Asian markets fell amid mixed earnings and expectations that lower US jobless claims today will boost the chance of Fed tapering next month. The Nikkei was down 1.7% and the Topix 1.5% lower as sentiment on Japanese stocks was also affected by the finance minister denying a cut to the corporate tax rate was being considered. The Shanghai Composite rose 1.1%. (Bloomberg)(FastFT)
Today: China FDI. UK retail sales. US jobless claims, CPI, NY Empire and Philadelphia manufacturing surveys.
Japan's government upgraded its economic outlook, saying an end to deflation is approaching. The latest monthly economic statement had the most upbeat view of prices for nearly four years. The government also revised up its assessment on the job market to say it is "improving," as falls in the yen falls. (Reuters)
State of emergency declared in Egypt; scores dead: "Egypt's security services on Wednesday stormed two Cairo protest camps housing thousands of Islamists, killing scores and igniting a wave of violence across the Arab world's most populous country that raised the spectre of further chaos." At least 235 people were killed in Wednesday's violence and 1,403 injured, according to the Egyptian Health Ministry. The decision to storm the camps appeared to eliminate what limited hope there might have been for political reconciliation in Egypt following the military taking power last month."(Financial Times)
"US prosecutors filed criminal charges against two former JPMorgan Chase traders alleging that they falsified the bank's books to hide its multibillion-dollar "London whale" trading losses." (Financial Times)
Cisco cuts jobs, sees poor Asia demand continuing : The company's shares fell almost 10% in after-hours trade after it announced it was cutting 5% of its workforce, or 4,000 jobs. the company revealed lower than expected sales expectations for the next quarter, particularly in Asia. Sales in China and Japan fell 3% last quarter and orders for the next quarter were down by the same amount. (Financial Times)
Lenovo beats Q1 earnings estimates after increasing its global market share for tablet computers, smartphones and PCs. Net income climbed 23 percent to $173.9 million in the three months ended June from $141.4 million a year earlier. (Bloomberg)
Cathay Pacific misses H1 estimates: Cathay's cargo revenue fell 5.2% in the first half due to both volumes and rates declining, while travel within the Asia Pacific region was affected by avian flu and political issues in Northeast Asia, the carrier said. (Bloomberg)
Chinese regulator may target more sectors for price probes: "The National Development and Reform Commission (NDRC) would look at industries that have an impact on the lives of ordinary Chinese, China Central Television (CCTV) quoted Xu Kunlin, head of the anti-monopoly bureau at the NDRC, as saying... Companies in the petroleum, telecommunications, banking and auto sectors were on the NDRC's radar for future investigations, CCTV's official blog quoted Xu as saying." (Reuters) Meanwhile an investigation of drug pricing and corruption in the pharmaceuticals sector has intensified. (Financial Times)
Exxon wants to sell part of Iraqi oil field stake to PetroChina: "The request, which is subject to review by Iraq's cabinet before a sale process can begin, comes amid Baghdad's displeasure over Exxon's decision to strike separate exploration deals with the semiautonomous Kurdistan region in the country's north." (Financial Times)
ON FT ALPHAVILLE
The SME demand-side problem.
Who needs all that power capacity anyway?
The velocity of handbags.
About those low rates in the UK until 2016.
COMMENT AND CURIOS
- China's first order of business: not the economy. (WSJ China Realtime)
- Gillian Tett: US doctors' fee-for-service system needs a review. (Financial Times)
- The cracks showing in China's banking sector. (Wall Street Journal)
- How much are markets testing central banks? (Financial Times)
OVERNIGHT MARKETS
Asian markets
Nikkei 225 down -251.09 (-1.79%) at 13,799
Topix down -17.05 (-1.46%) at 1,154
Hang Seng up +29.61 (+0.13%) at 22,571
US markets
S&P 500 down -8.77 (-0.52%) at 1,685
DJIA down -113.35 (-0.73%) at 15,338
Nasdaq unchanged 0.00 (0.00%) at 3,669
European markets
Eurofirst 300 up +3.31 (+0.27%) at 1,240
FTSE100 down -24.51 (-0.37%) at 6,587
CAC 40 up +21.70 (+0.53%) at 4,114
Dax up +22.36 (+0.27%) at 8,438
Currencies
€/$ 1.33 (1.33)
$/¥ 97.76 (98.13)
£/$ 1.55 (1.55)
Commodities ($)
Brent Crude (ICE) up +0.38 at 110.58
Light Crude (Nymex) up +0.37 at 107.22
100 Oz Gold (Comex) up +6.60 at 1,341
Copper (Comex) unchanged 0.00 at 3.34
10-year government bond yields (%)
US 2.71%
UK 2.64%
Germany 1.82%
CDS (closing levels)
Markit iTraxx Europe -0.11bps at 94.65bp
Markit iTraxx Xover +0.78bps at 395.23bp
Markit CDX IG +1.12bps at 86.56bp
Sources: FT, Bloomberg, Markit
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