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Daily US Opening News And Market Re-Cap: August 12

Tyler Durden's picture




 

From RanSquawk

  • Countries including France, Italy, Spain and Belgium imposed a short-selling ban, which helped financials
  • According to sources, Chancellor Merkel may not be able to keep her promise of getting changes to the EFSF before end-September
  • The 10-year yield in Italy fell below 5% and in France fell below the 3% level, demonstrating that ECB’s SMP bond-buying programme may be working
  • CHF weakened across the board partly on the back of market talk that the SNB was conducting currency swap operations via small Swiss corporate banks

Market Re-Cap
 
Volatility continued across European equities in early trade supported by a short-selling ban imposed by countries including France, Italy, Spain and Belgium. However, prices came under pressure following news that Chancellor Merkel may not be able to keep her promise of getting changes to the EFSF before end-September, together with lower than expected GDP data from France. As the session progressed, appetite for risk emerged as the dominant theme as equities moved higher, led by financials, whereas the Eurozone 10-year government bond yield spreads tightened across the board, with aggressive narrowing witnessed in the French/German spread. This was supported by market talk of the ECB buying in the Italian and Spanish government debts, with the 10-year yield in Italy falling below 5% and France below the 3% level. Elsewhere, CHF weakened across the board partly on the back of market talk that the SNB was conducting currency swap operations via small Swiss corporate banks. Also, a weakening USD-Index supported EUR/USD and GBP/USD, whereas the latter received further boost following an upward revision to the UK's construction output data, which is said to add 0.1% to country's Q2 GDP. The release of Project Merlin data showing an enhanced lending by UK banks in Q2 as compared to Q1 helped the GBP currency further.
 
Moving into the North American open, markets look ahead to key economic data from the US in the form of retail sales, business inventories, and University of Michigan confidence report. Fed's Dudley and President Obama are also scheduled to speak later in the session.
 
Asia Headlines:
 
Japan’s government cut its economic growth forecast for the current fiscal year to 0.5% from 1.5% to reflect the slump in factory output after a magnitude 9.0 earthquake, tsunami and nuclear meltdown in March, the Cabinet said. Japan’s recovery from natural disaster faces growing risks from an uncertain global economic outlook and rising JPY, nevertheless, the government expects the economy to grow 2.7% – 2.9% next fiscal year. Japan will aim to keep its ceiling for new borrowing unchanged next fiscal year, the government said. (RTRS)
 
•    Japanese Industrial Production (Jul F) M/M 3.8% vs. Prev. 3.9%
•    Japanese Industrial Production (Jul F)Y/Y -1.7% vs. Prev. -1.6%
•    Japanese Capacity Utilisation (Jun) M/M 5.2% vs. Prev. 12.8% (RTRS)
 
US Headlines:
 
Fed’s balance sheet expanded to USD 2.856tln in the week ended Aug 10th from USD 2.851tln in the week ended Aug 3rd. Also, foreign central banks’ holding of US marketable securities at the Fed rose USD 3.823bln in the week ended Aug 10th to stand at USD 3.476tln. (RTRS)
 
EU and UK Headlines:
 
A ban on short-selling financial stocks in four European countries including France takes effect today, a co-ordinated attempt to restore confidence in a market hit by rumours and higher borrowing costs. France, Italy, Spain, Belgium imposed a ban which will vary in detail depending on the country, the European Securities and Markets Authority (ESMA) said. France will ban short-selling on 11 financial stocks for 15 days, Spain will protect 16 stocks for 15 days, while Belgium will ban short-selling for 4 financial stocks for an indefinite period. Italian regulator Consob introduced a 15 day short-selling ban of financial stocks, covering 20 companies in the banking and insurance sector. (RTRS/Sources)
 
In other news, according to UK’s ONS, construction output rose by 2.3% quarter-on-quarter, faster than the 0.5% estimate used to calculate preliminary GDP data released last month. Year-on-year construction output grew by 0.8%, rather than contracting by 1.4%. The ONS also said that the upward revision to construction output will add 0.1% to UK’s Q2 GDP estimate. (RTRS)
 
•    French GDP (Q2 P) Q/Q 0.0% vs. Exp. 0.3% (Prev. 0.9%)
•    French GDP (Q2 P) Y/Y 1.6% vs. Exp. 1.6% vs. Exp. 2.0% (Prev. 2.2%, Rev. to 2.1%)
•    French CPI (Jul) M/M -0.4% vs. Exp. -0.3% (Prev. 0.1%)
•    French CPI (Jul) Y/Y 1.9% vs. Exp. 2.2% (Prev. 2.1%) (RTRS)
 
EQUITIES
 
Volatility continued across European equities in early trade supported by a short-selling ban imposed by countries including France, Italy, Spain and Belgium. However, prices came under pressure following news that Chancellor Merkel may not be able to keep her promise of getting changes to the EFSF before end-September, together with lower than expected GDP data from France. As the session progressed, appetite for risk emerged as the dominant theme as equities moved higher, led by financials, and moving into the North American open equities continue to trade in positive territory, with outperformance seen in the Eurozone peripheral indices.

FX
 
CHF weakened across the board partly on the back of market talk that the SNB was conducting currency swap operations via small Swiss corporate banks. Also, a weakening USD-Index supported EUR/USD and GBP/USD, whereas the latter received further boost following an upward revision to the UK's construction output data, which is said to add 0.1% to country's Q2 GDP. The release of Project Merlin data showing an enhanced lending by UK banks in Q2 as compared to Q1 helped the GBP currency further.

COMMODITIES
 
After trading lower in early European trade, WTI and Brent crude futures came off their worst levels as the USD-Index weakened.
 
Oil & Gas News:

•    Indian finance minister said India has paid the first instalment of oil import debts to Iran.
•    According to reports from Bernstein & Co, Saudi Arabia may start cutting oil output to achieve prices of at least USD 85 per barrel to keep spending levels sustained.
 
Geopolitical News:

•    Syrian forced killed at least 19 people in raids near the Lebanon border and in the country’s Sunni tribal heartland, activists said. Washington said sanctions were needed on Syria’s oil industry. European states warned of tougher UN response, however, Russia, and China opposed UN sanctions against Assad.
•    Libyan rebels said they had captured part of oil town of Brega while their forces in the West pushed toward Zawiyah, trying to get within striking distance of Gaddafi’s capital.
•    South Korea’s navy rescued three North Korean fishing boats and seven fishermen after the vessel drifted over a disputed border in the West Sea, a military official said.

Full report:

Daily Us Opening News

 

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Fri, 08/12/2011 - 07:58 | 1553672 Zedge Hero
Zedge Hero's picture

The British Rebellion is not over and not covered correctly, here is the other side of the story.

 

http://www.youtube.com/user/zedgehero?feature=mhee

Fri, 08/12/2011 - 08:16 | 1553703 moregoldplease
moregoldplease's picture

What a load of cobblers! They are on the dole and either don't want to work, or don't have skills. They are basically yobbos with no self respect. That is the individual's fault. Stop putting this garbage out as something to be taken seriously. Of course as it is a cartoon it is obviously pointed at those whose mentality is at the cartoon level.

Fri, 08/12/2011 - 08:11 | 1553695 Oh regional Indian
Oh regional Indian's picture

Un-believable theatrics in Europe. Last week, unbelievable theatrics in the US. The london riots are a clear sign that it's time. In London it's the blacks. In France it will be those le mooosliiim. In the US, will it be La Razza?

In times of war, the ghetto rules.

Get organized, it's time.

ORI

http://aadivaahan.wordpress.com/2011/08/04/many-drafts/

Fri, 08/12/2011 - 08:17 | 1553706 moregoldplease
moregoldplease's picture

As long as you are not afraid to defend yourself the problem of looting and thuggery will disappear. Don't just show your guns, fire them.

Fri, 08/12/2011 - 08:18 | 1553711 Sequitur
Sequitur's picture

I feel bad for the mom-and-pop folk who are still in this market. How the hell are they supposed to put their meager savings aside and try to make a little yield? Down 600, up 500, down 450, up 400. Massive volatility and the finance headlines are laughable: bullish "plays" alongside "bear market" strategies, yes/no/maybe when it comes to asset classes, all kinds of contradictory "data" that is certain to be revised months from now.

I sure hope they find their way to this site, or at least to some of the non-MSM market touts. High VIX = eTrade/Schwab/TDAmeritrade homejockeys getting pockets picked by the pros all over this globe, as well as the machines. Fuck these rigged "markets" and the goddamn cheerleaders telling them to step in front of this train.

Fri, 08/12/2011 - 08:27 | 1553722 johnQpublic
johnQpublic's picture

obama set to speak again today

wonder if he's got anything to say thats not horse shit

i loved yesterdays "doubled gas mileage" bit

gas mileage today is no better for a pickup today than the model T ford truck

 

"The Environmental Protection Agency reported that the average performance of new, 2011 model cars and trucks was 20.8 miles per gallon in 2011."  --

"Ford's Model T, which went 25 miles on a gallon of gasoline, was more fuel efficient than the current Ford Explorer sport-utility vehicle -- which manages just 19 miles per gallon."  --

 

Fri, 08/12/2011 - 08:32 | 1553737 janus
janus's picture

"...to rumors merkel may not be able to secure changes to the efsf before september."

yes, i've been hearing those rumors as well; they're being spread by 60 million german voters.

Fri, 08/12/2011 - 08:40 | 1553749 overmedicatedun...
overmedicatedundersexed's picture

sequitor, you will love this: Troweprice chief economut Alan Levenson: "us expansion will stay on tract " and this is just the nuts: "expect UE to fall to 7.5% by end of 2012, with GDP growth to rebound to 3.5%"

I am speachless. Hopium is a virus with no cure.

Fri, 08/12/2011 - 08:54 | 1553770 janus
janus's picture

okay this makes a little more sense now...and then again it doesn't:

so the short ban will be limited to 'certain' stocks, and it seems those cetains are certain to be financials...so 'risk-on', bitchez?  just financials...oh, as soon as the schitzophrenia (badly butchered spelling) settles and they realize that by nuetering the financial shorts they've done a defacto ban on shorting the entire market, equities may take a slightly different turn -- and without the support of the shorts to incrementally halt the blow and allow for cooler heads to prevail...looks like a giant sink hole softening under the feet of every 'nation' from the channel to the hellenspont.  i love war! it's just so beautifully bloody and sinister.

so what the fuck can they be building in england?  a super-sized sarcophagous to house the corpse of empire?  or are those plans for that massive mosque finally under weigh?

Fri, 08/12/2011 - 08:56 | 1553792 Jim in MN
Jim in MN's picture

NHK news recap on progress at Fukushima: Not much.  They are calling the reactors "stable at about 100 degrees" which is essentially "stable with your fingernails keeping you from falling".  Decontamination systems working at 66% of promised throughput.  And that's the good news.

http://www3.nhk.or.jp/daily/english/11_31.html

Decontamination not successful at nuke plant

5 months after the Fukushima Daiichi nuclear power plant crisis started, workers are still struggling to decontaminate large amounts of highly radioactive water.

The plant's operator, Tokyo Electric Power Company, has now restored all circulating cooling systems for spent-fuel storage pools at 4 of its reactors, after the system was restored at the Number One unit on Wednesday.

Cooling of 3 reactors has been continuing since late June, by decontaminating highly radioactive stagnant water and then circulating it.

The Nuclear and Industrial Safety Agency says the temperatures of the reactors have been relatively stable at around 100 degrees, lowering the risk of another hydrogen explosion.

But the filtering equipment -- the key part of the system -- has been plagued with problems. Repeated suspension of the equipment's operation has slowed down the water decontamination process.

In the week until Tuesday, the filtering equipment ran at 77.4 percent of its capacity, the largest-ever. But the overall figure stands at 66.4 percent, failing to achieve the initial target of 90 percent.

The utility is now at stage two of its timetable to end the nuclear crisis, which aims to reduce the amount of contaminated water to curb the risk of radioactive releases from the plant.

The stage also calls for achieving a cold shutdown with reactor temperatures being kept stable and below 100 degrees.

TEPCO is reducing the amount of water injection into the reactors to prevent an increase in the amount of contaminated water, but the effort could be a hurdle in achieving a cold shutdown.

Friday, August 12, 2011 02:06 +0900 (JST)

Sat, 08/13/2011 - 02:43 | 1556583 yang46
yang46's picture


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Mon, 08/15/2011 - 00:00 | 1560584 MGHJFHD
MGHJFHD's picture

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