Bloomberg:
- China Home Prices Rose in November as Shenzhen Led Increases. New home prices in China’s four major cities rose, with the southern business hub of Shenzhen posting the biggest gain in almost three years, as property measures by local governments failed to deter buyers. Shenzhen and Guangzhou posted increases of 21 percent from a year earlier, while prices climbed 18 percent in Shanghai and 16 percent in Beijing, data from the National Bureau of Statistics showed today. Prices rose from a year earlier in 69 of 70 cities tracked by the government last month, it showed.
- Aussie Broken Link With U.S. Yield Spells Drop: Australia Credit. The tendency for the Australian dollar to rise in step with U.S. bond yields has broken down and that signals more declines for the world’s worst-performing major currency. The 60-day correlation between the Aussie dollar and Treasury yields was -0.42 last week, where a reading of -1 means the two move in opposite directions. That’s the strongest negative link since 2006 and follows a five-year period ending in June in which the assets tended to move together as the outlook for the global economy fluctuated.
- Asian Stocks Rise a Second Day Ahead of Fed Decision. Asian stocks rose, with the benchmark regional index climbing for a second day, as investors await a Federal Reserve decision on its stimulus program. Honda Motor Co. (BHP), which gets 80 percent of its sales abroad, gained 2.2 percent as the yen weakened against the dollar, boosting Japanese exporters. Casio Computer Co. (6952) climbed 4.8 percent in Tokyo after Morgan Stanley advised buying the shares. Wotif.com Holdings Ltd. slumped 30 percent after the Australian online travel company said it will report lower profit. The MSCI Asia Pacific Index added 0.5 percent to 138.22 as of 11:21 a.m. in Hong Kong.
- Rebar Drops to Three-Week Low as China May Curb Property Prices. Steel reinforcement-bar futures declined to the lowest level in three weeks as iron ore dropped after gains in home prices in China spurred concern the central government will take measures to rein in the property market. Rebar for May delivery on the Shanghai Futures Exchange lost as much as 0.5 percent to 3,644 yuan ($600) a metric ton, the lowest intra-day level for the most-active contract since Nov. 26. Futures, falling for a fifth day, traded at 3,653 yuan by 11:27 a.m. local time.
- Rubber Declines for Second Day on Signs Demand Slowing in China. Rubber dropped for a second day as rising stockpiles in China and Japan signaled slow demand for the commodity used in tires. Futures for delivery in May on the Tokyo Commodity Exchange fell as much as 0.7 percent to 279.2 yen a kilogram ($2,710 a metric ton) before trading at 280 yen at 11:39 a.m. local time. Prices fell 7.4 percent this year.
- China Said to Refuse More Than 500,000 Tons of U.S. Corn. China has rejected more than half a million metric tons of genetically modified U.S. corn in November and December, almost three times the amount it previously announced, said three people with knowledge of the issue.
- Merkel Prods EU Finance Chiefs as Bank-Failure Talks Heat Up. German Chancellor Angela Merkel called on European Union finance ministers to agree this week on a bank-failure plan for the euro area, as emergency talks that dragged into the night highlighted how much work remained.
- Spanish Defaults Surge as Banks Forced to Come Clean: Mortgages. Liliana Proano Males won’t be decorating her house in Madrid this Christmas because she’s about to lose it. Males and her husband, who was fired from his job during the depths of the financial crisis in 2009, can no longer afford their mortgage. With Spain’s persistently high unemployment rate now at 26 percent, the couple is among the 350,000 homeowners who may be foreclosed upon by lenders in the next two years as the housing crisis worsens, according to AFES, a Madrid-based association that advises on restructuring debt. Since 2008, about 150,000 families have been hit with a foreclosure.
- New Mortgages to Get Pricier Next Year. Increase in Fannie, Freddie Fees to Hit Borrowers Without Perfect Credit or Big Down Payments.
- Facebook's(FB) Video Ads Risk Alienating Users. Marketers Applaud Move, but Untested Advertising Presents Challenge.
- The Judge and the NSA. In Klayman v. Obama, a lower court can't simply wish away Supreme Court precedent. Federal Judge Richard Leon has become a sudden political celebrity after his remarkable opinion holding that antiterror surveillance is unconstitutional and, even more remarkably, enjoining the entire program. If only his legal reasoning were as compelling as his new repute.
MarketWatch.com:
- Three reasons the Fed should taper QE3. Opinion: Federal Reserve needs to prove that it can rip the Band-Aid off.
- Bernanke should lay groundwork for QE pullback. It should be a slightly more hawkish Ben Bernanke presiding over his final press briefing Wednesday, even though many Federal Reserve watchers say odds are against a move to taper back on stimulus just now.
- US preparing Citigroup, Merrill Lynch charges: report. The U.S. Justice Department is preparing to file civil fraud charges against Citigroup and Bank of America's Merrill Lynch unit over their sale of flawed mortgage securities ahead of the financial crisis, according to people familiar with the probes. Civil investigators have compiled evidence that allegedly shows that investors lost tens of billions of dollars after purchasing securities Citigroup had marketed as safe even though the bank had reason to believe otherwise, one person said.
ValueWalk:
Business Insider:
Washington Post:
- Obamas, Biden to skip the Winter Olympics in Russia. The White House announced Tuesday that President Obama, Vice President Biden and the first lady will not attend the Winter Olympics in Sochi, Russia, in February, a pointed snub by an administration that is feuding with Russian leaders on a range of foreign policy and human rights issues.
- VAT reform could place a strain on Chinese telecoms operators' profitability. Barclays' report suggests that the scheme is a 'confusing transition' that could affect China Mobile, China Unicom and China Telecom.
- Other Nations Won't Tolerate Japan as Military Power. No country with a normal development strategy will tolerate Japan becoming a major military power as the country denies history and justice, and challenges international order after World War II, according to a commentary published by People's Daily.
- None of note
- Asian equity indices are -.25% to +.75% on average.
- Asia Ex-Japan Investment Grade CDS Index 127.5 -1.0 basis point.
- Asia Pacific Sovereign CDS Index 102.75 +1.25 basis points.
- FTSE-100 futures +.27%.
- S&P 500 futures +.21%.
- NASDAQ 100 futures +.20%.
Earnings of Note
Company/Estimate
- (GIS)/.87
- (NX)/.14
- (LEN)/.62
- (FDX)/1.64
- (MLHR)/.40
- (ORCL)/.67
- (PAYX)/.42
- (SCS)/.26
- (RUE)/.29
8:30 am EST
- Housing Starts for November are estimated at 954K.
- Building Permits for November are estimated to fall to 990K versus 1034K in October.
- Bloomberg consensus estimates call for a weekly crude oil inventory decline of -1,999,000 barrels versus a -10,585,000 barrel decline the prior week. Gasoline supplies are estimated to rise by +1,718,000 barrels versus a +6,717,000 barrel gain the prior week. Distillate Inventories are estimated to rise by +209,000 barrels versus a +4,541,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to rise +.14% versus a +.2% gain the prior week.
- The FOMC is expected to leave the benchmark fed funds rate at .25%.
- Fed QE3 Pace for December is estimated at $85B versus $85B in November.
- None of note
- The Fed's Bernanke speaking, UK Unemployment Rate, weekly MBA mortgage applications report, $35 5Y T-Note auction, (CVS) analyst day, (JCI) analyst day and the (F) analyst briefing could also impact trading today.
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