AdminBill: MONDAY, SEPTEMBER 12, 2016 (6:40AM MDT)
NOTHING SO FAR THIS MORNING BUT THE DAY IS YOUNG.
I BELIEVE THIS WEEK IS CRITICAL. SHOULD THE RELEASE NOT HAPPEN THIS WEEK THEN IMO ALL BETS ARE OFF.
THE WORLD DETERS (teeters?) ON FINANCIAL COLLAPSE WHILE NERO PLAYS THE FIDDLE:
http://www.bloomberg.com/news/articles/2016-09-11/asian-stock-futures-tip-more-pain-as-policy-angst-ignites-swings
NAME YOUR OWN NERO.
U.S. Stock Futures, Treasuries Pare Losses as Selloff Eases
Treasuries erased losses while U.S. equity futures pared a decline as the biggest selloff for U.S. assets since June eased before a Federal Reserve official speaks. Markets from Asia to Europe retreated.
Futures on the S&P 500 Index were little changed after falling as much as 0.7 percent. Concern that central banks are preparing to wean markets off stimulus sent the underlying measure tumbling 2.5 percent on Friday. The yield on 10-year Treasury notes held at 1.67 percent after surging eight basis points to end last week. Shares in Europe and Asia, which were closed Friday when the selloff began, dropped Monday by the most since the aftermath of the Brexit vote. Oil sank below $45 a barrel. The yen advanced and the won slid.
While financial markets were jolted out of a period of calm by an uptick in concern over the outlook for central bank policies, futures traders on Monday are assigning just a 26 percent chance of a rate hike at the Fed’s September meeting. Lael Brainard, a member of the board of governors, speaks in Chicago. Boston Fed President Eric Rosengren last week said the economy could overheat if rates stay low for longer, while European Central Bank President Mario Draghi last week played down the prospect of further stimulus.
“I’d take this as another of those blips when markets come to terms with less stimulus,” said Kully Samra, a London-based client manager at Charles Schwab Corp., which has $2.7 trillion in client assets. “The market is hooked on any words coming out of the Fed. Some recent economic reports have made people challenge the wisdom of another rate increase this year.”
Markets and commodities are slumping as the new trading week begins. Here’s what you need to know https://t.co/YTt3jkQa6r
— Bloomberg (@business) September 12, 2016
Investors got another stress to ponder after concerns over the health of Democratic presidential candidate Hillary Clinton flared, weighing in particular on the Mexican peso. The 68 year-old is suffering from pneumonia and became overheated and dehydrated during a Sept. 11 commemoration Sunday, her doctor said. She subsequently canceled a two-day trip to California.
Stocks
The MSCI All-Country World Index of shares fell for a third day, dropping 0.8 percent at 8:01 a.m. New York time. All major western-European stock markets dropped as the Stoxx Europe 600 Index lost 1.6 percent. The VStoxx Index tracking euro-area equity volatility headed for its biggest jump since January, signaling a return of instability after an extended period of stable prices.
Miners posted the worst performance of the 19 industry groups on the Stoxx 600 today as commodity prices retreated. Energy companies slid as oil extended declines after U.S. producers increased drilling.
Linde AG tumbled 8 percent after saying it terminated talks for a combination with Praxair Inc. EON SE slid 16 percent after spinning off its Uniper SE unit. RWE AG fell 3.6 percent after confirming plans for an initial public offering of Innogy SE shares in the fourth quarter. SVG Capital Plc jumped 15 percent after HarbourVest Global Private Equity Ltd. offered to buy it for about 1 billion pounds ($1.3 billion) in cash.
S&P 500 Index futures slipped 0.3 percent, indicating U.S. equities will slide for a fourth day, after ending last week lower.
The index slumped 2.5 percent Friday, breaking out of a range that hadn’t seen it move more than 1 percent in either direction for 43 days. Praxair Inc. lost 1.7 percent in early New York trading, and HP Inc. slipped 2.1 percent after saying it will buy Samsung’s printer business for $1.05 billion.
The MSCI Emerging Markets Index slid 2.6 percent, the most since June 24. The gauge has slumped 4.2 percent in two days, poised for a one-month low. The Hang Seng China Enterprises Index of mainland companies listed in Hong Kong sank 4 percent, the most in seven months, and South Korea’s Kospi lost 2.3 percent.
Samsung plunged 7 percent after U.S. regulators joined the company in cautioning users to power down their Note 7s and refrain from charging them. Aviation authorities and airlines have called on passengers to stop using the gadgets during flights.
The company announced a recall of millions of big-screen smartphones on Sept. 2 after about three dozen of them were found to have batteries that caught fire or exploded.
Bonds
Germany’s 10-year yield climbed two basis points, or 0.02 percentage point, to 0.03 percent, and touched the highest level since June 24. Spanish bonds with a similar maturity dropped a fourth day, pushing the yield to the most in seven weeks.
Yields on benchmark Treasuries increased two basis points to 1.69 percent, before sales of a combined $44 billion of three- and 10-year notes. The three-year noes being sold later on Monday yielded 0.95 percent, an increase of 10 basis points compared with the previous auction on Aug. 9.
Brainard, seen as a leading opponent of rate increases for much of the past year, is the last scheduled Fed speaker before the self-imposed blackout period running up to the Sept. 20-21 policy meeting. Any hawkish shift in her rhetoric may stoke volatility in financial markets, which on Friday put the probability of a hike in borrowing costs this month at 30 percent.
“Growth is low and going to stay low and inflation is not really a problem,” Charles Diebel, London-based head of rates at Aviva Investors said in a Bloomberg TV interview with Manus Cranny and Nejra Cehic. “That’s not an environment where bonds get destroyed. It may be that their valuations are relatively rich and we’re experiencing a correction, but we’re not talking about the start of a huge bear market.”
Ten-year yields in Australia surged nine basis points to 2.05 percent, after gaining 10 basis points on Friday, and that for New Zealand debt with a similar due date jumped 11 basis points to 2.47 percent.
Japanese government bonds with maturities of less than a decade advanced and longer-dated securities declined. The moves follow a Reuters report on Friday that said the Bank of Japan was studying options to steepen the nation’s yield curve.
The cost of insuring corporate debt against default jumped the most since late June. The Markit iTraxx Europe Index of credit-default swaps on highly rated companies climbed four basis points to 72 basis points. A measure of swaps on junk-rated corporate issuers rose 16 basis points to 332 basis points. Both gauges are at the highest in about two months.
Commodities
The Bloomberg Commodity Index fell 0.8 percent, after sliding 1.3 percent on Friday.
Crude oil sank 2.2 percent to $44.85 a barrel in New York after American producers increased drilling, adding to a glut. U.S. rigs targeting crude rose to the highest since February, according to data from Baker Hughes Inc.
Nickel slid 3 percent in London, dropping for the first time in eight days, while tin tumbled by the most since May.
Iron ore fell in China to the lowest since June amid speculation the nation’s policy makers will tighten property curbs and so cool demand for steel. Steps should be taken to restrain bubble-like expansion in the housing market, Ma Jun, chief economist of the PBOC’s research bureau, said in an interview with China Business News.
Currencies
The Bloomberg Dollar Spot Index fluctuated near a one-week high before Brainard’s speech, with regional Fed chiefs for Atlanta and Minneapolis also lined up to speak on Monday. The yen appreciated 0.6 percent versus the greenback.
There’s “growing caution over a rate hike as the day of the Fed’s decision draws closer,” said Masashi Murata, a currency strategist at Brown Brothers Harriman & Co. in Tokyo. “Markets had been too confident that a hike wouldn’t happen. But global economies are not in a critical phase, so there’s a limit to selling on risk aversion. Money will eventually seek yields and underpin high-yielding currencies.”
The won slumped 1.4 percent after Yonhap News reported that U.S. and South Korean intelligence authorities see a high chance that North Korea will conduct an additional nuclear weapons test after holding one on Friday.
The Mexican peso tumbled to a 2 1/2-month low. Spurred by his policies toward the U.S.’s neighbor, Mexico’s currency has repeatedly declined when Republican nominee Donald Trump’s election outlook improved and rallied when his odds of winning slumped.
The MSCI Emerging Markets Currency Index slid 0.6 percent, leaving it down 1.3 percent over two days.
Financial markets in Singapore, Malaysia, Indonesia, Turkey and the Middle East were among those closed for holidays.
Click link to view videos: http://www.bloomberg.com/news/articles/2016-09-11/asian-stock-futures-tip-more-pain-as-policy-angst-ignites-swings
