Asian markets swung between gains and losses. The MSCI Asia Pacific was 0.1% lower. Australia's Bluescope Steel fell 16% after missing estimates and Indonesia's stock market fell as much as 4% after Friday data showed the current account deficit widened. (Bloomberg)(FastFT)
Japan's exports jump, but so does trade deficit: The country's exports were 12.2% higher in July than a year earlier, the biggest increase since 2010, reflecting the weaker yen and demand recovery in the US and Europe. However imports rose 19.6% on the same basis, "leaving a trade deficit of 1.02 trillion yen ($10.5 billion), the third biggest on record in data back to 1979. The seasonally-adjusted deficit widened from June to 944 billion yen." (Bloomberg)
"UK monthly online retail sales fell for the first time in 13 years in July, as a prolonged bout of hot weather lured shoppers away from their computers to the high street, according to industry research." (Financial Times)
JP Morgan legal losses could exceed reserves by $6.8bn, says Barclays: "A growing number of lawsuits and investigations could force the nation's largest bank to absorb $6.8 billion in future legal losses above its existing reserves, according to a filing earlier this month. That amount is greater than any other U.S. bank, according to an analysis from Barclays Research, a unit of Barclays PLC." (Wall Street Journal)
CME under fire over Brent trades: Campaign to break into North Sea oil benchmark "has been marked by unusual trading patterns as computerised firms engineer ways to exploit a cash-for-volume scheme, according to market participants." (Financial Times)
Goldman Sachs has been trying to recruit other banks to its electronic bond trading platform, and even offered to turn over the platform to an independent operator, according to two people familiar with the company's overtures. Goldman is among several banks experimenting with new ways of trading corporate bonds by setting up their own "single dealer" electronic trading platforms, but most bond market participants are distrustful of the bank-run platforms. "A few dealers have agreed in principle to the idea but Goldman needs many more to make the plan viable, one said." (Financial Times)
Everbright Securities was banned from proprietary trading for three months and from creating new stock-index futures positions, after placing Rmb23.4bn ($3.8bn) of erroneous buy orders on Friday that caused a flash spike in Shanghai stocks. China Securities Regulatory Commission said yesterday it had started an investigation into the state-controlled brokerage. (Bloomberg) The fat finger trade could cost Everbright up to Rmb400m ($65.4m), or up to 2 per cent of its equity base, according to estimates by Citi analysts. (FastFT)
Bo Xilai's trial to begin Thursday: State media agency Xinhua reveals date for the long-awaited trial of the disgraced Chinese politician whose dramatic purge revealed discord within the ruling Communist party. "A court in eastern China will kick off Mr Bo's trial on charges of bribery, corruption and abuse of power, in what is likely to be one of the most celebrated political show trials in China in recent memory." (Financial Times)
US fuel exports has grown faster than other goods and commodities during Barack Obama's presidency, according to a Financial Times analysis, emerging as a driving force behind his goal to double exports by 2015. (Financial Times)
CBI raises UK growth forecasts, warns of rebalancing: The business lobby group predicted growth of 1.2% this year and 2.3% next year – a level in line with other economists' predictions. It said the higher growth would come from slowly strengthening household spending and a fall in the savings ratio, from 6.1% in the second quarter of this year to 4.4% by the end of 2014. But business investment would not pick up until next year. (Financial Times)
COMMENT AND CURIOS:
- David Bonderman: Last of the risk-takers? (Financail Times)
- Hilsenrath: Neither Yellen nor Summers known for Bernanke-style consensus-forging. (Wall Street Journal)
- Sequestration housing cuts forcing low-income families out of home. (Financial Times)
- China's richest person is... (Bloomberg)
- SAC's money market lesson. (Bloomberg)
- Stock-picking is enjoying a renaissance. (Wall Street Journal)
OVERNIGHT MARKETS: MIXED
Asian markets
Nikkei 225 up +34.56 (+0.25%) at 13,685
Topix up +3.36 (+0.29%) at 1,146
Hang Seng down -38.37 (-0.17%) at 22,479
US markets
S&P 500 down -5.49 (-0.33%) at 1,656
DJIA down -30.72 (-0.20%) at 15,081
Nasdaq down -3.34 (-0.09%) at 3,603
European markets
Eurofirst 300 up +3.64 (+0.30%) at 1,231
FTSE100 up +16.65 (+0.26%) at 6,500
CAC 40 up +30.69 (+0.75%) at 4,124
Dax up +15.65 (+0.19%) at 8,392
Currencies
€/$ 1.33 (1.33)
$/¥ 97.62 (97.52)
£/$ 1.56 (1.56)
Commodities ($)
Brent Crude (ICE) up +0.08 at 110.48
Light Crude (Nymex) up +0.11 at 107.57
100 Oz Gold (Comex) up +10.00 at 1,382
Copper (Comex) unchanged 0.00 at 3.36
10-year government bond yields (%)
US 2.85%
UK 2.70%
Germany 1.90%
CDS (closing levels)
Markit iTraxx SovX Western Europe +1.16bps at 89.49bp
Markit iTraxx Europe -0.21bps at 99.02bp
Markit iTraxx Xover -2.82bps at 409.91bp
Markit CDX IG (returning soon)
Sources: FT, Bloomberg, Markit
