Good morning New York,
FT ALPHAVILLE
An upcoming dehoarding effect? Izzy considers the real motivations for JP Morgan and Goldman Sachs seeking to sell their metal warehousing, among them the additional margining costs that could be borne by commodity players when the LME begins to self-clear.
NEWS
Bernanke faces grilling over bond buying: The Fed chairman testifies before the House Financial Services committee at 10am on Wednesday, and repeats the performance in front of the Senate Banking committee the next day, with markets still jittery about the central bank's plan to gradually slow its $85bn-a-month in asset purchases. (Financial Times)
Baidu offers $1.9bn for online app store: Chinese search engine giant Baidu plans to buy the entire share capital of NetDragon Websoft's subsidiary 91 Wireless for $1.9bn, making it the biggest acquisition deal in China's internet industry if it succeeds. (Financial Times)
Rio Tinto raises full-year copper output guidance: Rio Tinto has increased its full-year copper production guidance by 25,000 tonnes after making swifter-than-expected progress with the recovery programme at its Bingham Canyon mine in the US state of Utah. (Financial Times)
Indian stocks fell and the rupee strengthened after new rules were announced late yesterday, aimed at preventing short moves against the currency by putting a daily cap on how much banks can borrow from the RBI. The rupee strengthened almost 1% against the dollar and the benchmark Sensex stock index fell 1.6%, with financials falling 2.3% on average. (FastFT)(Bloomberg)
Spanish PM rejects calls to stand down: Mariano Rajoy rejected what he called efforts to blackmail him into resigning. Political pressure mounted yesterday after Luis Barcenas, the former treasurer of his centre-right People's Party, gave new testimony before a judge looking into a party finance scandal. Barcenas said he had made payments of €20,000-€25,000 to Rajoy and party secretary-general Maria Dolores Cospedal between 2008 and 2011. (Financial Times)(Wall Street Journal)
The UK peer-to-peer lending market is set to reach £1bn by 2016 from £550m today, according to research by the Open Data Institute supported by the Bank of England. (Financial Times)
European car sales fall as unemployment and sluggish growth bite: New car sales in the European Union last month fell 5.6 per cent year-on-year as sluggish growth and high unemployment continued to sap demand, with Fiat, Peugeot-Citroën and General Motors hit hardest. (Financial Times)
Bitcoin ETF plan struggles to find support: The Bitcoin ETF will probably never hit the market because it is too difficult for "authorised participants" and "market-makers" – the banks and trading firms that typically sustain such funds – to profit from discrepancies between the underlying asset and the ETF, they say. (Financial Times)
Markets: Global equities were rising gently, with the FTSE All-World index set for its ninth consecutive day of gains. In the absence of any clear catalysts, markets appeared to be interpreting limited data points positively. In the US, for example, the S&P 500 closed at yet another record high on Monday, despite weaker than expected retail sales data. Bullish analysts are hopeful mediocre economic indicators will check any inclination at the Federal Reserve to taper asset purchases rapidly. London's FTSE 100 opened up 0.2 per cent, briefly topping 6,600 for the first time since the end of May. But the London index has since pared its gains, while sterling has fallen to a session low against the dollar of $1.5045, as UK inflation came in slightly lower than expected. The consumer price index was up 2.9 per cent year-on-year, the most since last April, but less than the 3 per cent expected. That could leave Mark Carney, the new Bank of England governor, some room to loosen monetary policy, which could further weaken sterling. Gilt yields also fell slightly, possibly pricing in expectation of further easing. (Financial Times)
