Asian stocks fell for a fourth day after Treasury yields reached a two-year high. Currencies from Malaysia to Thailand declined and the Jakarta Composite fell more than 3%, taking losses to 10% in four days. The Nikkei fell 1.4% and the Hang Seng was down 1.5%. (Bloomberg)
Today: BHP Billiton full-year, Glencore-Xstrata's first combined results. Dell, Home Depot, JC Penney.
"The Justice Department is investigating whether J.P. Morgan Chase manipulated U.S. energy markets, according to people familiar with the case, marking the latest legal hurdle for a bank already facing a mountain of litigation and regulatory scrutiny." This follows the $410m settlement reached with Ferc, the electricity regulator, last month. Some of the same issues as those in the Ferc case would be examined in the DoJ investigation, the sources said. (Wall Street Journal)
RBS decision likely within two weeks as rival bidders step up efforts: "W&G Investments, led by Andrew Higginson, former Tesco finance director, is expected to table its final bid on Tuesday morning after its investment vehicle floats on Aim." (Financial Times)
Falcone to admit wrongdoing: Philip Falcone and his hedge fund Harbinger Capital Partners have agreed to pay more than $18m and admit wrongdoing in the regulator's first use of a new policy to hold companies and individuals more accountable. (Financial Times) SEC takes a harder line. (NYT Dealbook)(FT Alphaville)
Fed says big US banks need to lift capital targets: The study, which examined banks' approaches to the Fed's recent stress tests, said the biggest banks should "establish capital targets above their capital goals to ensure that capital levels will not fall below the goals during periods of stress", the US central bank said. "The goals and targets should be specified in the capital policy and reviewed and approved by the board." (Financial Times)
Eurozone banks cut securitised loans: The outstanding amount of securitised loans in the eurozone fell to €1.33tn, representing a year-on-year decline of 8.6% according to data from the ECB. It's the second year of decline after a post-crisis peak in 2011. (Financial Times)
"Shares in QBE tumbled after Australia's biggest insurer by premiums reported first-half earnings almost 20 per cent below expectations, blaming a spike in US claims and a big drop in investment income." (Financial Times)
ON FT ALPHAVILLE:
Phil cops, drops.
Happiness is good for you shock.
That spike in Treasury yields.
Moral hazard, the Chinese way.
COMMENT AND CURIOS:
- James Mackintosh: No Bollywood ending for the rupee. (Financial Times)
- Q&A: How low can the rupee go? (Financial Times)
- The Bundesbank is *not* forgetting about inflation amid all the forward guidance excitement. (FT Money Supply)
- How Chinese banks work around lending limits. (Wall Street Journal)
- John Gapper: Wall St's Chinese princeling premium. (FT Business blog)
- Princelings: Is nepotism a crime? (Wall Street Journal)
- Emerging market linkers are falling sharply even in the broader EM rout context. (Financial Times)
- Jeremy Siegel: The Cape ratio's pessimistic predictions are based on biased data. (Financial Times)
OVERNIGHT MARKETS: DOWN
Asian markets
Nikkei 225 down -187.88 (-1.37%) at 13,570
Topix down -10.66 (-0.93%) at 1,138
Hang Seng down -331.75 (-1.48%) at 22,132
US markets
S&P 500 down -9.77 (-0.59%) at 1,646
DJIA down -70.73 (-0.47%) at 15,011
Nasdaq down -13.69 (-0.38%) at 3,589
European markets
Eurofirst 300 down -6.85 (-0.56%) at 1,225
FTSE100 down -34.26 (-0.53%) at 6,466
CAC 40 down -39.91 (-0.97%) at 4,084
Dax down -25.65 (-0.31%) at 8,366
Currencies
€/$ 1.34 (1.33)
$/¥ 97.57 (97.55)
£/$ 1.56 (1.56)
Commodities ($)
Brent Crude (ICE) down -0.31 at 109.59
Light Crude (Nymex) down -0.29 at 106.81
100 Oz Gold (Comex) unchanged 0.00 at 1,366
Copper (Comex) unchanged 0.00 at 3.34
10-year government bond yields (%)
US 2.87%
UK 2.76%
Germany 1.90%
CDS (closing levels)
Markit iTraxx SovX Western Europe Returning soon
Markit iTraxx Europe +4.06bps at 103.08bp
Markit iTraxx Xover +15.49bps at 425.4bp
Markit CDX IG returning soon
Sources: FT, Bloomberg, Markit
