Asian stocks swung between gains and losses after Ben Bernanke's comments yesterday, and the IMF said risks are rising for slower growth in China, and that its growth model is 'not sustainable'. Japanese stock market benchmarks were higher led by SoftBank, whose shares reached a 13-year high after announcing a fuel cell joint-venture, but the MSCI Asia was little changed. (Bloomberg)(FastFT)
JP Morgan in talks over power price settlement worth hundreds of millions: The bank is in discussions with the Federal Energy Regulatory Commission about paying a big fine to settle allegations it manipulated electricity markets in California and the Midwest, according to the FT and WSJ citing people familiar with the matter. The WSJ sources say draft agreements between JP Morgan and FERC would result in fines that would likely exceed the record $435m fine levied by FERC on Tuesday against Barclays. The FT says one source said part of the enforcement action was to involve JPMorgan traders being banned from commodity markets, but the bank rejected it. (Wall Street Journal)(Financial Times)
Troika report warns of more uncertainty on Greek debt servicing: "Downside risks have increased significantly compared to the second review, particularly as regards privatization proceeds," the report said. (Bloomberg)
Intel has cut its financial forecasts for the rest of the year after concluding that the battered PC market would not see the recovery it had been expecting in the second half of 2013. Meanwhile, IBM raised its full-year outlook and beat estimates on its 2Q operating profits, but said an expected asset sale would be delayed. eBay, also reporting yesterday, blamed conditions in Europe and Korea for lower-than-expected 3Q earnings guidance. (Financial Times)
China's June new home prices rose in all but one city, in the latest official survey of 70 cities. (Bloomberg)
Schäuble flies to Athens with SME loans: The German finance minister travels to Athens today where he will offer €100m ($132m) in loans to small and medium-sized businesses through state-owned lender KfW Group. Yesterday the Greek government scraped through a vote on a bill to sack public sector workers, whose passage was required to unlock nearly €7bn ($9.2bn) in aid from the EU and IMF. (Bloomberg)(Reuters)
"Dell's special committee of the board is considering delaying the July 18 shareholder vote on the buyout by founder Michael Dell, seeking a higher bid or time to win support for the $24.4 billion deal, said a person with direct knowledge of the situation." (Bloomberg)
China bans GSK finance chief from leaving: Chinese authorities investigating alleged bribery by GlaxoSmithKline have barred the company's finance chief in China, British national Steve Nechelput, from leaving the country, Glaxo said Wednesday. Meanwhile, the UK's Serious Fraud Office is in the preliminary stages of reviewing the bribery allegations Glaxo faces in China, the WSJ says citing people familiar with the matter, based on both an anonymous tipster contacting the SFO directly and the claims made publicly by Chinese authorities. (Wall Street Journal)
Junk bond yields are falling fast: Average yields have fallen by nearly 60 basis points in the past week, and are falling towards the 6% mark. (Financial Times)
"General Motors has delayed the launch of the next-generation Chevrolet Cruze by a year due to engineering changes and a desire to squeeze more sales from the small car before it is redesigned, people familiar with the US automaker's plans said." (Reuters)
ON FT ALPHAVILLE:
The return of the D word (deflation) in Bernanke's speech.
When does a Chinese growth deceleration become a crisis?
Liborising oil-price reporting, encore.
By the way, China isn't rebalancing.
The raw cost of can-kicking: €35bn.
COMMENT AND CURIOS:
- Hilsenrath: What Bernanke means. (Wall Street Journal)
- Chris Giles: Britain is creating a rentier society. (Financial Times)
- Chinese money is still cheap and plentiful in some places, like Nigeria. (Bloomberg)
OVERNIGHT MARKETS: MIXED
Asian markets
Nikkei 225 up +123.70 (+0.85%) at 14,739
Topix up +7.38 (+0.61%) at 1,221
Hang Seng up +4.85 (+0.02%) at 21,377
US markets
S&P 500 up +4.65 (+0.28%) at 1,681
DJIA up +18.67 (+0.12%) at 15,471
Nasdaq up +11.50 (+0.32%) at 3,610
European markets
Eurofirst 300 up +7.56 (+0.63%) at 1,199
FTSE100 up +15.58 (+0.24%) at 6,572
CAC 40 up +20.99 (+0.55%) at 3,872
Dax up +53.67 (+0.65%) at 8,255
Currencies
€/$ 1.31 (1.31)
$/¥ 99.97 (99.57)
£/$ 1.52 (1.52)
Commodities ($)
Brent Crude (ICE) down -0.14 at 108.47
Light Crude (Nymex) down -0.23 at 106.25
100 Oz Gold (Comex) unchanged 0.00 at 1,278
Copper (Comex) unchanged 0.00 at 3.14
10-year government bond yields (%)
US 2.48%
UK 2.31%
Germany 1.54%
CDS (closing levels)
Markit iTraxx SovX Western Europe -0.43bps at 100.2bp
Markit iTraxx Europe +1.64bps at 113.57bp
Markit iTraxx Xover +9.58bps at 455.56bp
Markit CDX IG +1.12bps at 86.56bp
Sources: FT, Bloomberg, Markit
