Asian stocks fell and the Nikkei and Topix both slumped more than 2% as the yen strengthened and earnings from Advantest and Nissan Motor were mixed. (FastFT)(Bloomberg)
Today: US consumer sentiment.
Japan's CPI rose the most since 2008 in June. Excluding fresh food, the inflation measure rose 0.4% from a year earlier, compared to median Bloomberg survey estimates of 0.3%. However some analysts pointed to a base effect due to comparison with last year's energy prices. With energy also excluded, consumer prices fell 0.2%. (Bloomberg)
Activision CEO leads $8.2bn buyout: "Bobby Kotick, chief executive of Activision Blizzard, is leading an $8.2bn investor buyout of most of Vivendi's controlling stake in the world's largest video games company." (Financial Times)
Samsung Electronics said smartphone would slow in Q3. It reported second-quarter revenue of Won57.5tn ($51.7bn), a year-on-year increase of 20.1 per cent. The figure was in line with guidance that Samsung gave at the start of this month. (Financial Times)
FHFA reaches $885m UBS settlement; more banks in regulators' sights: "Under the terms of the agreement with the Federal Housing Finance Agency, UBS must pay about $415 million to Fannie Mae and $470 million to Freddie Mac to resolve claims related to securities sold to the companies between 2004 and 2007. " (Reuters) Meanwhile Bank of America, JPMorgan Chase and RBS are being pressed for multibillion-dollar payments to the US government over toxic mortgage-backed securities, according to people familiar with negotiations. UBS was a relatively small seller of MBS to Fannie Mae and Freddie Mac, with $6.4bn notional value. BofA, JPMorgan and RBS were much bigger, each with more than $30bn in notional value. (Financial Times)
GSK replaces China operations head: "Hervé Gisserot as its new head of operations in China. He will take over from Mark Reilly, who left Shanghai in early July and will continue to assist in handling the company's own investigation into the scandal from London. Mr Gisserot was previously co-head of GSK's pharmaceutical business in Europe." (Financial Times)
Greece clears last bailout hurdle: The country yesterday adopted the last piece of legislation its international lenders required to release the next batch of rescue loans, ending two months of wrangling over unpopular measures to overhaul the economy. It's expected to begin receivingn payments from an E5.8bn bailout tranche from Monday. (Reuters)
CFTC mulled metals warehousing investigation for two years: "CFTC investigators began inquiring about aluminum warehouses at least two years ago but didn't open a formal investigation, according to someone familiar with the matter. In a meeting with Senate aides this spring, CFTC officials said they were unsure whether they had authority to do anything about potential price manipulation, according to someone familiar with the matter." (Wall Street Journal)
Fabrice Tourre said he "deeply" regretted an email in which he joked about selling subprime mortgage bonds "to widows and orphans" following a grilling from SEC lawyers. (Financial Times)
Halliburton has agreed to plead guilty to destroying evidence related to the Deepwater Horizon disaster. The US Department of Justice said Halliburton would be required to pay a maximum $200,000 statutory fine in the guilty plea is the third by a company over the spill. (Reuters)
ON FT ALPHAVILLE:
- The QE repo distortion is uncharted territory for funding markets.
- SAC, the reckoning.
COMMENT AND CURIOS:
- SAC deemed a magnet for cheating. (NYT DealBook)
- Summers dismissed QE effectiveness. (Financial Times)
- Unintended consequences of Cyprus bailout to be revealed as deposit conversion draws near. (Wall Street Journal)
- Moody's sees a Chinese local government default looking more likely as maturing debt approaches records. (Bloomberg)
- Detroit's creditors are unlikely to stop the bankruptcy going ahead. (Reuters)
OVERNIGHT MARKETS: DOWN
Asian markets
Nikkei 225 down -373.79 (-2.57%) at 14,189
Topix down -28.29 (-2.35%) at 1,174
Hang Seng up +9.45 (+0.04%) at 21,910
US markets
S&P 500 up +4.31 (+0.26%) at 1,690
DJIA up +13.37 (+0.09%) at 15,556
Nasdaq up +25.59 (+0.71%) at 3,605
European markets
Eurofirst 300 down -5.52 (-0.45%) at 1,209
FTSE100 down -32.48 (-0.49%) at 6,588
CAC 40 down -6.73 (-0.17%) at 3,956
Dax down -80.13 (-0.96%) at 8,299
Currencies
€/$ 1.33 (1.33)
$/¥ 98.85 (99.28)
£/$ 1.54 (1.54)
Commodities ($)
Brent Crude (ICE) down -0.02 at 107.63
Light Crude (Nymex) up +0.03 at 105.52
100 Oz Gold (Comex) unchanged 0.00 at 1,329
Copper (Comex) unchanged 0.00 at 3.19
10-year government bond yields (%)
US 2.58%
UK 2.37%
Germany 1.68%
CDS (closing levels)
Markit iTraxx SovX Western Europe -8.03bps at 92.17bp
Markit iTraxx Europe -10.17bps at 103.4bp
Markit iTraxx Xover -39.31bps at 416.25bp
Markit CDX IG +1.12bps at 86.56bp
Sources: FT, Bloomberg, Markit
