Bank of America

"If No Agreement, Expect A Sharp Selloff" - All You Need To Know About Doha

Sunday’s producer meeting is all about nothing no matter what agreement might be forged. At best, the agreement will be, as Russia’s energy minister has stated, a gentlemen’s affair, with no binding commitments, no concrete next steps beyond having a review meeting, and no procedure for moving to production cuts.

Frontrunning: April 15

  • Global stocks, dollar and oil cool ahead of Doha meeting (Reuters)
  • Oil Falls Before Doha as Global Markets Brace for Weekend Risk (BBG)
  • China Growth Slows; Revival Policies Appear to Gain Traction (WSJ)
  • White House hopefuls Clinton, Sanders joust in Brooklyn brawl (Reuters)
  • Trump talks up 'New York values' as protesters demonstrate against him (Reuters)
  • Sanders Can’t Clarify Wall Street Plan in Testy Clinton Debate (BBG)

Futures Fade As Chinese "Good News Is Bad News" For Fed, Oil Drops As Doha Concerns Emerge

Good news is still bad news after all. After last night's China 6.7% GDP print which while the lowest since Q1 2009, was in line with expectations, coupled with beats in IP, Fixed Asset Investment and Retail Sales (on the back of $1 trillion in total financing in Q1)  the sentiment this morning is that China has turned the corner (if only for the time being). And that's the problem, because while China was a good excuse for the Fed to interrupt its rate hike cycle as the biggest "global" threat, that is no longer the case if China has indeed resumed growing. As such Yellen no longer has a ready excuse to delay. This is precisely why futures are lower as of this moment, because suddenly the "scapegoat" narrative has evaporated.

Peter Schiff Slams Managers' "Denial... And Mindless Optimism"

The Winter of 2015-2016, which came to an end a few weeks ago, has been officially designated as the mildest in the U.S. in 121 years according to NOAA. While this fact will certainly add a major talking point in the global warming debate, it should also be front and center in the current economic discussion. The fact that it isn’t is testament to the blatantly self-serving manner in which economic cheerleaders blame the weather when it’s convenient, but ignore it when it’s not.

In Its Second Attempt At Going Public, BATS Prices $253 Million IPO At $19/Share

It's time for try number two. Moments ago BATS announced that it has just priced its second attempt at going public by pricing its (second) initial public offering at a price to the public of $19.00 per share (this time the high end of the range). The size of the offering has been increased from the initially announced 11,200,000 shares of common stock to 13,300,000 shares of common stock.

Frontrunning: April 14

  • Global shares reach four-month high, forex hit by Singapore sting (Reuters)
  • Dollar Rally Hits Commodities as Europe Halts Global Stock Gains (BBG)
  • Currencies Across Asia Fall Sharply Against U.S. Dollar (WSJ)
  • IEA expects limited impact from oil output freeze at Doha (Reuters)
  • IEA Sees Oil Oversupply Almost Gone in Second Half on Shale Drop (BBG)
  • BofA Profit Declines 13% on Trading Slump, Energy Reserves (BBG)

BofA Profit Misses, Tumbles 13% On Trading Revenue Slide, Build In Energy Reserves

Expectations of a "less terrible" first quarter for banks may have been premature following yesterday's stronger than expected JPM earnings report. First it was both PNC and Blackrock missing on the top and bottom line, but the highlight of the day was Bank of America which moments ago reported $0.20 in EPS, missing expectations of a $0.21 print, while revenue ex-DVA dropped by $1.4 billion to $19.7 billion, also missing expectations of a $20bn print. BofA reported Net Income of $2.68 billion, down from $3.1 billion one year ago.

U.S. Futures Flat After Oil Erases Overnight Losses; Dollar In The Driver's Seat

In another quiet overnight session, the biggest - and unexpected - macro news was the surprise monetary easing by Singapore which as previously reported moved to a 2008 crisis policy response when it adopted a "zero currency appreciation" stance as a result of its trade-based economy grinding to a halt. As Richard Breslow accurately put it, "If you need yet another stark example of the fantasy storytelling we amuse ourselves with, juxtapose today’s Monetary Authority of Singapore policy statement with the storyline that the Asian stock market rally intensified on renewed optimism over the global economy. Singapore is a proxy for trade and economic growth ground to a halt last quarter." The Singapore announcement led to a sharp round of regional currency weakness just as the dollar appears to have bottomed and is rapidly rising.

Bank Of America Reveals "The Next Big Trade"

Markets have stopped focusing on what central banks are doing and are "positioning for what they believe central banks may or may not do," according to BofA's Athanasios Vamvakidis as he tells FX traders to "prepare to fight the central banks," as the market reaction to central bank policies this year reflects transition to a new regime, in which investors start speculating which central bank will have to give up easing policies first.

Federal Regulators Accuse Banks Of Not Having Credible Crisis Plans, Would Need Another Bailout

We were not surprised to read this morning that federal regulators announced that five out of eight of the biggest U.S. banks do not have credible plans for winding down operations during a crisis without the help of public money. Which is precisely the point: now that the precedent has been set and banks know they can rely on the generosity of taxpayers (with the blessing of legislators) why should they even bother planning; they know very well that if just one bank fails, all would face collapse, and the only recourse would be trillions more in taxpayer aid.

Dear Dallas Fed, Any Comment?

"In September, regulators from the OCC, the Federal Reserve and the Federal Deposit Insurance Corp. met with dozens of energy bankers at Wells Fargo’s office in Houston...  Regulators pushed lenders to focus instead on a borrower’s ability to make enough money to repay the loan, according to the person familiar with the discussions."

Chart Of The Day - Wall Street Vs. Main Street

For those of us who recall how the mainstream media, compromised pundits and Wall Street welfare babies “sold” us on the unconscionable banker bailouts, we vividly remember a constant repetition of the invented and preposterous mantra that “helping Wall Street in turn helps Main Street.” This fantastical idea that the fortunes of Wall Street and Main Street are inextricably linked is, of course, total garbage and always has been.