Frontrunning: August 2

  • Debt Deal Puts U.S. on Austerity Path as Economy Falters (Bloomberg)
  • Short-term US Funding Highly Restricted (FT)
  • China Halts Offshore Yuan Borrowing to Tighten Policy (Reuters)
  • Fed Confronts Limited Tools to Stir Economy (Hilsenrath)
  • Australia Leaves Key Rate Unchanged (WSJ)
  • N.Z. Second-Quarter Wages Rise at Faster Pace, Adding to Inflation Signs (Bloomberg)
  • China’s Expanding Naval Reach Worries Japan Over Routing Warship Presence (Bloomberg)
  • Geithner Says Debt-Limit Deal Good for Economy in the Long Term (BusinessWeek)
  • UK borrowing costs brush close to record low (FT)
  • Britain's Austerity Canary Develops a Worrisome Cough (WSJ)
  • Forget the ceiling, the GDP is underground (NYPost)
  • Greek Banks Should Merge With Foreign Institutions to Win Funds, OECD Says (Bloomberg)
  • Fed Policy Makers May Consider Additional Stimulus as U.S. Economy Slows (Bloomberg)

European economic summary:

  • Euro-Zone PPI for June 0.0% m/m 5.9% y/y – in line with expectations.Consensus 0.1% m/m 5.9% y/y. Previous -0.2% m/m 6.2% y/y
  • Switzerland Retail Sales for June 7.4%.Previous -3.9% (revised from -4.1%)
  • Switzerland PMI Manufacturing for July 53.5 – higher than expected.Consensus 52.5. Previous 53.4
  • UK PMI Construction for July 53.5 – higher than expected. Consensus 53.1. Previous 53.6

Global highlights courtesy of Egan-Jones

  • Asian shares fell on fresh worries over the global growth outlook.
  • India growth forecast cut to 8.2%; PMI data show stalling manufacturing sector.
  • Oil falls to near $94 as US economy weakens.
  • Spain 10-year bond yield soars to 6.45%.
  • US ISM Manufacturing Index fell to 50.9 in July from June's 55.3 - lower than expected.
  • AK Steel to add $460 per ton surcharge to September shipments of electrical steel products.
  • Allstate posts $620M loss in Q2 largely because of $2.3B in catastrophe losses.
  • America Movil offered to buy the 40.4% it doesn’t own of Telnex for 10.50 pesos per share.
  • Barclays Bank H1 profit slides 33% and cuts 3,000 Jobs.
  • BMW Q2 profit up at $2.5B, up 16.5%.
  • BNP Paribas Q2 net gains 1.1%.
  • Charter's net loss for June was $81M last year and $107M this year.
  • CNA Financial Corp.'s Q2 earnings fell, 55.4% to $126M partly due to catastrophe losses.
  • Consortium led by Li Ka-Shing to buy Northumbrian Water for $3.62B.
  • Deutsche Post's Q2 profit reached $395M.
  • Duke Energy's June net income rise from a $222M loss to a $435M gain,
  • Eastman Kodak is exploring a sale of its key patent for previewing photographs currently being litigated against Apple, RIM.
  • FMC Corp beats by $0.03, reports revs in-line; guides Q3 EPS below consensus.
  • Ford to recall 1.1M pickup trucks with gas tanks that can fall off and cause fires.
  • Honda's Q1 net slides 88% to $414.2M largely b'cos of Mar 11 earthquake. But lifts its 2012 outlook.
  • Humana's Q2 net jumps 35% to $460.3M on higher Medicare enrolments. Ups full year EPS f'cast.
  • Hyatt's June net income rises from $25M to $37M.
  • Japan's Kirin Holdings buys Brazilian beer maker for $2.5B.
  • Loews Corp. Q2 net income falls 31% to $252M on higher insurance catastrophe losses.
  • MLM's June net in declines from $54M to $36M.
  • Olin Corp. bags 5-yr deal to provide ammunition to US Army; est. to earn $300M in revs.
  • Vornado Realty posts 19% jump in Q2 FFO; revs up 7% at $730.2M.
  • Windstream Corp. to buy Paetec Hldg, telco service provider to businesses, for $891M in stock.
  • Winn-Dixie Stores reaffirms FY11 EBITDA guidance; sees Q4 revs of ~$1.6B (cons est. $1.59B).

Economic Calendar: Personal Income & Spending, PCE Prices, Auto Sales to be released.



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