Monday, March 23, 2015

Today's Headlines

  • Draghi Rejects Accusation That ECB Is Blackmailing Greece. Mario Draghi pushed back against an accusation that the European Central Bank is blackmailing Greece and compounding the pressure on the country. “Let me disagree with you about everything you said,” Draghi told Portuguese lawmaker Marisa Matias during his regular hearing at the European Parliament in Brussels. He was responding to a question about the withdrawal of a waiver that allowed the ECB to accept the country’s junk-rated debt as collateral. 
  • Russia Accuses Ukraine of Truce Breaches as Clashes Persist. Clashes between Ukrainian troops and pro-Russian rebels continued to undermine a cease-fire in the country’s east as Russia accused the government in Kiev of violating the truce. The United Nations raised its death toll estimate to at least 6,072 and said 15,345 people have been wounded in the conflict that started last April. About 1.2 million people have registered as displaced within Ukraine and 747,357 have fled abroad, including 610,558 to Russia, the UN Office for the Coordination of Humanitarian Affairs said in a report Monday. Skirmishes between government troops and pro-Russian rebels continue to underscore the tenuous nature of a truce agreement negotiated last month in the Belarusian capital. While the cease-fire has checked the worst of the fighting, both sides are accusing each other of violations that are threatening to return to conflict to open war.
  • U.S.-Russian Relationship `Irrevocably’ Broken: Bremmer. (video)
  • Saudis Ready to Take ‘Necessary Measures’ in Yemen If Talks Fail. Saudi Arabia and its Gulf Cooperation Council partners will take “necessary measures” to restore stability in Yemen if peace talks fail to resolve the deepening conflict there, the Saudi foreign minister said. “We hope that this can be done peacefully but if it is not done peacefully, certainly countries of the region will take the necessary measures to protect the region from the aggression,” Saudi Foreign Minister Prince Saud al-Faisal said Monday during a press conference in Riyadh. 
  • The Dollar Is Continuing Its Slide. This week doesn't look any better than last week so far. After suffering through one of its worst weeks in quite a while, things aren't getting any easier for U.S. dollar on Monday. The Dollar Spot Index is down again today, thanks in part to rallies by the euro and Swiss franc. 
  • Europe Stocks Drop After Nearing Record With Seventh Weekly Gain. European stocks declined, after a seventh weekly gain pushed equities near an all-time high. The Stoxx Europe 600 Index slid 0.7 percent to 401.24 at the close of trading, paring earlier losses of as much as 1 percent.
  • Fed’s Fischer Says Rate Increase Probably Warranted by End-2015. Federal Reserve Vice Chairman Stanley Fischer said raising interest rates from near zero “likely will be warranted before the end of the year” and subsequent increases probably won’t be uniform or predictable. “A smooth path upward in the federal funds rate will almost certainly not be realized” as the economy will encounter shocks such as the surprise plunge in oil prices or future geopolitical crises, Fischer said Monday in remarks prepared for delivery to the Economic Club of New York. He said while forward guidance on rates remains important, its role may diminish.
  • These Junk Bond Outflows Show Just How Jumpy Buyers Have Become. The promise of low borrowing costs for longer just doesn’t pack the punch it used to. Last week should have been fantastic for the $1.3 trillion U.S. junk-bond market: the Federal Reserve scaled back its prediction for how quickly it will raise benchmark interest rates while also expressing confidence in the world’s biggest economy. That’s almost an ideal world for junk bonds. And yet investors yanked $1.3 billion from mutual funds that buy the debt last week, and they’ve pulled $2.9 billion this month, according to data compiled by Wells Fargo & Co. Dollar-denominated high-yield bonds, while rallying some immediately after the Fed statement was released Wednesday, have lost about 1 percent in March
Business Insider:
  • IBM(IBM) to share technology with China in strategy shift -CEOIBM Corp will share technology with Chinese firms and will actively help build China's industry, CEO Virginia Rometty said in Beijing as she set out a strategy for one of the foreign firms hardest hit by China's shifting technology policies.
  • Mester says Fed eyeing dollar as rate hike approaches -Bloomberg. The Federal Reserve is looking to the dollar among other factors as it considers when to raise interest rates, a move that should be made this year, Cleveland Fed President Loretta Mester said according to Bloomberg. Mester, who spoke on Bloomberg TV, repeated that June is still a viable option for the U.S. central bank to hike rates. She added that the drop in oil prices is going to be a positive for the economy. Mester spoke in Paris earlier on Monday.

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