US futures were largely unchanged overnight, with a modest bounce after the European close driven by a feeble attempt to push oil higher, faded quickly and as of this moment the E-mini was hugging the flatline ahead of today's main event - the January payrolls, expected to print at 190K and 5.0% unemployment, however the whisper number - that required to push stocks higher - is well lower, at 150K (according to DB), as only a bad (in fact very bad) jobs number today will cement the Fed's relent and assure no more rate hikes in 2016 as the market now largely expects.
It's official: two of America oldest publicly traded companies will merge, with Dow and DuPoint merging as equals in a combined company that will have a $130 billion market cap and will be named DowDuPont. And while shareholders already benefited from the deal with shares of both consitutents rising by 10% in the days preceding the official announcement, the biggest loser are once again the employees: the combined company announced that as part of the $700 million in restructuring efforts, 10% of the combined company's employees will be laid off.
With at least 83 percent of these companies' operating cash being spent on debt repayments - the highest on record - the renewed collapse in crude oil prices of the last month has renewed focus on the tidal wave of defaults that the credit market is increasingly pricing in (and stocks not).
- China stocks slump 6 percent on fears of further yuan depreciation (Reuters)
- U.S. Lacks Ammo for Next Economic Crisis (Hilsenrath)
- Emerging Markets Extend Slide as Commodities Fall; Pound Jumps (BBG)
- China yuan to move both ways, more 'adjustments' unlikely: central bank economist (Reuters)
- Playing Chinese markets is as simple as 'follow the leader' (Reuters)
- PBOC Injection Shows China Worries About Outflows (WSJ)
- Russia Fails to Soothe Oil Concerns as Citi Joins Ruble Bears (BBG)
It is unclear what catalyzed today's dump. Futures were briefly green at the open, then as if all hell broke loose and without an explicit catalyst (although the technical collapse of numerous "story stocks" which had been market leaders for months, both today and in recent weeks has not helped) the E-mini, and individual stocks, just took out level after level of bids and at last check the Dow has dropped to 6 month lows, the S&P is just barely green for the year, while the biggest pain is in the Nasdaq which has dropped as much as 2% intraday. Below we lay out the biggest losers from today's market drop.
From Greek lobbyists to Silicon Valley VCs and from Goldman BSDs to FT reporters, The Bilderberg Group will meet later this week in Tirol to discuss what happens next to the rest of the world... here are the participants...
- Obama, McConnell missteps undercut trade pact in U.S. Senate (Reuters)
- Bears Beware: Rout Puts Investors on Wrong Side of Central Banks (BBG)
- U.S. Set to Rip Up UBS Libor Accord, Seek Conviction (BBG)
- Greece’s Creditors Said to Seek EU3 Billion in Budget Cuts (BBG)
- Amtrak train derails in Philadelphia, killing at least five (Reuters)
- Oil glut worsens as OPEC market-share battle just beginning (Reuters)
- China Stimulus Aims at Restructuring Trillions in Local-Government Debt (WSJ)
- Maryland Governor Calls in National Guard to Control Baltimore Riots (BBG)
- Fed Seen Delaying Liftoff to September to Push Down Unemployment (BBG)
- Nepal PM says toll could rise to 10,000 (Reuters)
- China Readies Fresh Easing to Tackle Specter of Debt (WSJ)
- ‘Damned Lies’ Threaten to Overshadow U.K. GDP in Election Fight (BBG)
- Uncertainty Over Impact of a Default by Greece (NYT)
- Why the Cost of Hedging European Banks Stocks Has Soared (BBG)
- Carinthia cash crunch gives Austria its own mini-Greece (Reuters)
Thousands Of Layoffs Coming After Buffett Merges Heinz With Kraft, Creating 5th Largest Food Company In The WorldSubmitted by Tyler Durden on 03/25/2015 05:37 -0500
Another day, another mega-M&A deal taking advantage of abnormally low bond rates, this time however not involving biotechs or a specialty pharma seeking to purchase a debt-free balance sheet, but one involving the Oracle of Omaha himself, and his Heinz investment, which will merge with Kraft Foods whose market cap was over $40 billion this morning on the news of the merger, and create the third largest food and beverage company in the US, and 5th largest in the world. And while the resulting company will certainly be a food giant, here is the rationale behind the deal and the punchline for American workers: "significant synergy opportunities." Translation: thousands of layoffs imminent.
- Central Banks With Negative Rates Spur Question of How Low to Go (BBG)
- DHS to keep running: Congress edges toward domestic security funding patch (Reuters)
- Setbacks for Tsipras Stir Discord in Greek Ruling Party (BBG)
- Greece’s Challenge: Appeasing Its Creditors and Its Population (WSJ)
- Buffett, a cheerleader for America, takes his checkbook abroad (Reuters)
- Oil’s Big Swings Are the New Normal: Market has rarely been more volatile (WSJ)
- Ukraine Left Behind as Russian Stock Gains Are Unmatched (BBG)
- Brent rises to $61, set for first monthly gain since July (Reuters)
When it comes to the ongoing Greek question, I see a lot of people eagerly jump to conclusions, after the ‘debt deal’, that I don’t think are justified; certainly not yet. The overall conviction in the press seems to be that Syriza has given in on just about all fronts, and Germany and Dijsselbloem are the big winners. But since that may well be the exact position Syriza wants ‘the other side’ to be in, where they think they have prevailed, one will have to try and think a few steps ahead before judging the situation. There’s far more grey area here than many pundits seem to assume, easily 50 shades of it.
There’s nothing good left from the initial idea that gave birth to the EU. It’s devolved into something utterly ugly, in which fat Germans driving their Mercs and Beamers down the autobahn can yell at their car stereos that those lazy Greeks must pay their due - which stems from Merkel et al. bailing out Deutsche Bank’s insanely outsized derivatives portfolios. The whole thing is so morally bankrupt, it’s really insane that we’re still trying to have a serious discussion about it. The whole thing, the entire global banking system, is as morally bankrupt as it is financially. So far, all the EU has (anyone notice how silent the IMF has been?) is hubris, bluster and chest-thumping. They play politicians, but Syriza plays real life.
The REAL Greek Negotiations: Situation Is “Berserk", "There Is No Plan", "Greeks Digging Own Graves"Submitted by Tyler Durden on 02/10/2015 13:34 -0500
“The Greeks are digging their own graves,” warns one EU official, according to MNI, with another exclaiming the Greek plan as “hopeless” and added “how can you have a plan when you make no payment obligation till the autumn and then you probably scrap that.” Simply put, speaking on condition of anonymity, an EU official described the situation as “berserk” adding “there is no plan.”
- Greek defense minister says Greece has Plan B if EU rigid on deal (Reuters)
- Germany rejects Greek claim for World War Two reparations (Reuters)
- Greece to Seek $11.3 Billion in Financing to Avoid Funding Crunch (BBG)
- Lazard Sees $113 Billion Greek Debt Cut as ‘Reasonable’ (BBG)
- U.S. Navy Considers Setting Up Ship Base in Australia (BBG)
- Dalio’s Bridgewater Fund Said to Rise 8.3% in January (BBG)
- As U.S. Exits, China Takes On Afghanistan Role (WSJ)
- EU money funds cut exposure to bank debt (FT)
- China Inflation Drops to Five-Year Low in January (WSJ)
- Oil-Price Rebound Predicted (WSJ)