Markets: Nervousness about the US budget impasse kept Asian markets subdued as a deal to end the government shutdown and raise the debt ceiling continued to prove elusive. (Financial Times)
Fitch placed the triple A credit rating of the US on negative watch, as efforts to end the budget impasse faltered during a day of drama on Capitol Hill capped by the reopening of talks in the Senate late on Tuesday. The chances of the US missing Thursday's deadline to raise its $16.7tn borrowing capacity increased after House Republican leaders earlier scrapped a plan to raise the debt ceiling until February and reopen the government until mid-December. One-month Treasury bills maturing on October 31 shot up 21 basis points to a new debt ceiling peak of 53 bps late on Tuesday, as investors grew alarmed by the lack of a deal. (Financial Times) (WSJ) (And a reminder from Cardiff that the US won't actually beginning welching for a little while yet)
JPMorgan has agreed to $100m CFTC fine over 'London whale' and accepted the episode had a "manipulative" effect on credit derivatives markets, according to people familiar with the situation. (Financial Times)
"Pakistan is acquiring two large nuclear power reactors from longtime ally China, officials said, in a $9.1 billion deal that has raised concern in Washington that Beijing is overstepping international rules on transferring nuclear technology." (WSJ)
Bond trading slowdown hurts Citigroup: "Citigroup has missed analysts' estimates of its net income in the third quarter, reporting a figure of $3.2bn, following lower volumes of fixed-income trading and a drop in mortgage banking. The results come a day before the one-year anniversary of Vikram Pandit's ousting as chief executive of the banking group, which had followed clashes with the board." (Financial Times)
SoftBank and GungHo Online Entertainment are buying 51 per cent of Supercell for $1.5bn, confirming the dizzying rise of the Finnish mobile gaming company -- which has just two, admittedly chart-topping, games in Clash of Clans and Hay Day. (Financial Times)
Twitter revealed its losses had widened in the third quarter in an updated filing for its $1bn IPO, which it said would take place on the New York Stock Exchange -- a blow to rival Nasdaq. (Financial Times)
Yahoo will retain more than half its stake in Alibaba when the Chinese ecommerce site goes public, after agreeing a new deal that will see it sell just 40 per cent of its shares in the much-awaited IPO. JPMorgan had balked at the admission, fearing it would open the door to a slew of cases from private plaintiffs. (Financial Times)
BMW family gave €690,000 to Merkel party just as the German chancellor was lobbying fellow EU leaders to block tougher exhaust emission standards for big cars, it emerged on Tuesday. (Financial Times)
"Advance Auto Parts plans to buy General Parts International for just over $2 billion, a takeover [expected to be announced Wednesday] that would create one of North America's largest aftermarket auto-parts providers, according to people familiar with the matter." (WSJ)
"China should implement more policies to protect retail stock investors to ensure the healthy development of the country's capital market, the head of the securities regulator said on Wednesday." (Reuters)
Batista group in $1bn port deal to avert collapse: Batista has struck a near-$1bn deal to stave off the collapse of his business empire, ceding control of his prized iron ore port to the Dutch trading house Trafigura and an Abu Dhabi sovereign wealth fund. (Financial Times) He also fired OGX's "chief executive officer amid talks with bondholders to keep the explorer afloat." (Bloomberg)
COMMENTS & CURIOS
"Abolish the ceiling now. It is an invitation to mischief." (Financial Times Wolf)
Beijing should cut back its lending to Washington (Financial Times)
America needs to lift its ban on crude exports, soon (Financial Times editorial)
The myth of Abe the reformer (WSJ)
The lunacy of 'fairness' in government contracting (WSJ)
Germany hardens stance on common eurozone safety net for banks (Financial Times)
OVERNIGHT MARKETS
Asian markets
Nikkei 225 up +23.92 (+0.17%) at 14,465
Topix down -1.16 (-0.10%) at 1,196
Hang Seng down -89.99 (-0.39%) at 23,247
US markets
S&P 500 down -12.08 (-0.71%) at 1,698
DJIA down -133.25 (-0.87%) at 15,168
Nasdaq down -21.26 (-0.56%) at 3,794
European markets
Eurofirst 300 up +10.78 (+0.86%) at 1,263
FTSE100 up +41.46 (+0.64%) at 6,549
CAC 40 up +33.06 (+0.78%) at 4,256
Dax up +80.63 (+0.92%) at 8,804
Currencies
€/$ 1.35 (1.35)
$/¥ 98.49 (98.10)
£/$ 1.60 (1.60)
Commodities ($)
Brent Crude (ICE) up +0.06 at 110.02
Light Crude (Nymex) down -0.05 at 101.16
100 Oz Gold (Comex) unchanged 0.00 at 1,273
Copper (Comex) unchanged 0.00 at 3.30
10-year government bond yields (%)
US 2.75%
UK 2.84%
Germany 1.91%
CDS (closing levels)
Markit iTraxx SovX Western Europe -1.89bps at 73.45bp
Markit iTraxx Europe -3.42bps at 88.85bp
Markit iTraxx Xover -12.82bps at 356.35bp
Sources: FT, Bloomberg, Markit
