Bloomberg:
- China Workforce Slide Robs Xi of Growth Engine. China's second straight annual drop in its working-age population is robbing President Xi Jinping of an engine of three decades of growth, underscoring the need to close the gap between his achievements and ambitions. Xi and Premier Li Keqiang, who in November unveiled the broadest policy shifts since the 1990s, are facing a labor force decline that the United Nations estimates will total almost 30 million in the decade through 2025. China’s working-age population, or people age 16 to 59, fell by 2.44 million in 2013, the National Bureau of Statistics said yesterday.
- Crunch Escalates as Money Funds Rival Shadow Banks: China Credit. A doubling in China’s money-market funds in the past six months is draining bank deposits and raising the risk of financial failures during cash crunches, according to Fitch Ratings. The assets under management of such plans surged to a record 737 billion yuan ($122 billion) on Dec. 31 from 304 billion yuan on June 30, said Roger Schneider, senior director at Fitch’s Fund and Asset Manager Rating Group. Yu’E Bao, managed by Tianhong Asset Management Co. and sold online by Alibaba Group Holding Ltd., offers an annualized return of 6.7 percent, compared with the 3 percent official one-year savings rate. Some funds are offering higher rates, with news portal Eastmoney.com marketing a product that targets 10 percent.
- China’s 2013 New Home Sales Hit $1.1 Trillion, Record High. China’s new home sales last year exceeded $1 trillion for the first time as property prices in cities the government considers first tier surged in the absence of more nationwide property curbs. The value of new homes sold in 2013 rose 27 percent from 2012 to 6.8 trillion yuan ($1.1 trillion), National Bureau of Statistics said in a statement today. New-home prices in December climbed 20 percent in Guangzhou and Shenzhen from a year earlier, and jumped 18 percent in Shanghai and 16 percent in Beijing, the bureau of statistics said Jan. 18.
- Bird Flu Kills Health Worker, Stokes Transmission Concern. A medical worker at a Shanghai hospital died from bird flu, stoking concern that the influenza virus known as H7N9 may have spread from person to person. The 31-year-old man died on Jan. 18, according to a statement on the Shanghai Municipal Commission of Health and Family Planning website yesterday. The city has identified seven cases of infection with the virus this year, the statement said.
- Thai Default Risk Soars as Funds Pull $4 Billion: Southeast Asia. The cost of protecting the country’s debt soared after investors including Wells Fargo Inc. pulled more than $4 billion from Thai stocks and bonds since Oct. 31, as rallies clogged up Bangkok roads and clashes left nine dead with about 550 injured. Pacific Investment Management Co., Goldman Sachs Group Inc. and Kokusai Asset Management Co. reduced holdings before protests erupted in late October, regulatory filings show. Credit-default swaps insuring Thai debt against non-payment for five years rose to 158 as of 10:37 a.m. in London, versus 150 on Jan. 17, according to data compiled by Bloomberg. They touched 160 earlier today in Asian trading, according to CMA prices, the highest since June 2012. The spread has widened 53 basis points since anti-government protest broke out on Oct. 31, compared with increases of 30 for Indonesia and 19 for the Philippines.
- Lenovo Said to Be in Discussions to Buy IBM(IBM) Server Business. Lenovo Group Ltd. (992) is in discussions to acquire International Business Machines Corp. (IBM)’s low-end server business, and a deal may be signed within weeks, according to a person with direct knowledge of the matter.
- Asian Stocks Rise as China Acts to Pare Rates; Yen Drops. Asian stocks climbed as China’s money-market rates fell the most in four weeks after the nation’s central bank injected funds into the financial system. The yen slid against major peers as policy makers meet to review Japan’s monetary policy and oil retreated. The MSCI Asia Pacific Index gained 0.4 percent by 11:18 a.m. in Tokyo.
- WTI Oil Drops on Concern Slowing China Economy Will Curb Demand. WTI for February delivery fell as much as 94 cents to $93.43 a barrel in electronic trading on the New York Mercantile Exchange and was at $93.90 at 12:27 p.m. Sydney time.
- Rubber Trades Near 5-Month Low on Concern Chinese Demand to Slow. Rubber futures in Tokyo traded near a five-month low amid concern that slowing economic growth in China may weaken demand from the world’s largest consumer of the commodity used in tires. The contract for delivery in June on the Tokyo Commodity Exchange was at 252.2 yen a kilogram ($2,413 a metric ton) at 10:42 a.m. local time after swinging between 251.8 yen and 254.6 yen. Futures settled at 252.3 yen yesterday, the lowest settlement for a most-active contract since Aug. 7.
- Copper Drops as Economic Growth Slows in Leading Consumer China. “The base metals have made a fairly subdued start to the week, digesting the Chinese data,” Leon Westgate, an analyst at Standard Bank Plc in London, said in a report today. Copper for delivery in three months dropped 0.4 percent to $7,314 a metric ton on the London Metal Exchange. Copper for delivery in March dropped 0.2 percent to $3.3375 a pound on the Comex in New York.
- European Banks Face $1 Trillion Gap Before Review, Study Shows. European banks have a capital shortfall of as much as 767 billion euros ($1 trillion) before the European Central Bank’s probe into the financial health of the region’s lenders, according to a study. French banks show the biggest gap of 285 billion euros, followed by German lenders with as much as 199 billion euros, Sascha Steffen of the European School of Management and Technology in Berlin and Viral Acharya at New York University said in their study dated Jan. 15. The figures assume a benchmark capital ratio for other book measures of leverage of 7 percent, they wrote. “A comprehensive and decisive AQR will most likely reveal a substantial lack of capital in many peripheral and core European banks,” the authors wrote, referring to the central bank’s Asset Quality Review stage of the Comprehensive Assessment.
- OECD Says Denmark Ignores Debt at Own Risk as Higher Rates Loom. Denmark needs to put in place policies that help households deleverage before central banks start raising interest rates, according to the Organization for Economic Cooperation and Development. “Sooner or later rates in Denmark and the rest of Europe will go back to more normal levels,” Robert Ford, deputy director at the Paris-based OECD, said in an interview in Copenhagen. The nation’s household debt level is “a risk. It’s very high compared to any other.” At 321 percent of disposable incomes, Denmark boasts the world’s highest private debt burden.
- Spain’s Worst Year for Work Leaves Rajoy Counting Cost. Spanish Prime Minister Mariano Rajoy can count the social cost of the economy’s slump when data this week show how 2013 was probably the worst year for work in its democratic history. Economists predict the unemployment rate in Spain, home to almost a third of the euro region’s jobless, stayed above 25 percent for the sixth quarter in a row. The National Statistics Institute in Madrid will release the report for the final three months of the year on Jan. 23.
- Deutsche Bank(DB) Foresees Challenging 2014 After Surprise Loss. Deutsche Bank AG, Germany’s biggest bank, said this year will be challenging after a surge in legal costs and lower debt trading revenue spurred a surprise fourth- quarter loss. The shares slumped.
- Ukrainian Clashes Intensify After Night of Violence in Kiev. Ukrainian activists battled police for a second night in the capital, defying new laws to subdue anti-government rallies that began two months ago. By 8:45 p.m. today in Kiev, protesters throwing Molotov cocktails at police were met by rubber bullets and smoke bombs. Activists also began building a catapult to launch projectiles. The two sides exchanged smoke and sound bombs yesterday in subzero temperatures as police vehicles were burned. More than 200 people were injured.
- Taliban Bombs Kabul Restaurant to Kill 21 ‘Invaders’ for Parwan. The Taliban claimed responsibility for an attack near a Lebanese restaurant in Kabul that killed 21 people including the International Monetary Fund’s senior official in Afghanistan and three United Nations workers. Three suicide bombers armed with heavy and light weapons stormed the restaurant on Jan. 17 in retaliation for a strike by U.S. forces in Parwan province, north of the capital, Taliban spokesman Zabihullah Mujahed said in e-mailed statements. La Taverna du Liban was targeted because it’s where “invaders used to dine with booze and liquor in the plenty,” Mujahed said, according to a statement in English.
- CEO earnings skepticism backs weakest S&P 500 forecast in decade. Investors who want to know why U.S. equity strategists are the most pessimistic in a decade need look no further than statements by chief executive officers. For every company predicting in January that earnings that will beat analyst estimates, 2.5 are projecting results that fall short, matching the worst ratio since the rally began in March 2009, according to data compiled by Bloomberg. While analysts say Standard & Poor’s 500 Index profits will rise 8.8 percent in 2014, that’s almost the same estimate they generated a year ago for 2013, when earnings ended up increasing at about half that rate, the data show.
- Next Cut in Fed Bond Buys Looms by Jon Hilsenrath. Reduction to $65 Billion Could Be Announced on Jan. 29. The Federal Reserve is on track to trim its bond-buying program for the second time in six weeks as a lackluster December jobs report failed to diminish the central bank's expectations for solid U.S. economic growth this year, according to interviews with officials and their public comments. A reduction in the program to $65 billion a month from the current $75 billion could be announced at the end of the Jan. 28-29 meeting, which would be the last meeting for outgoing Chairman Ben Bernanke.
- Deutsche Bank(DB) Loss Could Be Harbinger for Sector. Bank's Shares Down More Than 5% in European Trading.
Fox News:
- 'I’ve got a pen': Obama raises hackles with executive actions. With his newly announced overhaul of National Security Agency surveillance activities, President Obama has once again hit a nerve with members of Congress on both sides of the aisle. The president, as he often does when facing a nettlesome problem, used his executive powers to implement changes. In his address on Friday, Obama said he's approved a "new presidential directive for our signals intelligence activities both at home and abroad."
- UN chief withdraws invitation for Iran to participate in Syria peace talks. U.N. Secretary-General Ban Ki-moon has withdrawn his invitation for Iran to participate in Syria peace talks, a spokesman said, after the invite spurred objections from the United States and the Syrian opposition.
Zero Hedge:
ValueWalk:- The Retail Death Rattle. (graph)
Business Insider:
CNN:
Telegraph:- Warships part of U.S. contingency plan for Sochi Olympics. The U.S. military will have up to two warships and several transport aircraft on standby under a contingency plan to help evacuate American officials and athletes from the Winter Olympics in Sochi, Russia, if ordered, a U.S. official said. The State Department would take the lead in organizing and evacuating Americans, if necessary, the official with direct knowledge of the plan told CNN.
- EMERGING MARKETS-Brazil stocks fall nearly 1 pct on China data, Mexico steady. Brazilian stocks fell nearly 1 percent on Monday, hurt by economic data from China suggesting an impending slowdown in the world's No. 2 economy. On a day of light trading due to the Martin Luther King Jr. national holiday in the United States, Mexico's IPC index rose slightly, while Chile's bourse ended a three-day rally. Brazil's benchmark Bovespa stock index closed the day down 0.96 percent.
- JP Morgan(JPM) drops second China IPO amid 'princeling' probe. JP Morgan has ceased working on the proposed US$1bn IPO of Jinzhou-based Tianhe Chemicals amid an ongoing investigation into its hiring practices.
- In France, les poulets are coming home to roost. France’s charmed life falls prey to excessive state spending and regulation.
- NSA Monitors Merkel Advisers After Obama Reassurances. The NSA will continue to spy on advisers to Chancelor Angela Merkel even after U.S. President Barack Obama said the U.S. isn't observing the chancellor, citing intelligence employees. NSA has analyzed with whom Merkel telephoned, had e-mail conversations, discussed decisions.
- Hedge Fund Bears Take Grisly View On China. 2014 may be the year that China's economy undergoes a reckoning of its economy as the country seeks to tighten credit, argue some managers.
- China's Economic Slowdown Risk Rises. China's risk of a future economic slowdown has risen under continuous relatively tight monetary conditions in early 2014, according to a front-page commentary by reporter Ren Xiao.
- China 2013 Insurers' Investment Yield 5.04%. Chinese insurers' 2013 investment yield rose to 5.04%, highest in 4 years, citing an annual meeting of China Insurance Regulatory Commission.
Weekend Recommendations
Barron's:- Bullish commentary on (DNR), (DF), (MRO) and (GPS).
- Bearish commentary on (NAV).
- Asian indices are +.25% to +.75% on average.
- Asia Ex-Japan Investment Grade CDS Index 144.0 +4.0 basis points.
- Asia Pacific Sovereign CDS Index 110.75 +4.25 basis points.
- FTSE-100 futures +.34%.
- S&P 500 futures +.44%.
- NASDAQ 100 futures +.66%.
Earnings of Note
Company/Estimate
- None of note
- None of note
- None of note
- The Germany ZEW Index and the Bank of Japan decision could also impact trading today.
No comments:
Post a Comment