Monday, December 07, 2015

Today's Headlines

Posted by Gary .....at 3:01 PM
Bloomberg: 
  • Nomura: If You Thought This Year Was Volatile in Asia, Just Wait Until 2016. The storm isn't over. While 2015 has brought about a number of challenges for Asian economies, Nomura says investors shouldn't expect the region's troubles to recede anytime soon. In fact, things might just get worse. "The choppy seas we foresaw in 2015 are likely to get choppier in 2016," Nomura's Chief Economist for Asia ex-Japan Rob Subbaraman and his team said in a note. "We forecast Asia-ex Japan GDP growth to slow further to 5.7 percent in 2016. That would be its slowest pace since 1998, heightening the already non-trivial risk of credit crunches."
  • Rousseff Ups Defense as Brazil Congress Haggles Over Impeachment. Brazil’s President Dilma Rousseff on Monday stepped up efforts to protect her mandate as legislators choose members of a committee that will recommend whether to impeach her. The full lower house of Congress is scheduled to vote Monday evening whether to accept the 65 members of the committee who are nominated by party leaders. The committee will hear Rousseff’s defense and make a recommendation whether the full house should back accusations against her and allow the Senate to try her on charges she broke Brazil’s fiscal law. She denies wrongdoing.
  • Le Pen's National Front result points to third way in France. Marine Le Pen's victory in the first round of France's regional elections suggests that voters have moved beyond a rejection of the mainstream parties to embrace her party's nationalist and anti-immigration policies. That shift toward acceptability for Le Pen's National Front opens the way to a three-party system in France, making it tougher for Socialist President Francois Hollande and his Republican rival Nicolas Sarkozy to claw their way back. "Voters have begun to see the National Front as an alternative to the Republicans or the Socialists, as a third way," said Yves-Marie Cann, head of political research at Elabe polling institute in Paris. "While there is an element of protest in choosing the National Front, some French people are looking for politicians who respond to their demands on the economy, security, immigration and identity -- anti-Islam in the main."  
  • Germany Struggles With Nearly One Million New Refugees in 2015. The number of asylum seekers making their way to Germany this year approached one million as Chancellor Angela Merkel’s government struggles to shelter and register the influx of migrants fleeing war and poverty. The number of registered asylum seekers rose to about 965,000 by the end of November, exceeding the government’s full-year forecast from August of 800,000, Interior Minister Thomas de Maiziere told reporters in Berlin Monday. Double registrations would likely reduce that number, though de Maiziere declined to give another full-year estimate.
  • German October Industry Output Rises, Below Expectations. German industrial production rose less than economists predicted in October amid a slump in energy output. Output, adjusted for seasonal swings and inflation, rose 0.2 percent from September, when it declined 1.1 percent, data from the Economy Ministry in Berlin showed on Monday. The reading, which tends to be volatile, is the first positive one in three months and compares with a median estimate for a 0.8 percent gain in a Bloomberg survey of economists. 
  • Dollar Traders Give Yellen Green Light as Fed Rate Meeting Nears. The dollar’s biggest weekly loss since May just made it a little easier for the Federal Reserve to raise interest rates. The greenback’s tumble from a 12-year high removes one of the last stumbling blocks for officials contemplating how to navigate their first rate increase in almost a decade. As the specter of liftoff looms, options suggest traders are the least concerned in four months about dollar strength versus the euro. Hedge funds and other large speculators reduced bets on dollar gains for the first time in six weeks in the period through Dec. 1, Commodity Futures Trading Commission data show.   
  • Europe Shares Rebound as Investors Consider Draghi Rout Overdone. (video) European stocks advanced after their worst week since August as investors considered the European Central Bank-induced slide overdone. The Stoxx Europe 600 Index closed 0.5 percent higher, its biggest increase since Nov. 26. The equity benchmark pared earlier gains of as much as 1.6 percent as a slide in oil prices dragged energy companies lower.
  • Oil Staying at $40 Would Stall Russian Recovery, Ulyukayev Says. Any Russian economic rebound would stall if oil prices stay at $40 a barrel, even if such an outcome wouldn’t create “risks” for the banking industry or the budget, Economy Minister Alexei Ulyukayev said.
  • OPEC Unshackled From Quota Could Add Millions of Barrels. (video) OPEC’s new free-for-all production stance could lift the lid on millions of barrels of additional crude supply next year. “Everyone does whatever they want” now that the Organization of Petroleum Exporting Countries has effectively abandoned its formal production target, Iranian Oil Minister Bijan Namdar Zanganeh said after the group met on Friday. What Iran wants is to revive exports by about 1 million barrels a day when sanctions are removed next year. It’s not the only member with potential to swell the global oil surplus, with millions of barrels of capacity lying unused under the sands of Saudi Arabia and Libya. “It means more OPEC oil next year,” Jamie Webster, a Washington-based oil analyst for IHS Inc., said of the organization’s Dec. 4 decision. “OPEC is not cutting. With Iran looming, as well as largely only upside risk for Libya, the smart money is on more, and not less, production.”
  • OPEC's Oil Market Disarray Looks Like 1990s Slump All Over Again. (video) OPEC has seemingly dropped any attempt at trying to fulfill its founding mission and manage the global oil market. For Saudi Arabia’s Ali al-Naimi, the most powerful and longest-serving of the group’s oil ministers, it may have seemed like history was repeating itself. There are several striking parallels between the Organization of Petroleum Exporting Countries’ current situation and the period from 1997 to 1999, when the group lost control of the market and oil slipped to less than $10 a barrel. While investors may wonder whether markets will follow a similar trajectory this time, it’s important to remember that OPEC emerged from the crisis to see oil prices surge all the way to almost $150 a barrel. If the parallels hold, markets could be in for a wild ride.   
  • Iron Ore Joins Oil's Move Lower in Commodity Slump. (video) 
  • Iron Ore Nearing Rio's `Fantasy Land' Shows Depth of Turmoil. When Rio Tinto Group’s Sam Walsh, head of the world’s second-biggest iron-ore exporter, was asked 10 months ago whether the steelmaking raw material could reach $30 a metric ton, he derided it as impossible. “That’s fantasy land -- it simply can’t happen,” Walsh, 65, said in a February interview with Bloomberg Television. “There are very wild forecasts out there that quite frankly just can’t come to pass, otherwise it’s going to be very lonely for us as the lowest-cost producer in the world.”
  • Smith & Wesson(SWHC) Soars to Highest Since 2007 on Gun Control Talk. Smith & Wesson Holding Corp. jumped to its highest level in eight years and Sturm Ruger & Co. also soared on investor expectations that gun enthusiasts will purchase more pistols and rifles as calls for restrictions increase. The gunmakers’ shares have seen gains in recent years in the wake of mass shootings like the one in California last week that have led to stepped-up efforts to restrict ownership. Both companies also have seen sales rise in response to politicians’ demands for tougher legislation. Those efforts have all fizzled. Smith & Wesson, whose brands also include M&P and Thompson/Center Arms, surged 7.4 percent to $20.39 at 12:02 p.m. in New York after reaching $20.62, the highest intraday price since October 2007.
  • Staples(SPLS) Drops After U.S. Moves to Challenge Office Depot(ODP) Deal. Staples Inc. fell the most in over a year after the U.S. said it would challenge the office supply chain’s proposed takeover of Office Depot Inc., the second time in 20 years that antitrust officials said the tie-up would squelch competition and should be blocked. 
  • Icahn Tops Bridgestone With $15.50-a-Share Bid for Pep Boys(PBY).
  • Electrolux Drops After GE(GE) Pulls $3.3 Billion Appliance Deal. (video) Electrolux AB fell the most in more than four years after General Electric Co. abandoned plans to sell its appliance business to the Swedish manufacturer for about $3.3 billion because of opposition from U.S. antitrust regulators.
CNBC:
Zero Hedge:
Business Insider: 
The Hill:
  • ISIS has targeted refugee program to enter US, chairman says. Intelligence officials have determined that Islamic extremists have explored using the refugee program to enter the United States, the head of the House Homeland Security Committee said on Monday. Rep. Michael McCaul (R-Texas) declined to go into detail about the determination, which the Obama administration has not announced publicly. Yet the disclosure could add ammunition to critics of the White House’s refugee plans who have warned that the program is vulnerable to infiltration by adherents of the Islamic State in Iraq and Syria (ISIS). “ISIS members in Syria have attempted to exploit it to get into the United States,” McCaul said during a speech at the National Defense University on Monday. “The U.S. government has information to indicate that individuals tied to terrorist groups in Syria have already attempted to gain access to our country through the U. S. refugee program.”
Caixin:
  • China Jan.-Nov. National Rail Cargo Volume Falls 11.6%. Cargo volume at national rail roads was 2.49b tons in Jan.-Nov., citing data from China Railway Corp.

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