Style Underperformer:
Sector Underperformer:
- 1) Airlines +.03% 2) Retail +.14% 3) Road & Rail +.28%
Stocks Falling on Unusual Volume:
- BTH, FUL, CPHD, TXI, CMTL, NSM, WMC, NWE, ATU, IBKC, MKC, BAK, WAC, QIHU, TDG, IMGN, BIIB, AHGP, EZCH, TREX, PNG and DG
Stocks With Unusual Put Option Activity:
- 1) ETP 2) ISRG 3) CCJ 4) GLW 5) STZ
Stocks With Most Negative News Mentions:
- 1) UAL 2) ALTR 3) TOL 4) GS 5) JBLU
Charts:
Style Outperformer:
Sector Outperformers:
- 1) Oil Tankers +2.44% 2) Coal +1.55% 3) Gold & Silver +1.33%
Stocks Rising on Unusual Volume:
Stocks With Unusual Call Option Activity:
- 1) HLF 2) DG 3) DFS 4) MDT 5) CSTR
Stocks With Most Positive News Mentions:
- 1) ZZ 2) NOC 3) PEP 4) BA 5) EXP
Charts:
Evening Headlines
Bloomberg:
- Euro Can Bear Fewer Members as Czech Leader Calls Greeks Victims. The exit of one or more member
states from the euro won’t destroy the monetary union or the
project of European integration, Czech President Vaclav Klaus
said. And a Greek departure from the currency would be a
“victory” for that country, which has been a victim of the monetary system, Klaus said
yesterday in an interview at Bloomberg’s headquarters in New York. The
Czech Republic, which pledged to adopt the euro as part of its agreement
to join the European Union in 2004, is under no official deadline to do
so and the question of joining the
common currency is a “non-issue” in the country, said Klaus,
whose second term as president expires in March. “I don’t think the euro
as a currency disappears,” Klaus,
71, said. “The issue is whether all of the 17 countries and
potentially a few others should be or will be in this system or
not.”
- Gilmore Says Irish Debt Deal Won’t Unravel. Eamon Gilmore, the Irish deputy
prime minister, said an accord that paved the way to cut
Ireland’s legacy bank debt won’t unravel, seeking to calm investor concern that German-led opposition could derail the agreement.
Irish bonds slumped yesterday after finance chiefs from Germany, the
Netherlands and Finland indicated a retreat from the June agreement to
allow the euro-area bailout fund to recapitalize banks. Their statement
on Sept. 25 excluded
“legacy assets” from the region’s rescue facility’s
responsibility.
- Hollande
Sruggles to Match Sarkozy Budget-Gap Wins: Euro Credit. Plugging a
budget hole of more than 30 billion euros next year against a backdrop
of an economy that hasn't grown in three quarters and joblessness that's
at a 13-year high will be a tall order, investors such as Dagmar Dvorak
at Baring Asset Management say. Failure to do so may drive money away
from French debt.
- GM(GM)-Peugeot Discussion Said to Slow While Economy Worsens. General Motors Co. (GM) and PSA Peugeot Citroen’s efforts to deepen their alliance have slowed recently
amid a worsening European auto market and complicated regulatory
review, people familiar with the matter said. The companies have already missed a June 30 deadline on the
parts-buying plan. The automakers also aimed to announce as soon
as this week at the Paris Motor Show more details on plans to
jointly build four model lines using common underpinnings and to
combine purchasing efforts, said the people, who asked not to be
identified discussing internal negotiations.
- Japan Won’t Compromise With China on Claim to Islands: Noda. Prime Minister Yoshihiko Noda said Japan will never budge on
its ownership over islands in the East China Sea also claimed by China,
doing little to ease tensions with Asia’s top economic power. While
Japan isn’t seeking a military confrontation with China and wants to
keep talking “calmly,” the disputed islands “are an inherent part of our
territory in light of history and also under international law,” Noda
told reporters in New York yesterday. “There can’t be any compromise
that would be a step back from this basic position.” Tensions
over the islands, known as Diaoyu in Chinese and Senkaku in Japanese,
spilled over to an annual gathering of world leaders at the United
Nations. The foreign ministers of China and Japan held talks on Sept. 25
in New York that failed to ease a feud damaging a $340 billion trade
relationship. The conflict has sparked the worst diplomatic
crisis between the two nations since 2005, when thousands of Chinese
protested Japanese textbooks that downplayed wartime atrocities. Chinese
Foreign Minister Yang Jiechi told Japanese counterpart Koichiro Gemba
that China “will not tolerate” Japan’s claims, according to a Chinese
Foreign Ministry statement. Gemba described the atmosphere at the
meeting as “severe” and emphasized Japan’s “maximum restraint” over the
dispute, Kyodo News reported.
- Chinese Industrial Profits Fall 6.2% in Fifth Consecutive Drop. Chinese
industrial companies’
profits dropped for a fifth month in August, a government report
showed, adding to signs the nation’s economic slowdown is extending into
a seventh quarter. Net income fell 6.2 percent from a year earlier to
381.2 billion yuan ($60.4 billion), the National Bureau of Statistics said today in Beijing. That
compares with a 5.4 percent decline in July and a 1.7 percent slide in
June. “Profits are expected to continue to fall as there is a
considerable build-up of excess capacity in the economy, and businesses
have very little pricing power and in some cases are looking to unload
inventory,” Patrick Bennett, a senior strategist at Canadian Imperial
Bank of Commerce in Hong Kong, said before the release. The
economic slowdown may persist into next year on a lack of funding for
investment projects, Song Guoqing, a central bank adviser, said last
week. Earnings are declining amid falling prices, higher costs and
slower demand. More small companies are halting all or half of their
production due to narrowing profit margins, Miao Wei, minister of industry and information technology, said in remarks posted on the agency’s website on Sept. 24. Industrial companies’ profits in the first eight months of the year declined 3.1 percent to 3.06 trillion yuan, according
to today’s statement. That compares with a 2.7 percent drop in
the first seven months and a 28.2 percent gain in the same
period in 2011. Revenue for the companies in the first eight months
increased 10.2 percent from a year earlier to 57.6 trillion yuan,
today’s statistics bureau report showed. Sales rose 29.9 percent
in the January-August period of 2011.
- Foxconn Workers Labor Under Guard After Riot Shuts Plant. Security teams wearing riot helmets
and wielding plastic shields marched around a Foxconn Technology
Group factory in northern China in a sign that tensions remain
high after a fight between 2,000 workers halted production. Foxconn’s complex, home to 79,000 workers in Taiyuan,
Shanxi province, still shows damage caused by a Sept. 23 clash
in which a dormitory fight escalated into a riot finally quelled
by hundreds of security guards and police. More than 40 people
were hospitalized in the melee that left shattered windows and
damaged parked cars across the campus.
- China
Unlikely to Introduce Infrastructure Stimulus: Baosteel. China is
unlikely to introduce any large stimulus plans on infrastructure
investment in the near term because economic development is already
"unbalanced," Zhang Dianbo, president of Raw Materials Procurement
Center and the assistant president of Baoshan Iron & Steel Co., told
reporters at an iron ore conference in Dalian today. China's stimulus
on roads, rail and ports in September won't give a big boost to steel
demand, Zhang said.
- Cosco
Sees Extended Slump as Shipper Yields Surge: China Credit. Bonds of
China's two biggest shippers are yielding the most in at least nine
months as a slump in world trade drags freight rates to levels last seen
in the 2008 global financial crisis.
Wall Street Journal:
- Spanish Scare Roils Europe Markets. Madrid's Borrowing Costs Rise as Investors Fear It Will Delay Bailout Request; Exchanges Fall as 'Draghi Effect' Wanes. Spain's borrowing costs rose and its stock market fell sharply on
the eve of Madrid's announcement of new austerity measures, putting the
shaky economy again at the center of Europe's race to preserve its
currency union. Spain's benchmark IBEX-35 index fell 3.9% and
other European exchanges posted losses as well. The government's 10-year
borrowing costs rose nearly one-third of a percentage point, to above
6%, placing renewed pressure on Madrid to find a way out of its debt
crisis and appearing to crimp its prospects for avoiding a bailout from
its euro-zone partners.
- It's Always the Economy, Stupid. Barack Obama wants to talk about his windmill economy. Next week's debate should discuss the one we've got now.
- Obama's Biggest Opponent Is the Truth. Voters expect Mitt Romney to blow the whistle in the debates.
MarketWatch.com:
Zero Hedge:
Business Insider:
NY Times:
- Spanish Ire, Symbolized by a Carrot. As Spanish domestic politics threaten to spin beyond the control of the
central government, they are also making it harder for Prime Minister
Mariano Rajoy to meet Spain’s financial obligations to the rest of the
euro zone.
Reuters:
- Europe's dimming prospects in spotlight at Paris auto show. As executives bemoan the
worsening outlook for the European car market, they hope the
no-frills small cars on display at the Paris auto show will lure
customers in austerity-hit markets and premium limousines will
attract buyers in China. Even the carmakers that had until recently been thriving,
poaching market share from ailing competitors, are now feeling
the pinch as austerity measures, high unemployment and fears
about the future keep customers away from showrooms. South Korean automaker Hyundai Motor Co on
Wednesday said it was deferring its sales and market share
target by at least a year due to the dismal outlook that is now
starting to worry the stronger carmakers as well as the weak.
- H.B. Fuller(FUL) cuts forecast for full-year revenue. H.B. Fuller Co's third-quarter
profit met analysts' estimates, but the specialty chemicals
maker cut its full-year revenue outlook, citing a slight slow
down in the global market for industrial adhesives. The company cut its full-year revenue forecast to between
$1.88 billion and $1.90 billion from between $1.93 billion and
$1.98 billion.
Telegraph:
Xinhua:
- China
will continue to stabilize land prices and crack down on hoarding and
speculation of land, citing an official from the Ministry of Land and
Resources.
China Securities Journal:
- Major
shareholders of 32 companies listed on China's ChiNext have offered to
extend the lockups on the holdings after they become tradable in Oct,
citing statements. The move is ant attempt to help stabilize the stock
market, according to the report. ChiNext tumbled -3.1% yesterday to the
lowest since Feb. 2, extending a 5-day loss to 9.2%.
Evening Recommendations
Night Trading
- Asian equity indices are -.25% to +.50% on average.
- Asia Ex-Japan Investment Grade CDS Index 143.0 -2.0 basis points.
- Asia Pacific Sovereign CDS Index 120.0 +1.75 basis points.
- FTSE-100 futures +.03%.
- S&P 500 futures +.40%.
- NASDAQ 100 futures +.32%.
Morning Preview Links
Earnings of Note
Company/Estimate
- (DFS)/1.03
- (MKC)/.76
- (ATU)/.54
- (NKE)/1.12
- (MU)/-.23
- (GPN)/.87
- (ZZ)/.03
- (AZZ)/.52
Economic Releases
8:30 am EST
- Final 2Q GDP is estimated to rise +1.7% versus a prior estimate of a +1.7% gain.
- Final 2Q GDP Price Index is estimated to rise +1.6% versus a prior estimate of a +1.6% gain.
- Final 2Q Personal Consumption is estimated to rise +1.7% versus a prior estimate of a +1.7% gain.
- Final 2Q Core PCE is estimated to rise +1.8% versus a prior estimate of a +1.8% gain.
- Durable Goods Orders for August are estimated to fall -5.0% versus a +4.2% gain in July.
- Durables Ex Transports for August are estimated to rise +.2% versus a -.4% decline in July.
- Cap Goods Orders Non-Defense Ex Air for August are estimated to rise +.7% versus a -3.4% decline in July.
- Initial Jobless Claims are estimated to fall to 375K versus 382K the prior week.
- Continuing Claims are estimated to rise to 3288K versus 3272K prior.
10:00 am EST
- Pending Home Sales for August are estimated to rise +.3% versus a +2.4% gain in July.
11:00 am EST
- Kansas City Fed Manufacturing for September is estimated to fall to 5 versus a reading of 8 in August.
Upcoming Splits
Other Potential Market Movers
- The
Spanish retail sales report, Germany unemployment rate, Italy 10Y Bond
Auction, UK GDP, Spanish 2013 Budget Approval, Spanish bank stress
tests, 7Y T-Note auction, Japan Industrial Production report, weekly
Bloomberg Consumer Comfort Index and the weekly EIA natural gas
inventory report could also impact trading today.
BOTTOM LINE: Asian
indices are mostly higher, boosted by consumer staple and
industrial shares in the region. I expect US stocks to open
modestly higher and to weaken into the afternoon, finishing modestly
lower. The Portfolio is 25% net long heading into the day.
Broad Market Tone:
- Advance/Decline Line: Lower
- Sector Performance: Most Sectors Declining
- Volume: Around Average
- Market Leading Stocks: Underperforming
Equity Investor Angst:
- VIX 16.32 +5.77%
- ISE Sentiment Index 131.0 +36.46%
- Total Put/Call .90 -2.17%
- NYSE Arms 1.14 -62.68%
Credit Investor Angst:
- North American Investment Grade CDS Index 102.68 bps +2.31%
- European Financial Sector CDS Index 209.27 bps +7.83%
- Western Europe Sovereign Debt CDS Index 149.27 +9.06%
- Emerging Market CDS Index 232.14 +1.28%
- 2-Year Swap Spread 16.0 +2.25 basis points
- TED Spread 26.0 +.25 basis point
- 3-Month EUR/USD Cross-Currency Basis Swap -26.75 -4.0 basis points
Economic Gauges:
- 3-Month T-Bill Yield .10% -1 basis point
- Yield Curve 136.0 -5 basis points
- China Import Iron Ore Spot $104.20/Metric Tonne +.48%
- Citi US Economic Surprise Index 28.9 -.2 point
- 10-Year TIPS Spread 2.43 -1 basis point
Overseas Futures:
- Nikkei Futures: Indicating -31 open in Japan
- DAX Futures: Indicating +17 open in Germany
Portfolio:
- Slightly Higher: On gains in my Retail sector longs, emerging markets shorts and index hedges
- Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges and covered some of my (EEM) short, then added them back
- Market Exposure: 25% Net Long
BOTTOM LINE: Today's
overall market action is bearish as the
S&P 500 trades lower on soaring Eurozone debt angst, rising global growth fears, high
food/energy prices,
earnings worries, growing Mid-east unrest, increasing China/Japan
tensions, US "fiscal cliff" worries and tech/homebuilding sector
weakness. On
the positive side, Tobacco, Education and Gaming shares are
especially strong, rising more than +.75%. Consumer Staple shares have
traded well throughout the day. The UBS-Bloomberg Ag Spot
Index is down -2.0%, Gold is down -.5% and Oil is down -1.1%. On
the negative side, Oil Service, Software, Computer, Disk Drive,
Networking, Biotech and Homebuilding shares are especially weak,
falling more than
-1.25%. Tech and homebuilding shares have traded poorly throughout the
day. Lumber is falling -.8% and Copper is down -1.3%. Major Asian indices were lower overnight, led down by a -2.0% decline in Japan. The Shanghai Comp fell another -1.2%(-8.9% ytd) to the lowest since Feb. 2009,
which remains a large red flag for the global economy. China’s ChiNext
Index of faster growing smaller companies fell another -3.0% overnight
and is down -13.2% in 2 weeks.
Major European indices are under substantial pressure, led down by a
-3.9% decline in Spain. The Bloomberg European Bank/Financial Services
Index is dropping -3.7% today. Brazil is -.2% today and testing its
200-day. The
European Investment Grade CDS Index
is gaining +4.6% to 141.28 bps. The European Financial Sector CDS Index
is jumping +6.3% to 206.2 bps. The Germany sovereign cds is jumping
+8.8% to 57.12 bps(+21.9% in 5 days). The France sovereign cds is
soaring +10.2% to 122.83 bps(+28.6% in 5 days).
The Spain sovereign cds is up +9.6% to 399.37 bps. The Italy sovereign
cds is gaining 10.1% to 367.12 bps. The Portugal sovereign cds is
soaring +11.7% to 530.64 bps. The Ireland sovereign cds is jumping +7.9%
to 306.33 bps. The Spain 10Y Yld is jumping +4.8% to 6.02% and the
Italian/German 10Y Yld Spread is gaining +5.4% to 370.61 bps(+11.8% in 5
days). The China sovereign cds is up +1.6% to 93.0 bps(+26.9% in 5
days). The China Development Bank Corp CDS is rising +3.7% to 141.0
bps(+19.9% in 5 days). The Russia sovereign cds is gaining +4.4% to
155.41 bps(+19.4% in 5 days). The Brazil sovereign cds is gaining +4.5%
to 116.6 bps(+15.5% in 5 days). The UBS/Bloomberg Ag Spot Index is breaking down from its recent range, but is still up +20.3% since 6/1. The benchmark China Iron/Ore Spot Index is down -42.4% since 9/7/11. The China Hot Rolled Steel Sheet Spot Index
also continues to trend lower despite the recent bounce. As well,
copper, oil and lumber continue to trade poorly given equity investor
perceptions that the Eurozone has successfully kicked-the-can, housing
has hit a major bottom and global central bank stimuli will boost
economic growth in the near future. US weekly retail sales have decelerated to a sluggish rate at +2.4%. The Philly Fed ADS Real-Time Business Conditions Index has shown meaningful deceleration since early July. Moreover,
the weekly MBA Home Purchase Applications Index has been around the
same level since May 2010 despite investor perceptions of a big
improvement in the nationwide housing market. The Baltic Dry Index has
plunged around -65.0% from its Oct. 14th high and is now down around
-55.0% ytd. Shanghai Copper Inventories have risen +314.0% ytd. Oil tanker rates have plunged, with the benchmark Middle East-to-US voyage down to 27.50 industry-standard worldscale points, which is near the lowest since May, 2009.
The 10Y T-Note continues to trade too well with the yield falling -6
bps to 1.61%. There still appears to be a fairly high level of complacency among US investors regarding the deteriorating macro backdrop. It remains unclear to me whether or not Germany will
destroy its own balance sheet or allow the ECB to monetize debt in a
major way in an attempt to "save" the euro even as investors have been pricing this outcome into stocks. Massive tax hikes and spending cuts have still yet to hit in several key eurozone countries that are already in recession. A lack of economic competitiveness and growth incentives remain unaddressed problems. The European debt crisis is also really affecting emerging market economies now, which will further pressure exports from the region and further raise the odds of more sovereign/bank downgrades after the US election. I continue to believe that China's problems are much larger than commonly perceived
and cannot be solved with another massive stimulus package given their
real estate bubble, rising food prices/labor costs, massive
overcapacity in certain key parts of the economy and growing bad loans
problem. Little being done by global central bankers will actually boost global economic growth to an extent that overcomes the growing
macro headwinds over the intermediate-term, in my opinion. Over the intermediate-term, the Fed's recklessness
greatly increases the chances of hard-landings in key emerging markets
and of a serious global stock swoon, in my opinion. Moreover,
uncertainty surrounding the effects on business of Obamacare, the "US
fiscal cliff" and the election outcome uncertainty will likely become
more and more of a focus for US investors into the fourth quarter. The Mid-east continues to unravel at an alarming rate, as well.
The quality of the stock rally off the June lows has been very poor as
breadth, volume, leadership, lack of big volume/gainers and
copper/lumber/transports relative weakness all continue to be concerns. Thus,
recent market p/e multiple expansion on global central bank
stimulus/action hopes, is creating an unstable situation for equities,
which could become a big problem this fall unless a significant macro
catalyst materializes soon. For this year's equity advance to regain
traction, I would expect to see further European credit gauge
improvement, a subsiding of hard-landing fears in key emerging markets,
a rising 10-year yield, better volume, stable-to-lower food/energy
prices, a US "fiscal cliff" solution, a calming in Mid-east and
China/Japan tensions and higher-quality stock market leadership. I
expect US stocks to trade modestly lower into the close from
current levels on rising global growth fears, earnings worries, rising
Japan/China/Mideast tensions, quarter-end profit-taking, more shorting,
technical selling, tech/homebuilding sector weakness and US "fiscal
cliff" concerns.
Bloomberg:
- Spanish Bonds Slump as Marchers Plan Further Protests. Spanish
bond yields climbed the most this month as a second night of violent
protests loomed amid sparring over the police response to clashes in
Madrid. Spain’s 10-year benchmark yield rose above 6 percent,
approaching the levels seen before European Central Bank President Mario
Draghi offered to buy struggling nations’ debt. Prime Minister
Mariano Rajoy told the Wall Street Journal in comments confirmed by his
office that he would “100 percent” seek a rescue if borrowing costs
stayed “too high.” “The negative newsflow on Spain is gaining momentum,”
said Michael Leister, a fixed-income strategist at Commerzbank AG in
London. “The protests will definitely add to the pressure, but negative
news regarding the regions pose a bigger risk.” The
slump in Spanish bonds sent the yield to 6.06 percent, up 32 basis
points, at 5:55 p.m. in Madrid. The benchmark Ibex stock index slid 3.9
percent.
- Rajoy Bets Italian Woes May Ease Spain Rescue Terms: Euro Credit. Spanish
Prime Minister Mariano Rajoy may be delaying a bailout request on a bet
that renewed market tension will also force Italy to seek aid,
strengthening his bargaining power and giving political cover. Spain
will have more leverage if it can fend off a rescue until Italy joins it
in needing ECB help to bring down the cost of servicing its debt, said
Raphael Gallardo, head of macroeconomics at Rothschild Asset Management
in Paris.
- Greek Protests in Athens End After Police Use Tear Gas. Protests in Athens ended today
after police fired tear gas in response to fire-bombs thrown by
demonstrators during a strike over wage cuts and austerity that
Prime Minister Antonis Samaras said are vital to keep the euro. Demonstrators earlier filled central Syntagma Square in
Athens, opposite the Parliament House, shouting slogans such as
“struggle, clash, overturn: history gets written by those who
disobey.” Police spokesman Takis Papapetropoulos estimated the
crowd at 35,000 people. Police said 105 people were detained, 21
were arrested and 8 officers were injured. Schools, hospitals, ferries and government services shut
down in the first walkout since February. Shops closed from 3
p.m. today to let staff take part in demonstrations. Public
transport operated to allow protesters to attend rallies in
Athens city center. A three-hour walkout by air traffic
controllers disrupted flights around the country.
- Credit
Risk Surges as Catalan Concern Adds to Spanish Bank Woes.
Credit-default swaps on sovereign and corporate debt rose on concern
Spain faces a constitutional crisis after its richest region called
early elections and that recapitalization of the nation's banks faces
new hurdles. The Markit iTraxx SovX Western Europe Index rose 12 basis
points to 150 with contracts on Spain climbing 30 basis points to 400 at
2:53 pm in London, the biggest rise in almost three weeks. The Markit
iTraxx Financial Index linked to the senior debt of 25 banks and
insurers rose 11 basis points to 205.
- European Stocks Drop Most Since July Before Spain Budget. European
stocks slid the most in two months as Spain prepared to present its
budget and Federal Reserve Bank of Philadelphia President Charles
Plosser said the third round of bond buying may fail to stimulate growth.
Acciona SA (ANA) sank 9.9 percent, leading Spanish builders lower a day
before the government presents its budget for next year. Banco
Santander SA (SAN), Spain’s largest lender, retreated 4.5 percent. Anglo
American Plc (AAL) lost 3.7 percent after saying that it plans to
reduce its production of coal. The Stoxx Europe 600 Index plunged 1.8 percent to 270.72 at
the close, its largest drop since July 23.
- China’s Stocks Fall to 2009 Low on Concern About Economy, Profit.
China’s stocks fell, with the Shanghai Composite Index briefly sliding
below the 2,000 level for the first time in three years, on concern the
deepening
economic slowdown is hurting corporate profits.
The Shanghai Composite dropped 1.2 percent to 2,004.17 at
the close, after slumping to as low as 1,999.48 in the last five
minutes of trading. The benchmark gauge has lost 9.9 percent
this quarter, the most in a year, and is the worst performer
among global markets after Cyprus.
- Foxconn Workers Labor Under Police Watch After Riot Shuts Plant. Security teams wearing riot helmets
and wielding plastic shields marched around a Foxconn Technology
Group factory in a show of force after a fight involving 2,000
workers prompted the company to suspend production there. The campus used by 79,000 workers in Taiyuan, in northern
Shanxi province, showed the damage caused by a Sept. 23 clash
between laborers from different provinces that left more than 40
people hospitalized. Windows in a bath house, supermarket,
arcade and parked cars were shattered as investigators tried to
determine how a fight in a dormitory escalated into a riot
quelled by hundreds of security guards and police.
- U.S. Grads Work As Waiters While Italy’s Remain Jobless.
- Fed’s Evans Calls for More Easing, Warns of ‘Lost Decade’. Federal
Reserve Bank of Chicago President Charles Evans said policy makers must
not be passive in the face of high U.S. unemployment, firing back at critics of
the Fed’s decision this month to step up record stimulus. “We cannot be complacent and assume that the economy is
not being damaged if no action is taken,” Evans said today in
the text of remarks prepared for delivery in Hammond, Indiana.
“If we continue to take only modest, cautious, safe policy
actions, we risk suffering a lost decade similar to that which
Japan experienced in the 1990s.”
Wall St. Journal:
- Carney: Obama Does View Libya Attack as ‘Terrorist Attack’. The White House fielded questions Wednesday about why President Barack Obama
has not gone as far as members of his administration — including his
top spokesman — in labeling the violence in Libya that killed four
Americans a terrorist attack.
- Israel Must Be 'Eliminated'. Netanyahu has to take Iran's words seriously. Why doesn't Obama?
- Factory Riot Spotlights Breaking Point in China. The pressures threatening China's status as the world's factory floor
have been laid bare by a riot this week at a factory that makes parts
for Apple Inc. and other electronics companies, a clash that workers
said was sparked by onerous security and repressive living conditions. The consequences of a riot that erupted on Sunday in the Hon Hai
Precision Industry Co.'s plant go far beyond the security of Apple's
supply chain, which relies on armies of industrious and docile Chinese
workers. The riot raises questions about the sustainability of China's vaunted manufacturing machine.
MarketWatch.com:
CNBC:
- Fed Virtually Funding the Entire US Deficit: Lindsey. The
latest round of extraordinary Federal
Reserve stimulus is risky and leaves little room to maneuver should
another crisis hit, economist Lawrence Lindsey told CNBC’s “Squawk Box”
on Wednesday. Lindsey said that with the Fed purchasing at least $40
billion a month in mortgage debt through QE3, “they are buying the
entire deficit.”
Zero Hedge:
Business Insider:
CNN:
RasmussenReports:
- Daily Presidential Tracking Poll. The Rasmussen Reports daily Presidential Tracking Poll for Wednesday
shows both President Obama and Mitt Romney attracting support from 46%
of voters nationwide. Three percent (3%) prefer some other candidate,
and five percent (5%) are undecided.
Reuters:
- CEO confidence tumbles to three-year low: Roundtable. U.S. chief executives' view of the economy deteriorated sharply in the
third quarter and is now as bleak as it was in the immediate aftermath
of the last recession, with more planning to cut jobs over the next six
months, according to a survey released by the Business Roundtable on
Wednesday. The group's CEO Economic Outlook Index
tumbled to 66 in the third quarter from 89.1 in the second, in the
sharpest drop recorded in the survey's decade-long history. Confidence
fell to its lowest point since the third quarter of 2009. Thirty-four percent of U.S. CEOs expect to cut jobs in the United States
over the next six months, up from 20 percent a quarter ago, while 30
percent plan to raise capital spending, down from 43 percent.
Fifty-eight percent expect their sales to rise over that time period,
down from the previous survey's 75 percent.
- Austerity-hit Italians avoid shops, sales drop. Italian retail sales fell for the fourth month running in July, data
showed on Wednesday, highlighting how austerity measures and
unemployment are discouraging shoppers and deepening a year-long
recession. Sales dropped 3.2 percent in July
compared to the same month last year, National statistics office ISTAT
said, for their steepest fall since a 6.8 percent drop in April, the
largest decline since the current data series began in January 2001. With Italians buckling under the
impact of a severe recession, tax hikes, falling disposable incomes and
rising unemployment, the prospects for a rebound in consumer spending
are looking increasingly bleak. Retail lobby
Confcommercio said this week that consumer spending is set this year for
its biggest post-World War Two decline, and data from ISTAT shows
consumer morale has only recovered slightly from a historic low hit in
June.
- Copper slides on renewed European debt worries.
- Shanghai rebar falls, pressure on iron ore as restocking stalls.
- U.S. recession signal from the Philly Fed. (graph) Tom Porcelli, economist at RBC Capital, says he’s concerned about a new trough from a little-watched Philadelphia Fed survey of coincident indicators.
- French joblessness tops 3 mln for first time in 13 yrs.
The number of unemployed in France topped the 3 million mark in August
for the first time in 13 years, official figures showed on Wednesday,
adding to President Francois
Hollande's woes as he seeks to revive a stalled economy and his tumbling
poll ratings. Marking its 16th consecutive monthly rise, the number of
registered jobseekers in mainland France increased by 23,900
last month to 3,011,000, Labour Ministry data showed. That was a
9 percent increase year-on-year and the highest figure since
June 1999.
Telegraph:
Sueddeutsche Zeitung:
- Slovakia
won't agree to give Greece "more money, more time," Prime Minister
Robert Fico said. Euro countries can only get money from bailout funds
if they meet conditions, he said.
Style Underperformer:
Sector Underperformer:
- 1) Homebuilders -2.80% 2) Computer Hardware -1.60% 3) Oil Service -1.50%
Stocks Falling on Unusual Volume:
- DB,
BMA, CTCM, PRGS, STO, TOT, AAPL, TDG, BTH, COLB, FTNT, SNX, RAH, TROX,
JBL, MKTX, RNF, AI, AMTG, PAY, LPX, ARII, CMO, NOW, EPL, NRP, MSM, ARI,
DXPE, PKX, THR, PNR, TDG, FTK, SPN and NRP
Stocks With Unusual Put Option Activity:
- 1) URBN 2) MRVL 3) JBL 4) HYG 5) DISH
Stocks With Most Negative News Mentions:
- 1) SNDK 2) CCL 3) LEN 4) EPL 5) MRVL
Charts: