Markets: China's pledge to introduce wide-ranging reforms continues to be the dominant theme feeding investor appetites. Shares of Chinese companies listed in Hong Kong, or H shares, were up another 1.8 per cent to reach their highest since early March, extending Monday's 5.7 per cent climb. The gain was enough to push their 2013 return into positive territory. (Financial Times)
JPMorgan agrees to shoulder WaMu bill: "JPMorgan Chase has conceded it will take responsibility for the past misdeeds of Washington Mutual, according to people familiar with the matter, paving the way for the Department of Justice to announce the biggest ever settlement with a single company. People close to the sometimes fractious talks over the US government's investigation into mortgage securities mis-selling say that the DoJ is poised to announce a $13bn settlement with JPMorgan this week after the bank accepted it would not try to claim back part of the costs from the government-managed receivership of WaMu." (Financial Times)
The UK's financial regulator is probing the use of private accounts by foreign exchange traders amid allegations they traded their own money ahead of clients orders, in a serious twist in the global probe into possible currency market manipulation. The Financial Conduct Authority has asked several banks to investigate whether traders used undeclared personal accounts, two people close to the situation said. (Financial Times)
"Three exchange companies are considering individual bids for Euronext, the European exchange group set to be spun off after it was acquired last week by IntercontinentalExchange Group according to people familiar with the discussions. London Stock Exchange Group, Nasdaq OMX Group, and Deutsche Börse AG each have discussed with advisers the possibility of making offers for Euronext, although none has hired bankers to launch a formal bid, the people said." (WSJ)
At least 10 London banks have scaled back or closed their carbon trading desks amid turmoil in the European emissions trading scheme. The number of City workers employed on carbon desks has fallen by 70 per cent in the past four years, according to Anthony Hobley, president of the Climate Markets & Investors Association. (Financial Times)
"Russian billionaire Mikhail Prokhorov agreed to buy out the primary shareholder of OAO Uralkali in a deal that could end the turmoil that has shaken the $22 billion potash industry. The global potash market has been in disarray since Uralkali announced in July that it would leave a trading partnership with Belarus that controlled around 40% of the world's trade in the fertilizer ingredient." (WSJ)
DSM, the world's largest vitamin producer, is preparing to spin off its pharmaceuticals division in a deal that will create a $2.6bn drug-making business. The Dutch cod-liver oil to petrochemical conglomerate will sell the division to JLL, a New York-based private equity group, which will merge it with Patheon, the drug-maker of which it is the majority shareholder. The deal is expected to close early next year. (FastFT)
Sony Pictures has hired Bain & Company to advise on potential cost-cutting, according to people familiar with the situation, following criticism of the film and television studio this year from Dan Loeb, the activist investor. No upper limit has been set for the cost-cutting, the people said. (Financial Times)
"India is considering sharp new limits on investment in the country's pharmaceutical industry that would bar foreign companies from taking control of makers of "rare and critical" medicines, a senior government official said Monday. New draft rules before the cabinet would bar foreigners from owning more than 49% of Indian manufacturers of such drugs, the official said. The official said the aim is to ensure adequate supplies of inexpensive, lifesaving medicines in India." (WSJ)
Dropbox, now apparently worth some $8bn: "Online-storage service Dropbox Inc. is raising a funding round that could value it at more than $8 billion, according to people familiar with the situation, though new figures reveal its revenue growth is decelerating. The talks with investors to raise around $250 million are still early and no valuation has been agreed upon, said a person familiar with the discussions." (WSJ)
Coastal Energy, the Toronto and London-listed oil and gas explorer with assets in southeast Asia, is selling itself to Spanish energy giant Cepsa for C$2.3bn ($2.2bn). The deal values Coastal at C$19 a share. (FastFT)
"T-Mobile US plans to sell $2 billion in debt after raising nearly that amount in a stock sale, as the company beefs up its war chest for acquiring wireless spectrum. The fourth-largest U.S. wireless carrier said in a filing Monday it could use the money for a number of purposes including spectrum purchases, a goal it has been open about recently. The company also said Monday it had raised a net $1.8 billion from a sale of stock last week." (WSJ)
"The National Labor Relations Board said it is prepared to file complaints alleging Wal-Mart violated workers' rights to protest—unless Wal-Mart and the parties settle matters first." (WSJ)
"Brazilian oil company OGX, which is in bankruptcy and controlled by former billionaire Eike Batista, said on Monday that Malaysia's Petroliam Nasional (Petronas) had rescinded a deal to buy a 40 percent stake in two of its oil blocks. OGX Petróleo e Gas Participações SAm said in a filing that it is analyzing taking legal action against Petronas." (Reuters)
"A federal court in New York has ordered MF Global Inc. to pay $1.2 billion in restitution to the failed brokerage firm's customers, the U.S. Commodity Futures Trading Commission said Monday." (WSJ)
COMMENTS & CURIOS
Donziger vs Chevron (WSJ)
FT series: Graduandthenwhat? (Financial Times)
China and Japan are heading for a collision (Financial Times Rachman)
China: Make plenum-ade (Financial Times Lex)
Chinese billions and the search for safety (Bloomberg)
Sugar subsidies and bad puns (WSJ)
OVERNIGHT MARKETS
Asian markets
Nikkei 225 down -53.01 (-0.35%) at 15,111
Topix down -4.11 (-0.33%) at 1,238
Hang Seng up +66.13 (+0.28%) at 23,726
US markets
S&P 500 down -6.65 (-0.37%) at 1,792
DJIA up +14.32 (+0.09%) at 15,976
Nasdaq down -36.90 (-0.93%) at 3,949
European markets
Eurofirst 300 up +6.40 (+0.49%) at 1,304
FTSE100 up +30.02 (+0.45%) at 6,723
CAC 40 up +28.45 (+0.66%) at 4,321
Dax up +56.74 (+0.62%) at 9,225
Currencies
€/$ 1.35 (1.35)
$/¥ 99.76 (99.98)
£/$ 1.61 (1.61)
€/£ 0.8388 (0.8381)
Commodities ($)
Brent Crude (ICE) down -0.54 at 107.93
Light Crude (Nymex) down -0.22 at 92.81
100 Oz Gold (Comex) at 1,272
Copper (Comex) at 3.15
10-year government bond yields (%)
US 2.67%
UK 2.72%
Germany 1.68%
CDS (closing levels)
Markit iTraxx SovX Western Europe -0.16bps at 64.4bp
Markit iTraxx Europe -0.72bps at 79.72bp
Markit iTraxx Xover -3.88bps at 332.47bp
Sources: FT, Bloomberg, Markit
