox News:
Business Insider:- 18 firefighters confirmed dead fighting Arizona blaze. Local fire officials have confirmed that at least 18 firefighters have died while battling the Yarnell Hill Fire in central Arizona. The Prescott Fire Department confirmed to MyFoxPhoenix that the firefighters,all part of a group called the Prescott Granite Mountain Hotshots, had passed away Sunday evening. The Yavapai County Sheriff's Office has notified residents in the Peeples Valley area and in the town of Yarnell to evacuate.
- Why China's Economy May Be Heading for a Crash. China's central bank sent global markets reeling when it attempted tighten credit and rein in the country's shadow banking system. But the consequences of China's credit binge may just be getting started, and experts say there could be more pain to come for the world's second-largest economy.
Telegraph:
- France's triumphant 'Joan of Arc' vows to bring back franc and destroy euro. Marine Le Pen is spoiling for a fight. The leader of France's Front National vows to smash the existing order of Europe and force the break-up of monetary union, if she wins the next election.
- Asian indices are -.75% to +.25% on average.
- Asia Ex-Japan Investment Grade CDS Index 152.50 +1.0 basis point.
- Asia Pacific Sovereign CDS Index 114.25 +1.5 basis points.
- FTSE-100 futures +.06%.
- S&P 500 futures -.13%.
- NASDAQ 100 futures +.01%.
Earnings of Note
Company/Estimate
- None of note
8:30 am EST
- Final Markit US PMI is estimated to rise to 52.4 versus a prior estimate of 52.2.
- Construction Spending for May is estimated to rise +.6% versus a +.4% gain in April.
- ISM Manufacturing for June is estimated to rise to 50.5 versus 49.0 in May.
- ISM Prices Paid for June is estimated to rise to 50.5 versus 49.5 in May.
- (SNP) 13-for-10
- (OGE) 2-for-1
- (AAON) 3-for-2
- The Eurozone PMI/Inflation reports, Japan 10Y Treasury auction and the (SD) annual meeting could also impact trading today.
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