Thursday, March 27, 2014

Today's Headlines

  • Congress Approves Russian Sanctions With Putin Warnings. The U.S. Senate and House passed separate bills today imposing additional sanctions on Russian officials for the nation’s annexation of Crimea. The Senate bill, passed on a voice vote, includes about $1 billion in loan guarantees and authorizes $150 million in direct assistance to Ukraine. The House legislation would impose additional asset freezes and visa bans on senior Russian officials and corporations. The bill passed 399-19.
  • Russia Faces Recession Risk as Capital Outflows Bleed Economy. Russia faces a growing risk of recession as a hemorrhaging of $100 billion in capital this year may bring the economy to a near standstill, according to analysts and government officials. Gross domestic product will expand 1.2 percent in 2014, according to the median estimate of 37 economists in a Bloomberg survey. That compares with a 2.2 percent forecast in last month’s poll. The economy may stagnate at rates below 1 percent and contract if capital outflows reach $150 billion, Economy Minister Alexei Ulyukayev said at a conference in Moscow today.
  • China Swap Market 'Too Complacent' Amid Funding Pressure: Nomura. Swap market has been "too complacent" in light of PBOC's relatively aggressive mop up of liquidity, Wee-Khoon Chong, rate strategist at Nomura, wrote. Liquidity may further tighten in coming days and last longer than expected, he wrote.
  • Syria Peace Effort Largely a Failure, U.S. Official Says. Attempts to negotiate a diplomatic solution to Syria’s civil war are failing, a U.S. State Department official said, as lawmakers denounced the Obama administration’s response to the country’s turmoil. “The Geneva II process has faltered,” Assistant Secretary of State Anne Patterson said yesterday of talks between Syrian President Bashar al-Assad’s regime and rebels that were organized by Russia and the U.S. “We’ve worked closely with the Russians particularly to try and get them to cooperate with us,” Patterson told the Senate Foreign Relations Committee. “It’s a process that’s largely failed.” 
  • European Stocks Little Changed After Rally; H&M Declines. European stocks were little changed, after a two-day rally, as retailers fell, while food and beverage companies climbed. Hennes & Mauritz AB lost 4.3 percent after reporting quarterly profit that missed analysts’ estimates. Babcock International Group Plc posted the biggest drop in four years after agreeing to buy private equity-owned Avincis Group. United Internet AG added 5 percent after saying that earnings jumped 25 percent last year. Marine Harvest ASA rose 2.4 percent after the salmon farmer agreed to sell U.K. farming assets to Cooke Aquaculture Inc. The Stoxx Europe 600 Index gained 0.1 percent to 331.4 at the close of trading in London.
  • WTI Crude Rises to Two-Week High on Cushing Supplies. WTI for May delivery gained $1.22, or 1.2 percent, to $101.48 a barrel at 1:01 p.m. on the New York Mercantile Exchange. Futures touched $101.70, the highest level since March 10. The volume of all futures traded was 1.7 percent below the 100-day average.
  • Consumer Sentiment Declines to a Seven-Week Low. Consumer confidence in the U.S. declined to the lowest level in seven weeks as Americans turned more pessimistic about the economy. The Bloomberg Consumer Comfort Index fell for a second week, to minus 31.5 in the period ended March 23 from minus 29. For the first time since early February, all three components of the gauge, which also includes measures of the buying climate and personal finances, decreased in the same week. Higher prices at the gas pump and smaller paychecks for employees after inclement winter weather reduced hours combined to damp spirits among lower-income households.
  • Fed’s Retreat From Mortgages Approaching Tipping Point. The Federal Reserve is about to find out how well the mortgage-bond market can stand on its own. Fed buying of the securities that helped spur a housing recovery is poised to fall below growth in the $5.5 trillion government-backed market as soon as May, Nomura Holdings Inc. said. Last year, the Fed added twice as much of the debt as was created, suppressing yields that guide mortgage interest rates.
Wall Street Journal:
Fox News:
  • US intel: More indications than ever Russia could invade Ukraine. New U.S. intelligence assessments say there are more indications than ever that Russia could invade eastern Ukraine, as congressional lawmakers reacted with alarm to Vladimir Putin's rapidly expanding military buildup along the border. "The thinking in the U.S. government is that the likelihood of a major Russian incursion into Ukraine has increased," a senior U.S. official told Fox News.
  • High fliers begin dipping as balloon deflates. (video) What was once sizzling is now burning. The momentum names—the high fliers that sucked in fast money—once again got hit with no regard for quality or prospects Thursday morning.
Business Insider: 
The Hill:
  • Accenture warns consulting business to remain weak. Accenture Plc warned that weakness in its consulting business that hurt second-quarter results would carry on though the year, sending its shares down as much as 8 percent. The consulting business, which brings in more than half of the company's revenue, has fallen in six of the last seven quarters as customers cut discretionary spending and stiff competition puts pressure on contract prices. 
  • Brazil central bank raises inflation forecast, signals rate hikes. Brazil's central bank raised its 2014 inflation forecast sharply on Thursday and said it sees the economy growing at a moderate pace, signaling it may prolong its cycle of interest-rate hikes to battle naggingly high inflation in an election year. The central bank increased its 2014 inflation forecast to 6.1 percent from its previous estimate of 5.6 percent as a severe drought in southern Brazil hurt crops and raised food prices.
  • Ukraine says 100,000 Russian troops near border. Nearly 100,000 Russian forces have massed on Ukraine's border, a top Ukrainian defense official told an American audience Thursday, giving a number far higher than US military estimates. "Almost 100,000 soldiers are stationed on the borders of Ukraine and in the direction ... of Kharkiv, Donetsk, " Andriy Parubiy, chairman of Ukraine's national security council, said via a webcast from Kiev. "Russian troops are not in Crimea only, they are along all Ukrainian borders. They're in the south, they're in the east and in the north," Parubiy said.

1 comment:

theyenguy said...

On Thursday March 26, 2014, currencies swelled higher in a massive short sell covering of major currency carry trade crosses.

The Australian Dollar, FXA, rose relative to the Yen, FXY, causing a swell in the AUD/JPY, and the Brazilian Dollar, BZF, also rose, taking Major World Currencies, DBV, and Emerging Market Currencies, CEW, parabolically higher, producing a massive wave from which global competitive currency devaluation is going to produce a tsunami of fiat wealth, and fiat money destruction, which one can follow with the use of this Finviz Screener of 50 Common ETFs

World Stocks, VT, traded unchanged, while, Social Media, SOCL, Resorts and Casinos, BJK, and Health Care Providers, IHF, Transportation, XTN, Small Cap Consumer Discretionary, PSCC, Nasdaq Internet, PNQI, China Technology, CQQQ, and Industrial Textiles, MHK, traded lower. US Refiners such as VLO, MPC, PSX, HFC, traded lower on this week’s lower Euro.

Global Financials, IXG, traded unchanged, as Stockbrokers, IAI, and Regional Banks, KRE, traded lower. The Too Big To Fail Banks, RWW traded lower on a sharp drop in Citigroup, C. Brazil Financials, BRAF, blasted higher. Chinese Financials, CHIX, traded higher.

Nation Investment, EFA, traded higher as Brazil, EWZ, Brazil Small Caps, EWZS, blasted higher. South Korea, EWY, India, INP, SMIN, Indonesia, IDX, IDXJ, Mexico, EWW, and Chile, ECH, traded higher. Of note, New Zealand, ENZL, and South Africa, EZA, traded to new rally highs. Egypt, EGPT, plummeted, and China Small Caps, ECNS, traded lower.

Dividends Excluding Financials, DTN, traded to a new rally high, as the Interest Rate on the US Ten Year Note, ^TNX, traded lower to 2.67%, and the 10 30 US Soveign Debt Yield Curve, $TNX:$TYX, flattened.

Aggregate Credit, AGG, traded higher, on the falling Benchmark Interest Rate, as Notes and Bonds, such as the 10 Year US Government Note, TLT, traded higher