Markets: "U.S. stock futures and the dollar came under pressure on Monday as a shutdown of the U.S. government seemed increasingly likely, while the euro had political troubles of its own as the Italian government teetered on the edge of collapse. Not helping was a surprise downward revision to activity in China's factory sector. While the final HSBC Purchasing Managers' Index (PMI) did edge up to 50.2 in September, that was well down on the preliminary reading of 51.2." (Reuters) (Bloomberg)
Parts of the US government may shut down at midnight on Monday for the first time since 1996 if Congress and the White House can't find a way out of their latest stand-off on fiscal policy - analysis shows that automatic US government spending cuts which took effect in March are causing the most damage in regions that weathered the recession better than the rest of the country. (Financial Times)
"Twitter is planning to make public its secret filing for an initial public offering as soon as this week, people familiar with the matter said. That means the social media and microblogging company's stock could begin trading by late October or early November, if the offering moves at full speed." (WSJ)
Wall Street's top five banks face $1bn earnings cut on growing fears of a sharp decline in trading revenues coupled with increased legal costs.Analysts reduced their expectation of net income by $210m for Citigroup, $128m at Bank of America, $123m at Goldman Sachs and $97m at Morgan Stanley, according to Bloomberg data. (Financial Times)
Italy's PM seeks to shore up government: Enrico Letta is seeking urgently parliamentary support for a new government after centre-right leader Silvio Berlusconi pulled his ministers out of their five-month-old coalition, risking a financial market backlash. (Financial Times) Italian bonds and stocks are suffering. (Financial Times) (FT editorial)
Faltering Chinese factory growth adds to rebound fears: The purchasing managers' index published by HSBC edged up to 50.2 in September from 50.1 in August. The preliminary result had fuelled optimism that China's recovery was in full swing after a shaky first half of the year, but the final result suggests the recovery could easily falter. (Financial Times)
Tories accelerate help for home buyers: In a a riposte to Ed Miliband, leader of the opposition Labour party David Cameron, UK prime minister, is to expedite a government-backed mortgage scheme to help would-be homeowners in a bid to portray his party as champion of "hard-working" families. (Financial Times)
"Creditors are set to provide $5.9 billion in financing to Tokyo Electric Power Co, a person involved in the talks told Reuters on Monday, offering a lifeline to the embattled owner of the crippled Fukushima nuclear plant." (Reuters)
"Mizuho Financial Group fell the most in more than three months in Tokyo trading after Japan's banking regulator penalized the lender for dealing with organized crime groups." (Bloomberg)
Siemens to shed 15,000 jobs worldwide: The company, which had previously declined to detail the job cuts until it had talked to affected staff and was able to plan for 2014, said on Sunday 5,000 of the jobs would be in Germany and none of the cuts at home would involve compulsory redundancies. (Financial Times)
Axa to spin out private equity arm: Axa Private Equity, the $32bn fund management business headed by industry veteran Dominique Senequier, will announce early this week that it has spun out of the French insurer in a management-led buyout that creates a standalone European heavyweight. (Financial Times)
CLO issuance hits highest level since before financial crisis: A spurt in sales last week has helped push US issuance of so-called "collateralised loan obligations" so far this year to at least $55.41bn, according to S&P Capital IQ LCD – the highest since the $88.94bn sold in 2007, just before the financial crisis. (Financial Times)
"The indirect fracking effect is probably the one that helps Europe the fastest – not direct fracking." The head of Germany's largest utility has warned it will be years before Europe can hope to counter the US's growing advantage in energy costs and predicts that the disparity will meanwhile lead heavy industry to abandon the continent. (Financial Times)
Global banks cautious on Shanghai free-trade zone, reflecting widespread confusion about how the zone will operate, even as regulators have appealed for patience. Citigroup and Singapore's DBS are the only foreign banks that will begin operations in the new zone for now. (Financial Times)
COMMENTS & CURIOS
"We need to decide whether India will run on the whims of the crown prince" - Modi (Financial Times)
Yellen's record -- interesting that she is the only current member of the FOMC who was present for the "bond shock" of 1994 (Financial Times)
The Republican lost cause – bringing Barack Obama down (Financial Times)
Why world trade growth has lost its mojo (Financial Times)
Banks watchdog backs away from strict requirements (Financial Times)
London still top financial centre but ratings fall (Financial Times)
Wall Street is losing the best and brightest (WSJ)
House Sister: jailed (Financial Times) (NYT)
SEC vs Cuban (NYT)
OVERNIGHT MARKETS
Asian markets
Nikkei 225 down -164.42 (-1.11%) at 14,596
Topix down -14.89 (-1.22%) at 1,203
Hang Seng down -255.58 (-1.10%) at 22,951
US markets
S&P 500 down -6.92 (-0.41%) at 1,692
DJIA down -70.06 (-0.46%) at 15,258
Nasdaq down -5.83 (-0.15%) at 3,782
European markets
Eurofirst 300 down -2.94 (-0.23%) at 1,255
FTSE100 down -52.93 (-0.81%) at 6,513
CAC 40 up +0.05 (0.00%) at 4,187
Dax down -2.59 (-0.03%) at 8,662
Currencies
€/$ 1.35 (1.35)
$/¥ 97.94 (98.24)
£/$ 1.62 (1.61)
Commodities ($)
Brent Crude (ICE) down -0.83 at 107.80
Light Crude (Nymex) down -1.25 at 101.62
100 Oz Gold (Comex) down -0.20 at 1,338
Copper (Comex) down -0.02 at 3.31
10-year government bond yields (%)
US 2.59%
UK 2.73%
Germany 1.78%
CDS (closing levels)
Markit iTraxx SovX Western Europe +0.25bps at 87.24bp
Markit iTraxx Europe +2.94bps at 102.44bp
Markit iTraxx Xover +5.71bps at 400.5bp
Sources: FT, Bloomberg, Markit
