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Global shares sank on Monday as weaker-than-expected economic data added to investor worries over the unresolved U.S.-China trade dispute's effects on the world economy. European stock markets opened lower as surveys of purchasing managers from France, Germany, and the euro zone came in weaker than expected. Germany's DAX index hit its lowest level in nearly two weeks, down 1.35% after the euro zone data, while France's CAC 40 fell nearly 1%.
Since the 2011 Fukushima disaster, Japan has been scrambling to secure alternative sources of energy, and geothermal may be able to provide a solution
(Bloomberg) -- A Friday flare-up in trade tensions between the U.S. and China sent American equities to the first weekly decline in a month. Treasuries capped a fifth straight gain and the dollar rose.The S&P 500 halted a three-day advance on the week’s final day, with losses coming after Chinese trade officials canceled farm visits and President Donald Trump called the nation a threat. Technology and consumer shares sensitive to U.S. tariffs on Chinese goods paced the decline. Stocks edged higher for most of the week after the Federal Reserve delivered a rate cut and promised to do more if needed. Data on housing and manufacturing topped estimates.Treasuries climbed all week, sending the 10-year yield lower by 17 basis points. The move was unrelated to problems in the short-term funding market that prompted the New York Fed to announce a series of overnight operations for the next three weeks to ensure a vital corner of financial markets work properly. The dollar nudged higher in the five days.U.S. equity trading may have been extra volatile Friday because of a quarterly event known as “quadruple witching,” when options and futures on indexes and stocks expire. The moves bring some of the busiest trading days of the year, and volume was above average on the week’s last trading day.After a slew of monetary policy decisions this week, including the Fed’s interest-rate cut Wednesday and pledge to support economic growth, traders are now looking toward negotiations between the U.S. and China. President Donald Trump said Friday he doesn’t want to make a partial trade deal with China and that voters won’t punish him for the ongoing trade war in his 2020 bid for re-election.“I keep calling it the headline hokey pokey -- that’s kind of how it feels,” said Matt Lloyd, chief investment strategist at Advisors Asset Management, which has about $30 billion in assets under management. “The back and forth will continue. I don’t think anything will get done until 2020.”Elsewhere on Friday, the Stoxx Europe 600 Index advanced. The pound fell as the Irish government damped hopes of an imminent breakthrough in Brexit negotiations.Asian stocks saw modest gains on reduced volumes, except in India, where equities soared after the country cut its corporate tax rate. Hong Kong shares slipped while the Shanghai Composite Index added just 0.2% after China’s modest cut to a reference rate for bank loans failed to impress investors.Here are the main moves in markets:StocksThe S&P 500 Index fell 0.5% at the close of trading in New York, leaving it down by the same amount for the week.The Stoxx Europe 600 Index advanced 0.3%.The MSCI Asia Pacific Index climbed 0.4%.The MSCI Emerging Market Index climbed 0.4%.CurrenciesThe Bloomberg Dollar Spot Index rose 0.1%.The euro fell 0.2% to $1.1021.The British pound decreased 0.4% to $1.2473.The Japanese yen gained 0.4% to 107.55 per dollar.BondsThe yield on 10-year Treasuries fell six basis points to 1.72%.Germany’s 10-year yield fell one basis point to -0.53%.Britain’s 10-year yield slipped one basis point to 0.63%.CommoditiesGold rose 1.1% to $1,515.90 an ounce.West Texas Intermediate crude fell 0.1% to $58.09 a barrel.\--With assistance from Adam Haigh, Todd White, Lu Wang and Constantine Courcoulas.To contact the reporters on this story: Brendan Walsh in Austin at email@example.com;Vildana Hajric in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Samuel Potter at email@example.com, ;Jeremy Herron at firstname.lastname@example.org, Brendan WalshFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
An index of global stock markets surrendered early gains on Friday after Chinese agriculture officials who were to visit U.S. farm states next week canceled their trip, dampening optimism on U.S.-China trade talks. Renewed worries about the state of the ongoing trade tensions between Washington and Beijing drove Treasury yields lower and pushed the U.S. dollar down against the safe-haven Japanese yen. The cancellation came as U.S.-Chinese trade talks were held in Washington and U.S. President Donald Trump said he wanted a complete trade deal, not just an agreement for China to buy more U.S. agricultural goods.
(Bloomberg) -- U.S. equities ended the day near where they started as investors failed to find a catalyst to lift the benchmark stock index to an all-time high. The dollar sank and Treasuries rose amid a slew of fresh monetary-policy decisions.The S&P 500 Index closed little changed, within 1% of a record, as gains in software companies offset losses for carmakers. After getting a boost from positive comments on trade by White House economic adviser Larry Kudlow early in the day, equities took a leg down after a report about a U.S. official threatening steeper tariffs against China. The yen, pound and Swiss franc led Group-of-10 currency gains after their respective central banks left borrowing rates unchanged.The slate of monetary policy decisions, hot on the heels of the Federal Reserve’s interest-rate cut Wednesday, comes just as the OECD cut its world growth forecast to 2.9% from 3.2% as intensifying trade conflicts take a toll on confidence. Investors continue to focus on the outlook for negotiations between the U.S. and China as trade deputies from both nations meet.Elsewhere, banks pushed the Europe Stoxx 600 higher. Treasuries advanced while European government bonds slipped. Shares fell in Hong Kong and nudged up in Shanghai. China’s yuan dropped as traders weighed the odds of the People’s Bank of China lowering borrowing costs. Australia’s dollar slumped after the unemployment rate rose.Oil gained amid contrasting reports about whether Saudi Arabia asked Iraq for crude to supply its domestic refineries.These are some key events to keep an eye on this week:Friday is quadruple witching day for U.S. markets. When the quarterly expiration of futures and options on indexes and stocks occurs on the same day, surging volatility and trading can follow.Here are the main moves in markets:\--With assistance from Laura Curtis.To contact the reporter on this story: Brendan Walsh in Austin at email@example.comTo contact the editors responsible for this story: Jeremy Herron at firstname.lastname@example.org, Brendan Walsh, Dave LiedtkaFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
World share markets and bond yields nudged modestly higher on Thursday as the U.S. Federal Reserve's second interest rate cut of the year and promises of support from other top central banks kept global recession jitters at bay. The effects of the trade war has seen monetary policy swing back into support mode this year, but the Fed's central message on Wednesday was that it wasn't expecting a major capitulation of the economy. Japan and Switzerland then kept their deeply negative interest rates on hold.
The major Asia Pacific stock indexes are mostly higher in the wake of interest rate and policy decisions from the U.S. Federal Reserve and the Bank of Japan.
(Bloomberg) -- The dollar rallied and Treasuries pared gains as Federal Reserve policy makers cast doubt on the need for further easing after lowering their main interest rate for a second time this year. Stocks erased losses as financial companies that benefit from higher rates rallied.The S&P 500 Index ended little changed, wiping out a drop that at one point reached the biggest in four weeks, as Fed Chair Jerome Powell promised at a press conference to be vigilant against any signs of economic slowdown. Banks were the best performers. Ten-year Treasury yields dipped just below 1.8%.While Fed policy makers were widely expected to reduce their benchmark rate by a quarter-point, investors were more focused on the outlook for further cuts this year. Five officials think the rate at year end should be higher than it is after today’s cut, five wanted the rate cut today but are not projecting any more cuts, and seven are projecting one more quarter-point cut by December.“I view the guidance we received as mixed,” said Eric Winograd, senior U.S. economist at AllianceBernstein. “They want to stop the economy from slipping into a recession but aren’t going to do anything to push growth higher.”Elsewhere, FedEx Corp. tumbled after the company slashed its profit outlook, blaming a global economy weakened by trade tensions. Stocks were mixed in Asia. Europe’s equity benchmark barley budged. Precious metals fell.Oil ticked lower after tumbling Tuesday, when Saudi Aramco said it had revived 41% of capacity at a key crude-processing complex days after a devastating aerial attack that wrecked vital equipment and rocked global energy markets.These are some key events to keep an eye on this week:The Bank of Japan monetary policy decision is Thursday, followed by a briefing from Governor Haruhiko Kuroda.Bank Indonesia and Bank of England also decide policy Thursday.Australia jobs figures are out Thursday.Friday is quadruple witching day for U.S. markets. When the quarterly expiration of futures and options on indexes and stocks occurs on the same day, surging volatility and trading can follow.Here are the main moves in markets:StocksThe S&P 500 Index was little changed at the close of trading in New York.The Stoxx Europe 600 Index was little changed.The MSCI Emerging Market Index advanced 0.2%.The Nikkei-225 Stock Average fell 0.2%CurrenciesThe Bloomberg Dollar Spot Index increased 0.2%.The British pound fell 0.1% to $1.2493.The euro declined 0.3% to $1.1035.The Japanese yen fell 0.3% to 108.4 per dollar.BondsThe yield on 10-year Treasuries fell one basis point to 1.79%.Germany’s 10-year yield fell four basis points to -0.51%.Japan’s 10-year yield slipped three basis points to -0.20%CommoditiesWest Texas Intermediate crude fell 2.1% to $58.11 a barrel.The Bloomberg Commodity Index decreased 0.5%.Gold fell 0.4% to $1,495.14 an ounce.\--With assistance from Adam Haigh, Todd White, Robert Brand and Nancy Moran.To contact the reporters on this story: Brendan Walsh in Austin at email@example.com;Vildana Hajric in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Jeremy Herron at email@example.com, Brendan WalshFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
In a well-strategized move, Apple (AAPL) is relocating its production base to India. Apple's investment in India will be around $1 billion.
Crude oil prices plunged on Tuesday after the Saudi energy minister said the kingdom’s oil supply will soon be back online. The drop in crude oil prices spread weakness throughout the Asia Pacific region on Wednesday.
The S&P 500 and the Dow reversed losses to close higher on Wednesday and U.S. Treasury yields slipped after remarks by Federal Reserve Chair Jerome Powell tempered the market's initial reaction to the U.S. central bank's policy statement. All three major U.S. stock indexes initially extended earlier losses following the release of the Fed's policy decision after the close of a two-day meeting, which dimmed hopes for further rate cuts and fell short of the more aggressive reduction in borrowing costs that President Donald Trump had demanded.
Chinese retail sales and investment gauges also worsened, reinforcing views that China is likely to cut some of its key interest rates this week for the first time in over three years to prevent a sharper slump in activity.
Japan has agreed to phase out tariffs on U.S. wine imports as part of a bilateral trade deal expected to be signed at the end of the month, t1he Nikkei newspaper reported on Sunday. Japan will eliminate the tariffs on U.S. wine within five to seven years after the trade agreement goes into effect, the Nikkei reported without giving its sources. Japan taxes imported wine at a rate of 15% or 125 yen ($1.16) per litre, whichever is cheaper, according to the Nikkei.
(Bloomberg) -- U.S. stocks finished the week mixed as Treasury yields jumped to six-week highs and the dollar slipped.All three major U.S. indexes still closed higher for a third consecutive week after being whipsawed by a rotation from growth to value shares by some investors. Apple weighed on the Nasdaq Friday. Equity indexes in Europe and Asia finished the week in the green thanks to easing trade fears and a new round of central bank stimulus.“We’re going to see volatility in the market,” said Alan Adelman, a senior fund manager at Frost Investment Advisors, which oversees $4.7 billion. “We’ve seen it this week -- it may not come in absolute price moves -- but we’re going to see volatility.”The pound posted the biggest weekly gain since May after the Times reported possible progress in Brexit negotiations related to the contentious Irish backstop. Prime Minister Boris Johnson will meet EU President Jean-Claude Juncker next week. The euro strengened this week and most government bonds retreated in the wake of the European Central Bank’s moves to support growth, with one policy maker saying a new easing package was a possible mistake.Optimism over a trade deal is growing ahead of expected high-level talks next month between the world’s two largest economies.“With holiday spending on the horizon and inflation at bay, we could continue to see momentum in the retail sector,” said Mike Loewengart, vice president of investment strategy at E*TRADE Financial Corp. “A healthy consumer can help inject some energy into other sectors of the economy. That said, trade tensions are a key focal point and rising tariffs between the U.S. and China could threaten this critical indicator.”Elsewhere, WTI crude fluctuated around $55 a barrel, poised for a weekly drop following a warning from the International Energy Agency of a “daunting” surplus of crude in 2020.Here are the main moves in markets: \--With assistance from Andrew Cinko and Laura Curtis.To contact the reporters on this story: Vildana Hajric in New York at firstname.lastname@example.org;Sarah Ponczek in New York at email@example.comTo contact the editors responsible for this story: Jeremy Herron at firstname.lastname@example.org, Dave LiedtkaFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Global markets rise on trade hopes but new records for the indices and a trade deal may be elusive.
Toyota Motor Corp has started using the same type of battery that Panasonic Corp designed for Tesla Inc in some of its plug-in hybrids sold in China, sources familiar with the matter said. Toyota is using Panasonic's cylindrical batteries in its new Corolla and Levin plug-in hybrid sedans launched in China this year, one of the people said. The batteries are the same size as those that Panasonic makes for Tesla, but the composition is different, said the sources, who declined to be identified as the matter is private.
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.Stocks eked out a gain on optimism about the outlook for a trade agreement between the U.S. and China and after Europe’s central bank announced a fresh round of stimulus.The S&P 500 Index closed just 0.5% below its all-time high after a report that American officials have discussed offering a limited trade agreement to China. That followed a decision by the European Central Bank to cut its main rate to minus 0.5% and buy 20 billion euros ($22 billion) of bonds a month. The euro gained and sovereign bonds were mixed.Any steps by China and the U.S. to ease tensions ahead of face-to-face talks in Washington in the coming weeks would support sentiment as investors await monetary decisions from more of the world’s major central banks. The ECB changed its guidance on interest rates to say they’ll stay at present or lower levels until the outlook for inflation “robustly” converges to its goal of just below 2%.“It’s a perfect storm of good news,” said Chris Gaffney, president of world markets at TIAA. “Investors are feeling relief now and feeling that perhaps things aren’t quite as bad as they seemed two months ago.”The Federal Reserve is due to meet next week as economic indicators give mixed signals about whether the record-long expansion will end soon. The dollar weakened.Elsewhere, European equities edged higher. Turkey’s lira rallied after its policy makers cut interest rates by more than forecast. Oil turned lower as the International Energy Agency warned OPEC it faces a “daunting” surplus of crude in 2020.Hong Kong equities bucked the advance in Asia, dragged lower by shares of the city’s exchange following a surprise takeover bid for its London counterpart.Here are the main moves in markets:StocksThe S&P 500 Index climbed 0.3% at the close in New York.The Stoxx Europe 600 Index rose 0.2%.The Nikkei-225 Stock Average rose 0.8% for its eighth straight gain, the best streak in a yearCurrenciesThe Bloomberg Dollar Spot Index slipped 0.2%.The euro rose 0.5% to $1.1065.The British pound rose 0.1% to $1.2339.The Japanese yen fell 0.3% to 108.14 per dollar.BondsThe yield on 10-year Treasuries rose four basis points to 1.78%.Germany’s 10-year yield rose five basis points to -0.52%.Britain’s 10-year yield rose three basis points 0.67%.Italy’s 10-year yield decreased 11 basis points to 0.86%.CommoditiesGold added 0.1% to $1,499.21 an ounce.West Texas Intermediate crude dipped 1.3% to $55.05 a barrel.Silver fell 0.2% to $18.08 per ounce.\--With assistance from Yakob Peterseil and Reade Pickert.To contact the reporter on this story: Vildana Hajric in New York at email@example.comTo contact the editors responsible for this story: Jeremy Herron at firstname.lastname@example.org, Brendan Walsh, Dave LiedtkaFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Global markets rise on trade hopes and stimulus plans, the S&P; 500 is striking distance from new all-time highs.
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.If the appetite for U.K. equities is still pretty weak among asset managers, that’s not the case for overseas companies. While Brexit has dominated headlines lately, another major theme has been the sale of U.K. Plc. The latest target is the venerable London Stock Exchange, which can trace its roots back to 1698. As Britain’s divorce appears to near its conclusion, the trend might continue.British stocks have fallen like dominoes, with Greene King, Cobham, Entertainment One, Just Eat, Inmarsat and BCA Marketplace all receiving bids in recent months. A Brexit-weakened currency, depressed equity valuations, cash-rich private equity buyers and yield hungry investors, are some of the reasons behind the M&A wave.“There is a broader story here,” says Edward Park, deputy chief investment officer at Brooks Macdonald Asset Management. Most mergers are driven by idiosyncratic factors, he says. However the depressed pound and the underperformance of U.K. equities have made the nation’s assets a fertile hunting ground, particularly for international businesses looking to diversify or expand into new markets, Park explains.By enfeebling the pound, Brexit has led to more foreign swoops on U.K. firms, says Chris Beauchamp, chief market analyst at IG. If the takeover of LSE is successful, which is far from certain with the FT reporting this morning the exchange is set to reject the offer, it would mark the departure of one of the best-performing shares on the FTSE since the Brexit vote in 2016, further shrinking the pool of firms successfully navigating the post-referendum world, he adds.Whatever happens politically, U.K. assets will probably be sought after by longer-term investors given their valuations and reasonable quality, says Roger Jones, head of equities at London and Capital Asset Management.The valuation discount between Britain and the rest of the world continues to widen, as the stocks never recovered from the Brexit vote. In terms of price-to-earnings, the MSCI UK is the cheapest among major indexes, even cheaper than emerging markets.A HKEX/LSE combination would create the third-largest operator globally. But the proposed takeover may head toward a dead-end, according to Mathias Lascar, an event-driven sales trader at Makor Securities. “This deal is highly political and we don’t see how -- since a deal with Deutsche Boerse failed to succeed partly on political grounds -- a deal with the HK exchange can succeed in the current environment," he said.Indeed, buying the LSE may not be a walk in the park. The government could choose to block the deal on national security or public interest grounds. Separately, the Competition and Markets Authority, the U.K. antitrust regulator, is studying whether the acquisition of Inmarsat by a consortium of funds led by Apax Partners raises public interest concerns or could endanger national security. There’s also been a plethora of calls for a similar treatment of defense company Cobham, which is subject to a bid from another private equity firm, Advent International.HKEX’s takeover proposal is also conditional on the termination of LSE’s planned acquisition of Refinitiv -- another thorny issue, given the warm welcome to that deal by shareholders and analysts.There’s yet another possible outcome for LSE. This takeover attempt could trigger a counter offer from a U.S. peer, such as Intercontinental Exchange, which could potentially realize higher synergies from a combination, according to analysts. That may come at a price though, as the LSE is the most expensive exchange out there.In the meantime, Euro Stoxx 50 futures are up 0.5% ahead of the European open, while S&P 500 contracts are up 0.2%.SECTORS IN FOCUS TODAY:Watch trade-sensitive stocks after U.S. President Donald Trump delayed the imposition of extra tariffs on Chinese goods by two weeks. The extra 5% tariffs will now be imposed on Oct. 15 instead of Oct. 1 as a “gesture of good will,” Trump wrote on Twitter. Watch miners, steelmakers, semiconductors, autos and other cyclical segments like industrials and chemicals.Watch tobacco stocks including BAT and Imperial Brands, following a vow for tougher U.S. scrutiny of vaping products and as Senate Democrats seek to raise taxes on e-cigarettes.Watch banks on ECB day, as a rate cut is widely expected, but question marks remain on the controversial restart to the bank’s bond-buying program and a tiering system to ease some pain for lenders.COMMENT:“While the likelihood of an imminent no deal Brexit has subsided, it remains a material risk,” Citi strategist Robert Buckland writes in a note. “We don’t think that it would hit the FTSE 100’s EPS particularly hard and would buy into further weakness. Domestic-exposed stocks would likely be hit harder than the multinationals.”NOTES FROM THE SELL SIDE:Jungheinrich is initiated with an overweight rating, and is preferred over equal-weight rated Kion in the warehousing and forklift truck market sphere, Morgan Stanley says, setting PT at EU26.Future initiated at buy and Euromoney set at hold as Berenberg increases its U.K. mid-cap media coverage to 10 stocks, with most in this “eclectic mix” seen offering strong operating margins and high return on capital. Future named among top picks with Ascential and YouGov, with least-preferred Moneysupermarket the only sell, Berenberg says in note.COMPANY NEWS AND M&A:Morrison 1H Rev. Below Estimate; Firms Up Amazon Partnership (1)AB InBev Said to Target $5 Billion in Asian Unit IPO This MonthBouygues: 13% Alstom Stake Sold at EU37/Shr Vs EU39.38 CloseBAT to Cut 2,300 Jobs by 2020London Stock Exchange Set to Reject Hong Kong Bid, FT Says (1)HKEX Bid for LSE Could Face U.S. Scrutiny: TelegraphCapgemini Won’t Budge on Altran Price, CEO Says: Les EchosKnorr-Bremse Maintains FY Revenue EU6.88 Bln To EU7.08 BlnRovio Lowers 2019 Profit OutlookHSBC Prepares to Unload French Retail Bank, DJ SaysBBVA Seeks to Sell Almost EU5B of Unpaid Loans: ConfidencialUBS’s Weber Says France Legal Matter May Take Some TimeRemy Cointreau Names Richemont’s Vallat as CEO in Luxury PushNational Grid Cut Jobs Months Before U.K. Blackout: GuardianRio to Face Pressure on Scope 3 Emissions, Campaign Group SaysTelia Acting CEO Sees Bonnier Deal Closed Before Year-End: DISports Direct to Start GBP30m Buyback Program Sept. 12TECHNICAL OUTLOOK for Stoxx 600 index:Resistance at 395.1 (July high); 397.9 (June 2018 high)Support at 381.1 (50-DMA); 372.6 (200-DMA); 365.5 (50% Fibo)RSI: 66.3TECHNICAL OUTLOOK for Euro Stoxx 50 index:Resistance at 3,573 (July high); 3,596 (May 2018 high)Support at 3,435 (50-DMA); 3,403 (61.8% Fibo); 3,321 (200-DMA)RSI: 65.8MAIN RESEARCH AND RATING CHANGES:UPGRADES:4imprint upgraded to buy at BerenbergAIB Group upgraded to buy at Goldman; PT 3.40 EurosDNB upgraded to buy at Goldman; PT 200 KronerGenmab upgraded to overweight at JPMorgan; PT 1,500 KronerNornickel GDRs upgraded to overweight at JPMorgan; PT $28Zurich Ins. upgraded to buy at SocGen; PT 425 FrancsDOWNGRADES:Accor downgraded to underweight at JPMorgan; PT 35.50 EurosBank of Ireland downgraded to sell at Goldman; PT 3.50 EurosInterContinental Hotels cut to underweight at JPMorganLloyds downgraded to sell at Goldman; PT 47 PenceSAF Holland cut to sell at Quirin Privatbank AG; PT 7.40 EurosSkanska cut to sell at Handelsbanken; Price Target 175 KronorVeidekke downgraded to hold at Handelsbanken; PT 100 KronerINITIATIONS:Ascential rated new hold at Liberum; PT 3.80 PoundsEuromoney rated new hold at Berenberg; PT 14 PoundsFuture PLC rated new buy at Berenberg; PT 15.30 PoundsGarofalo Health Care rated new outperform at Mediobanca SpAJungheinrich rated new overweight at Morgan Stanley; PT 26 EurosMarzocchi Pompe rated new outperform at MainFirst; PT 5.80 EurosNorsk Hydro rated new underweight at Barclays; PT 26 KronerMARKETS:MSCI Asia Pacific up 1%, Nikkei 225 up 1% S&P 500 up 0.7%, Dow up 0.8%, Nasdaq up 1.1%Euro up 0.03% at $1.1013Dollar Index down 0.02% at 98.63Yen down 0.17% at 108Brent up 0.8% at $61.3/bbl, WTI up 1% to $56.3/bblLME 3m Copper up 1.2% at $5843/MTGold spot up 0% at $1497.9/ozUS 10Yr yield up 1bps at 1.75% ECONOMIC DATA (All times CET):8:45am: (FR) Aug. CPI EU Harmonized MoM, est. 0.5%, prior 0.5%8:45am: (FR) Aug. CPI EU Harmonized YoY, est. 1.2%, prior 1.2%8:45am: (FR) Aug. CPI MoM, est. 0.5%, prior 0.5%8:45am: (FR) Aug. CPI YoY, est. 1.1%, prior 1.1%8:45am: (FR) Aug. CPI Ex-Tobacco Index, est. 104.38, prior 103.919am: (SP) July House transactions YoY, prior -9.0%10am: (IT) 2Q Unemployment Rate Quarterly, est. 10.0%, prior 10.4%11am: (EC) July Industrial Production SA MoM, est. -0.1%, prior -1.6%11am: (EC) July Industrial Production WDA YoY, est. -1.4%, prior -2.6%\--With assistance from Namitha Jagadeesh, Ksenia Galouchko and Lisa Pham.To contact the reporters on this story: Michael Msika in London at email@example.com;William Canny in Amsterdam at firstname.lastname@example.orgTo contact the editor responsible for this story: Blaise Robinson at email@example.comFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Hong Kong Exchanges and Clearing Limited (HKEX) said Wednesday it had made a proposal to the board of London Stock Exchange Group Plc (LSE) to “combine the two companies,” in a deal which values the (LSE) at about 29.6 billion Pounds or $36.6 billion.
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.Stocks rallied, with the Nasdaq Composite Index rising to the highest level since July, as the rotation from momentum to value shares that began at the start of the week slowed. Crude oil plunged after President Donald Trump indicated that sanctions on Iran could be eased.The Nasdaq rose for the first time in four days as Apple’s cheaper priced iPhone gave analysts reason to cheer, while the Dow Jones Industrial Average gained for a sixth day and the S&P 500 closed above 3,000 for the first time in six weeks. Trump earlier urged the Federal Reserve to cut interest rates to “zero, or less,” in a tweet, while China moved to lessen the trade war’s repercussions by announcing a range of U.S. goods to be exempted from 25% extra tariffs put in place last year.“Get a trade deal, get a dovish Fed, decent valuations, lower interest rates, and all of a sudden, you have the tinder potentially for markets to move higher,” Jeff Mortimer, director of investment strategy for BNY Mellon Wealth Management, said in an interview at Bloomberg’s New York headquarters.Crude oil futures fell as much as 2.8% in London. Trump is preparing to meet with Iranian President Hassan Rouhani later this month, according to people familiar with the matter. Such talks would be unprecedented for an administration that made isolating the Islamic Republic a cornerstone policy. The dollar strengthened, while benchmark Treasury yields lingered near one-month highs.Equities are rebounding in September on hopes for fresh monetary stimulus from the European Central Bank on Thursday and the Fed next week, while market-supportive measures by China helped lift sentiment. Strong monetary easing is not a given, though, with some investors dialing back their expectations of accommodation and bond traders pulling back from the more bullish sentiment of August.These are the main moves in markets:\--With assistance from Andrew Cinko.To contact the reporter on this story: Vildana Hajric in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Jeremy Herron at email@example.com, Dave LiedtkaFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- Japan’s central bank, long a pioneer in pushing the envelope of monetary policy in its campaign to stimulate the economy, may yet add to its record of innovation.The Bank of Japan’s current dilemma is that while its peers have eased policy -- or are set to do so soon -- it has refrained from additional action. That leaves Japan’s exchange rate vulnerable if other central banks’ moves drive down their currencies. A stronger yen would hurt Japanese exporter earnings and the stock market, and put downward pressure on prices.Yet taking Japanese interest rates deeper into negative territory, or stepping up asset purchases, risks doing yet more damage to investment returns. Governor Haruhiko Kuroda himself issued a warning on that front last week.This Gordian Knot-type conundrum has revived speculation about a so-called reverse operation twist. That’s where the central bank moves to cut short-term rates while supporting longer-term ones. In theory, it could head off yen appreciation, support institutional investors’ returns and boost bank stocks.“Aggressive tapering alone would be viewed as major tightening,” if the BOJ just focused on cutting back its bond purchases, Yujiro Goto, head of foreign-exchange strategy at Nomura Holdings Inc. in Tokyo, wrote in a note Tuesday. That approach would risk a strengthening of the yen, he added.That’s why “a reverse twist operation-type policy combination would be necessary,” Goto wrote. In the original Operation Twist in the 1960s, U.S. policy makers attempted to shrink the gap between short and long-term yields. The Federal Reserve mounted another such maneuver in 2011.BOJ watchers also floated the idea of a reverse twist back in 2016, when -- like now -- there were global economic headwinds and trenchant declines in longer-dated bond yields were stoking angst among Japanese investors.Kuroda said in an interview with the Nikkei newspaper last week that yields on 20-year and 30-year Japanese government bonds have “fallen a bit too far” and that returns for life insurers and pension funds have fallen significantly -- negatively affecting consumer sentiment.Three years ago, instead of a reverse twist, the BOJ adopted a new framework, twinning the negative short-term interest rate it had adopted earlier in 2016 with a target for 10-year bond yields of around zero.Trouble is the actual yield is now well below zero, at -0.20% in Tokyo trading late Wednesday. Japanese banks, insurers and pension funds have been piling into foreign securities in their hunt for returns, potentially stockpiling risk as they do so. Regulators have had to tighten scrutiny.Given that the impetus for lower long term yields lately has been global, not local, there may not be much the BOJ can do to limit damage to savers if it steps up stimulus via interest rates. (There’s always other moves, like expanding exchange-traded fund purchases.)While the BOJ could trim its bond buying to prevent any “violent” move in longer-dated yields, “it would not be surprising should Japan end up joining Switzerland and Germany in having its entire yield curve” below zero, Morgan Stanley analysts including Takeshi Yamaguchi wrote in a note last month.(Updates yield in third-to-last paragraph.)To contact the reporter on this story: Christopher Anstey in Tokyo at firstname.lastname@example.orgTo contact the editors responsible for this story: Malcolm Scott at email@example.com, Paul JacksonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.