Saudi Arabia

Saudi Arabia Bails Out Banking System After Interbank Rates Hit 2009 Highs

Amid what some might call self-inflicted economic collapse, Saudi Arablia has announced a $5.3 billion bailout of its banking system as interbank borrowing rates near the highest since Lehman. In what the supposedly central bank calls "supportive monetary policy...on behalf of government entities," is easing liquidity constraints with 28-day repo agreements and is the second liquidty injection this year.

Frontrunning: September 26

  • Stocks Drop on Bank, Commodity Company Woes; Turkish Lira Falls (BBG)
  • Clinton and Trump to square off in highly anticipated debate showdown (Reuters)
  • Profit Slump for S&P 500 Heads for a Sixth Straight Quarter  (WSJ)
  • Oil rises as OPEC meets, volatility hits post-Doha high (Reuters)
  • Deutsche Bank Slumps to Fresh Record Low on Capital Concerns (BBG)
  • Police Videos Fail to Quiet Protests in Charlotte (WSJ)

Global Stocks Tumble, US Futures Slide On Deutsche Bank Fears, Central Bank And Commodity Concerns

While today's biggest event for both markets and politics will be tonight's highly anticipated first presidential debate between Trump and Hillary, markets are waking up to some early turmoil in both Asia and Europe, with declines in banks and energy producers dragging down stock-markets around the world, pushing investors to once again seek the safety of government bonds and the yen.

Saudis Offer To Cut Production By 500,000 Barrels: "The Oil Market Situation Is Much More Critical"

Saudi Arabia offered to cut its oil output to January levels, as OPEC members seek ways to stabilize crude prices at talks this week in Algiers.“Saudi Arabia is ready to freeze production at the January level,” Boutarfa said, calling the offer “an interesting step.” Saudi Arabia pumped a record 10.69 million barrels a day in August compared with 10.2 million in January, suggesting the Saudis are willing to cut total output by half a million barrels. 

Siding With Saudi Arabia, Obama Vetoes Sept 11 Bill Passed Unanimously In Congress

It has been a day of Friday afternoon surprises: just one hour after Ted Cruz pretended to endorse Donald Trump when he really meant don't vote for Hillary, president Obama denied what all American citizens demanded - and got - after both chambers unanimously passed the Sept 11 law several weeks ago, when he decided to veto the Justice Against Sponsors of Terrorism Act bill.

So Much For The Saudi "Proposal" - Iran Refuses To Cap Output, Clashes With Saudis Over Freeze

After oil spiked earlier on an anonymously-sourced Reuters "report" that Saudi Arabia has offered to cut production in exchange for an Iran production freeze, a proposal which was promptly shut down by third party observes, moments ago WSJ reporter Summari Said effectively killed this particular attempt to spike the price of oil when she reported - also citing sources - that Saudis and Iranians have clshed over output freeze levels, and that Iran has refused to cap output.

Iran Is Unlikely To Accept Saudi Oil Cut Offer: Bloomberg Analyst

With the oil market roiled by the latest unconfirmed report by Reuters, which cited three anonymous sources as claiming that Saudi Arabia was ready to cut production if Iran freezes output, everyone has been focused on the follow up, to see if there is either an official confirmation, or an unofficial denial. While we wait, however, Bloomberg oil strategist Julian Lee released a quick analysis moments ago in which he explains "why Iran is unlikely to accept the Saudi oil cut offer." 

Global Central Bank-Driven Stock Rally Fizzles; Crude Rebounds On Saudi Oil Production Cut Report

Until minutes ago, this week's rebound in global equities appeared to be running out of steam as oil retreated from a two-week high and a dollar slide ended.  However, as noted just around 6am, Reuters reported, citing as it usually does various "anonymous sources", that in a radical departure from its long-held policy of not cutting production, Saudi Arabia was prepared to cut production on condition that Iran freezes output, which led to an instant spike in crude.

Saudis Said To Offer Oil Production Cut If Iran Freezes Output, Reuters Reports

With oil rolling over, and modestly pressuring US equity futures, moments ago Reuters did what it does best, and reported, citing three "anonymous" sources, that Saudi Arabia was prepared to engage in a radical shift in its long-held policy of not cutting production, and has offered to lower its own oil production if Iran agrees to cap its output this year, in a major compromise ahead of talks in Algeria next week, "three sources familiar with the discussions told Reuters."

Soothing Fed Sends Global Stocks, US Futures, Commodities Higher

Following the Fed's "hawkish hold" and the BOJ's "confused contradiction", global risk (and non-risk) assets got the green light, and as a result stocks and bonds rallied in Asia and Europe, with US equity futures rising another 0.4%, advancing with oil and industrial metals, as iron surged in Chinese trading.