Evening Headlines
Bloomberg:
Bloomberg:
- Fed's Historic Liftoff and Everything After: Decision Day Guide. (video) Here’s what to look for when the Federal Open Market Committee releases its policy statement at 2 p.m. Wednesday following a two-day meeting in Washington. Economists and traders expect the first interest rate increase since 2006, marking the beginning of the end for the unprecedented era of easy monetary policy. The move would come at a time when a commodity slump is causing the market for high-yield bonds to gyrate, sending tremors through financial conditions indexes and spreading unease across trading desks.
- Aussie Borrowing Held Hostage to Fed Impact From Ore to Yields. Australian Treasurer Scott Morrison needs markets to take Wednesday’s Federal Reserve meeting in their stride, after global turmoil blew holes in the nation’s budget plans. Morrison said Tuesday in Perth that the underlying cash deficit in the year through June would be 6.6 percent wider than forecast in May after commodity prices slumped and wage growth sagged to levels normally seen during recessions. Australia will sell A$12.5 billion ($9 billion) more bonds and inflation-linked securities than previously projected, the government’s financing arm said Wednesday. The new estimates hinge partly on iron ore remaining close to its current price, after dropping almost 50 percent this year. The big risk: the Fed.
- Indonesia Wouldn't Block OPEC Cuts; Says Prices May Slide Lower. Indonesia wouldn’t oppose any call by OPEC to cut crude production while saying oil prices may trend lower because of weak global demand and high supply. The Southeast Asian producer officially reactivated its OPEC’s membership on Dec. 4 after a seven-year suspension and is the only net-importing country in the producer group. Its return coincides with a collapse in crude prices that’s discouraging energy investments and as the country’s dependence on overseas oil grows.
- Asian Stocks Rise to Halt Six-Day Selloff Ahead of Fed Decision. Asian stocks rose, following a rally in U.S. shares, as crude oil prices jumped and investors awaited the Federal Reserve’s first interest rate increase in almost a decade. The MSCI Asia Pacific Index rose 1.3 percent to 128.31 as of 9:05 a.m. in Tokyo, its first advance in seven days.
- Fed Poised to Mark the End of an Era. Long run of near-zero rates helped cut joblessness and boost U.S. growth, but weak spots linger. The Federal Reserve’s likely decision Wednesday to raise short-term borrowing costs will mark the end of an era of zero interest rates, a period of extraordinary policy experimentation that has yielded mixed results.
- The Global Battle for Oil Market Share. Iran and its rivals vie for advantage amid low prices, oversupply and the likely end of the U.S. export ban.
Fox News:
- 2016 Election Live Debate Blog.
- Coal industry treated like 'slave traders' by world leaders, says Euracoal boss. (video) The coal industry will be scorned like the slave trade because of the Paris climate deal, and a global population “brainwashed” by the United Nations, the top lobbyist for Europe’s coal industry charged.
CNBC:
Zero Hedge:- This year could be Ackman's worst, investors stick by firm. Billionaire hedge fund investor William Ackman, whose funds have been suffering double-digit losses this year, on Tuesday told investors that 2015 could be the firm's worst ever but noted that clients are generally sticking with him.
- Obama's Vendetta With Gun Makers Gets Personal: Smith & Wesson Shares Plunge After Call For SEC Investigation. (graph)
- Which President Has Received The Most "Charity" From The Fed? (graph)
- WTI Slumps Under $37 After API Reports Unexpected, Large Inventory Build. (graph)
- Stephen Roach: "The Fed Has Set The Market Up For A Crisis". (graph)
- European Nations Throw Up On EU Plan To Seize Border Sovereignty, Impose Standng Border Force.
- Majority Of Millennials Have Under $1,000 In Savings.
- NatGas Crashes To Lowest Since 1999. (graph)
- Goldman(GS) Warns IG Credit Collapse Signals S&P 500 Notably Overvalued. (graph)
- 16 Charts Showing Just How Confused "The Smartest Guys In The Room" Are Right Now. (graph)
- 3 Charts The Fed Should Consider. (graph)
- Pre-Fed Pandemonium - "Confident" Traders Buy Stocks, Dollars, Crude; Dump Bonds & Protection. (graph)
Business Insider:
Financial Times: - The next big credit collapse has already begun.
- There's a new sign of problems in China's mining sector.
- Ad-block software is approaching 200 million users — here's how publishers are reacting.
- Russia thinks it will take 7 years for oil prices to recover.
- There's been a gigantic shift in how Americans view the threat of terrorism. Terrorism now tops the list of Americans' concerns, according to new polls from Gallup, the Pew Research Center, and The Wall Street Journal and NBC News.
- Russia and China are building highly autonomous killer robots.
- Employees are expecting a lump of coal in their office holiday stockings.
- Junk bond market tests nervous investors. Investors are discovering why high-yield bonds are also called “junk”. After years of ignoring the low credit ratings and indebted balance sheets of companies within the junk bond sector, a wave of redemptions for three funds — forcing two to shutter in the past week — has triggered a frisson across the US fixed income market.
- In charts: Markets make Fed rate-rise decision harder. (graph)
Telegraph:
- Is the next financial crisis nigh? Could closure of Third Avenue Fund finally explode the post-crisis asset bubble? The closure of a number of US funds linked to the high yield corporate debt market is eerily reminiscent of the events that led up to the global financial crisis.
- PBOC Adviser Sees 'Adjustments' in China Economy. Overcapacity, bad debts, and problems in Internet finance haven't been resolved, citing Fan Gang, an adviser to the People's Bank of China.
- None of note
- Asian equity indices are +1.0% to +2.0% on average.
- Asia Ex-Japan Investment Grade CDS Index 138.0 -6.0 basis points.
- Asia Pacific Sovereign CDS Index 73.0 -3.0 basis points.
- Bloomberg Emerging Markets Currency Index 69.45 +.01%.
- S&P 500 futures +.18%.
- NASDAQ 100 futures +.21%.
Earnings of Note
Company/Estimate
- (JOY)/.43
- (APOG)/.64
- (FDX)/2.51
- (MLHR)/.54
- (JBL)/.80
- (ORCL)/.60
- (PIR)/.12
- (WOR)/.52
8:30 am EST
- Housing Starts for November are estimated to rise to 1130K versus 1060K in October.
- Building Permits for November are estimated at 1150K versus 1150K in October.
- Industrial Production MoM for November is estimated to fall -.2% versus a -.2% decline in October.
- Capacity Utilization for November is estimated to fall to 77.4% versus 77.5% in October.
- Manufacturing Production for November is estimated unch. versus a +.4% gain in October.
- Preliminary Markit US Manufacturing PMI for December is estimated to fall to 52.6 versus 52.8 in November.
- Bloomberg consensus estimates call for a weekly crude oil inventory decline of -600,000 barrels versus a -3,568,000 barrel decline the prior week. Gasoline supplies are estimated to rise by +959,090 barrels versus a +786,000 barrel gain the prior week. Distillate supplies are estimated to rise by +1,778,910 barrels versus a +4,998,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to rise +.58% versus a -1.4% decline prior.
- The FOMC is expected to raise the benchmark Fed Funds rate to .25%-.5%.
- None of note
- The Fed's Yellen speaking, Eurozone PMI, weekly MBA Mortgage Applications report, BofA Merrill Animal Health Summit, (HON) outlook call, (VRX) investor day, (CVS) analyst day and the (DHR) analyst meeting could also impact trading today.
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