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These 8 companies and trade groups are said to be among the top donors to "Sedition Caucus" Republicans who voted against certifying the 2020 election result

Top donors to members of the so-called Sedition Caucus include Boeing, General Dynamics, and Lockheed Martin, says watchdog Accountable.US. After the January 6 Capitol siege, top companies scrambled to cut ties with the 147 GOP lawmakers who voted against certifying Joe Biden's 2020 election win.Scott Olson/Getty Images On Jan. 6, 2021, some 147 GOP lawmakers voted against certifying Joe Biden's 2020 election victory. Members of the group have since received $8.1 million in corporate donations, watchdog Accountable.US says. These eight companies and trade groups are among the top donors, according to Accountable.US. Trump supporters clashed with police and security on Capitol Hill on January 6, 2021.Brent Stirton/Getty ImagesTop US companies and trade groups have donated more than $8.1 million to Republican lawmakers who voted against Joe Biden's certification as president, according to a report by watchdog Accountable.US.After a pro-Trump mob stormed the US Capitol on January 6, 2021, many companies scrambled to cut ties with the 147 GOP lawmakers who voted against certifying the 2020 election result.Dozens of companies including Walmart, Amazon, Morgan Stanley, and AT&T said they would stop donating to these 147 Republican lawmakers – a group dubbed the Sedition Caucus by political opponents. Others including Microsoft, Deloitte, and Goldman Sachs said they would pause all political donations.But Accountable.US says donations to the GOP election objectors soon recovered."What makes no sense is why major corporations chose to reward the politicians that weaponized Donald Trump's Big Lie with millions of dollars in campaign cash," Kyle Herrig, president of Accountable.US, told Insider.In the aftermath of the Capitol siege, "many big-name companies assured their customers and employees how much they value our democracy, but it's obvious they value something more – holding political influence over as many lawmakers as possible, even if those lawmakers voted to subvert our government," Herrig said.Here are some of the top donors to the GOP election objectors, per Accountable.US's corporate donations tracker, which is based on Federal Election Commission (FEC) data on direct donations from Fortune 500 companies and 700 trade associations. The latest data reflects donations through November 2021.BoeingBoeing said it paused all political donations after January 6.BoeingAviation giant Boeing is among the largest donors to the GOP election objectors, with its PAC handing out $190,000 since January 2021, according to the Accountable.US tracker.Boeing said it paused political donations after the January 6 attack and condemned the "violence, lawlessness, and destruction that took place in the US Capitol."Its donations include $10,000 to California Rep. Ken Calvert and $9,000 to Kentucky Rep. Hal Rogers, according to Accountable.US.Boeing declined to comment.UPSUPS has donated to 58 GOP election objectors, per Accountable.US.Jim Young/ReutersLogistics company UPS has donated $167,000 to GOP election objectors, per the Accountable.US tracker.The donations, up to a maximum of $5,000 each, were made to 58 of them, the tracker shows.UPS did not respond to Insider's request for comment.Lockheed MartinLockheed Martin has donated to more than half of the 147 GOP election objectors, per Accountable.US.Jon Hobley/MI News/NurPhoto via Getty ImagesAerospace and defense group Lockheed Martin has donated $184,500 to 76 GOP election objectors, meaning it has donated to more than half of the group, the Accountable.US tracker shows.Lockheed Martin's donations include $8,000 each to Calvert and to Utah Rep. Chris Stewart, according to the tracker.Lockheed Martin did not respond to Insider's request for comment.RaytheonRaytheon said it paused all political donations after the Capitol siege.AaronP/Bauer-Griffin/Getty ImagesAfter the Capitol siege, a spokesperson for aerospace and defense company Raytheon told Defense News that it had paused all PAC contributions "to reflect on the current environment and determine appropriate next steps."According to the Accountable.US tracker, Raytheon has since donated $186,000 to GOP election objectors, including $8,000 to Calvert and $6,500 to Colorado Rep. Doug Lamborn.Raytheon didn't respond to Insider's request for comment.General DynamicsGeneral Dynamics has donated $173,500 to 53 GOP election objectors, per Accountable.US.General DynamicsDefense contractor General Dynamics has split $173,500 among 53 of the GOP election objectors since the January 6 siege, including $10,000 each to Calvert and to Florida Rep. Mario Diaz-Balart, per Accountable.US.General Dynamics declined to comment.American Bankers AssociationThe American Bankers Association gave $203,000 to the GOP objectors between January 6 and November 2021, according to Accountable.US.Nicolas Economou/NurPhoto via Getty ImagesThe American Bankers Association (ABA) is the top corporate donor on Accountable.US's tracker.The ABA donated $203,000 to GOP election objectors between January 6 and November 2021, the tracker shows.After the January 6 siege, the ABA said it had temporarily paused all political contributions, and a spokesperson told Insider in January 2021 that the group would consider the "troubling events" at the Capitol when making future donations."The violent riot on Capitol Hill was nothing short of an assault on our democracy," an ABA spokesperson said at the time. "We continue to call on all elected officials to do everything in their power to support a peaceful transition of power."The group's PAC has since donated to 60 of the 147 election objectors, including $5,000 to House Minority Leader Kevin McCarthy, according to the Accountable.US tracker.The ABA did not respond to Insider's renewed request for comment.National Beer Wholesalers AssociationThe National Beer Wholesalers Association donated to 94 Republican election objectors after the Capitol siege.John Leyba/Getty ImagesThe National Beer Wholesalers Association has donated to more than half of the 147 GOP election objectors since the January 6 siege, splitting $196,000 between 94 of them, per the Accountable.US tracker.The association didn't respond to Insider's request for comment.Regions FinancialRegions Financial has donated $125,000 to GOP election objectors since January 6, per Accountable.US.Pavlo Gonchar/SOPA Images/LightRocket via Getty ImagesBanking group Regions Financial has donated $125,000 to 64 GOP election objectors since the Capitol siege, per Accountable.US.A spokesperson for Regions Financial said: "Contributions from Regions' voluntary, employee-funded political action committee are evaluated on an individual basis. The PAC has long supported candidates from both major parties whose policy objectives align with our goal of providing exceptional financial services to the people, businesses, and communities we serve."Kevin McCarthy tops individual donations listSince Jan. 6, Kevin McCarthy has received the most in corporate donations of any GOP election objector, according to Accountable.US.Chip Somodevilla/Getty ImagesOther companies whose PACs have made substantial donations to the GOP election objectors include Chevron, Eli Lilly, FedEx, General Motors, Johnson & Johnson, Merck, and Pfizer. An Eli Lilly spokesperson said: "LillyPAC supports candidates across the political spectrum who understand the value of a vibrant pharmaceutical ecosystem to address unmet patient needs. Contributions from LillyPAC will continue to be in line with Lilly's purpose to make life better."Chevron, FedEx, General Motors, Johnson & Johnson, Merck, and Pfizer did not respond to Insider's requests for comment.Accountable.US's tracker features dozens of other companies and trade associations that made single small contributions to individual objectors. These feed into the more than $8.1 million that corporate PACs have given to GOP election objectors since the Capitol siege.Of all the 147 GOP election objectors, House Minority Leader Kevin McCarthy is the top recipient of corporate funding since January 6, 2021, receiving $333,500 from the Fortune 500 companies and trade associations listed on Accountable.US's tracker.McCarthy is followed by Louisiana Rep. Steve Scalise, with $250,000, and Missouri Rep. Sam Graves, with $207,752.Accountable.US says companies and trade associations indirectly donated millions to GOP election objectors by funding multi-candidate committees like the National Republican Senatorial Committee and National Republican Congressional Committee.Accountable.US's Herrig told Insider: "Some things should be bigger than the bottom line, like a healthy democracy. These corporations should recognize that normalizing election conspiracy-mongers in Congress equates to normalizing their anti-democratic behavior."If they truly stand by their words in support of democracy, companies must prove it by changing their own hypocritical and complicit behavior."Read the original article on Business Insider.....»»

Category: dealsSource: nytJan 15th, 2022

These 8 companies and trade groups are said to be among the top donors to "Sedition Caucus" Republicans who voted against certifying the 2020 election result

Top donors to members of the so-called Sedition Caucus include Boeing, General Dynamics, and Lockheed Martin, says watchdog Accountable.US. After the January 6 Capitol siege, top companies scrambled to cut ties with the 147 GOP lawmakers who voted against certifying Joe Biden's 2020 election win.Scott Olson/Getty Images On Jan. 6, 2021, some 147 GOP lawmakers voted against certifying Joe Biden's 2020 election victory. Members of the group have since received $8.1 million in corporate donations, watchdog Accountable.US says. These eight companies and trade groups are among the top donors, according to Accountable.US. Trump supporters clashed with police and security on Capitol Hill on January 6, 2021.Brent Stirton/Getty ImagesTop US companies and trade groups have donated more than $8.1 million to Republican lawmakers who voted against Joe Biden's certification as president, according to a report by watchdog Accountable.US.After a pro-Trump mob stormed the US Capitol on January 6, 2021, many companies scrambled to cut ties with the 147 GOP lawmakers who voted against certifying the 2020 election result.Dozens of companies including Walmart, Amazon, Morgan Stanley, and AT&T said they would stop donating to these 147 Republican lawmakers – a group dubbed the Sedition Caucus by political opponents. Others including Microsoft, Deloitte, and Goldman Sachs said they would pause all political donations.But Accountable.US says donations to the GOP election objectors soon recovered."What makes no sense is why major corporations chose to reward the politicians that weaponized Donald Trump's Big Lie with millions of dollars in campaign cash," Kyle Herrig, president of Accountable.US, told Insider.In the aftermath of the Capitol siege, "many big-name companies assured their customers and employees how much they value our democracy, but it's obvious they value something more – holding political influence over as many lawmakers as possible, even if those lawmakers voted to subvert our government," Herrig said.Here are some of the top donors to the GOP election objectors, per Accountable.US's corporate donations tracker, which is based on Federal Election Commission (FEC) data on direct donations from Fortune 500 companies and 700 trade associations. The latest data reflects donations through November 2021.BoeingBoeing said it paused all political donations after January 6.BoeingAviation giant Boeing is among the largest donors to the GOP election objectors, with its PAC handing out $190,000 since January 2021, according to the Accountable.US tracker.Boeing said it paused political donations after the January 6 attack and condemned the "violence, lawlessness, and destruction that took place in the US Capitol."Its donations include $10,000 to California Rep. Ken Calvert and $9,000 to Kentucky Rep. Hal Rogers, according to Accountable.US.Boeing declined to comment.UPSUPS has donated to 58 GOP election objectors, per Accountable.US.Jim Young/ReutersLogistics company UPS has donated $167,000 to GOP election objectors, per the Accountable.US tracker.The donations, up to a maximum of $5,000 each, were made to 58 of them, the tracker shows.UPS did not respond to Insider's request for comment.Lockheed MartinLockheed Martin has donated to more than half of the 147 GOP election objectors, per Accountable.US.Jon Hobley/MI News/NurPhoto via Getty ImagesAerospace and defense group Lockheed Martin has donated $184,500 to 76 GOP election objectors, meaning it has donated to more than half of the group, the Accountable.US tracker shows.Lockheed Martin's donations include $8,000 each to Calvert and to Utah Rep. Chris Stewart, according to the tracker.Lockheed Martin did not respond to Insider's request for comment.RaytheonRaytheon said it paused all political donations after the Capitol siege.AaronP/Bauer-Griffin/Getty ImagesAfter the Capitol siege, a spokesperson for aerospace and defense company Raytheon told Defense News that it had paused all PAC contributions "to reflect on the current environment and determine appropriate next steps."According to the Accountable.US tracker, Raytheon has since donated $186,000 to GOP election objectors, including $8,000 to Calvert and $6,500 to Colorado Rep. Doug Lamborn.Raytheon didn't respond to Insider's request for comment.General DynamicsGeneral Dynamics has donated $173,500 to 53 GOP election objectors, per Accountable.US.General DynamicsDefense contractor General Dynamics has split $173,500 among 53 of the GOP election objectors since the January 6 siege, including $10,000 each to Calvert and to Florida Rep. Mario Diaz-Balart, per Accountable.US.General Dynamics declined to comment.American Bankers AssociationThe American Bankers Association gave $203,000 to the GOP objectors between January 6 and November 2021, according to Accountable.US.Nicolas Economou/NurPhoto via Getty ImagesThe American Bankers Association (ABA) is the top corporate donor on Accountable.US's tracker.The ABA donated $203,000 to GOP election objectors between January 6 and November 2021, the tracker shows.After the January 6 siege, the ABA said it had temporarily paused all political contributions, and a spokesperson told Insider in January 2021 that the group would consider the "troubling events" at the Capitol when making future donations."The violent riot on Capitol Hill was nothing short of an assault on our democracy," an ABA spokesperson said at the time. "We continue to call on all elected officials to do everything in their power to support a peaceful transition of power."The group's PAC has since donated to 60 of the 147 election objectors, including $5,000 to House Minority Leader Kevin McCarthy, according to the Accountable.US tracker.The ABA did not respond to Insider's renewed request for comment.National Beer Wholesalers AssociationThe National Beer Wholesalers Association donated to 94 Republican election objectors after the Capitol siege.John Leyba/Getty ImagesThe National Beer Wholesalers Association has donated to more than half of the 147 GOP election objectors since the January 6 siege, splitting $196,000 between 94 of them, per the Accountable.US tracker.The association didn't respond to Insider's request for comment.Regions FinancialRegions Financial has donated $125,000 to GOP election objectors since January 6, per Accountable.US.Pavlo Gonchar/SOPA Images/LightRocket via Getty ImagesBanking group Regions Financial has donated $125,000 to 64 GOP election objectors since the Capitol siege, per Accountable.US.A spokesperson for Regions Financial said: "Contributions from Regions' voluntary, employee-funded political action committee are evaluated on an individual basis. The PAC has long supported candidates from both major parties whose policy objectives align with our goal of providing exceptional financial services to the people, businesses, and communities we serve."Kevin McCarthy tops individual donations listSince Jan. 6, Kevin McCarthy has received the most in corporate donations of any GOP election objector, according to Accountable.US.Chip Somodevilla/Getty ImagesOther companies whose PACs have made substantial donations to the GOP election objectors include Chevron, Eli Lilly, FedEx, General Motors, Johnson & Johnson, Merck, and Pfizer. An Eli Lilly spokesperson said: "LillyPAC supports candidates across the political spectrum who understand the value of a vibrant pharmaceutical ecosystem to address unmet patient needs. Contributions from LillyPAC will continue to be in line with Lilly's purpose to make life better."Chevron, FedEx, General Motors, Johnson & Johnson, Merck, and Pfizer did not respond to Insider's requests for comment.Accountable.US's tracker features dozens of other companies and trade associations that made single small contributions to individual objectors. These feed into the more than $8.1 million that corporate PACs have given to GOP election objectors since the Capitol siege.Of all the 147 GOP election objectors, House Minority Leader Kevin McCarthy is the top recipient of corporate funding since January 6, 2021, receiving $333,500 from the Fortune 500 companies and trade associations listed on Accountable.US's tracker.McCarthy is followed by Louisiana Rep. Steve Scalise, with $250,000, and Missouri Rep. Sam Graves, with $207,752.Accountable.US says companies and trade associations indirectly donated millions to GOP election objectors by funding multi-candidate committees like the National Republican Senatorial Committee and National Republican Congressional Committee.Accountable.US's Herrig told Insider: "Some things should be bigger than the bottom line, like a healthy democracy. These corporations should recognize that normalizing election conspiracy-mongers in Congress equates to normalizing their anti-democratic behavior."If they truly stand by their words in support of democracy, companies must prove it by changing their own hypocritical and complicit behavior."Read the original article on Business Insider.....»»

Category: dealsSource: nytJan 15th, 2022

5 companies including Eli Lilly and Cigna donated to Republican election objectors after pledging not to, a report says

Dozens of companies pledged to halt funding to the 147 GOP lawmakers who voted against certifying Biden's election win. Not all kept their promises. Dozens of companies scrambled to cut ties with members of the so-called Sedition Caucus after the Jan. 6 insurrection.Salwan Georges/The Washington Post via Getty Images, Tasos Katopodis/Getty Images Dozens of big companies pledged to stop donating to the 147 Republican election objectors known as the "Sedition Caucus." But several companies appear to have broken their promises, research by Popular Information suggests. Accounting giant PWC was named as one of them, having donated $124,000 to 27 objectors, per Popular Information. Five major US companies including Eli Lilly, PWC, and Cigna have donated directly to Republican election objectors despite pledging not to do so, according to Popular Information.After a mob of pro-Trump supporters stormed the US Capitol on January 6, 2021, dozens of top US companies scrambled to cut ties with the 147 GOP lawmakers who voted against certifying Joe Biden's election victory – a group that has been referred to as the Sedition Caucus.But Fortune 500 companies and leading trade groups have since donated more than $8.1 million to members of the caucus, according to nonpartisan watchdog Accountable.US. Some of the companies had previously pledged to end donations, per Popular Information.Accounting giant PWC said after the January 6 siege that it had suspended all political contributions to the election objectors. But the company's PAC has since given $124,000 to 27 of the objectors, Popular Information said. PWC has also given $30,000 to both the National Republican Senatorial Committee (NRSC) and the National Republican Congressional Committee (NRCC), multi-candidate committees that fund lawmakers including members of the Sedition Caucus, Popular Information reported, citing Federal Election Commission (FEC) filings.Pharmaceutical company Eli Lilly, which also promised to cut donations to the objectors, later gave a total of $42,500 to 16 of them, as well as $15,000 to the NRSC and $15,000 to the the NRCC, Popular Information reported, citing FEC records.Health insurer Cigna said in January it would pause contributions to lawmakers "who encouraged or supported violence, or otherwise hindered a peaceful transition of power." It later gave $30,000 to members of the Sedition Caucus and $15,000 each to the NRSC and NRCC, Popular Information reported.Cigna told Insider in May that its revised PAC policy only applied to donations to lawmakers "who incited violence or actively sought to obstruct the peaceful transition of power through words and other efforts. Congressional votes are, by definition, part of the peaceful transition of power outlined by law, and therefore, we believe are not the appropriate indicator for the application of our policy."Cigna added that its PAC remains nonpartisan and "focused on the common concerns of the employees who fund it."Energy company Exelon donated $15,000 altogether to six objectors after saying it would stop donating to them, Popular Information said. eBay donated to one objector after saying it would stop funding them, per the report.Some 52 companies that said they would pause all political donations ultimately restarted donations to the objectors, Popular Information reported.A further 26 companies, including KPMG, Walmart, Dell, and Google, who said they'd either stop funding the 147 lawmakers or pause all donations, haven't donated directly to individual objectors but have donated to committees like the NRSC and the NRCC, Popular Information said.Communications giant AT&T said in January that it would halt contributions to lawmakers who voted against Biden's certification, but in February it donated $5,000 to the House Conservatives Fund, which fundraises for the Republican Study Committee, itself made up mainly of election objectors. The company has since donated a further $15,000 to each of the NRCC and NRSC, FEC filings show.AT&T, Eli Lilly, PWC, eBay, KPMG, Walmart, Dell, and Google did not immediately respond to Insider's requests for comment.Some companies have stuck to their promises. Popular Information reported that 79 big US companies including Allstate, Nike, and Walgreens didn't donate directly to the objectors, or to committees that count them among their members.Seven major US companies have pledged not to donate to Republican election objectors in 2022. Editor's note: A previous version of this story mistakenly said that S&P Global had donated $5,000 to a GOP objector. The story has been updated.Read the original article on Business Insider.....»»

Category: personnelSource: nytJan 5th, 2022

Futures Rebound As Yields Drop

Futures Rebound As Yields Drop U.S. index futures rebounded on Tuesday from Monday's stagflation-fear driven rout as an increase in Treasury yields abated and the greenback dropped from a 10 month high while Brent crude dropped from a 3 year high of $80/barrel after API showed a surprise stockpile build across all products. One day after one of Wall Street’s worst selloff of this year which saw the S&P's biggest one-day drop since May, dip buyers made yet another another triumphal return to global markets, with Nasdaq 100 futures climbing 130 points or 0.9% after the tech-heavy index tumbled the most since March on Tuesday as U.S. Treasury yields rose on tapering and stagflationconcerns. S&P 500 futures rose 28 points or 0.6% after the underlying gauge also slumped amid mounting concern over the debt-ceiling impasse in Washington. A key catalyst for today's easing in financial conditions was the 10-year yield shedding four basis points and the five-year rate falling below 1%. In the past five sessions, the 10Y yield rose by a whopping 25 basis point, a fast enough move to trigger VaR shocks across risk parity investors. "We think (10-year treasury yields) are likely to around 1.5% to 1.75%, so they obviously still have room to go," said Daniel Lam, senior cross-asset strategist at Standard Chartered, who added that the rise in yields was driven by the fact that the United States was almost definitely going to start tapering its massive asset purchases by the end of this year, and that this would drive a shift from growth stocks into value names. Shares of FAAMG gigatechs rose between 1% and 1.3% in premarket trading as the surge in yields eased. Oil firms and supermajors like Exxon and Chevron dipped as a rally in crude prices petered out. The S&P energy sector has gained 3.9% so far this week and is on track for its best monthly performance since February. Among stocks, Boeing rose 2.5% after it said 737 MAX test flight for China’s aviation regulator last month was successful and the planemaker hopes a two-year grounding will be lifted this year. Cybersecurity firm Fortinet Inc. led premarket gains among S&P 500 Index companies. Here are some of the other big movers this morning: Micron (MU US) shares down more than 3% in U.S. premarket trading after the chipmaker’s forecast came in well below analyst expectations. Co. was hurt by slowing demand from personal-computer makers Lucid (LCID US) shares rise 9.7% in U.S. premarket trading after the electric-vehicle company said it has started production on its debut consumer car EQT Corp. (EQT US) shares fell 4.8% in Tuesday postmarket trading after co. reports offering by certain shareholders who received shares as a part of its acquisition of Alta Resources Development’s upstream and midstream units PTK Acquisition (PTK US) rises in U.S. premarket trading after the blank-check company’s shareholders approved its combination with the Israel-based semiconductor company Valens Cal-Maine (CALM US) shares rose 4.4% postmarket Tuesday after it reported net sales for the first quarter that beat the average analyst estimate as well as a narrower-than-estimated loss Sherwin-Williams (SHW US) dropped 3.5% in Tuesday postmarket trading after its forecasted adjusted earnings per share for the third quarter missed the average analyst estimate Boeing (BA US) and Spirit Aerosystems (SPR US) climb as much as 3% after being upgraded to outperform by Bernstein on travel finally heading to inflection point The S&P 500 is set to break its seven-month winning streak as fears about non-transitory inflation, China Evergrande’s default, potential higher corporate taxes and a sooner-than expected tapering of monetary support by the Federal Reserve clouded investor sentiment in what is usually a seasonally weak month. Meanwhile, Senate Democrats are seeking a vote Wednesday on a stopgap funding bill to avert a government shutdown, but without a provision to increase the federal debt limit. On Tuesday, Jamie Dimon said a U.S. default would be “potentially catastrophic” event, in other words yet another multibillion bailout for his bank. “Many things are in flux: the pandemic is not over, the supply chain bottlenecks we are seeing are affecting all sorts of prices and we’ll need to see how it plays out because the results are not clear in terms of inflation,” Belita Ong, Dalton Investments chairman, said on Bloomberg Television. Europe’s Stoxx 600 gauge rebounded from a two-month low, rising 0.9% and reversing half of yesterday's losses. Semiconductor-equipment company ASM International posted the biggest increase on the index amid positive comments by analysts on its growth outlook. A sharp rebound during the European session marked a turnaround from the downbeat Asian session, when equities extended losses amid concerns over stagflation and China Evergrande Group’s debt crisis. Sentiment improved as a steady flow of buyers emerged in the Treasury market, ranging from foreign and domestic funds to leveraged accounts.  Here are some of the biggest European movers today: Academedia shares rise as much as 6.9% in Stockholm, the most since June 1, after the company said the number of participants for its higher vocational education has increased 25% y/y. ASM International jumps as much as 7.3%, rebounding from a three-day sell-off, boosted by supportive analyst comments and easing bond yields. GEA Group gains as much as 4.7% after the company published new financial targets through 2026, which Citigroup says are above analysts’ consensus and an encouraging signal. DSV bounces as much as 4.4% as JPMorgan upgrades to overweight, saying the recent pullback in the shares presents an opportunity. Genova Property Group falls as much as 10% in Stockholm trading after the real estate services company placed shares at a discount to the last close. ITM Power drops as much as 6.4% after JPMorgan downgrades to neutral from overweight on relative valuation, with a more mixed near-term outlook making risk/reward seem less compelling. Royal Mail slides as much as 6.2% after UBS cuts its rating to sell from buy, expecting U.K. labor shortages and wage inflation pressures to hurt the parcel service company’s profit margins. Earlier in the session, Asian equities slumped in delayed response to the US rout. MSCI's broadest index of Asia-Pacific shares outside Japan fell 1.43% with Australia off 1.5%, and South Korea falling 2.06%. The Hong Kong benchmark shed 1.2% and Chinese blue chips were 1.1% lower. Japan's Nikkei shed 2.35% hurt by the general mood as the country's ruling party votes for a new leader who will almost certainly become the next prime minister ahead of a general election due in weeks.  Also on traders' minds was cash-strapped China Evergrande whose shares rose as much as 12% after it said it plans to sell a 9.99 billion yuan ($1.5 billion) stake it owns in Shengjing Bank. Evergrande is due to make a $47.5 million bond interest payment on its 9.5% March 2024 dollar bond, having missed a similar payment last week, but it said in the stock exchange filing the proceeds of the sale should be used to settle its financial liabilities due to Shengjing Bank. Chinese real estate company Fantasia Holdings Group is struggling to avoid falling deeper into distress, just as the crisis at China Evergrande flags broader risks to other heavily indebted developers. In Japan, the country's PGIF, or Government Pension Investment Fund, the world’s largest pension fund, said it won’t include yuan- denominated Chinese sovereign debt in its portfolio. In rates, as noted above, Treasuries lead global bonds higher, paring large portion of Tuesday’s losses with gains led by intermediates out to long-end of the curve. Treasury yields richer by up to 4bp across long-end of the curve with 10s at around 1.50%, outperforming bunds and gilts both by 2bp; front-end of the curve just marginally richer, flattening 2s10s spread by 3.2bp with 5s30s tighter by 0.5bp. Futures volumes remain elevated amid evidence of dip buyers emerging Tuesday and continuing over Wednesday’s Asia hours. Session highlights include a number of Fed speakers, including Chair Powell.     In FX, the Bloomberg Dollar Spot Index was little changed after earlier advancing, and the dollar slipped versus most of its Group-of-10 peers. The yen was the best G-10 performer as it whipsawed after earlier dropping to 111.68 per dollar, its weakest level since March 2020. The Australian dollar also advanced amid optimism over easing of Covid-related restrictions while the New Zealand dollar was the worst performer amid rising infections. The euro dropped to an 11-month low while the pound touched its weakest level since January against the greenback amid a bout of dollar strength as the London session kicked off. Confidence in the euro-area economy unexpectedly rose in September as consumers turned more optimistic about the outlook and construction companies saw employment prospects improve. The yen climbed from an 18-month low as a decline in stocks around the world helps boost demand for the currency as a haven. Japanese bonds also gained. In commodities, oil prices dropped after touching a near three-year high the day before. Brent crude fell 0.83% to $78.25 per barrel after topping $80 yesterday; WTI dipped 1.09% to $74.47 a barrel. Gold edged higher with the spot price at $1,735.6 an ounce, up 0.1% from the seven-week low hit the day before as higher yields hurt demand for the non interest bearing asset. Base metals are under pressure with LME aluminum and copper lagging. Looking at the day ahead, the biggest highlight will be a policy panel at the ECB forum on central banking featuring ECB President Lagarde, Fed Chair Powell, BoJ Governor Kuroda and BoE Governor Bailey. Other central bank speakers include ECB Vice President de Guindos, the ECB’s Centeno, Stournaras, Makhlouf, Elderson and Lane, as well as the Fed’s Harker, Daly and Bostic. Meanwhile, data releases include UK mortgage approvals for August, the final Euro Area consumer confidence reading for September, and US pending home sales for August. Market Snapshot S&P 500 futures up 0.7% to 4,371.75 STOXX Europe 600 up 0.8% to 455.97 MXAP down 1.2% to 197.38 MXAPJ down 0.7% to 635.17 Nikkei down 2.1% to 29,544.29 Topix down 2.1% to 2,038.29 Hang Seng Index up 0.7% to 24,663.50 Shanghai Composite down 1.8% to 3,536.29 Sensex down 0.4% to 59,445.57 Australia S&P/ASX 200 down 1.1% to 7,196.71 Kospi down 1.2% to 3,060.27 Brent Futures down 0.7% to $78.53/bbl Gold spot up 0.4% to $1,740.79 U.S. Dollar Index little changed at 93.81 German 10Y yield fell 1.1 bps to -0.210% Euro down 0.2% to $1.1664 Top Overnight News from Bloomberg China’s central bank governor said quantitative easing implemented by global peers can be damaging over the long term and vowed to keep policy normal for as long as possible China’s central bank injected liquidity into the financial system for a ninth day in the longest run since December as it sought to meet a surge in seasonal demand for cash China stepped in to buy a stake in a struggling regional bank from China Evergrande Group as it seeks to limit contagion in the financial sector from the embattled property developer The Chinese government is considering raising power prices for industrial consumers to help ease a growing supply crunch Japan’s Government Pension Investment Fund, the world’s largest pension fund, said it won’t include yuan-denominated Chinese sovereign debt in its portfolio. The decision comes as FTSE Russell is set to start adding Chinese debt to its benchmark global bond index, which the GPIF follows, from October Fumio Kishida is set to become Japan’s prime minister, after the ex-foreign minister overcame popular reformer Taro Kono to win leadership of the country’s ruling party, leaving stock traders feeling optimistic ECB Governing Council member Gabriel Makhlouf said policy makers must be ready to respond to persistently higher inflation that could result from lasting supply bottlenecks Inflation accelerated in Spain to the fastest pace in 13 years, evidence of how surging energy costs are feeding through to citizens around the euro-zone economy Sterling-debt sales by corporates exceeded 2020’s annual tally as borrowers rushed to secure ultra-cheap funding costs while they still can. Offerings will top 70 billion pounds ($95 billion) through Wednesday, beating last year’s total sales by at least 600 million pounds, according to data compiled by Bloomberg A more detailed look at global markets courtesy of Newsquawk Asian equity markets were pressured on spillover selling from global peers which saw the S&P 500 suffer its worst day since May after tech losses were magnified as yields climbed and with sentiment also dampened by weak data in the form of US Consumer Confidence and Richmond Fed indexes. ASX 200 (-1.1%) was heavily pressured by tech and with mining-related stocks dragged lower by weakness in underlying commodity prices, with the mood also clouded by reports that Queensland is on alert for a potential lockdown and that Australia will wind down emergency pandemic support payments within weeks. Nikkei 225 (-2.1%) underperformed amid the broad sell-off and as participants awaited the outcome of the LDP leadership vote which saw no candidate win a majority (as expected), triggering a runoff between vaccine minister Kono and former foreign minister Kishida to face off in a second round vote in which Kishida was named the new PM. KOSPI (-1.2%) was heavily pressured by the tech woes and after North Korea confirmed that yesterday’s launch was a new type of hypersonic missile. Hang Seng (+0.7%) and Shanghai Comp. (-1.8%) conformed to the broad risk aversion with tech stocks hit in Hong Kong, although the losses were milder compared to regional peers with Evergrande shares boosted after it sold CNY 10bln of shares in Shengjing Bank that will be used to pay the developer’s debt owed to Shengjing Bank, which is the Co.’s first asset sale amid the current collapse concerns although it still faces another USD 45.2mln in interest payments due today. In addition, the PBoC continued with its liquidity efforts and there was also the absence of Stock Connect flows to Hong Kong with Southbound trading already closed through to the National Holidays. Finally, 10yr JGBs were slightly higher as risk assets took a hit from the tech sell-off and with T-notes finding some reprieve overnight. Furthermore, the BoJ were also in the market for nearly JPY 1tln of JGBs mostly in 3yr-10yr maturities and there were notable comments from Japan’s GPIF that it is to avoid investments in Chinese government bonds due to concerns over China market. Top Asian News L&T Is Said in Talks to Merge Power Unit With Sembcorp India Prosecutors Seek Two Years Jail for Ghosn’s Alleged Accomplice Japan to Start Process to Sell $8.5 Billion Postal Stake Gold Climbs From Seven Week Low as Yields Retreat, Dollar Pauses Bourses in Europe are attempting to claw back some ground lost in the prior session’s global stocks rout (Euro Stoxx 50 +0.9%; Stoxx 600 +0.8%). The upside momentum seen at the cash open has somewhat stabilised amid a lack of news flow and with a busy agenda ahead from a central bank standpoint, with traders also cognizant of potential month-end influence. US equity futures have also been gradually drifting higher since the reopen of electronic trade. As things stand, the NQ (+1.0%) narrowly outperforms the ES (+0.7%), RTY (+0.8%) and YM (+0.6%) following the tech tumble in the prior session, and with yields easing off best levels. Back to European cash, major regional bourses see broad-based gains with no standout performers. Sectors are mostly in the green; Oil & Gas resides at the foot of the bunch as crude prices drift lower and following two consecutive sessions of outperformance. On the flip side, Tech resides among today’s winners in what is seemingly a reversal of yesterday’s sector configuration, although ASML (+1.3%) may be offering some tailwinds after upping its long-term outlook whilst suggesting ASML and its supply chain partners are actively adding and improving capacity to meet this future customer demand – potentially alleviating some concerns in the Auto sector which is outperforming at the time of writing. Retail also stands strong as Next (+3.0%) upped its guidance whilst suggesting the longer-term outlook for the Co. looks more positive than it had been for many years. In terms of individual movers, Unilever (+1.0%) is underpinned by source reports that the Co. has compiled a shortlist of at least four bidders for its PG Tips and Lipton Iced Tea brands for some GBP 4bln. HeidelbergCement (-1.4%) is pressured after acquiring a 45% stake in the software firm Command Alko. Elsewhere, Morrisons (+1.3%) is on the front foot as the takeover of the Co. is to be decided via an auction process as touted earlier in the month. Top European News Makhlouf Says ECB Must Be Ready to Act If Inflation Entrenched ASML to Ride Decade-Long Sales Boom After Chip Supply Crunch Spanish Inflation at 13-Year High in Foretaste of Regional Spike U.K. Mortgage Approvals Fall to 74,453 in Aug. Vs. Est. 73,000 In FX, the yield and risk backdrop is not as constructive for the Dollar directly, but the index has posted another marginal new y-t-d best, at 93.891 compared to 93.805 yesterday with ongoing bullish momentum and the bulk of the US Treasury curve remaining above key or psychological levels, in contrast to other global bond benchmarks. Hence, the Buck is still elevated and on an upward trajectory approaching month end on Thursday, aside from the fact that hedge rebalancing flows are moderately positive and stronger vs the Yen. Indeed, the Euro is the latest domino to fall and slip to a fresh 2021 low around 1.1656, not far from big barriers at 1.1650 and further away from decent option expiry interest at the 1.1700 strike (1 bn), and it may only be a matter of time before Sterling succumbs to the same fate. Cable is currently hovering precariously above 1.3500 and shy of the January 18 base (1.3520) that formed the last pillar of support for the Pound before the trough set a week earlier (circa 1.3451), and ostensibly supportive UK data in the form of BoE mortgage lending and approvals has not provided much relief. AUD/JPY - A rather odd couple in many ways given their contrasting characteristics as a high beta or activity currency vs traditional safe haven, but both are benefiting from an element of corrective trade, consolidation and short covering relative to their US counterpart. Aud/Usd is clinging to 0.7250 in advance of Aussie building approvals on Thursday and Usd/Jpy is retracing from its new 111.68 y-t-d pinnacle amidst the less rampant yield environment and weighing up the implications of ex-Foreign Minister Kishida’s run-off win in the LDP leadership contest and the PM-in-waiting’s pledge to put together a Yen tens of trillion COVID-19 stimulus package before year end. CHF/CAD/NZD - All relatively confined vs their US rival, as the Franc continues to fend off assaults on the 0.9300 level with some impetus from a significant improvement in Swiss investor sentiment, while the Loonie is striving to keep its head above 1.2700 ahead of Canadian ppi data and absent the recent prop of galloping oil prices with WTI back under Usd 75/brl from Usd 76.67 at best on Tuesday. Elsewhere, the Kiwi is pivoting 0.6950 pre-NZ building consents and still being buffeted by strong Aud/Nzd headwinds. SCANDI/EM - Not much purchase for the Sek via upgrades to Swedish GDP and inflation forecast upgrades by NIER as sentiment indices slipped across the board, but some respite for the Try given cheaper crude and an uptick in Turkish economic confidence. Conversely, the Cnh and Cny have not received their customary fillip even though the PBoC added liquidity for the ninth day in a row overnight and China’s currency regulator has tightened control over interbank trade and asked market makers to narrow the bid/ask spread, according to sources. In commodities, WTI and Brent front month futures have been trimming overnight losses in early European trade. Losses overnight were seemingly a function of profit-taking alongside the bearish Private Inventory Report – which showed a surprise build in weekly crude stocks of 4.1mln bbls vs exp. -1.7mln bbls, whilst the headline DoE looks for a draw of 1.652mln bbls. Further, there have been growing calls for OPEC+ to further open the taps beyond the monthly 400k BPD hike, with details also light on the White House’s deliberations with OPEC ahead of the decision-making meeting next week. Despite these calls, it’s worth bearing in mind that OPEC’s latest MOMR stated, “increased risk of COVID-19 cases primarily fuelled by the Delta variant is clouding oil demand prospects going into the final quarter of the year, resulting in downward adjustments to 4Q21 estimates. As a result, 2H21 oil demand has been adjusted slightly lower, partially delaying the oil demand recovery into 1H22.” Brent Dec dipped back under USD 78/bbl (vs low 763.77/bbl) after testing USD 80/bbl yesterday, whilst WTI Nov lost the USD 75/bbl handle (vs low USD 73.37/bbl). Over to metals, spot gold and silver have seen somewhat of divergence as real yields negate some effects of the new YTD peak printed by the Dollar index, whilst spot silver succumbs to the Buck. Over to base metals, LME copper trade is lacklustre as the firmer dollar weighs on the red metal. Shanghai stainless steel meanwhile extended on losses, notching the fourth session of overnight losses with desks citing dampened demand from the Chinese power crunch. US Event Calendar 7am: Sept. MBA Mortgage Applications, prior 4.9% 10am: Aug. Pending Home Sales YoY, est. -13.8%, prior -9.5% 10am: Aug. Pending Home Sales (MoM), est. 1.3%, prior -1.8% Central Bank speakers 9am: Fed’s Harker Discusses Economic Outlook 11:45am: Powell Takes Part in ECB Forum on Central Banking 11:45am: Bailey, Kuroda, Lagarde, Powell on ECB Forum Panel 1pm: Fed’s Daly Gives Speech to UCLA 2pm: Fed’s Bostic Gives Remarks at Chicago Fed Payments DB's Jim Reid concludes the overnight wrap The main story of the last 24 hours has been a big enough rise in yields to cause a major risk-off move, with 10yr Treasury yields up another +5.0bps to 1.537% yesterday, and this morning only seeing a slight -0.3bps pullback to 1.534%. At the intraday peak yesterday, they did climb as high as 1.565% earlier in the session, but this accelerated the risk off and sent yields somewhat lower intraday as a result, which impacted the European bond closes as we’ll see below. All told, US yields closed at their highest level in 3 months and up nearly +24bps since last Wednesday’s close, shortly after the FOMC meeting. That’s the largest 4-day jump in US yields since March 2020, at the outset of the pandemic and shortly after the Fed announced their latest round of QE. This all led to the worst day for the S&P 500 (-2.04%) since mid-May and the worst for the NASDAQ (-2.83%) since mid-March. The S&P 500 is down -4.06% from the highs now – trading just below the Evergrande (remember that?) lows from last week. So the index still has not seen a -5% sell-off on a closing basis for 228 days and counting. If we make it to Halloween it will be a full calendar year. Regardless, the S&P and STOXX 600 remain on track for their worst monthly performances so far this year. Those moves have continued this morning in Asia, where the KOSPI (-2.05%), Nikkei (-1.64%), Hang Seng (-0.60%), and the Shanghai Comp (-1.79%) are all trading lower. The power crisis in China is further dampening sentiment there, and this morning Bloomberg have reported that the government are considering raising prices for industrial users to ease the shortage. Separately, we heard that Evergrande would be selling its stake in a regional bank at 10 billion yuan ($1.55bn) as a step to resolve its debt crisis, and Fitch Ratings also downgraded Evergrande overnight from CC to C. However, US equity futures are pointing to some stabilisation later, with those on the S&P 500 up +0.49%. Running through yesterday’s moves in more depth, 23 of the 24 industry groups in the S&P 500 fell back yesterday with the lone exception being energy stocks (+0.46%), which gained despite the late pullback in oil prices. In fact only 53 S&P constituents gained on the day. The largest losses were in high-growth sectors like semiconductors (-3.82%), media (-3.08%) and software (-3.05%), whilst the FANG+ index was down -2.52% as 9 of the 10 index members lost ground – Alibaba’s +1.47% gain was the sole exception. Over in Europe it was much the same story, with the STOXX 600 (-2.18%) falling to its worst daily performance since July as bourses across the continent fell back, including the German DAX (-2.09%) and France’s CAC 40 (-2.17%). Back to bonds and the rise in 10yr Treasury yields yesterday was primarily led by higher real rates (+2.1bps), which hit a 3-month high of their own, whilst rising inflation breakevens (+2.3bps) also offered support. In turn, higher yields supported the US dollar, which strengthened +0.41% to its highest level since November last year, though precious metals including gold (-0.92%) fell back as investors had less need for the zero-interest safe haven. Over in Europe the sell-off was more muted as bonds rallied into the close before selling off again after. Yields on 10yr bunds (+2.4bps), OATs (+3.0bps) and BTPs (+6.1bps) all moved higher but were well off the peaks for the day. 10yr Gilts closed up +4.2bps but that was -6.6bps off the high print. And staying with the UK, sterling (-1.18%) saw its worst day this year and fell to its lowest level since January 11 as sentiment has increasingly been knocked by the optics of the fuel crisis here. Given this and the hawkish BoE last week many are now talking up the stagflation risk. On the petrol crisis it’s hard to know how much is real and how much is like an old fashion bank run fuelled mostly by wild speculation. Regardless it doesn’t look good to investors for now. All this came against the backdrop of yet further milestones on inflation expectations, as the German 10yr breakeven hit a fresh 8-year high of 1.690%, just as the Euro Area 5y5y forward inflation swap hit a 4-year high of its own at 1.789%. Meanwhile 10yr UK breakevens pulled back some, finishing -6bps lower on the day after initially spiking up nearly +5bps in the opening hours of trading. This highlights the uncertainty as to the implications of a more hawkish BoE last week. As we’ve discussed over recent days, part of the renewed concerns about inflation have come from a fresh spike in energy prices, and yesterday saw Brent crude move above $80/bbl in regards intraday trading for the first time since 2018. Furthermore, natural gas prices continued to hit fresh highs yesterday, with European futures up +2.69% to a fresh high of €78.56 megawatt-hours. That said, oil prices did pare back their gains later in the session as the equity selloff got underway, with Brent crude (-0.55%) and WTI (-0.21%) both closing lower on the day, and this morning they’ve fallen a further -1.49% and -1.54% respectively. Yesterday, Fed Chair Powell and his predecessor Treasury Secretary Yellen appeared jointly before the Senate Banking Committee. The most notable moment came from Senator Warren who criticized Chair Powell for his track record on regulation, saying he was a “dangerous man” and then saying on the record that the she would not support his re-nomination ahead of his term ending in February. Many senators, mostly Republicans, voiced concerns over inflationary pressures, but both Yellen and Powell maintained their stances that the current high level of inflation was temporary and due to the supply chain issues from Covid-19 that they expect to be resolved in time. Lastly, both Powell and Yellen warned the Senators that a potential US default would be “catastrophic” and Treasury Secretary Yellen said in a letter to Congress that the Treasury Department now estimated the US would hit the debt ceiling on October 18. So we’ve got an important few days and weeks coming up. Last night, Senate Majority Leader Schumer tried to pass a vote that would drop the threshold from 60 to a simple majority to suspend the debt limit, but GOP Senator Cruz amongst others blocked this and went forward with forcing Democrats to use the budget reconciliation measure instead. Some Democrats have pushed back saying that the budget process would take too long and increases the risk of a default. While this is all going on we’re now less than 48 hours from a US government shutdown as it stands, though there seems to be an agreement on the funding measure if it were to be raised as clean bill without the debt ceiling provisions. There is also other business in Washington due tomorrow, with the bipartisan infrastructure bill with $550bn of new spending up for a vote. While the funding bill is the higher short-term priority, there was news yesterday that progressive members of the House of Representatives may try and block the infrastructure bill if it comes up ahead of the budget reconciliation vote. That was according to Congressional Progressive Caucus Chair Jayapal who said “Progressives will vote for both bills, but a majority of our members will only vote for the infrastructure bill after the President’s visionary Build Back Better Act passes.” The infrastructure bill could be tabled once again as there is no real urgency to get it voted on until the more pressing debt ceiling and funding bill issues are resolved. Democratic leadership is trying to thread a needle and the key sticking point appears to be if the moderate and progressive wing can agree on the budget quickly enough to beat the clock on the US defaulting on its debt. Shifting back to central bankers, ECB President Lagarde warned against withdrawing stimulus too rapidly as a response to inflationary pressures. She contested that there are “no signs that this increase in inflation is becoming broad-based across the economy,” and continued that the “key challenge is to ensure that we do not overreact to transitory supply shocks that have no bearing on the medium term.” Similar to her US counterpart, Lagarde cited higher energy prices and supply-chain breakdowns as the root cause for the current high inflation data and argued these would recede in due time. The ECB continues to strike a more dovish tone than the Fed and BoE. Speaking of inflation, DB’s chief European economist, Mark Wall, has just put out a podcast where he discusses the ECB, inflation and the value of a flexible asset purchase programme. He and his team have a baseline assumption that the ECB will double the pace of their asset purchases to €40bn per month to smooth the exit from the Pandemic Emergency Purchase Programme, but the upward momentum in the inflation outlook and the latest uncertainty from recent supply shocks puts a premium on policy flexibility. You can listen to the podcast "Focus Europe: Podcast: ECB, inflation and the value of a flexible APP" here. In Germany, there weren’t a great deal of developments regarding the election and coalition negotiations yesterday, but NTV reported that CSU leader Markus Söder had told a regional group meeting of the party that he expected the next government would be a traffic-light coalition of the SPD, the Greens and the FDP. Speaking to reporters later in the day, he went onto say that the SPD’s Olaf Scholz had the best chance of becoming chancellor, and that the SPD had the right to begin coalition negotiations. Running through yesterday’s data, the Conference Board’s consumer confidence reading in the US for September fell to 109.3 (vs. 115.0 expected), which marks the third consecutive decline in the reading and the lowest it’s been since February. Meanwhile house prices continued to rise, with the FHFA’s house price index for July up +1.4% (vs. +1.5% expected), just as the S&P CoreLogic Case-Shiller index saw a record +19.7% increase in July as well. To the day ahead now, and the biggest highlight will be a policy panel at the ECB forum on central banking featuring ECB President Lagarde, Fed Chair Powell, BoJ Governor Kuroda and BoE Governor Bailey. Other central bank speakers include ECB Vice President de Guindos, the ECB’s Centeno, Stournaras, Makhlouf, Elderson and Lane, as well as the Fed’s Harker, Daly and Bostic. Meanwhile, data releases include UK mortgage approvals for August, the final Euro Area consumer confidence reading for September, and US pending home sales for August. Tyler Durden Wed, 09/29/2021 - 07:42.....»»

Category: blogSource: zerohedgeSep 29th, 2021

2021 Greatest Hits: The Most Popular Articles Of The Past Year And A Look Ahead

2021 Greatest Hits: The Most Popular Articles Of The Past Year And A Look Ahead One year ago, when looking at the 20 most popular stories of 2020, we said that the year would be a very tough act to follow as there "could not have been more regime shifts, volatility moments, and memes than 2020." And yet despite the exceedingly high bar for 2021, the year did not disappoint and proved to be a successful contender, and if judging by the sheer breadth of narratives, stories, surprises, plot twists and unexpected developments, 2021 was even more memorable and event-filled than 2020. Where does one start? While covid was the story of 2020, the pandemic that emerged out of a (Fauci-funded) genetic lab team in Wuhan, China dominated newsflow, politics and capital markets for the second year in a row. And while the biggest plot twist of 2020 was Biden's victory over Trump in the presidential election (it took the pandemic lockdowns and mail-in ballots to hand the outcome to Biden), largely thanks to Covid, Biden failed to hold to his biggest presidential promise of defeating covid, and not only did he admit in late 2021 that there is "no Federal solution" to covid waving a white flag of surrender less than a year into his presidency, but following the recent emergence of the Xi, pardon Omicron variant, the number of covid cases in the US has just shattered all records. The silver lining is not only that deaths and hospitalizations have failed to follow the number of cases, but that the scaremongering narrative itself is starting to melt in response to growing grassroots discontent with vaccine after vaccine and booster after booster, which by now it is clear, do nothing to contain the pandemic. And now that it is clear that omicron is about as mild as a moderate case of the flu, the hope has finally emerged that this latest strain will finally kill off the pandemic as it becomes the dominant, rapidly-spreading variant, leading to worldwide herd immunity thanks to the immune system's natural response. Yes, it may mean billions less in revenue for Pfizer and Moderna, but it will be a colossal victory for the entire world. The second biggest story of 2021 was undoubtedly the scourge of soaring inflation, which contrary to macrotourist predictions that it would prove "transitory", refused to do so and kept rising, and rising, and rising, until it hit levels not seen since the Volcker galloping inflation days of the 1980s. The only difference of course is that back then, the Fed Funds rate hit 20%. Now it is at 0%, and any attempts to hike aggressively will lead to a horrific market crash, something the Fed knows very well. Whether this was due to supply-chain blockages and a lack of goods and services pushing prices higher, or due to massive stimulus pushing demand for goods - and also prices - higher, or simply the result of a record injection of central bank liquidity into the system, is irrelevant but what does matter is that it got so bad that even Biden, facing a mauling for his Democratic party in next year's midterm elections, freaked out about soaring prices and pushed hard to lower the price of gasoline, ordering releases from the US Strategic Petroleum Reserve and vowing to punish energy companies that dare to make a profit, while ordering Powell to contain the surge in prices even if means the market is hit. Unfortunately for Biden, the market will be hit even as inflation still remain red hot for much of the coming year. And speaking of markets, while 2022 may be a year when the piper finally gets paid, 2021 was yet another blockbuster year for risk assets, largely on the back of the continued global response to the 2020 covid pandemic, when as we wrote last year, we saw "the official arrival of global Helicopter Money, tens of trillions in fiscal and monetary stimulus, an overhaul of the global economy punctuated by an unprecedented explosion in world debt, an Orwellian crackdown on civil liberties by governments everywhere, and ultimately set the scene for what even the World Economic Forum called simply "The Great Reset." Yes, the staggering liquidity injections that started in 2020, continued throughout 2021 and the final tally is that after $3 trillion in emergency liquidity injections in the immediate aftermath of the pandemic to stabilize the world, the Fed injected almost $2 trillion in the subsequent period, of which $1.5 trillion in 2021, a year where economists were "puzzled" why inflation was soaring. This, of course, excludes the tens of trillions of monetary stimulus injected by other central banks as well as the boundless fiscal stimulus that was greenlighted with the launch of helicopter money (i.e., MMT) in 2020. It's also why with inflation running red hot and real rates the lowest they have ever been, everyone was forced to rush into the "safety" of stocks (or stonks as they came to be known among GenZ), and why after last year's torrid stock market returns, the S&P rose another 27% in 2021 and up a staggering 114% from the March 2020 lows, in the process trouncing all previous mega-rallies (including those in 1929, 1938, 1974 and 2009)... ... making this the third consecutive year of double-digit returns. This reminds us of something we said last year: "it's almost as if the world's richest asset owners requested the covid pandemic." A year later, we got confirmation for this rhetorical statement, when we calculated that in the 18 months since the covid pandemic, the richest 1% of US society have seen their net worth increase by over $30 trillion. As a result, the US is now officially a banana republic where the middle 60% of US households by income - a measure economists use as a definition of the middle class - saw their combined assets drop from 26.7% to 26.6% of national wealth as of June, the lowest in Federal Reserve data, while for the first time the super rich had a bigger share, at 27%. Yes, the 1% now own more wealth than the entire US middle class, a definition traditionally reserve for kleptocracies and despotic African banana republics. It wasn't just the rich, however: politicians the world over would benefit from the transition from QE to outright helicopter money and MMT which made the over monetization of deficits widely accepted in the blink of an eye. The common theme here is simple: no matter what happens, capital markets can never again be allowed to drop, regardless of the cost or how much more debt has to be incurred. Indeed, as we look back at the news barrage over the past year, and past decade for that matter, the one thing that becomes especially clear amid the constant din of markets, of politics, of social upheaval and geopolitical strife - and now pandemics -  in fact a world that is so flooded with constant conflicting newsflow and changing storylines that many now say it has become virtually impossible to even try to predict the future, is that despite the people's desire for change, for something original and untried, the world's established forces will not allow it and will fight to preserve the broken status quo at any price - even global coordinated shutdowns - which is perhaps why it always boils down to one thing - capital markets, that bedrock of Western capitalism and the "modern way of life", where control, even if it means central planning the likes of which have not been seen since the days of the USSR, and an upward trajectory must be preserved at all costs, as the alternative is a global, socio-economic collapse. And since it is the daily gyrations of stocks that sway popular moods the interplay between capital markets and politics has never been more profound or more consequential. The more powerful message here is the implicit realization and admission by politicians, not just Trump who had a penchant of tweeting about the S&P every time it rose, but also his peers on both sides of the aisle, that the stock market is now seen as the consummate barometer of one's political achievements and approval. Which is also why capital markets are now, more than ever, a political tool whose purpose is no longer to distribute capital efficiently and discount the future, but to manipulate voter sentiments far more efficiently than any fake Russian election interference attempt ever could. Which brings us back to 2021 and the past decade, which was best summarized by a recent Bill Blain article who said that "the last 10-years has been a story of massive central banking distortion to address the 2008 crisis. Now central banks face the consequences and are trapped. The distortion can’t go uncorrected indefinitely." He is right: the distortion will eventually collapse especially if the Fed follows through with its attempt rate hikes some time in mid-2020, but so far the establishment and the "top 1%" have been successful - perhaps the correct word is lucky - in preserving the value of risk assets: on the back of the Fed's firehose of liquidity the S&P500 returned an impressive 27% in 2021, following a 15.5% return in 2020 and 28.50% in 2019. It did so by staging the greatest rally off all time from the March lows, surpassing all of the 4 greatest rallies off the lows of the past century (1929,1938, 1974, and 2009). Yet this continued can-kicking by the establishment - all of which was made possible by the covid pandemic and lockdowns which served as an all too convenient scapegoat for the unprecedented response that served to propel risk assets (and fiat alternatives such as gold and bitcoin) to all time highs - has come with a price... and an increasingly higher price in fact. As even Bank of America CIO Michael Hartnett admits, Fed's response to the the pandemic "worsened inequality" as the value of financial assets - Wall Street -  relative to economy - Main Street - hit all-time high of 6.3x. And while the Fed was the dynamo that has propelled markets higher ever since the Lehman collapse, last year certainly had its share of breakout moments. Here is a sampling. Gamestop and the emergence of meme stonks and the daytrading apes: In January markets were hypnotized by the massive trading volumes, rolling short squeezes and surging share prices of unremarkable established companies such as consoles retailer GameStop and cinema chain AMC and various other micro and midcap names. What began as a discussion on untapped value at GameStop on Reddit months earlier by Keith Gill, better known as Roaring Kitty, morphed into a hedge fund-orchestrated, crowdsourced effort to squeeze out the short position held by a hedge fund, Melvin Capital. The momentum flooded through the retail market, where daytraders shunned stocks and bought massive out of the money calls, sparking rampant "gamma squeezes" in the process forcing some brokers to curb trading. Robinhood, a popular broker for day traders and Citadel's most lucrative "subsidiary", required a cash injection to withstand the demands placed on it by its clearing house. The company IPOed later in the year only to see its shares collapse as it emerged its business model was disappointing hollow absent constant retail euphoria. Ultimately, the market received a crash course in the power of retail investors on a mission. Ultimately, "retail favorite" stocks ended the year on a subdued note as the trading frenzy from earlier in the year petered out, but despite underperforming the S&P500, retail traders still outperformed hedge funds by more than 100%. Failed seven-year Treasury auction:  Whereas auctions of seven-year US government debt generally spark interest only among specialists, on on February 25 2021, one such typically boring event sparked shockwaves across financial markets, as the weakest demand on record hit prices across the whole spectrum of Treasury bonds. The five-, seven- and 10-year notes all fell sharply in price. Researchers at the Federal Reserve called it a “flash event”; we called it a "catastrophic, tailing" auction, the closest thing the US has had to a failed Trasury auction. The flare-up, as the FT put it, reflects one of the most pressing investor concerns of the year: inflation. At the time, fund managers were just starting to realize that consumer price rises were back with a vengeance — a huge threat to the bond market which still remembers the dire days of the Volcker Fed when inflation was about as high as it is today but the 30Y was trading around 15%. The February auaction also illustrated that the world’s most important market was far less liquid and not as structurally robust as investors had hoped. It was an extreme example of a long-running issue: since the financial crisis the traditional providers of liquidity, a group of 24 Wall Street banks, have pulled back because of higher costs associated with post-2008 capital requirements, while leaving liquidity provision to the Fed. Those banks, in their reduced role, as well as the hedge funds and high-frequency traders that have stepped into their place, have tended to withdraw in moments of market volatility. Needless to say, with the Fed now tapering its record QE, we expect many more such "flash" episodes in the bond market in the year ahead. The arch ego of Archegos: In March 2021 several banks received a brutal reminder that some of family offices, which manage some $6 trillion in wealth of successful billionaires and entrepreneurs and which have minimal reporting requirements, take risks that would make the most serrated hedge fund manager wince, when Bill Hwang’s Archegos Capital Management imploded in spectacular style. As we learned in late March when several high-flying stocks suddenly collapsed, Hwang - a former protege of fabled hedge fund group Tiger Management - had built up a vast pile of leverage using opaque Total Return Swaps with a handful of banks to boost bets on a small number of stocks (the same banks were quite happy to help despite Hwang’s having been barred from US markets in 2013 over allegations of an insider-trading scheme, as he paid generously for the privilege of borrowing the banks' balance sheet). When one of Archegos more recent bets, ViacomCBS, suddenly tumbled it set off a liquidation cascade that left banks including Credit Suisse and Nomura with billions of dollars in losses. Conveniently, as the FT noted, the damage was contained to the banks rather than leaking across financial markets, but the episode sparked a rethink among banks over how to treat these clients and how much leverage to extend. The second coming of cryptos: After hitting an all time high in late 2017 and subsequently slumping into a "crypto winter", cryptocurrencies enjoyed a huge rebound in early 2021 which sent their prices soaring amid fears of galloping inflation (as shown below, and contrary to some financial speculation, the crypto space has traditionally been a hedge either to too much liquidity or a hedge to too much inflation). As a result, Bitcoin rose to a series of new record highs that culminated at just below $62,000, nearly three times higher than their previous all time high. But the smooth ride came to a halt in May when China’s crackdown on the cryptocurrency and its production, or “mining”, sparked the first serious crash of 2021. The price of bitcoin then collapsed as much as 30% on May 19, hitting a low of $30,000 amid a liquidation of levered positions in chaotic trading conditions following a warning from Chinese authorities of tighter curbs ahead. A public acceptance by Tesla chief and crypto cheerleader Elon Musk of the industry’s environmental impact added to the declines. However, as with all previous crypto crashes, this one too proved transitory, and prices resumed their upward trajectory in late September when investors started to price in the launch of futures-based bitcoin exchange traded funds in the US. The launch of these contracts subsequently pushed bitcoin to a new all-time high in early November before prices stumbled again in early December, this time due to a rise in institutional ownership when an overall drop in the market dragged down cryptos as well. That demonstrated the growing linkage between Wall Street and cryptocurrencies, due to the growing sway of large investors in digital markets. China's common prosperity crash: China’s education and tech sectors were one of the perennial Wall Street darlings. Companies such as New Oriental, TAL Education as well as Alibaba and Didi had come to be worth billions of dollars after highly publicized US stock market flotations. So when Beijing effectively outlawed swaths of the country’s for-profit education industry in July 2021, followed by draconian anti-trust regulations on the country's fintech names (where Xi Jinping also meant to teach the country's billionaire class a lesson who is truly in charge), the short-term market impact was brutal. Beijing’s initial measures emerged as part of a wider effort to make education more affordable as part of president Xi Jinping’s drive for "common prosperity" but that quickly raised questions over whether growth prospects across corporate China are countered by the capacity of the government to overhaul entire business models overnight. Sure enough, volatility stemming from the education sector was soon overshadowed by another set of government reforms related to common prosperity, a crackdown on leverage across the real estate sector where the biggest casualty was Evergrande, the world’s most indebted developer. The company, whose boss was not long ago China's 2nd richest man, was engulfed by a liquidity crisis in the summer that eventually resulted in a default in early December. Still, as the FT notes, China continues to draw in huge amounts of foreign capital, pushing the Chinese yuan to end 2021 at the strongest level since May 2018, a major hurdle to China's attempts to kickstart its slowing economy, and surely a precursor to even more monetary easing. Natgas hyperinflation: Natural gas supplanted crude oil as the world’s most important commodity in October and December as prices exploded to unprecedented levels and the world scrambled for scarce supplies amid the developed world's catastrophic transition to "green" energy. The crunch was particularly acute in Europe, which has become increasingly reliant on imports. Futures linked to TTF, the region’s wholesale gas price, hit a record €137 per megawatt hour in early October, rising more than 75%. In Asia, spot liquefied natural gas prices briefly passed the equivalent of more than $320 a barrel of oil in October. (At the time, Brent crude was trading at $80). A number of factors contributed, including rising demand as pandemic restrictions eased, supply disruptions in the LNG market and weather-induced shortfalls in renewable energy. In Europe, this was aggravated by plunging export volumes from Gazprom, Russia’s state-backed monopoly pipeline supplier, amid a bitter political fight over the launch of the Nordstream 2 pipeline. And with delays to the Nord Stream 2 gas pipeline from Russia to Germany, analysts say the European gas market - where storage is only 66% full - a cold snap or supply disruption away from another price spike Turkey's (latest) currency crisis:  As the FT's Jonathan Wheatley writes, Recep Tayyip Erdogan was once a source of strength for the Turkish lira, and in his first five years in power from 2003, the currency rallied from TL1.6 per US dollar to near parity at TL1.2. But those days are long gone, as Erdogan's bizarre fascination with unorthodox economics, namely the theory that lower rates lead to lower inflation also known as "Erdoganomics", has sparked a historic collapse in the: having traded at about TL7 to the dollar in February, it has since fallen beyond TL17, making it the worst performing currency of 2021. The lira’s defining moment in 2021 came on November 18 when the central bank, in spite of soaring inflation, cut its policy rate for the third time since September, at Erdogan’s behest (any central banker in Turkey who disagrees with "Erdoganomics" is promptly fired and replaced with an ideological puppet). The lira recovered some of its losses in late December when Erdogan came up with the "brilliant" idea of erecting the infamous "doom loop" which ties Turkey's balance sheet to its currency. It has worked for now (the lira surged from TL18 against the dollar to TL12, but this particular band aid solution will only last so long). The lira’s problems are not only Erdogan’s doing. A strengthening dollar, rising oil prices, the relentless covid pandemic and weak growth in developing economies have been bad for other emerging market currencies, too, but as long as Erdogan is in charge, shorting the lira remains the best trade entering 2022. While these, and many more, stories provided a diversion from the boring existence of centrally-planned markets, we are confident that the trends observed in recent years will continue: coming years will be marked by even bigger government (because only more government can "fix" problems created by government), higher stock prices and dollar debasement (because only more Fed intervention can "fix" the problems created by the Fed), and a policy flip from monetary and QE to fiscal & MMT, all of which will keep inflation at scorching levels, much to the persistent confusion of economists everywhere. Of course, we said much of this last year as well, but while we got most trends right, we were wrong about one thing: we were confident that China's aggressive roll out of the digital yuan would be a bang - or as we put it "it is very likely that while 2020 was an insane year, it may prove to be just an appetizer to the shockwaves that will be unleashed in 2021 when we see the first stage of the most historic overhaul of the fiat payment system in history" - however it turned out to be a whimper. A big reason for that was that the initial reception of the "revolutionary" currency was nothing short of disastrous, with Chinese admitting they were "not at all excited" about the prospect of yet one more surveillance mechanism for Beijing, because that's really what digital currencies are: a way for central banks everywhere to micromanage and scrutinize every single transaction, allowing the powers that be to demonetize any one person - or whole groups - with the flick of a switch. Then again, while digital money may not have made its triumphant arrival in 2021, we are confident that the launch date has merely been pushed back to 2022 when the rollout of the next monetary revolution is expected to begin in earnest. Here we should again note one thing: in a world undergoing historic transformations, any free press must be throttled and controlled, and over the past year we have seen unprecedented efforts by legacy media and its corporate owners, as well as the new "social media" overlords do everything in their power to stifle independent thought. For us it had been especially "personal" on more than one occasions. Last January, Twitter suspended our account because we dared to challenge the conventional narrative about the source of the Wuhan virus. It was only six months later that Twitter apologized, and set us free, admitting it had made a mistake. Yet barely had twitter readmitted us, when something even more unprecedented happened: for the first time ever (to our knowledge) Google - the world's largest online ad provider and monopoly - demonetized our website not because of any complaints about our writing but because of the contents of our comment section. It then held us hostage until we agreed to implement some prerequisite screening and moderation of the comments section. Google's action was followed by the likes of PayPal, Amazon, and many other financial and ad platforms, who rushed to demonetize and suspend us simply because they disagreed with what we had to say. This was a stark lesson in how quickly an ad-funded business can disintegrate in this world which resembles the dystopia of 1984 more and more each day, and we have since taken measures. One year ago, for the first time in our 13 year history, we launched a paid version of our website, which is entirely ad and moderation free, and offers readers a variety of premium content. It wasn't our intention to make this transformation but unfortunately we know which way the wind is blowing and it is only a matter of time before the gatekeepers of online ad spending block us again. As such, if we are to have any hope in continuing it will come directly from you, our readers. We will keep the free website running for as long as possible, but we are certain that it is only a matter of time before the hammer falls as the censorship bandwagon rolls out much more aggressively in the coming year. That said, whether the story of 2022, and the next decade for that matter, is one of helicopter or digital money, of (hyper)inflation or deflation: what is key, and what we learned in the past decade, is that the status quo will throw anything at the problem to kick the can, it will certainly not let any crisis go to waste... even the deadliest pandemic in over a century. And while many already knew that, the events of 2021 made it clear to a fault that not even a modest market correction can be tolerated going forward. After all, if central banks aim to punish all selling, then the logical outcome is to buy everything, and investors, traders and speculators did just that armed with the clearest backstop guarantee from the Fed, which in the deapths of the covid crash crossed the Rubicon when it formally nationalized the bond market as it started buying both investment grade bonds and junk bond ETFs in the open market. As such it is no longer even a debatable issue if the Fed will buy stocks after the next crash - the only question is when. Meanwhile, for all those lamenting the relentless coverage of politics in a financial blog, why finance appears to have taken a secondary role, and why the political "narrative" has taken a dominant role for financial analysts, the past year showed vividly why that is the case: in a world where markets gyrated, and "rotated" from value stocks to growth and vice versa, purely on speculation of how big the next stimulus out of Washington will be, the narrative over Biden's trillions proved to be one of the biggest market moving events for much of the year. And with the Biden stimulus plan off the table for now, the Fed will find it very difficult to tighten financial conditions, especially if it does so just as the economy is slowing. Here we like to remind readers of one of our favorite charts: every financial crisis is the result of Fed tightening. As for predictions about the future, as the past two years so vividly showed, when it comes to actual surprises and all true "black swans", it won't be what anyone had expected. And so while many themes, both in the political and financial realm, did get some accelerated closure courtesy of China's covid pandemic, dramatic changes in 2021 persisted, and will continue to manifest themselves in often violent and unexpected ways - from the ongoing record polarization in the US political arena, to "populist" upheavals around the developed world, to the gradual transition to a global Universal Basic (i.e., socialized) Income regime, to China's ongoing fight with preserving stability in its gargantuan financial system which is now two and a half times the size of the US. As always, we thank all of our readers for making this website - which has never seen one dollar of outside funding (and despite amusing recurring allegations, has certainly never seen a ruble from the KGB either, although now that the entire Russian hysteria episode is over, those allegations have finally quieted down), and has never spent one dollar on marketing - a small (or not so small) part of your daily routine. Which also brings us to another critical topic: that of fake news, and something we - and others who do not comply with the established narrative - have been accused of. While we find the narrative of fake news laughable, after all every single article in this website is backed by facts and links to outside sources, it is clearly a dangerous development, and a very slippery slope that the entire developed world is pushing for what is, when stripped of fancy jargon, internet censorship under the guise of protecting the average person from "dangerous, fake information." It's also why we are preparing for the next onslaught against independent thought and why we had no choice but to roll out a premium version of this website. In addition to the other themes noted above, we expect the crackdown on free speech to accelerate in the coming year when key midterm elections will be held, especially as the following list of Top 20 articles for 2021 reveals, many of the most popular articles in the past year were precisely those which the conventional media would not touch out of fear of repercussions, which in turn allowed the alternative media to continue to flourish in an orchestrated information vacuum and take significant market share from the established outlets by covering topics which the public relations arm of established media outlets refused to do, in the process earning itself the derogatory "fake news" condemnation. We are grateful that our readers - who hit a new record high in 2021 - have realized it is incumbent upon them to decide what is, and isn't "fake news." * * * And so, before we get into the details of what has now become an annual tradition for the last day of the year, those who wish to jog down memory lane, can refresh our most popular articles for every year during our no longer that brief, almost 11-year existence, starting with 2009 and continuing with 2010, 2011, 2012, 2013, 2014, 2015, 2016, 2017, 2018, 2019 and 2020. So without further ado, here are the articles that you, our readers, found to be the most engaging, interesting and popular based on the number of hits, during the past year. In 20th spot with 600,000 reads, was an article that touched on one of the most defining features of the market: the reflation theme the sparked a massive rally at the start of the year courtesy of the surprise outcome in the Georgia Senate race, where Democrats ended up wining both seats up for grabs, effectively giving the Dems a majority in both the House and the Senate, where despite the even, 50-seat split, Kamala Harris would cast the winning tie-breaker vote to pursue a historic fiscal stimulus. And sure enough, as we described in "Bitcoin Surges To Record High, Stocks & Bonds Battered As Dems Look Set To Take Both Georgia Senate Seats", with trillions in "stimmies" flooding both the economy and the market, not only did retail traders enjoy unprecedented returns when trading meme "stonks" and forcing short squeezes that crippled numerous hedge funds, but expectations of sharply higher inflation also helped push bitcoin and the entire crypto sector to new all time highs, which in turn legitimized the product across institutional investors and helped it reach a market cap north of $3 trillion.  In 19th spot, over 613,000 readers were thrilled to read at the start of September that "Biden Unveils Most Severe COVID Actions Yet: Mandates Vax For All Federal Workers, Contractors, & Large Private Companies." Of course, just a few weeks later much of Biden's mandate would be struck down in courts, where it is now headed to a decision by SCOTUS, while the constantly shifting "scientific" goal posts mean that just a few months later the latest set of CDC regulations have seen regulators and officials reverse the constant drone of fearmongering and are now even seeking to cut back on the duration of quarantine and other lockdown measures amid a public mood that is growing increasingly hostile to the government response. One of the defining political events of 2021 was the so-called "Jan 6 Insurrection", which the for America's conservatives was blown wildly out of proportion yet which the leftist media and Democrats in Congress have been periodically trying to push to the front pages in hopes of distracting from the growing list of failures of the Obama admin. Yet as we asked back in January, "Why Was Founder Of Far-Left BLM Group Filming Inside Capitol As Police Shot Protester?" No less than 614,000 readers found this question worthy of a response. Since then many more questions have emerged surrounding this event, many of which focus on what role the FBI had in organizing and encouraging this event, including the use of various informants and instigators. For now, a response will have to wait at least until the mid-term elections of 2022 when Republicans are expected to sweep one if not both chambers. Linked to the above, the 17th most read article of 2021 with 617,000 views, was an article we published on the very same day, which detailed that "Armed Protesters Begin To Arrive At State Capitols Around The Nation." At the end of the day, it was much ado about nothing and all protests concluded peacefully and without incident: perhaps the FBI was simply spread too thin? 2021 was a year defined by various waves of the covid pandemic which hammered poor Americans forced to hunker down at home and missing on pay, and crippled countless small mom and pop businesses. And yet, it was also a bonanza for a handful of pharma companies such as Pfizer and Moderna which made billions from the sale of "vaccines" which we now know do little if anything to halt the spread of the virus, and are instead now being pitched as palliatives, preventing a far worse clinical outcome. The same pharma companies also benefited from an unconditional indemnity, which surely would come in useful when the full side-effects of their mRNA-based therapies became apparent. One such condition to emerge was myocarditis among a subset of the vaxxed. And while the vaccines continue to be broadly rolled out across most developed nations, one place that said enough was Sweden. As over 620,000 readers found out in "Sweden Suspends Moderna Shot Indefinitely After Vaxxed Patients Develop Crippling Heart Condition", not every country was willing to use its citizens as experimental guniea pigs. This was enough to make the article the 16th most read on these pages, but perhaps in light of the (lack of) debate over the pros and cons of the covid vaccines, this should have been the most read article this year? Moving on to the 15th most popular article, 628,000 readers were shocked to learn that "Chase Bank Cancels General Mike Flynn's Credit Cards." The action, which was taken by the largest US bank due to "reputational risk" echoed a broad push by tech giants to deplatform and silence dissenting voices by literally freezing them out of the financial system. In the end, following widespread blowback from millions of Americans, JPMorgan reversed, and reactivated Flynn's cards saying the action was made in error, but unfortunately this is just one example of how those in power can lock out any dissenters with the flick of a switch. And while democrats cheer such deplatforming today, the political winds are fickle, and we doubt they will be as excited once they find themselves on the receiving end of such actions. And speaking of censorship and media blackouts, few terms sparked greater response from those in power than the term Ivermectin. Viewed by millions as a cheap, effective alternative to offerings from the pharmaceutical complex, social networks did everything in their power to silence any mention of a drug which the Journal of Antibiotics said in 2017 was an "enigmatic multifaceted ‘wonder’ drug which continues to surprise and exceed expectations." Nowhere was this more obvious than in the discussion of how widespread use of Ivermectin beat Covid in India, the topic of the 14th most popular article of 2021 "India's Ivermectin Blackout" which was read by over 653,000 readers. Unfortunately, while vaccines continue to fail upward and now some countries are now pushing with a 4th, 5th and even 6th vaccine, Ivermectin remains a dirty word. There was more covid coverage in the 13th most popular article of 2021, "Surprise Surprise - Fauci Lied Again": Rand Paul Reacts To Wuhan Bombshell" which was viewed no less than 725,000 times. Paul's reaction came following a report which revealed that Anthony Fauci's NIAID and its parent, the NIH, funded Gain-of-Function research in Wuhan, China, strongly hinting that the emergence of covid was the result of illicit US funding. Not that long ago, Fauci had called Paul a 'liar' for accusing him of funding the risky research, in which viruses are genetically modified or otherwise altered to make them more transmissible to humans. And while we could say that Paul got the last laugh, Fauci still remains Biden's top covid advisor, which may explain why one year after Biden vowed he would shut down the pandemic, the number of new cases just hit a new all time high. One hope we have for 2022 is that people will finally open their eyes... 2021 was not just about covid - soaring prices and relentless inflation were one of the most poignant topics. It got so bad that Biden's approval rating - and that of Democrats in general - tumbled toward the end of the year, putting their mid-term ambitions in jeopardy, as the public mood soured dramatically in response to the explosion in prices. And while one can debate whether it was due to supply-issues, such as the collapse in trans-pacific supply chains and the chronic lack of labor to grow the US infrastructure, or due to roaring demand sparked by trillions in fiscal stimulus, but when the "Big Short" Michael Burry warned that hyperinflation is coming, the people listened, and with over 731,000 reads, the 12th most popular article of 2021 was "Michael Burry Warns Weimar Hyperinflation Is Coming."  Of course, Burry did not say anything we haven't warned about for the past 12 years, but at least he got the people's attention, and even mainstream names such as Twitter founder Jack Dorsey agreed with him, predicting that bitcoin will be what is left after the dollar has collapsed. While hyperinflation may will be the endgame, the question remains: when. For the 11th most read article of 2021, we go back to a topic touched upon moments ago when we addressed the full-blown media campaign seeking to discredit Ivermectin, in this case via the D-grade liberal tabloid Rolling Stone (whose modern incarnation is sadly a pale shadow of the legend that house Hunter S. Thompson's unforgettable dispatches) which published the very definition of fake news when it called Ivermectin a "horse dewormer" and claimed that, according to a hospital employee, people were overdosing on it. Just a few hours later, the article was retracted as we explained in "Rolling Stone Issues 'Update' After Horse Dewormer Hit-Piece Debunked" and over 812,000 readers found out that pretty much everything had been a fabrication. But of course, by then it was too late, and the reputation of Ivermectin as a potential covid cure had been further tarnished, much to the relief of the pharma giants who had a carte blanche to sell their experimental wares. The 10th most popular article of 2021 brings us to another issue that had split America down the middle, namely the story surrounding Kyle Rittenhouse and the full-blown media campaign that declared the teenager guilty, even when eventually proven innocent. Just days before the dramatic acquittal, we learned that "FBI Sat On Bombshell Footage From Kyle Rittenhouse Shooting", which was read by over 822,000 readers. It was unfortunate to learn that once again the scandal-plagued FBI stood at the center of yet another attempt at mass misinformation, and we can only hope that one day this "deep state" agency will be overhauled from its core, or better yet, shut down completely. As for Kyle, he will have the last laugh: according to unconfirmed rumors, his numerous legal settlements with various media outlets will be in the tens if not hundreds of millions of dollars.  And from the great US social schism, we again go back to Covid for the 9th most popular article of 2021, which described the terrifying details of one of the most draconian responses to covid in the entire world: that of Australia. Over 900,000 readers were stunned to read that the "Australian Army Begins Transferring COVID-Positive Cases, Contacts To Quarantine Camps." Alas, the latest surge in Australian cases to nosebleed, record highs merely confirms that this unprecedented government lockdown - including masks and vaccines - is nothing more than an exercise in how far government can treat its population as a herd of sheep without provoking a violent response.  The 8th most popular article of 2021 looks at the market insanity of early 2021 when, at the end of January, we saw some of the most-shorted, "meme" stocks explode higher as the Reddit daytrading horde fixed their sights on a handful of hedge funds and spent billions in stimmies in an attempt to force unprecedented ramps. That was the case with "GME Soars 75% After-Hours, Erases Losses After Liquidity-Constrained Robinhood Lifts Trading Ban", which profiled the daytrading craze that gave an entire generation the feeling that it too could win in these manipulated capital markets. Then again, judging by the waning retail interest, it is possible that the excitement of the daytrading army is fading as rapidly as it first emerged, and that absent more "stimmies" markets will remain the playground of the rich and central banks. Kyle Rittenhouse may soon be a very rich man after the ordeal he went through, but the media's mission of further polarizing US society succeeded, and millions of Americans will never accept that the teenager was innocent. It's also why with just over 1 million reads, the 7th most read article on Zero Hedge this year was that "Portland Rittenhouse Protest Escalates Into Riot." Luckily, this is not a mid-term election year and there were no moneyed interests seeking to prolong this particular riot, unlike what happened in the summer of 2020... and what we are very much afraid will again happen next year when very critical elections are on deck.  With just over 1.03 million views, the 6th most popular post focused on a viral Twitter thread on Friday from Dr Robert Laone, which laid out a disturbing trend; the most-vaccinated countries in the world are experiencing  a surge in COVID-19 cases, while the least-vaccinated countries were not. As we originally discussed in ""This Is Worrying Me Quite A Bit": mRNA Vaccine Inventor Shares Viral Thread Showing COVID Surge In Most-Vaxxed Countries", this trend has only accelerated in recent weeks with the emergence of the Omicron strain. Unfortunately, instead of engaging in a constructive discussion to see why the science keeps failing again and again, Twitter's response was chilling: with just days left in 2021, it suspended the account of Dr. Malone, one of the inventors of mRNA technology. Which brings to mind something Aaron Rogers said: "If science can't be questioned it's not science anymore it's propaganda & that's the truth." In a year that was marked a flurry of domestic fiascoes by the Biden administration, it is easy to forget that the aged president was also responsible for the biggest US foreign policy disaster since Vietnam, when the botched evacuation of Afghanistan made the US laughing stock of the world after 12 US servicemembers were killed. So it's probably not surprising that over 1.1 million readers were stunned to watch what happened next, which we profiled in the 5th most popular post of 2021, where in response to the Afghan trajedy, "Biden Delivers Surreal Press Conference, Vows To Hunt Down Isis, Blames Trump." One person watching the Biden presser was Xi Jinping, who may have once harbored doubts about reclaiming Taiwan but certainly does not any more. The 4th most popular article of 2021 again has to do with with covid, and specifically the increasingly bizarre clinical response to the disease. As we detailed in "Something Really Strange Is Happening At Hospitals All Over America" while emergency rooms were overflowing, it certainly wasn't from covid cases. Even more curiously, one of the primary ailments leading to an onslaught on ERs across the nation was heart-related issues, whether arrhytmia, cardiac incidents or general heart conditions. We hope that one day there will be a candid discussion on this topic, but until then it remains one of the topics seen as taboo by the mainstream media and the deplatforming overlords, so we'll just leave it at that. We previously discussed the anti-Ivermectin narrative that dominated the mainstream press throughout 2021 and the 3rd most popular article of the year may hold clues as to why: in late September, pharma giant Pfizer and one of the two companies to peddle an mRNA based vaccine, announced that it's launching an accelerated Phase 2/3 trial for a COVID prophylactic pill designed to ward off COVID in those may have come in contact with the disease. And, as we described in "Pfizer Launches Final Study For COVID Drug That's Suspiciously Similar To 'Horse Paste'," 1.75 million readers learned that Pfizer's drug shared at least one mechanism of action as Ivermectin - an anti-parasitic used in humans for decades, which functions as a protease inhibitor against Covid-19, which researchers speculate "could be the biophysical basis behind its antiviral efficiency." Surely, this too was just another huge coincidence. In the second most popular article of 2021, almost 2 million readers discovered (to their "shock") that Fauci and the rest of Biden's COVID advisors were proven wrong about "the science" of COVID vaccines yet again. After telling Americans that vaccines offer better protection than natural infection, a new study out of Israel suggested the opposite is true: natural infection offers a much better shield against the delta variant than vaccines, something we profiled in "This Ends The Debate' - Israeli Study Shows Natural Immunity 13x More Effective Than Vaccines At Stopping Delta." We were right about one thing: anyone who dared to suggest that natural immunity was indeed more effective than vaccines was promptly canceled and censored, and all debate almost instantly ended. Since then we have had tens of millions of "breakout" cases where vaccinated people catch covid again, while any discussion why those with natural immunity do much better remains under lock and key. It may come as a surprise to many that the most read article of 2021 was not about covid, or Biden, or inflation, or China, or even the extremely polarized US congress (and/or society), but was about one of the most long-suffering topics on these pages: precious metals and their prices. Yes, back in February the retail mania briefly targeted silver and as millions of reddit daytraders piled in in hopes of squeezing the precious metal higher, the price of silver surged higher only to tumble just as quickly as it has risen as the seller(s) once again proved more powerful than the buyers. We described this in "Silver Futures Soar 8%, Rise Above $29 As Reddit Hordes Pile In", an article which some 2.4 million gold and silver bugs read with hope, only to see their favorite precious metals slump for much of the rest of the year. And yes, the fact that both gold and silver ended the year sharply lower than where they started even though inflation hit the highest level in 40 years, remains one of the great mysteries of 2021. With all that behind us, and as we wave goodbye to another bizarre, exciting, surreal year, what lies in store for 2022, and the next decade? We don't know: as frequent and not so frequent readers are aware, we do not pretend to be able to predict the future and we don't try despite endless allegations that we constantly predict the collapse of civilization: we leave the predicting to the "smartest people in the room" who year after year have been consistently wrong about everything, and never more so than in 2021 (even the Fed admitted it is clueless when Powell said it was time to retire the term "transitory"), which destroyed the reputation of central banks, of economists, of conventional media and the professional "polling" and "strategist" class forever, not to mention all those "scientists" who made a mockery of the "expertise class" with their bungled response to the covid pandemic. We merely observe, find what is unexpected, entertaining, amusing, surprising or grotesque in an increasingly bizarre, sad, and increasingly crazy world, and then just write about it. We do know, however, that after a record $30 trillion in stimulus was conjured out of thin air by the world's central banks and politicians in the past two years, the attempt to reverse this monetary and fiscal firehose in a world addicted to trillions in newly created liquidity now that central banks are freaking out after finally getting ot the inflation they were hoping to create for so long, will end in tears. We are confident, however, that in the end it will be the very final backstoppers of the status quo regime, the central banking emperors of the New Normal, who will eventually be revealed as fully naked. When that happens and what happens after is anyone's guess. But, as we have promised - and delivered - every year for the past 13, we will be there to document every aspect of it. Finally, and as always, we wish all our readers the best of luck in 2022, with much success in trading and every other avenue of life. We bid farewell to 2021 with our traditional and unwavering year-end promise: Zero Hedge will be there each and every day - usually with a cynical smile - helping readers expose, unravel and comprehend the fallacy, fiction, fraud and farce that defines every aspect of our increasingly broken system. Tyler Durden Sun, 01/02/2022 - 03:44.....»»

Category: personnelSource: nytJan 2nd, 2022

Futures Meltup To New All Time High As November Begins With A Bang

Futures Meltup To New All Time High As November Begins With A Bang US futures and European stocks rose to a new record high to start the historically stellar month of November... ... and Asian markets jumped amid positive earnings surprises and as concerns of a global stagflation and central bank policy error faded for a few hours (they will return shortly). TSLA melted up by another $35BN in market cap "because gamma." S&P 500 futures climbed 0.4% after the cash index posted the biggest monthly gain since last November. Treasury Secretary Janet Yellen expressed confidence in the continuing recovery from the pandemic, helping spur gains in equity markets. Health-care shares rallied in Europe. The dollar and Treasury yields advanced as investors awaited this week’s Federal Reserve meeting to announce the start of tapering (which will then lead to rate hikes next July according to Goldman). Oil rebounded on fresh supply concerns. In addition to the now absolutely batshit insane meltup in Tesla, which won't end until the SEC cracks down on gamma squeeze manipulation, other mega-cap technology stocks such as Google, Meta, Microsoft, Amazon.and Apple, aka oddly enough GAMMA, traded mixed. Exxon and Chevron added about 0.7% each as JP Morgan raised its price target on the oil majors following their strong quarterly results last week. Major Wall Street banks gained between 0.2% and 0.8%. The broader S&P 500 financials sector slipped last week, breaking a three-week winning streak. Lucid Group Inc. rose 4.8% in premarket, extending its advance from last week, after the new U.S. tax plan included a proposal to make EV tax credits more widely available. Harley-Davidson Inc jumped 8.2% after the European Union removed retaliatory tariffs on U.S. products including whiskey, power boats and company’s motorcycles. Here are the most notable pre-market movers: Tesla shares rise 2.3% in U.S. premarket trading after their biggest monthly gain in almost a year in October ABVC BioPharma jumps more than 700% as thelittle known biotechnology company garners attention from retail traders on social media Ocugen and Zosano (ZSAN US) are some other top gainers among retail trader stocks in premarket A largely upbeat earnings season has helped investors look past a mixed-macro economic picture, with the benchmark S&P 500 and the tech-heavy Nasdaq recording their best monthly performance since November 2020 in October. Of the 279 S&P 500 companies that have reported quarterly results, 87% have met or exceeded estimates. Among members of Europe’s Stoxx 600 index, 68% surpassed expectations. On the economic data front, readings on October factory activity data from IHS Markit and ISM are due after market open, followed by non-farm payrolls on Friday. Focus is now on the Fed’s two-day policy meeting which concludes at 2pm on Nov 3, where the central bank will announce the tapering of its $120 billion monthly bond buying program by $15 billion. With recent U.S. data showing inflation pressures building, the market has also started pricing in rate hikes next year. November and December tend to be among the strongest months for stocks and any hawkish tilt in the Fed’s message could catch equities by surprise.  Meanwhile, Biden’s economic agenda seemed to be on track as Democratic lawmakers worked to overcome their differences on a $1.75 trillion social-spending plan. “Depending on where you are looking, you are getting very different stories on the outlook for global markets,” Kerry Craig, global market strategist at JPMorgan Asset Management, said on Bloomberg Television. “If you look at equities and the rally you are seeing, you think everything is OK. If you look at the bond market and how yields are moving, there’s obviously a lot more concern around inflation and policy normalization.” European stocks hit the afterburner out of the gate with the Euro Stoxx 50 adding as much as 1% before drifting off best levels. FTSE MIB and IBEX outperform, FTSE 100 lags slightly. Banks, construction and travel are the strongest sectors; tech the sole Stoxx 600 sector in the red. Barclays Plc fell 1.5%. Chief Executive Officer Jes Staley stepped down amid a U.K. regulatory probe into how he characterized his ties to the financier and sex offender Jeffrey Epstein. Asian stocks were poised to snap a three-day decline thanks to a rally in Japanese equities, which got a boost from an election victory for the country’s ruling party and Prime Minister Fumio Kishida.  The MSCI Asia Pacific Index advanced as much as 0.6%, while Japan’s benchmark Topix and the blue-chip Nikkei 225 Stock Average each added more than 2%. Sony Group, Toyota Motor and Tokyo Electron were among the single-largest contributors to the regional measure’s rise. By sector, industrials and information-technology companies provided the biggest boosts.  Japan’s ruling Liberal Democratic Party defied worst-case scenarios to secure a majority by itself in a closely-watched election Sunday. Analysts said the outcome signals political stability, paving the way for economic stimulus to be executed as anticipated (see Street Wrap).  “Indicators of market activity show that there will be a positive market impact to the election, as although it was not greatly different than expectations, the LDP clearly surpassed some of the more dire polls of last week and there will not likely be any party shake-up in the intermediate-term,” John Vail, Tokyo-based chief global strategist at Nikko Asset Management wrote in a note.  The market is also “reacting positively” to Friday’s share-price gains in the U.S., Vail said. Futures on the S&P 500 rose during Asian trading hours after the underlying gauge added 0.2%.  Asia’s regional benchmark capped a weekly drop of 1.5%, its worst such performance since early October, as disappointing results weighed on big technology stocks. More than half of the companies on the MSCI Asia Pacific Index have reported results for the latest quarter with about 37% posting a positive surprise, according to data compiled by Bloomberg. Australia's S&P/ASX 200 index rose 0.6% to 7,370.80, recouping some losses after Friday’s 1.4% plunge. Health and consumer discretionary stocks contributed the most to the benchmark’s gain. WiseTech was among the top performers, snapping a four-day losing streak. Westpac was the worst performer after the bank delivered a smaller share buyback than some had expected. In New Zealand, the S&P/NZX 50 index fell 0.5% to 13,030.31. In rates, fixed income trades heavy with gilts leading the long end weakness. Treasuries were slightly cheaper on the long-end of the curve as S&P 500 futures exceed last week’s record highs. Yields are cheaper by 2bp to 2.5bp from belly out to long-end, with front-end slightly outperforming and steepening 2s10s spread by 1.7bp; 10-year yields around 1.58% with gilts underperforming by 1.1bp, Italian bonds by 3.5bp. Gilts and Italian bonds lag, with Bank of England rate decision due Thursday. In the U.S., weekly highlights include refunding announcement and FOMC Wednesday and Friday’s October jobs report. Bund and gilt curves bear steepen with gilts ~1bps cheaper to bunds. Peripheral spreads swing an early tightening to a broad widening to core with Italy the weakest performer. Overnight futures and options flows included block seller in 5-year note futures (3,900 at 3:09am ET) and a buyer of TY Week 1 129.00 puts at 3 on 10,000, says London trader. In FX, the Bloomberg dollar index held a narrow range. SEK and CHF top the G-10 score board, GBP lags with cable snapping below 1.3650. TRY outperforms EMFX peers. The BBDXY inched up and the greenback traded mixed against its Group-of-10 peers, with many of the risk-sensitive currencies leading gains The pound retraced some losses against the dollar, after dipping earlier in the European session. The yield on 2-year gilts hit the highest since May 2019. Financial markets are almost fully pricing in a 15-basis point increase in the Bank of England’s benchmark lending rate on Nov. 4, while economists increasingly share that view, even as they see the decision as a far closer call. A record share of U.K. businesses are expecting to increase prices, adding to the inflationary pressures confronting Bank of England policy makers ahead of their meeting on Thursday Australian bonds extended opening gains as traders positioned for the Reserve Bank’s policy decision Tuesday. The Aussie fell, tracking losses in iron ore prices following a weak China PMI, which showed signs of further weakness in October The yen fell for a second day after the ruling Liberal Democratic Party retained its outright majority in a lower-house election, reinforcing bets for fiscal stimulus and reforms. Hedge funds boosted net short positions on the yen to the most since January 2019, raising the risk of a squeeze should risk appetite deteriorate suddenly and demand for havens rise The Turkish lira edged higher after Turkish President Recep Tayyip Erdogan said he had “positive” talks with U.S. President Joe Biden In commodities, crude futures drift higher. WTI adds 40c to trade near $84; Brent rises ~1% near $84.50. Spot gold is quiet near $1,786/oz. Base metals are mixed: LME nickel and tin outperform, zinc lags. Looking at today's calendar, earnings continue on Monday with PG&E and ON Semiconductor reporting pre-market, and NXP Semiconductors post-market. We also get the latest Mfg PMI print and the October Mfg ISM print. Market Snapshot S&P 500 futures up 0.3% to 4,612.25 STOXX Europe 600 up 0.8% to 479.40 MXAP up 0.4% to 198.04 MXAPJ down 0.3% to 645.49 Nikkei up 2.6% to 29,647.08 Topix up 2.2% to 2,044.72 Hang Seng Index down 0.9% to 25,154.32 Shanghai Composite little changed at 3,544.48 Sensex up 1.3% to 60,079.40 Australia S&P/ASX 200 up 0.6% to 7,370.78 Kospi up 0.3% to 2,978.94 Brent Futures up 0.3% to $83.95/bbl Gold spot down 0.0% to $1,783.20 U.S. Dollar Index little changed at 94.14 German 10Y yield little changed at -0.091% Euro up 0.1% to $1.1571 Top Overnight News from Bloomberg House Democratic leaders are pushing hard to get Biden’s package finalized, with votes on both that bill and a smaller infrastructure plan this week -- the latest in a string of self- imposed deadlines. The Senate, which already approved the public-works bill, is likely to vote on the larger package later in the month Leaders of the Group of 20 countries agreed on a climate deal that fell well short of what some nations were pushing for, leaving it to negotiators at the COP26 summit in Glasgow this week to try to achieve a breakthrough The U.K. said it will trigger legal action against France within 48 hours unless a dispute over post-Brexit fishing rights is resolved, as the growing spat threatens to overshadow the United Nations’ climate summit Treasury Secretary Janet Yellen said she believes Federal Reserve Chair Jerome Powell has taken “significant action” in the wake of revelations over the personal investments of U.S. central-bank policy makers; Yellen dismissed recent moves in the bond market that have signaled concern about monetary policy makers squelching economic growth, and expressed confidence in the continuing recovery from the Covid-19 pandemic The U.S. and the European Union have reached a trade truce on steel and aluminum that will allow the allies to remove tariffs on more than $10 billion of their exports each year Asia-Pac bourses traded mostly higher amid tailwinds from last Friday's fresh record highs in the US where Wall St. topped off its best monthly performance YTD, but with some of the advances in the region capped as participants digested mixed Chinese PMI data and ahead of this week’s slew of key risk events including crucial central bank policy announcements from the RBA, BOE and FOMC, as well as the latest NFP jobs data. ASX 200 (+0.8%) was led higher by the consumer-related sectors amid a reopening play after Australia permitted fully vaccinated citizens to travel internationally again and with several M&A related headlines adding to the optimism including the Brookfield-led consortium acquisition of AusNet Services and Seven West Media’s takeover of Prime Media. Conversely, the largest weighted financials sector failed to join in on the spoils with Westpac shares heavily pressured following its FY results which fell short of analyst estimates despite more than doubling on its cash earnings. Nikkei 225 (+2.5%) was the biggest gainer with the index underpinned by favourable currency flows and following the general election in which the ruling LDP maintained a majority in the lower house although won fewer seats than previously for its slimmest majority since 2012, while the KOSPI (+0.4%) was kept afloat but with upside limited by slightly softer than expected trade data. Hang Seng (-1.5%) and Shanghai Comp. (+0.1%) were subdued amid a slew of earnings releases and following mixed Chinese PMI data in which the official Manufacturing and Non-Manufacturing PMIs disappointed analysts’ forecasts with the former at a second consecutive contraction, although Caixin Manufacturing PMI was more encouraging and topped market consensus. Finally, 10yr JGBs initially declined amid gains in stocks and recent pressure in T-notes due to rate hike bets with analysts at Goldman Sachs bringing forward their Fed rate hike calls to July 2022 from summer 2023 citing inflation concerns, although 10yr JGBS then recovered despite the mixed results from the 10yr JGB auction which showed a higher b/c amid lower accepted prices and wider tail in price. Top Asian News Japan’s Kishida Mulls Motegi for LDP Secretary General: Kyodo Home Sales Slump; Another Bond Deadline Looms: Evergrande Update Two Thirds of China’s Top Developers Breach a ‘Red Line’ on Debt Hedge Fund Quad Sells Memory Stocks Citing Demand Uncertainty European equities (Stoxx 600 +0.6%) have kicked the week off on the front-foot with the Stoxx 600 printing a fresh all-time-high. The handover from the APAC session was a largely constructive one with the Nikkei 225 (+2.6%) the best in class for the region amid favourable currency flows and the fallout from the Japanese general election which saw the ruling LDP party maintain a majority in the lower house. Elsewhere, performance for the Shanghai Composite (-0.1%) and Hang Seng (-0.9%) was less impressive amid a slew of earnings releases and mixed Chinese PMI data in which the official Manufacturing and Non-Manufacturing PMIs disappointed analysts’ forecasts. US equity index futures are trading on a firmer footing (ES +0.5%) ahead of Wednesday’s FOMC announcement and Friday’s NFP data. The latest reports from Washington suggest that House Democrats are hoping to pass the social spending and bipartisan infrastructure bills as soon as Tuesday. Back to Europe, a recent note from JPM stated that Q3 European earnings “are coming in well ahead of expectations in aggregate”, adding that results are healthy when considering the “trickier operating backdrop”. Sectors in the region are higher across the board with Auto names top of the leaderboard. Renault (+3.3%) sits at the top of the CAC 40 with the name potentially gaining some reprieve from agreement to resolve the US-EU steel and aluminium trade dispute (something which the Co. has previously noted as a negative). Also following the resolution, Thyssenkrupp (+2.8%) and Salzgitter (+4.5%) are both trading notably higher. Barclays (-2.0%) shares are seen lower after news that CEO Staley is to step down with immediate effect following the investigation into his relationship with sex offender Jeffrey Epstein; Barclays' Global Head of Markets, Venkatakrishnan is to take over. UK homebuilders (Persimmon -2.1%, Taylor Wimpey -1.9%, Barratt Developments -1.9%, Berkeley Group -1.7%) are softer on the session amid concerns that the sector could fall victim to higher mortgage rates given the shape of the UK yield curve. Ryanair (+1%) shares are higher post-earnings which saw the Co. continue its recovery from the pandemic, albeit still expects a loss for the year. Furthermore, the board is considering the merits of retaining its standard listing on the LSE. Finally, BT (+4.2%) is the best performer in the Stoxx 600 ahead of earnings on Thursday with press reports suggesting that the Co. could announce that its GBP 1bln cost savings target will be met a year earlier than the guided March 2023. Top European News SIG Proposed Offering for EU300m Senior Secured Notes Due 2026 Delivery Hero’s Turkey Unit CEO Nevzat Aydin to Step Down Goldman Sachs Says ‘Lost Decade’ Is Looming for 60/40 Portfolios URW Sells Stake in Paris Triangle Tower Project to AXA IM Alts In FX, the Greenback is holding above 94.000 in index terms and gradually ground higher after pausing for breath and taking some time out following its rapid resurgence last Friday to eclipse the 94.302 month end best at 94.313 before waning again. Hawkish vibes going into the FOMC are underpinning the Dollar and helping to offset external factors that are less supportive, including ongoing strength in global stock markets on solid if not stellar Q3 earnings and economic recovery from COVID-19 lockdown or restricted levels. Hence, the DXY is keeping its head above the round number and outperforming most major peers within and beyond the basket, awaiting Markit’s final manufacturing PMI, the equivalent ISM and construction spending ahead of the Fed on Wednesday and NFP on Friday. JPY/AUD - Little sign of relief for the Yen from victory by Japan’s ruling LDP part at the weekend elections as the 261 seat majority secured is down from the previous 276 and the tightest winning margin since 2012. Moreover, Security General Amari lost his constituency and new PM Kishida concedes that this reflects the public’s adverse feelings towards the Government over the last 4 years. Usd/Jpy is eyeing 114.50 as a result and the Aussie is looking precarious around 0.7500 against the backdrop of weakness in commodity prices even though perceptions for the upcoming RBA have turned markedly towards the potential for YCT to be withdrawn following firm core inflation readings and no defence of the 0.1% April 2024 bond target. NZD/EUR/CHF/CAD/GBP - All narrowly mixed vs their US counterpart, and with the Kiwi also taking advantage of the aforementioned apprehension in the Aud via the cross, while the Euro has pared declines from just under 1.1550, but still looks top-heavy into 1.1600. Elsewhere, the Franc is pivoting 0.9160 and 1.0600 against the Euro with more attention on a rise in Swiss sight deposits at domestic banks as evidence of intervention than a fractionally softer than expected manufacturing PMI, the Loonie is keeping afloat of 1.2400 ahead of Markit’s Canadian manufacturing PMI and Sterling is striving to stay above 1.3600, but underperforming vs the Euro circa 0.8470 amidst the ongoing tiff between the UK and France over fishing rights. SCANDI/EM - Robust Swedish and Norwegian manufacturing PMIs plus broad risk appetite is underpinning the Sek and Nok, in contrast to the Cnh and Cny following disappointing official Chinese PMIs vs a more respectable Caixin print, but the EM laggard is the Zar in knock-on reaction to Gold’s fall from grace on Friday, increasingly bearish technical impulses and SA energy supply issues compounded by Eskom’s load-shedding. Conversely, the Try has pared some declines irrespective of a slowdown in Turkey’s manufacturing PMI as the CBRT conducted a second repo op for Lira 27 bn funds maturing on November 11 at 16%. In commodities, WTI and Brent are firmer this morning with gains of between USD 0.50-1.00/bbl, this upside is in-spite of a lack of fundamental newsflow explicitly for the complex and is seemingly derived from broader risk sentiment, as mentioned above. Nonetheless, Energy Ministers are beginning to give commentary ahead of Thursday’s OPEC+ event and so far Angola, Kuwait and Iraq officials have voiced their support for the planned 400k BPD hike to production in December. This reiteration of existing plans is in opposition from calls from non-OPEC members such as the US and Japan that the group should look to increase production quicker than planned, in a bid to quell rising prices. Separately, Saudi Aramco reported Q3 earnings over the weekend in which its net profit doubled given strong crude prices and sales volumes improving by 12% QQ; subsequently, some analysts have highlighted the possibility for a end-2021 special dividend. Elsewhere, base metals are mixed and fairly contained in-spite of the EU and US announcing an agreement to resolve the ongoing aluminium and steel trade dispute. While spot gold and silver are modestly firmer this morning as the yellow metal remains contained after its slip from the USD 1800/oz mark in the tail-end of last week. Currently, spot gold is pivoting its 100-DMA at USD 1786 with the 50- and 200-DMAs residing either side at USD 1780/oz and USD 1791/oz respectively. US Event Calendar 9:45am: Oct. Markit US Manufacturing PMI, est. 59.2, prior 59.2 10am: Oct. ISM Manufacturing, est. 60.5, prior 61.1 10am: Sept. Construction Spending MoM, est. 0.4%, prior 0% DB's Jim Reid concludes the overnight wrap Welcome to November. I had three halloween parties over the weekend which is probably more than the entire number I went to before I had kids. I still have some spooky make up on this morning that I just couldn’t get off from last night. So there’s a reason alone to zoom into the call at 3pm today. As it’s the 1st of November Henry is about to publish our monthly performance review. It was a hectic month of higher inflation expectations and commodities, and also the best S&P 500 month of the year. Bonds underperformed across the board but these small negatives masked great volatility and stress under the surface, especially in the last week. See the report that should be out in the next 30-60mins. With all due respect to our readers in Australia, I’m going to open the market section this morning with a line I don’t think I’ve written in 27 years of market commentary and probably won’t again. And it’s not about England thrashing Australia at cricket on Saturday. Yes the most important event of the week could be the RBA meeting tomorrow. 2 year yields last week rose from 0.15% on Wednesday morning to 0.775% at the close on Friday as the RBA were conspicuous by their absence in defending the 0.1% target on the April 24 bond. I’ve absolutely zero idea what they are going to do tomorrow which should help you all tremendously but their absence again this morning gives a decent indication. I was taught economics in an era where central banks liked to keep an element of mystery and surprise. As such I’ve always disliked the forward guidance era as it encourages markets to pile on to much riskier, one way positions that a normally functioning market should naturally allow. But to go from forward guidance to silence (that rhymes) is a recipe for huge market turmoil if the facts change. It's unclear if the full implications of last week’s carnage at the global front end has yet been cleared out. There is lots of speculation about large unwinds, big stop losses etc. Liquidity was also awful last week. Much might depend on central banks this week. Make no mistake though there is considerable pain out there. The latest this morning in Aussie rates is that the 2y yield is down around -7bps while the 10y yield is down -19.0bps. So we wait with baited breath for tomorrow. Elsewhere in Asia, the Nikkei 225 (+2.42%) is charging ahead this morning as Japan’s Liberal Democratic Party kept its majority after lower house elections, thus boosting optimism about a potential fiscal stimulus. Elsewhere, the KOSPI (+0.43%) and the Shanghai composite (+0.07%) are outperforming the Hang Seng (-1.10%). In terms of data, China’s official manufacturing PMI fell from 49.6 to 49.2 (49.7 expected), not helped by commodities price rises and electricity shortages. The non-manufacturing PMI also fell to 52.4 from 53.2 (consensus 53). The Caixin manufacturing PMI did beat at 50.6 this morning (consensus 50). In terms of virus developments in the region, Shanghai Disneyland is closed amid recent COVID outbreaks, while Singapore is adding ICU beds in response to high levels of serious cases. The S&P 500 mini futures is up +0.23% this morning, the US 10y Treasury is at 1.56% (+1.2bps). It’s strange to have a likely Fed taper announcement on Wednesday be third billing for the week but the BoE on Thursday might be the next most important meeting as it’s still a finely judged call as to whether they hike this week or not. DB (preview here) think they will raise rates by 15bps with two 25bps hikes in February and May. They’ll also end QE a month earlier than planned. So over to the third billing, namely the Fed. They will announce a well flagged taper on Wednesday. In line with recent guidance, DB expect that the Fed will announce monthly reductions of $10bn and $5bn of Treasury and MBS purchases, respectively. With the first cut to purchases coming mid-November, this will bring the latest round of QE to a conclusion in June 2022. The Fed has some flexibility with this timetable but it will be interesting to hear how much Powell pushes back on markets that price in two hikes in 2022, including one almost fully priced for before the taper ends. If markets attacked the Fed in the same way they have the RBA the global financial system would have a lot of issues so it’s a fine balance for the Fed. They won’t want to push back too aggressively on market pricing given the uncertainty but they won’t want an outright attack on forward guidance. Moving on, a lowly fourth billing will be reserved for US payrolls on Friday. DB expect the headline gain (+400k forecast, consensus +425k vs. +194k previously) to modestly outperform that of private payrolls (+350k vs. +317k) and for the unemployment rate to fall by a tenth to 4.7% and average hourly earnings to post another strong gain (+0.4% vs. +0.6%) amidst still-elevated hours worked (34.8hrs vs. 34.8hrs). Outside of all this excitement, we have the COP26 which will dominate all your news outlets. The other main data highlight are the global PMIs (today and Wednesday mostly) which will give insight into how the economic recovery has progressed in the first month of Q4 with the surveys shedding light onto how inflation is affecting suppliers. There is lots more in store for us this week but see the day by day calendar at the end for the full run down The market also enters the second half of the 3Q earnings season. There are 168 S&P 500 and 85 Stoxx 600 companies reporting this week with 52% of the S&P 500 and 48% of the STOXX 600 having already reported. DB’s Binky Chadha published an update on earnings season over the weekend (link here). In the US, the size of the earnings beat has declined over the course of the season and is on track to hit 7%, well below the record 14-20% range post pandemic. Excluding the lumpy loan-loss reserve releases by banks, the beat is even lower at 5%, bringing it back in line with the historical norm. Quarterly earnings are on track to be down sequentially from Q2 to Q3 by -1.1% (qoq seasonally adjusted), the first drop since Q2 2020. The flat to down read of earnings is broad based across sector groups. Forward consensus estimates have fallen outside of the Energy sector. The S&P 500 nevertheless has seen one of the strongest earning season rallies on record. See much more in Binky’s piece. This week’s highlights include NXP Semiconductors, Zoom, and Tata Motors today before Pfizer, T-Mobile, Estee Lauder, BP, Mondelez, Activision Blizzard, and AP Moller-Maersk tomorrow. Then on Wednesday we’ll hear from Novo Nordisk, Qualcomm, CVS, Marriott, Albemarle, and MGM resorts. Thursday sees reports from Toyota, Moderna, Square, Airbnb, Uber, and Deutsche Post and then a busy Friday with Alibaba Group, Dominion Energy, Honda, and Mitsubishi. Looking back now and reviewing last week in numbers, it was a week of heightened intraday volatility within rates, as markets brought forward the expected timing of central bank policy actions across advanced economies while revising down growth expectations. Position stop outs almost certainly played a role as the magnitude of the moves were out of sync with macro developments while FX and equity markets were not nearly as volatile. Global front end rates started moving in earnest on Wednesday, following the Bank of Canada’s surprise decision to end net asset purchases, while bringing forward the timing of liftoff, which sent 2yr Canadian bonds more than +20bps higher. In the following days, the RBA opted not to defend their yield curve control target, and ECB President Lagarde did not use her press conference to provide much of a forceful pushback on recent repricing. All told, almost every DM economy saw their 2 yr bond selloff, including the US (+4.4 bps, +0.8 bps Friday), UK (+4.9 bps, +5.9 bps Friday), Germany (+5.2 bps, +3.2 bps Friday), Canada (+23bps) and Australia (+65bps). The long end went the other direction in the core countries, with many curves twist flattening over the week as negative growth sentiment weighed on the back end. Nominal 10yr yields declined -6.2 bps (-2.8 bps Friday) in the US, -11.1 bps (+2.5 bps Friday) in the UK, and were flat in Germany (+3.0 bps Friday). Unlike the rest of October, the decline in nominal yields coincided with declining inflation breakevens (albeit from historically high levels), with 10yr breakevens declining -5.2 bps (-0.6 bps Friday) in the US, -25.4 bps (-8.5 bps Friday) in the UK, and -16.3 bps (-11.5 bps Friday) in Germany. Note that outside the core there were some bond markets that moved higher in yield with 10yr bonds in Canada (+7bps), Australia (+30bps) and Italy (+19bps) all higher for different reasons. Some of the bond moves above don’t do the intra-day volatility any justice though. Elsewhere Crude oil prices dipped to close out what was otherwise another very good month, with Brent and WTI -1.34% (+0.07% Friday) and -0.23% (+0.92% Friday) lower. Meanwhile, equity markets marched to the beat of a different drum. The S&P 500 (+1.33%, +0.19% Friday), Nasdaq (+2.71%, +0.33% Friday), and DJIA (+0.40%, +.25% Friday) all set new all-time highs, while the STOXX 600 increased +0.77% (+0.07% Friday), cents below the all-time high set in August. Generally strong earnings relative to a worried market prior to the season again supported equity markets. Calls were replete with mentions of supply chain woes and labour shortages though, but companies sounded an optimistic note on end-user demand. Many big tech stocks reported, to more mixed results than the broader index. Alphabet and Microsoft beat on both revenue and earnings, Facebook and Apple missed analyst revenue estimates, while Amazon and Twitter missed revenue and earnings estimates. Ford and Caterpillar, two bellwethers particularly exposed to current supply chain and labour maladies, fared especially well. So far this season 279 companies have reported, with 206 beating on revenue and 237 beating on earnings Out of D.C., after prolonged negotiations within the Democratic Party, US President Biden unveiled a new social and climate spending framework, containing $1.75 trillion in spending measures as well as revenue-raising offsets. Once the text is finalized, it should enable a vote on the social spending package as well as the separately-negotiated bi-partisan infrastructure bill. More is likely to come this week. Tyler Durden Mon, 11/01/2021 - 07:59.....»»

Category: smallbizSource: nytNov 1st, 2021

Futures Rise Ahead Of Deluge Of Big Tech Earnings

Futures Rise Ahead Of Deluge Of Big Tech Earnings One day after Goldman doubled down on its call for a market meltup into year-end, futures on the Nasdaq 100 edged higher, while contracts on the S&P 500 were modestly higher on Monday, approaching record highs again as investors braced for a flood of earnings (164 of 500 S&P companies report this week) while weighing rising inflation concerns, Covid-19 risks and China’s deteriorating outlook (Goldman slashed China's 2022 GDP to 5.2% from 5.6% overnight). The FOMC enters quiet period ahead of next week's FOMC meeting, which means no Fed speakers as attention shifts to economic data and corporate earnings. At 745 a.m. ET, Dow e-minis were up 3 points, or 0.01%, S&P 500 e-minis were up 4.25 points, or 0.1%, and Nasdaq 100 e-minis were up 36.25 points, or 0.25%. Bitcoin bounced back over $63,000 after sliding below $60,000 over the weekend, the 10-year US Treasury yield rose and the dollar also rose after Federal Reserve Chair Jerome Powell flagged that inflation could stay higher for longer, fueling investor concern that sticky price increases may force policy makers to raise borrowing costs. Global markets have remained resilient despite risks from price pressures stoked by supply-chain bottlenecks and higher energy costs. On Sunday, Janet Yellen was among those counseling the inflation situation reflects temporary pain that will ease in the second half of 2022 even as Twitter CEO Jack Dorsey warned hyperinflation is coming. Investors are wary that tighter monetary policy to keep inflation in check will stir volatility “Inflation concerns will continue to dominate markets this year as the price of crude oil remains elevated,” while “the pandemic remains a central concern,” said Siobhan Redford, an analyst at FirstRand Bank Ltd. in Johannesburg. “This will add further complexity to the already difficult decisions facing policy makers around the world.” All of FAAMG - Facebook, Microsoft, Apple, Alphabet and Amazon.com - are set to report their results later this week. The companies shares, which collectively account for over 22% of the weighting in the S&P 500, were mixed in trading before the bell. Facebook shares fell in premarket trading, extending six weeks of declines, after Bloomberg reported that the social-media company is struggling to attract younger users and that employees are concerned over the spread of misinformation and hate speech on its platform. The company is scheduled to report quarterly results after the market closes. “After Snap got an Apple caught in its throat, markets will have an itchy trigger finger over the sell button if the social network says the same,” said Jeffrey Halley, senior market analyst, Asia Pacific at OANDA. “Additionally, this week, it is a FAANG-sters paradise ... that decides whether the U.S. earnings season party continues, before the FOMC (Federal Open Market Committee) reasserts its dominance next week.” PayPal jumped 6.4% as the company said it wasn’t currently pursuing an acquisition of Pinterest, ending days of speculation over a potential $45 billion deal. Shares of Pinterest plunged 12.5%. Tesla gained 2.2% in premarket trading after Morgan Stanley raised its price target for the stock by a third, citing “extraordinary” sales growth. The stock then surged to new all time highs after Bloomberg reported that Hertz placed an order for 100,000 Teslas in the first step of an ambitious plan to electrify its rental-car fleet. Oil firms including Chevron Corp and Exxon Mobil rose about 0.5% each, tracking Brent crude prices to three-year high. Cryptocurrency-exposed stocks gain in premarket trading as Bitcoin climbs back above the $63,000 per token level after slipping from its record high last week. Crypto-linked stocks that are climbing in premarket include Bakkt +6.6%, Hive Blockchain +3.9%, Hut 8 Mining +2.8%, Riot Blockchain +2.2%, MicroStrategy +2.3%, Marathon Digital +2.8%, Coinbase +1.9%, Silvergate +1.8%, Bit Digital +1.2% and Mogo +0.8% Strong earnings reports helped lift the S&P 500 and the Dow to record highs last week, with the benchmark index rising 5.5% so far in October to recoup all of the losses suffered last month.  However, market participants are looking beyond the impressive earnings numbers with a focus on how companies mitigate supply chain bottlenecks, labor shortages and inflationary pressures to sustain growth. Analysts expect S&P 500 earnings to grow 34.8% year-on-year for the third quarter, according to data from Refinitiv. On the economic data front, readings on U.S. third-quarter GDP - the Federal Reserve’s favored inflation gauge, the core PCE price index and consumer confidence data will be released later this week. In Europe, mining companies and banks gained but the telecommunications and industrial goods and services sectors declined, leaving the Stoxx 600 index little changed. Banks rose on HSBC’s bright outlook. Spain’s Banco de Sabadell SA jumped more than 5% after rejecting an offer for its U.K. unit. Telecoms and industrials were the biggest losers. Volvo Car slashed its initial public offering by a fifth, making it the latest in a string of European companies to pull back from equity markets roiled by soaring energy costs and persistent supply chain delay. Here are some of the biggest European movers today: Banca Monte dei Paschi slides as much as 9.5% after the Italian government and UniCredit ended talks over the sale of the lender. Exor shares gain as much as 5.6% in Milan trading to the highest level on record after a report that the Agnelli family’s holding co. revived talks with Covea for the sale of Exor’s reinsurance unit PartnerRe. Banco Sabadell jumps as much as 5.6% after it said it rejected an offer for its TSB Bank unit in the U.K. from Co-operative Bank. SSAB rises as much as 5.2% after the Swedish steelmaker posted 3Q earnings well above analysts expectations. Handelsbanken analyst Gustaf Schwerin said the figures were “very strong.” Weir Group rises as much as 3.7% after Exane BNP Paribas raised the stock to outperform. Analyst Bruno Gjani says the stock’s underperformance YTD provides a “compelling entry opportunity.” Darktrace drops as much as 26% after Peel Hunt initiated coverage of the cybersecurity firm with a sell rating and 473p price target that implies about 50% downside to Friday’s close. Nordic Semiconductor declines as much as 8.8% after ABG Sundal Collier downgraded to hold. German business morale deteriorated for the fourth month running in October as supply bottlenecks in manufacturing, a spike in energy prices and rising COVID-19 infections are slowing the pace of recovery in Europe’s largest economy from the pandemic. The Ifo institute said on Monday that its business climate index fell to 97.7 from an upwardly revised 98.9 in September. This was the lowest reading since April and undershot the 97.9 consensus forecast in a Reuters poll. “Supply problems are giving businesses headaches,” Ifo President Clemens Fuest said, adding that capacity utilisation in manufacturing was falling. “Sand in the wheels of the German economy is hampering recovery.” The weaker-than-expected business sentiment survey was followed by a grim outlook from Germany’s central bank, which said in its monthly report that economic growth was likely to slow sharply in the fourth quarter. The Bundesbank added that full-year growth was now likely to be “significantly” below its 3.7% prediction made in June. Earlier in Asia, stocks dipped in Japan and were mixed in China, where the central bank boosted a daily liquidity injection and officials expanded a property-tax trial. Signs that it would take at least five years before authorities impose any nationwide property tax bolstered some industrial metals.  Asia-Pac equities kicked off the week with a downside bias as the region adopted a similar lead from Friday’s Wall Street session, although sentiment marginally improved. The ASX 200 (+0.3%) was kept afloat by its energy sector as oil prices drifted higher, whilst index heavyweight Telstra was boosted after partnering with the Australian government to acquire Digicel Pacific in USD 1.6bln deal - for which Telstra contributed only USD 270mln. The Nikkei 225 (-0.7%) opened lower by around 1% with Softbank and Fast Retailing the biggest losers, although the index initially trimmed losses as the JPY remained on the backfoot. The Hang Seng (+0.1%) and Shanghai Comp (+0.8%) were mixed at the open, with the latter supported by a net PBoC injection of CNY 190bln, while the Hang Seng Mainland Properties Index (-2.9%) was pressured by reports China's State Council is to expand the property-tax reform trials to more areas. On the flip side, China Evergrande and Evergrande New Energy Vehicle opened higher after the chairman said the group is to complete its transition to the NEV industry from real estate within 10 years. Finally, 10yr JGBs trade subdued and in contrast to its US and German counterparts. In FX, the Bloomberg Dollar Spot Index was little changed after earlier inching lower to touch the weakest level since Sept. 27; the greenback was mixed against its Group-of-10 peers with commodity currencies performing best, led by the Australian dollar and Norwegian krone. The euro hovered around $1.1650 even as German business confidence took another hit in October as global supply logjams damp momentum in the manufacturing-heavy economy. Ifo business confidence fell to 97.7 in October, from 98.9 in the prior month. The pound inched up, rising alongside other risk- sensitive Group-of-10 currencies, having trailed all its peers on Friday after Brexit risks reared their head late in the London session. A quiet week for U.K. data turns focus to the upcoming government budget. The Australian dollar rose against all its Group-of-10 peers, tracking commodity gains, with market sentiment also boosted by the People’s Bank of China’s move to inject additional cash into the banking system. The yen declined after rising for three consecutive days; Economists expect the BoJ to keep its policy rate unchanged Thursday. Turkey’s lira fell to a record low as the country’s latest diplomatic spat gave traders another reason to sell the struggling currency. Day traders in Japan have started trimming their bullish wagers on the Turkish lira, with forced liquidation a growing threat as the currency tumbles. In rates, Treasuries were under pressure again, with the yield curve steeper as US trading begins Monday. They’re retracing a portion of Friday’s swift flattening, which occurred after Fed Chair Powell said rising inflation rates would draw a response from the central bank. 5s30s curve is back to ~89bp vs Friday’s low 85bp, within half a basis point of the lowest level in more than a year. Long-end yields are higher by as much as 3bp, 10-year by 2.7bp at 1.66%, widening vs most developed-market yields; yields across the curve remain inside Friday’s ranges, which included higher 2- and 5-year yields since 1Q 2020. Curve-steepening advanced after an apparent wager via futures blocks. In commodities, Brent oil rallied above $86 a barrel after Saudi Arabia urged caution in boosting supply. Gold rose for a fifth day, the longest run of gains since July, as risks around higher-for-longer inflation bolstered the metal’s appeal. Facebook will report its third quarter results after the market today, followed by Alphabet, Microsoft, Apple and Amazon later in the week.  On the economic data front, readings on U.S. third-quarter GDP - the Federal Reserve’s favored inflation gauge, the core PCE price index and consumer confidence data will be released later this week. Top Overnight News from Bloomberg S&P 500 futures up 0.1% to 4,542.25 STOXX Europe 600 little changed at 472.03 MXAP little changed at 200.13 MXAPJ up 0.1% to 661.46 Nikkei down 0.7% to 28,600.41 Topix down 0.3% to 1,995.42 Hang Seng Index little changed at 26,132.03 Shanghai Composite up 0.8% to 3,609.86 Sensex up 0.4% to 61,038.76 Australia S&P/ASX 200 up 0.3% to 7,441.00 Kospi up 0.5% to 3,020.54 Brent Futures up 0.7% to $86.14/bbl Gold spot up 0.4% to $1,800.45 U.S. Dollar Index down 0.10% to 93.55 Euro up 0.1% to $1.1655 Top Overnight News from Bloomberg U.S. Treasury Secretary Janet Yellen defended Federal Reserve Chair Jerome Powell’s record on regulating the financial system, which has been a target of criticism from progressive Democrats arguing he shouldn’t get a new term. Yellen said she expects price increases to remain high through the first half of 2022, but rejected criticism that the U.S. risks losing control of inflation. Speaker Nancy Pelosi opened the door to Democrats using a special budget tool to raise the U.S. debt ceiling without the support of Senate Republicans, whose votes would otherwise be needed to end a filibuster on the increase. President Joe Biden and fellow Democrats are racing to reach agreement on a scaled-back version of his economic agenda, with a self-imposed deadline and his departure later this week for summits in Europe intensifying pressure on negotiations. Bundesbank chief Jens Weidmann’s surprise announcement last week that he will leave on Dec. 31 has hit Berlin at a sensitive time, with Chancellor Angela Merkel currently running only a caretaker administration in the aftermath of an election whose outcome is likely to remove her CDU party from power. Some holders of an Evergrande bond on which the embattled developer had missed a coupon deadline last month received the interest before the end of a grace period Saturday, according to people familiar with the matter. A more detailed look at global markets courtesy of Newsquawk Asia-Pac equities kicked off the week with a downside bias as the region adopted a similar lead from Friday’s Wall Street session, although sentiment marginally improved with the region now mixed heading into the European open. US equity futures overnight opened trade with a mild negative tilt before drifting higher, with a broad-based performance experienced across the Stateside contracts, whilst European equity contracts are marginally firmer. Back to APAC, the ASX 200 (+0.3%) was kept afloat by its energy sector as oil prices drifted higher, whilst index heavyweight Telstra was boosted after partnering with the Australian government to acquire Digicel Pacific in USD 1.6bln deal - for which Telstra contributed only USD 270mln. The Nikkei 225 (-0.7%) opened lower by around 1% with Softbank and Fast Retailing the biggest losers, although the index initially trimmed losses as the JPY remained on the backfoot. The Hang Seng (+0.1%) and Shanghai Comp (+0.8%) were mixed at the open, with the latter supported by a net PBoC injection of CNY 190bln, whilst the Hang Seng Mainland Properties Index (-2.9%) was pressured by reports China's State Council is to expand the property-tax reform trials to more areas. On the flip side, China Evergrande and Evergrande New Energy Vehicle opened higher after the chairman said the group is to complete its transition to the NEV industry from real estate within 10 years. Finally, 10yr JGBs trade subdued and in contrast to its US and German counterparts. Top Asian News Xi Takes Veiled Swipe at U.S. as China Marks 50 Years at UN Hong Kong Convicts Second Person Under National Security Law Gold Extends Gain as Inflation Risks and Virus Concerns Persist Amnesty to Quit Hong Kong Citing Fears Under Security Law A tentative start to the week for European equities (Stoxx 600 U/C) as stocks struggle to find direction. On the macro front, the latest IFO report from Germany was mixed, with commentary from IFO downbeat, noting that Germany's economy faces an uncomfortable autumn as supply chain problems were causing trouble for companies, and production capacities were falling. The overnight session was a mixed bag with the Shanghai Composite (+0.8%) supported by a liquidity injection from the PBoC whilst the Hang Seng Mainland Properties Index (-2.9%) was pressured by reports China's State Council is to expand the property-tax reform trials to more areas. Stateside, US futures are marginally firmer with newsflow in the US in part, focused on events on Capitol Hill with CNN reporting that the goal among Democratic leaders is to have a vote Wednesday or Thursday on the infrastructure package. Note, the Fed is currently observing its blackout period ahead of the November meeting. From an earnings perspective, large-cap tech earnings dominate the slate for the week with the likes of Facebook (FB), Apple (AAPL), Microsoft (MSFT) and Amazon (AMZN) all due to report. Back to Europe, sectors are somewhat mixed as Basic Resources is the marked outperformer amid upside in underlying commodity prices. It’s been a busy morning for the Banking sector as HSBC (+1%) reported a 74% increase in Q3 earnings, whilst Credit Suisse (+0.7%) is reportedly mulling the sale of its asset management unit. Less encouragingly for the sector, UniCredit (-0.5%) and BMPS (-3.2%) shares are lower after negations on a rescue plan for BMPS have ended without an agreement. Finally, Airbus (-1.2%) and Safran (-2.3%) sit at the foot of the CAC after reports suggesting that the CEO's of Avolon and AerCap have, in recent weeks, written to the Airbus CEO expressing their concerns that the market will not support Airbus' aggressive plans to increase the pace of production; subsequently, Airbus has rejected their proposal, according to sources. Top European News The Man Behind Erdogan’s Worst Spat With the West: QuickTake Weidmann Succession Suspense May Last for Weeks on Berlin Talks Cat Rock Capital Urges Just Eat Takeaway to Sell GrubHub European Gas Jumps Most in a Week as Russian Supplies Slump In FX, the Dollar is somewhat mixed vs major counterparts and the index is jobbing around 93.500 as a result in rather aimless fashion at the start of a typically quiet start to the new week awaiting fresh impetus or clearer direction that is highly unlikely to come from September’s national activity index or October’s Dallas Fed business survey. Instead, the Greenback appears to be reliant on overall risk sentiment, US Treasury yields on an outright and relative basis along with moves elsewhere and technical impulses as the DXY roams within a 93.775-483 range. TRY - Lira losses continue to stack up, and the latest swoon to circa 9.8545 against the Buck came on the back of Turkish President Erdogan’s decision to declare 10 ambassadors persona non grata status due to their countries’ support for a jailed activist, including diplomats from the US, France and Germany. However, Usd/Try has actually pared some gains irrespective of a deterioration in manufacturing confidence and this may be partly psychological given that 10.0000 is looming with little in the way of chart resistance ahead of the big round number. AUD/NZD - Iron ore prices are helping the Aussie overcome rather mixed news on the COVID-19 front, as the state of Victoria is on course to open up further from Friday, but new cases in NSW rose by almost 300 for the second consecutive day on Sunday. Nevertheless, Aud/Usd has had another look at offers around 0.7500 and Aud/Nzd is approaching 1.0500 even though Westpac sees near term downside prospects for the cross while maintaining its 1.0600 year end projection, as Nzd/Usd continues to encounter resistance and supply into 0.7200. GBP/CAD - Sterling has regrouped after losing some of its hawkish BoE momentum and perhaps the Pound is benefiting from the latest rebound in Brent prices towards Usd 86.50/br on top of reports that the first round of talks between the UK and EU on NI Protocol were constructive, while the Loonie is up alongside WTI that has been adobe Usd 84.50 and awaiting the BoC on Wednesday. Cable is around 1.3750 after fading into 1.3800, Eur/Gbp is hovering above 0.8450 and Usd/Cad is pivoting 1.2350. EUR/JPY/CHF - The Euro has bounced from the lower half of 1.1600-1.1700 parameters and looks enshrined by a key Fib just beyond the current high (1.1670 represents a 38.2% retracement of the reversal from September peak to October trough) and decent option expiry interest under the low (1 bn between 1.1615-00), with little fundamental direction coming from a very inconclusive German Ifo survey - see 9.00BST post on the Headline Feed for the main metrics and accompanying comments from the institute. Elsewhere, the Yen is hedging bets prior to the BoJ within a 113.83-42 band against the Dollar and the Franc seems to have taken heed of another rise in weekly Swiss sight deposits at domestic banks as Usd/Chf climbs from circa 0.9150 towards 0.9200 and Eur/Chf trades nearer the top of a 1.0692-65 corridor. SCANDI/EM/PM - Firm oil prices are also underpinning the Nok, Rub and Mxn to various extents, while the Zar looks content with Gold’s advance on Usd 1800/oz and the Cnh/Cny have derived traction via a firmer onshore PBoC midpoint fix, a net Yuan 190 bn 7 day liquidity injection and the fact that China’s Evergrande has restarted work on more than 10 projects having made more interest payments on bonds in time to meet 30 day grace period deadlines. In commodities, a modestly firmer start to the week for the crude complex though action has been contained and rangebound throughout the European session after a modest grinding bid was seen in APAC hours. Currently, the benchmarks post upside of circa USD 0.30/bbl amid relatively minimal newsflow. The most pertinent update to watch stems from China, where the National Health Commission spokesperson said China's current COVID outbreak covers 11 provinces and expects the number of new cases to keep rising; additionally, the number of affected provinces could increase. Separately, but on COVID, they are some reports that the UK Government is paving the wat for ‘plan B’ measures in England, while this are primarily ‘softer’ restrictions a return of work-from-home guidance could hamper the demand-side of the equation. Note, further reports indicate this is not on the cards for this week and there are some indications that we could see, if necessary, such an announcement after the COP26 summit in Scotland ends on November 12th. Elsewhere, and commentary to keep an eye on for alterations given the above factors, Goldman Sachs writes that the persistence of the global oil demand recovery being on course to hit pre-COVID levels would present an upside risk to its end-2021 USD 90/bbl Brent price target. Moving to metals, spot gold and silver are firmer but reside within tight ranges of just over USD 10/oz in gold, for instance. In a similar vein to crude, newsflow explicitly for metals has been minimal but it is of course attentive to the COVID-19 situation while coal futures were hampered overnight as China’s State Planner announced it is to increase credit supervision in the area. US Event Calendar 8:30am: Sept. Chicago Fed Nat Activity Index, est. 0.20, prior 0.29 10:30am: Oct. Dallas Fed Manf. Activity, est. 6.2, prior 4.6 DB's Jim Reid concludes the overnight wrap Well I saw Frozen twice this weekend. Once in the flesh up in London in the musical version and once on TV on Sunday at the heart of Manchester United’s defence which was breached 5 (five) times by Liverpool without reply. Regular readers can guess which I enjoyed the most. Anyway I’ll let it go for now and prepare myself for a bumper week ahead for markets. This week we have decisions from the ECB and the Bank of Japan (both Thursday) even if the Fed will be on mute as they hit their blackout period ahead of the likely taper decision next week. Inflation will obviously remain in the spotlight too as we get the October flash estimate for the Euro Area (Friday) with some regional numbers like German (Thursday) before. In addition, the Q3 earnings season will ramp up further, with 165 companies in the S&P 500 reporting, including Facebook (today), Microsoft, and Alphabet (both tomorrow), and Apple and Amazon (Thursday). Elsewhere, the UK government will be announcing their latest budget and spending review (Wednesday), Covid will remain in the headlines in light of the growing number of cases in many countries, and we’ll get the first look at Q3 GDP growth in the US (Thursday) and the Euro Area (Friday). Starting with those central bank meetings, we’re about to enter a couple of important weeks with the ECB and BoJ meeting this week, before the Fed and the BoE follow the week after. Market anticipation is much higher for the latter two though. So by comparison, the ECB and the BoJ are likely to be somewhat quieter, and our European economists write in their preview (link here) that this Governing Council meeting is likely to be a staging ground ahead of wide-ranging policy decisions in December, and will therefore be about tone and expectations management. One thing to keep an eye on in particular will be what is said about the recent surge in natural gas prices, as well as if ECB President Lagarde challenges the market pricing on liftoff as inconsistent with their inflation forecasts and new rates guidance. 5yr5yr Euro inflation swaps hit 2% for the first time on Friday so if the market is to be believed the ECB has achieved long-term success in hitting its mandate. With regards to the meeting, we think there’ll be more action in December where our economists’ baseline is that there’ll be confirmation that PEPP purchases will end in March 2022. See the BoJ preview here. Inflation will remain heavily in focus for markets over the week ahead, with recent days having seen investor expectations of future inflation rise to fresh multi-year highs. See the week in review at the end for more details. This week one of the main highlights will be the flash Euro Area CPI reading for October, which is out on Friday. Last month, CPI rose to 3.4%, which is the highest inflation has been since 2008, and this time around our economists are expecting a further increase in the measure to 3.8%. However, their latest forecast update (link here) expects that we’ll see the peak of 3.9% in November, before inflation starts to head back down again. The other main data highlight will come from the Q3 GDP figures, with releases for both the US and the Euro Area. For the US on Thursday the Atlanta Fed tracker has now hit a low of only +0.53%. DB is at 2.3% with consensus at 2.8%. Earnings season really ramps up this week, with the highlights including some of the megacap tech firms, and a total of 165 companies in the S&P 500 will be reporting. Among the firms to watch out for include Facebook and HSBC today. Then tomorrow, we’ll hear from Microsoft, Alphabet, Visa, Eli Lilly, Novartis, Texas Instruments, UPS, General Electric, UBS and Twitter. On Wednesday, releases will include Thermo Fisher Scientific, Coca-Cola, McDonald’s, Boeing, General Motors, Santander and Ford. Thursday then sees reports from Apple, Amazon, Mastercard, Comcast, Merck, Royal Dutch Shell, Linde, Volkswagen, Starbucks, Sanofi, Caterpillar, Lloyds Banking Group and Samsung. Finally on Friday, we’ll hear from ExxonMobil, Chevron, AbbVie, Charter Communications, Daimler, BNP Paribas, Aon and NatWest Group. Here in the UK, the main highlight next week will be the government’s Autumn Budget on Wednesday, with the Office for Budget Responsibility also set to release their latest Economic and Fiscal Outlook alongside that. In addition to the budget, the government will also be outlining the latest Spending Review, which will cover public spending priorities over the next 3 years. Our UK economists have released a preview of the event (link here), where they write that 2021-22 borrowing is expected to be revised down by £60bn, and they expect day-to-day spending will follow the path set out at the Spring Budget. They’re also expecting Chancellor Sunak will outline new fiscal rules. Finally, the pandemic is gaining increasing attention from investors again, with a number of countries having moved to toughen up restrictions in light of rising cases. This week, something to look out for will be the US FDA’s advisory committee meeting tomorrow, where they’ll be discussing Pfizer’s request for an emergency use authorization for its vaccine on 5-11 year olds. The CDC’s advisory committee is then holding a meeting on November 2 and 3 the following week, and the White House have said that if it’s authorised then the vaccine would be made available at over 25,000 paediatricians’ offices and other primary care sites, as well as in pharmacies, and school and community-based clinics. The full day by day calendar is at the end as usual. Asian markets are mixed this morning so far, as the Shanghai Composite (+0.38%), Hang Seng (+0.09%) and the KOSPI (+0.30%) are edging higher, while the Nikkei (-0.85%) is down. The rise in Chinese markets comes despite the news of 38 new COVID-19 cases as well as an announcement of a lockdown affecting around 35,700 residents of a county in Inner Mongolia. As China is one of the last countries in the world to still adhere to strict containment measures, a major outbreak can deal a fresh blow to the domestic economy and further reinforce global supply chain issues. Elsewhere the Turkish Lira hit fresh record lows, and is down around -1.5% as we type after last week’s surprise interest rate cut and Saturday’s news that ambassadors from 10 countries, including the US, Germany and France, were no longer welcome in the country. S&P 500 futures (+0.06%) are around unchanged and 10yr US Treasury yields are back up c.1bp. Looking back on an eventful week now, and there was a marked increase in inflation expectations, which manifested itself in global breakevens hitting multi-year, if not all-time, highs. Starting with the all-time highs, US 5-year breakevens increased +14.9bps (-1.0bps Friday) to 2.90%, the highest level since 5-year TIPS have started trading, while 10-year breakevens increased +7.5bps (-0.7bps Friday) to 2.64%, their highest readings since 2005. 10-year breakevens in Germany increased +9.5 bps (+3.6bps Friday) to 1.91%, their highest since 2011, while in the UK 10-year breakevens increased +17.1 bps (+4.0bps Friday) to 4.19%, the highest level since 1996. Remarkable as these levels are, 5-year 5-year inflation swaps in the US, UK, and Euro Area finished the week at 2.63%, 4.00%, and 2.00%, multi-year highs for all of these measures. If you never thought you’d see the day that long term inflation expectations in Europe would hit 2% then this is a nice/nasty surprise. Overall, this suggests investors are pricing in the potential for inflation far into the future to be higher, in addition to responding to near-term stimulus and Covid reopening impacts. Crude oil prices also climbed to their highest levels since 2014, with Brent climbing +1.07% (+1.37% Friday) and WTI gaining +2.07% (+1.79% Friday). One area where there was some reprieve was in industrial metals. Copper decreased -4.81% (-1.24% Friday), but at $449.80, remains +10.10% higher month-to-date. Bitcoin also joined the all-time high club intraweek, and finished the week +2.28% higher (-3.08% Friday). It marked a seminal week for the crypto asset, which saw ETFs and options on said ETFs begin trading in the US. The inflationary sentiment coincided with market pricing of central bank rate hikes shifting earlier. 2-year yields in the US, UK, and Germany increased +5.9 bps (+0.1bps Friday), +8.0 bps (-4.7 bps Friday), and +4.0 bps (+0.9bps Friday) respectively. In fact, money markets are now placing slightly-better-than even odds that the MPC will raise Bank Rate as early as next week. Fed and ECB officials offered some push back against the aggressive policy path repricing, but BoE speakers seemed to confirm a hike next week was a legitimate possibility. Rounding out sovereign bonds, nominal 10-year yields increased +6.2 bps (-6.9bps Friday) in the US, +4.0 bps (-5.6bps Friday) in the UK, +6.2 bps (-0.3 bps Friday) in Germany, +6.0 bps (-0.1bpFriday) in France, and +8.1 bps (+0.8bps Friday) in Italy. Inflation expectations didn’t fall with the big rally in the US and U.K. but real rates rallied hard. The S&P 500 increased +1.64% over the week, but ended its 7-day winning streak after retreating on -0.11% Friday. On earnings, 117 S&P 500 companies have now reported third quarter earnings. Roughly 85% of companies have beat earnings expectations compared to the five-year average of 76%, while 74% of reporting companies have beat sales estimates. The aggregate earnings surprise is +13.05%, topping the 5-year average of +8.4%, while the sales surprise is +2.06%. Although a seemingly strong performance on the surface, our equity team, after taking a look under the hood in this note here, points out that a large part of the beats so far is due to loan-loss reserve releases by banks. Excluding those, the aggregate S&P 500 beat is running much closer to historical average, suggesting the headline beats have not been as broad based as they look at first glance. Congressional Democrats spent the week negotiating the next fiscal package, which is set to spend more than $1 trillion on social priorities key to the Biden administration. On Sunday, House Speaker Nancy Pelosi noted that 90% of the bill is agreed to and would be voted on before October was out. One of the key sticking points has been what offsetting revenue raising measures should be included in the final bill. As those details emerge, it should give us a better picture as to the ultimate additional fiscal impulse the new bill will provide. Finally, global services PMIs out last Friday expanded while manufacturing PMIs lagged. Readings across jurisdictions were consistent with supply chain issues continuing to impact activity. Tyler Durden Mon, 10/25/2021 - 08:09.....»»

Category: blogSource: zerohedgeOct 25th, 2021

Kyrsten Sinema takes thousands in campaign contributions from pharmaceutical giants while stalling prescription drug pricing reforms

Since the start of her political career, pharmaceutical companies have lobbied Sinema and financed her campaign committee and leadership PAC. In this July 16, 2019, file photo, Senate Security and Governmental Affairs Committee member Sen. Kyrsten Sinema, D-Ariz., listens to witnesses during a hearing on 2020 census on Capitol Hill in Washington. AP Photo/Manuel Balce Ceneta Kyrsten Sinema's campaign has received $500,000+ in campaign donations from the pharma industry. The $3.5 trillion spending bill would save the US "hundreds of billions" on health care spending. The biotechnology company Amgen gave Sinema $25,500 and is one of her largest financial backers. See more stories on Insider's business page. Sen. Kyrsten Sinema of Arizona is said to be opposed to the current prescription drug pricing proposals in bills put forth by both the House and Senate, as well as an alternative from House centrists that would limit the drugs subject to Medicare negotiation, according to unnamed sources cited by Politico.Sinema's stance has stalled the passage of the $3.5 trillion spending bill crafted by the Biden administration and fellow Democrats, even though it could jeopardize her own bipartisan infrastructure bill. Democratic Rep. Pramila Jayapal of Washington has previously said the majority of the Congressional Progressive Caucus, which she chairs, would not vote for Sinema's infrastructure bill without first passing the spending package.If passed, the $3.5 trillion spending bill would lower the cost of certain prescription drugs by instituting reforms and allowing Medicare to negotiate prices, which would save the federal government "hundreds of billions" on health care spending, according to a memo for Democratic senators.Sinema is a "pharma favorite in Congress" Since launching her political career, Sinema's campaign committee has received more than $500,000 in donations from the pharmaceutical and health product industries, according to OpenSecrets.Kaiser Health News dubbed Sinema a "pharma favorite in Congress" after her campaign received $98,500 from PACs run by employees of drug companies and their trade groups during the 2019-20 election cycle.One of her largest financial backers has been Amgen, a biotechnology company that manufactures prescription drugs for individuals with illnesses that have limited treatment options, such as cancer patients and chronically ill individuals.Insider reached out to Sinema and her team but has not received a response.Many prescription drugs made by Amgen have hefty price tags. Overall, the company made $24.24 billion in global product sales in 2020.Amgen did not respond to inquiries about whether it lobbied Sinema on prescription drug pricing reforms or how the bill's passage would impact the company's bottom line. In 2021, Amgen has spent $4.72 million on lobbying Congressional representatives over 17 bills, the majority of which address issues related to prescription drug pricing, according to OpenSecrets.A super PAC with pharmaceutical industry ties funded a recent Sinema adAccording to Google's Transparency Report, a September 9 political ad for Sinema was paid for by Center Forward, a super PAC dedicated to supporting the election of centrist Democrats, according to The Washington Post. In its registration with the Washington, DC, Department of Consumer and Regulatory Affairs, Center Forward lists Libby Greer and Cindy Brown from the lobbying firm Forbes Tate Partners as governors on its board. Greer and Brown are lobbyists for several pharmaceutical companies, including Bayer, Gilead Sciences, Eli Lilly, Novartis, Amgen, and Merck & Co, according to documents obtained by the Daily Poster and reviewed by Insider. Greer and Brown did not respond to inquiries about the scope of their involvement in the Sinema political ads. Center Forward Executive Director Cori Kramer Smith said that day-to-day activities, programming, and messaging do not fall under the board's responsibilities.Merck was the second-highest pharmaceutical industry contributor to Sinema's campaign, donating $20,500 to her campaign committee and leadership PAC between 2015 and 2020, according to Kaiser Health News' "Pharma Cash to Congress" tracker.Eli Joseph, the husband of Sinema's chief of staff, Meg Joseph, worked as the executive director of federal policy and government relations for Merck & Co. from 2012-2015, according to his LinkedIn. Meg Joseph's LinkedIn also shows that she worked as a lobbyist from 2007-2008 at Clark & Weinstock, which lobbied on behalf of several pharmaceutical companies and major industry trade groups during her tenure, Salon reported. Neither of the Josephs responded to inquiries about their previous work as lobbyists or connections to the pharmaceutical industry. Merck spokesperson John Cummings said Eli Joseph handled Senate affairs and was not involved in decisions surrounding House contributions. In addition to Sinema, four House Democrats are also opposed to direct government negotiation of drug prices. Reps. Scott Peters, Kurt Schrader, Stephanie Murphy, and Kathleen Rice voted against advancing a drug-pricing provision on September 15, although it would be approved later in the day by the Ways and Means Committee, the Los Angeles Times reported.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderOct 24th, 2021

A Tale Of Two Civilizations

A Tale Of Two Civilizations Authored by Alasdair Macleod via GoldMoney.com, In recent years, America’s unsuccessful attempts at containing China as a rival hegemon has only served to promote Chinese antipathy against American capitalism. China is now retreating into the comfort of her long-established moral values, best described as a mixture of Confucianism and Marxism, while despising American individualism, its careless regard for family values, and encouragement of get-rich-quick financial speculation. After America’s defeat in Afghanistan, the geopolitical issue is now Taiwan, where things are hotting up in the wake of the AUKUS agreement. Taiwan is important because it produces two-thirds of the world’s computer chips. Meanwhile, the large US banks are complacent concerning Taiwan, preferring to salivate at the money-making prospects of China’s $45 trillion financial services market. The outcome of the Taiwan issue is likely to be decided by the evolution of economic factors. China is protecting herself against a global credit crisis by restraining its creation, while America is going full MMT. The outcome is likely to be a combined financial market and dollar crisis for America, taking down its Western epigones as well. China has protected herself by cornering the market for physical gold and secretly accumulating as much as 20,000-30,000 tonnes in national reserves. If the dollar fails, which without a radical change in monetary policy it is set to do, with its gold-backing China expects to not only survive but be able to consolidate Taiwan into its territory with little or no opposition. Introduction On the one hand we have America and on the other we have China. As civilisations, America is discarding its moral values and social structures while China is determined to stick with its Confucian and Marxist roots. America is inclined to recognise no other civilisations as being civilised, while China’s leadership has seen America’s version and is rejecting it. Both forms of civilisation are being insular with respect to the other, and their need to peacefully cooperate in a multipolar world is increasingly hampered. Understanding another nation’s point of view is essential for peaceful harmony. This truism has been ignored by not just America, but by the Western alliance under American coercion. The Federal Government and its agencies are pursuing a propaganda effort against China’s exports and technology, while the average American appears less troubled. Perhaps we can put this down to a nation based on immigrants having a more cosmopolitan psyche than its predominantly Anglo-Saxon establishment. In Europe, it sometimes appears to be the other way round, with the politicians more prepared to tolerate China than their US counterparts. But then geography is involved, and the silk roads do not involve America, while rail links between China and Western Europe work efficiently, delivering vital trade between them. Economic interdependency is rarely considered. Nor are the potential consequences of diverging economic and monetary policies. While China has been squeezing domestic credit, the West has been issuing currency and credit like drunken sailors on shore leave. Being starved of extra credit, China’s economy has been deliberately stalled, and there is a real or imagined crisis developing in its property markets. Only now, it has become apparent that the West’s major economies are running into troubles of their own. Economic destabilisation heightens the risk of conflict, and perhaps the timing of the build-up of tensions in the South China Sea and over Taiwan is not accidental. On Wall Street there is an air of complacency, with the US investment community led by the big banks ignoring the developing risks of this dysfunction. In the context of deteriorating relations between China and America and with China’s growing contempt for US political resolve, Taiwan is becoming extremely important geopolitically. China’s plans for Taiwan Taiwan is in the world’s geopolitical crosshairs with President Xi insisting it returns to China. The West, which has failed to protect Taiwan from China’s claims of sovereignty in the past, thereby endorsing them, is only now belatedly coming to its aid with a new Pacific strategy. But the signals already sent to the Chinese are that the Western alliance is too divided, too weak to prevent a Chinese takeover. This surely is the reasoning behind China’s attempts to provoke an attack on its air force by invading Taiwan’s airspace. And all the West can do is indulge in finger-wagging by sailing aircraft carriers through the Taiwan Strait. Taiwan matters, being the source of two-thirds of the world supply of microchips. Faced with a pusillanimous west, this fact hands great power to China — which with Taiwan corners the market. Furthermore, the big Wall Street banks are salivating over the prospects of participating in China’s $45 trillion financial services market and are preparing for it. China has thereby ensured the US banking system has too much invested to support the US administration in any escalation of the Taiwan issue. The actual timing of China’s escalation of the Taiwan issue appears related to the AUKUS nuclear submarine deal. That being so, the posturing between China and the Western Alliance has just begun. There are four possible outcomes: China backs off and the tension subsides, America and the Western Alliance back off and China gets Taiwan, there is a negotiated settlement, or a military war against China ensues. In this context it is important to understand the civilisation issue, which increasingly divides China and America. There is little doubt that the hitherto normal relationship between America and China was disrupted by President Trump becoming nationalistic. His “make America great again” policy was a declaration of a trade war. That was accompanied by a political attack on Hong Kong, which provoked China into taking Hong Kong under direct mainland control. There followed a technology war, leading to the arrest of the daughter of Huawei’s founder in Canada. There appears to be little change in President Biden’s policy against China. Now that his administration has bedded in, China is beginning to test it over Taiwan. To give it context, we should understand the Chinese culture and why the state is so defensive of it, and how the leadership views America and its weaknesses. For that is what is behind its economic divergence from the West. China’s changing political culture Since becoming President, Xi has reformed China’s state machinery. After assuming power in 2012, he needed to clear out the corrupt and vested interests of the previous regime. He instigated Operation Fox Hunt against corrupt officials, who, it was estimated, had salted away the equivalent of over a trillion dollars abroad. By 2015 over 180 people had been returned to China from more than 40 countries. Former security chief Zhou Yongkang and former vice security minister Sun Lijun ended up in prison and Hu Jintao’s powerful Communist Youth League faction was marginalised. By dealing ruthlessly with corrupt officials Xi got rid of the vested interests that would have potentially undermined him. He consolidated both his public support and his iron grip on the Communist Party for the decade ahead. His public approval ratings remain extraordinarily high to this day. On the economic front Xi faced major challenges. Having become the world’s manufacturer, a sharp wealth divide opened between China’s concentrated manufacturing centres and rural China. Some 600 million people are still subsisting on a monthly income of less than 1,000 yuan ($156) a month. A rapidly increasing urban population has been denuding the rural economy of human resources and undermining the family culture. The wealth disparity between city and country has become an important political issue, which is why as well as refocusing resources towards agriculture Xi has clamped down on super-rich entrepreneurs and their record-breaking IPOs. In his Common Prosperity policy, Xi declared that he was not prepared to let the gap between rich and poor widen, and that common prosperity was not just an economic issue but “a major political issue related to the party’s governing foundations”. Following decades of communism under Mao, after China’s initial recovery and development Xi is now clamping down on unfettered capitalism. He and his advisers have observed the disintegration of family values in America and the rise of individualism at the expense of family life; and with popular culture how these trends are being adopted by China’s youth. The state has now shut down western-style social media, and erased celebrity culture. The social impact of cultural change is often overlooked, but it is at the forefront of China’s policy-makers’ consideration. For millennia, a state-controlled Chinese civilisation endured. Despite the Cultural Revolution, the post-war Mao Zedong years failed to erase it. Never sympathetic to free markets, statist thoughts have turned inwardly to Confucius and Marx to escape the obvious failings of American capitalism and its decline from familial values to individualism and rampant speculation. This is what Xi reflects in his presidency. His chief adviser, his éminence grise, is Wang Huning who operates in the political shadows. From all accounts, Wang is extremely clever, speaks French and English, spent a year in America and is a deep thinker who, having examined them, has rejected western values in favour of Chinese tradition. NS Lyons, an analyst and writer living in Washington, DC, has written an interesting article about Wang, published on Palladium Magazine — it is well worth reading. As we saw with the UK’s temporary éminence grise, Dominic Cummings, the power to influence possessed by such a person is considerable, but always in a statist context. The economics of free markets are not involved, except as a source of revenue to fund statist ambitions. The result is an assumption, an ignorance of economic affairs concealed by an automatic acceptance of the status quo. This is Wang’s weak point, and insofar as Xi relies on his advice, it is the President’s as well. Wang appears to be promoting a Confucian/Marxist hybrid civilisation which is intended to unify China’s many ethnic groups in a government-set culture, reverting to a morality of yesteryear. Comparing China’s future with that of American democracy and its moral degradation, the approach is understandable and enjoys popular support. But the consequences are that the state is drifting backwards towards its Marxist roots. The central command over the economy is exemplified in energy policy: power entities have been instructed to keep factories running without power outages, irrespective of coal and natural gas costs. In fact, the management of the economy was never relinquished by the state, which is now redoubling its efforts to retain control over economic outcomes. All one can say is that so far, the Chinese appear to have made considerably less of a mess managing their economy and currency compared with America’s Federal Government and its central bank. The political consequences are also important. By stemming the tide of Western moral decadence in her own territory China is insulating herself from the rest of the American-dominated world. This is being bolstered by steps to shift the emphasis from the export trade towards domestic consumption to improve living standards. In the process China will become more of an economic fortress, mainly interested in Africa and the Americas as sources of raw materials and commodities rather than as export markets to be fostered. China’s internationalism of the last four decades is increasingly redirected and confined to the Eurasian continent over which she exercises greater degrees of political and economic control. Which brings us back to the issues of Taiwan and the South China Sea, which China sees as consolidating her rightful political and cultural borders. However, the increasing autarky of both China and America is making the Taiwan issue more difficult to resolve peacefully. And we must also consider the opposing directions of drift for their two economies, which could decide the outcome. The US’s economic condition and outlook There is a mistaken assumption that the US’s economic troubles relate solely to the consequences of the covid lockdowns. Certainly, the Fed timed its funds rate cut to the zero bound and its current and unprecedented rate of quantitative easing of $120bn every month to March 2020, when lockdowns in Europe and the UK commenced. And it was becoming clear, despite President Trump’s prevarication, that the US would follow. But that ignores developments which preceded covid. Probably due to earlier tapering of QE in 2019, financial markets signalled a developing slump, with the S&P 500 falling 35% in 23 trading sessions to mid-March 2020 — eerily replicating the Wall Street Crash between end-September and late October 1929. It took the reduction of the Fed funds rate to the zero bound, and $120bn of monthly QE feeding into pension funds and insurance companies to turn markets higher. The yield on 10-year US Treasuries fell to 0.5% and equities markets soared on the back of a new basis of relative valuation. After the repo blow-up in September 2019, it became clear that bank balance sheets were too constrained to extend additional bank credit, and conventionally, that might have marked the turn of the bank credit cycle, which was why the comparison with late-1929 was so apt. Furthermore, the banks became less interested in extending credit to Main Street than to Wall Street after financial markets stabilised. The recovery in equities and their move into new high ground is simply asset inflation. Speculators have been quick to add to the Fed’s QE liquidity by drawing on bank and shadow bank credit to play the game. Figure 1 shows how margin loans have nearly doubled as the bull market in equities proceeded from late-March 2020. Never has so much leverage been seen in US securities markets. During covid lockdowns, beyond pure survival few in industry made judgements about the future. It was commonly assumed that when lockdowns ceased business would return to normal. But this made no allowance for the passage of time and the evolution of consumer needs and wants. Eighteen months later, we find that supply chains are still wrongfooted, disrupted by covid shutdowns and not supplying newly needed goods. Consumer demand patterns are not where they left off — they have radically changed. Buoyancy in the US economy is now proving short-lived. The flood of initial spending following lockdowns has receded and different factors are now at play. Supply bottlenecks due to lack of components, transport, and labour are forcing up prices at a pace not reflected in official statistics. In effect, GDP is insufficiently deflated by price rises on the high street to give a reasonable estimate of real GDP. With prices probably rising at over 15% annualised (Shadowstats.com estimated 13.5% three months ago and pressures on rising prices have increased significantly since) the US economy is in a slump which is beginning to replicate that of ninety years ago. The difference is that in 1930-33 the dollar was on a gold coin standard increasing its purchasing power as bank credit was withdrawn, while today it is pure fiat and declining at an increasing pace. Rising prices across the board are another way of saying that the currency’s purchasing power is declining, which given the Fed’s monetary policies of recent years is not surprising. Figure 2 shows the impact of the Fed’s monetary policy on commodity prices, which reflects the dollar’s weakness as a medium of exchange. Given that it takes anything between a few weeks and six months for energy and commodity prices to work through to consumer prices, the recent spurt in commodity prices strongly suggests that consumer prices are going to continue to rise into next year. Yet, only now are the Fed and other central banks beginning to accept that rising prices are not going to be as temporary as they first hoped. This is because it is not prices rising, but the dollar’s purchasing power falling. When they fully realise it, foreign holders of dollars, totalling $33 trillion held in securities, short-term instruments, and bank deposits will require higher interest compensation to persuade them to continue holding dollars. And this is where a conflicting problem arises. A rise in interest rates sufficient to compensate foreign holders of dollars for the currency’s loss of purchasing power will undermine the values of their US stock holdings, totalling $14 trillion, of which $12 trillion is held by private sector foreign investors. Furthermore, a further $12.5 trillion of foreign private sector funds are invested in long-term bonds which will also decline in value. Higher interest rates will certainly trigger private sector selling of these assets across the board. The fate of $6.6 trillion of foreign official holdings of long-term securities will be partly political, demonstrated by the most recent Treasury TIC figures which showed China selling $21bn of US Treasuries, and Japan and the UK buying $39bn between them. This is strongly suggestive of swap lines being drawn down to support the US Treasury bond market, while presumably the US, either through the Treasury, the Exchange Stabilisation Fund, or the Fed itself has bought JGBs and gilts as the quid pro quo. It is worth noting this point because it shows how low bond yields are perpetuated by cooperation between major central banks – along with the attendant monetary inflation. That being the case, private sector holders are misled by price stability while bonds are being wildly overvalued. Another way of looking at it is that if John Williams at Shadowstats is right about inflation statistics, then US Treasuries should be yielding as much as 10% along the whole yield curve. Perhaps the recent rise in the 10-year US Treasury yield in Figure 2 is indicating the start of the process of this discovery for foreign and domestic investors alike. The chart shows that once the 1.75% level is overcome, there is considerable upside in the yield, with a golden cross forming under the spot value. If yields rise from here, it will not be long before equity markets take note and enter a full-blown bear market. The first reaction from the Fed to these events will almost certainly be to claim that falling equities are a leading economic indicator, suggesting the economy faces a post-covid recession. Interest rates cannot be eased further, but QE can be stepped up to cap bond yields and encourage pension funds and insurance corporations to increase their investments. This would be a U-turn from the projected policy of reducing QE due to inflation concerns. But at that point the neo-Keynesian argument can be expected to claim that the developing recession more than negates prospective inflation concerns. Facing the same dynamics, the other leading central banks are certain to fall in line with the Fed’s new policy. But as John Law found in a similar situation in France in 1720, rigging a failing stock market (in his case the Mississippi venture) by currency and credit expansion ultimately fails and undermines the currency. Law destroyed the French economy, contrasting with the British South Sea Bubble, where the Bank of England was not involved and did not deploy its currency to ramp markets. Today, it appears that Law’s experiment is about to be repeated on a grander scale by the issuer of the world’s reserve currency. The other major western central banks will follow suite. The whole fiat money system is at risk of being driven into a similar failure as that which faced the French livre. So, where would that leave China? China’s economic and monetary outlook As noted above, China has followed a different monetary path from that of the Fed for some time — most pointedly since March 2020. Consequently, the yuan has risen against the dollar since then, illustrated in Figure 4. After some initial uncertainty, the yuan began to rise against the dollar and is now about 10% up on the late-March 2020 level. This is not significant yet, because the dollar’s trade-weighted index has fallen by a similar amount. But with China’s monetary policy of clamping down on shadow banking and excessive bank credit creation, compared against the Fed’s more expansionary monetary policies, we can expect the trend for a stronger yuan relative to the dollar to continue. In neo-Keynesian language, China is in a period of deflation, leading to falling prices relative to those measured in dollars. But that misses the point: China has been careful not to encourage speculation in financial assets, reflected in relative stock market performances, shown in Figure 5. While the Fed has been inflating stock prices through interest rate and monetary policies, the Chinese have discouraged speculation. The result is that financial assets in China should be less vulnerable to a general market downturn. It has been a deliberate policy to protect the Chinese economy from 2014 onwards, after the PLA’s chief strategist, Major-General Qiao Liang convinced Beijing that permitting unfettered speculation would leave markets vulnerable to a pump-and-dump attack by America. To the Chinese, excessive financial speculation aided and abetted by the Fed must look like a cover for underlying economic failure. Every thread of their analysis must point to economic disintegration from which China must protect herself. Rates of credit expansion must be restricted, and the yuan be permitted to rise on the foreign exchanges. The change in policy emphasis from export markets towards increasing domestic consumption should be accelerated. In any event, China is the world’s dominant manufacturer, so she has a good degree of control over prices in international trade for consumer goods anyway. The prices of imported commodities and raw materials matter more today and rising dollar prices for commodities and energy can be countered by a higher exchange rate for the yuan. The state’s policy of least risk is to quietly divorce the Chinese economy from the dollar’s influence. In switching some of its trade into the yuan and other currencies, it has been doing this since the Lehman failure, which was another seminal moment in Chinese thinking. The cultural analysis is that America is now destroying its own currency towards a terminal event, an outcome forecast by economics professors in China’s Marxist universities over fifty years ago. The post-Mao ride, piggybacking on American capitalistic methods, is no longer tenable. The golden backstop Like the Marxist professors in the universities, China’s thinkers, such as Wang Huning and President Xi himself, always believed America to be politically and morally rudderless and would destroy itself. Presumably the election of an unpredictable Trump followed by a President Biden who appears to be in a geriatric decline is seen in Beijing as evidence that American society is indeed rudderless and imploding. It was against this likely event that in 1983 far-sighted Chinese strategists began to accumulate gold and to corner the word market for bullion. It would have been obvious to them that one day, dancing with the capitalist devils would become too dangerous and China’s future would have to be secured at the outset long before a capitalist collapse. Accordingly, the Regulations on the Control of Gold and Silver were promulgated on 15 June that year, appointing the People’s Bank (PBOC) with sole responsibility for managing China’s gold and silver while private ownership remained banned. The PBOC then began to acquire gold from foreign markets, a task made easier by the 1980-2002 bear market. Meanwhile, the government threw substantial resources into developing gold mining, and became the largest gold producer in the world by a substantial margin, overtaking South Africa, Russia, and the United States. State owned refineries took in doré from abroad, adding to the accumulation. It was only after the PBOC had accumulated sufficient bullion from imports and domestic production that she set up the Shanghai Gold Exchange in 2002 and permitted Chinese citizens to acquire gold. The government even ran advertising campaigns encouraging the purchase of gold, and since then, over 19,000 tonnes have been delivered into private sector ownership from the SGE’s vaults. Together with the total ban on exports of Chinese refined gold, the pre-2002 ban on private ownership while the state acquired sufficient bullion for its purposes, coupled with the subsequent encouragement to the public to do the same, China clearly regarded gold as her most important strategic asset. It has still not shown its hand, but given the likely amounts involved, to do so would risk destabilising the dollar-centric fiat currency world. Until it happens, we should assume that the 20,000-30,000 tonnes likely to have been accumulated in various state accounts since 1983 is an insurance policy against the failure of American capitalism and the world’s reserve currency. This brings us back to the Taiwan question. For China, the re-absorption of Taiwan may become a simpler matter when the capitalistic Americans are economically at their weakest and the dollar is collapsing. Taiwan itself might face up to this reality. A few steps to push America on its way may be tempting, such as selling down their holdings of US Treasuries (already in process) or disclosing a significantly higher level of gold reserves. The latter may wait until a dollar crisis really develops, which is now surely only a matter of a little time. Tyler Durden Sat, 10/23/2021 - 22:30.....»»

Category: personnelSource: nytOct 24th, 2021

Futures Slide On Stagflation Fears As 10Y Yields Spike

Futures Slide On Stagflation Fears As 10Y Yields Spike US index futures dropped after IBM and Tesla fell after their quarterly results, with investors turned cautious awaiting more reports to see the see the adverse impact of supply chain disruption and labor shortages on companies even as jitters remained over elevated inflation and the outlook for China’s property sector. The dollar reversed an overnight drop, while Treasuries fell pushing the 10Y yield to a 5-month high of 1.68%. At 745 a.m. ET, Dow e-minis were down 98 points, or 0.3%, S&P 500 e-minis were down 14 points, or 0.31%, and Nasdaq 100 e-minis were down 49.25 points, or 0.32%. In the premarket, Tesla fell 1% in premarket trading as it said on Wednesday its upcoming factories and supply-chain headwinds would put pressure on its margins after it beat Wall Street expectations for third-quarter revenue. AT&T rose 1% in pre-market trading after exceeding Wall Street’s expectations for profit and wireless subscriber growth. PayPal Holdings also climbed as it explores a $45 billion acquisition of social media company Pinterest Inc., in what could be the biggest technology deal of the year. Dow gained 1.1% after it posted a more than a five-fold jump in third-quarter profit as economic recovery boosted prices for chemicals. IBM plunged 4.7% after it missed market estimates for quarterly revenue as its managed infrastructure business suffered from a decline in orders. Some other notable premarket movers: Digital World Acquisition (DWAC US) surges 30% after the blank-check company agreed to merge with Trump Media & Technology. Former U.S. President Donald Trump says the new company plans to start a social media firm called Truth Social. Denny’s (DENN US) rises 1.4% as the restaurant chain is upgraded to buy from hold at Truist Securities, which sees upside to 3Q estimates, partly due to expanding operating hours. ESS Tech (GWH US) adds 4.6% as Piper Sandler says the stock offers a compelling entry point for investors seeking exposure to energy storage, initiating coverage at overweight. As Bloomberg notes, corporate results have tempered but not dissipated worries that cost pressures could slow the pandemic recovery. Among S&P 500 companies that have disclosed results, 84% have posted earnings that topped expectations, a hair away from the best showing ever. Yet, the firms that surpassed profit forecasts got almost nothing to show for it in the market. And misses got punisheddearly, by the widest margin since Bloomberg started tracking the data in 2017. European equities faded early losses but remain in small negative territory. Euro Stoxx 50 is 0.4% lower having dropped ~0.8% at the open. IBEX lags peers. Miners led a retreat in Europe’s Stocks 600 index, while industrial commodities including copper and iron ore reversed earlier gains; retail and banks were also among the weakest sectors. Concerns about the inflationary impact of higher prices have risen in recent days, with everyone from Federal Reserve officials to Tesla weighing in on cost pressures. Unilever Plc pushed rising raw material costs onto consumers, increasing prices by the most in almost a decade. Meanwhile, Hermes International said sales surged last quarter, showing resilience compared to rival luxury-goods makers. European autos dropped after Volvo Group warned that the global semiconductor shortage and supply-chain challenges will continue to cap truckmaking. Here are some of the biggest European movers today: Soitec shares gain as much as 7.3% in Paris, the stock’s best day since June, after reporting 2Q results and raising its full- year sales forecast. BioMerieux shares rise as much as 5.9%. Sales in 3Q were well ahead of expectations on strong U.S. demand for BioFire respiratory panels, Jefferies (hold) writes in a note. Randstad shares rise as much as 4.7%, the most intraday since Dec. 2020, with RBC (sector perform) saying the staffing firm’s 3Q earnings topped estimates. Sodexo shares rise as much as 4.8% after activist investor Sachem Head took a stake in the French catering co., saying the investment is passive and that Sodexo is going “activist on itself.” Zur Rose shares fall as much as 8.1% after the Swiss online pharmacy cut its growth guidance and posted 3Q sales that Jefferies says missed consensus expectations. Nordic Semi shares drop as much as 7% before recovering some losses, after results; Mirabaud Securities says any weakness in the stock is a “great buying opportunity.” Eurofins shares drop as much as 7.5%, the most in nearly a year, after the laboratory-testing company left its 2021 Ebitda and free cash flow guidance unchanged, which Morgan Stanley says implies a lower Ebitda margin versus previous guidance. Bankinter shares fell as much as 6.6%, most intraday since December. Jefferies highlighted the weaker trend for the Spanish lender’s 3Q net interest income. Earlier in the session, Asian equities fell in late-afternoon trading as investors sold Japanese and Hong Kong-listed tech shares, which helped trigger broader risk aversion among investors. Ailing China Evergrande Group sank on a worsening cash squeeze, while other developers rallied after regulators said their funding needs are being met. The MSCI Asia Pacific Index slid as much as 0.8%, with Japanese equities slumping by the most in over two weeks as the yen -- typically seen as a safe haven -- strengthened against the dollar, likely boosted by technical factors. Toyota Motor and Alibaba were the biggest drags on the regional benchmark as higher bond yields weighed on sentiment toward the tech sector. The story “shapes up to be worries about higher inflation and the follow-on policy response,” said Ilya Spivak, head of Greater Asia at DailyFX. Bucking the downtrend were Chinese developers, which shrugged off China Evergrande Group’s scrapping of a divestment plan and climbed after regulators said risks in the real estate market are controllable and reasonable funding needs are being met. China was one of the region’s top-performing equity markets.  Still, Asian stocks continue to feel pressure from higher U.S. bond yields as the 10-year rate surpassed 1.6%. In addition, earlier optimism about earnings is being muted by the outlook for inflation and supply-chain bottlenecks. Chinese growth, global supply constraints and inflation are “acting as a bit of a brake on markets,” said Shane Oliver, head of investment strategy & chief economist at AMP Capital. However, with U.S. equities trading near a record high, investors are “a bit confused,” he said. Japanese equities fell by the most in over two weeks, extending losses in afternoon trading as the yen strengthened against the dollar. Electronics and auto makers were the biggest drags on the Topix, which fell 1.3%, with all 33 industry groups in the red. Tokyo Electron and Fast Retailing were the largest contributors to a 1.9% loss in the Nikkei 225. S&P 500 futures and the MSCI Asia Pacific Index similarly extended drops. “There has been a general turn in equity market sentiment evident by the afternoon decline in U.S. equity futures and main regional equity indexes,” said Rodrigo Catril, senior foreign-exchange strategist at National Australia Bank Ltd. “The reversal in risk-sensitive FX pairs like the AUD is reflecting this u-turn.” The Japanese currency gained 0.2% to 114.05 per U.S. dollar, while the Australian dollar weakened. The yen is still down 9.5% against the greenback this year, the worst among major currencies. Yen Faces Year-End Slump as U.S. Yield Premium Spikes With Oil The gain in the yen on Thursday probably followed technical indicators suggesting the currency was oversold and positioning seen as skewed, said Shusuke Yamada, head of Japan foreign exchange and rates strategy at Bank of America in Tokyo. The rally may be short-lived, as rising oil prices are expected to worsen Japan’s terms of trade, and monetary policies between Japan and overseas are likely to diverge further In FX, the Bloomberg Dollar Spot Index reversed an earlier loss to rise as much as 0.2% as the greenback advanced versus all its Group- of-10 peers apart from the yen; risk-sensitive currencies, led by the New Zealand dollar, were the worst performers. The pound weakened against the dollar and was little changed versus the euro into the European session. U.K. government borrowing came in significantly lower than official forecasts, but a surge in debt costs sent a warning to the government ahead of the budget next week. The U.K.’s green gilt may price today, subject to market conditions, after being delayed earlier this week. The Australian and New Zealand dollars reversed intraday gains on sales against the yen following losses in regional stock indexes. A kiwi bond auction attracted strong demand. The yen headed for a second session of gains as a selloff in Japanese equities fuels haven bids. Government bonds consolidated. In rates, the Treasury curve flattened modestly as yields on shorter-dated notes inched up, while those on longer ones fell; the bund curve shifted as yields rose about 1bp across the curve. Yields were richer by less than 1bp across long-end of the curve, flattening 2s10s, 5s30s spreads by ~1bp each; 10-year yields rose to a 5 month high of 1.68%, outperforming bunds by 2bp and gilts by 4bp on the day. Long end USTs outperform, richening ~2bps versus both bunds and gilts. Peripheral spreads tighten slightly. U.S. breakevens are elevated ahead of $19b 5Y TIPS new issue auction at 1pm ET. In commodities, oil slipped from 7 year highs, falling amid a broad-based retreat in industrial commodities, though trader focus was glued to a surging market structure as inventories decline in the U.S.; Oil’s refining renaissance is under threat from the natural gas crisis; American drivers will continue to face historically high fuel prices. WTI was lower by 0.5% to trade near $83 while Brent declined 0.8% before finding support near $85. Spot gold is range-bound near $1,785/oz. Base metals are mixed. LME nickel and copper are deep in the red while zinc gains 1.5%.  Bitcoin was volatile and dropped sharply after hitting an all time high just above $66,500. Looking at the day ahead now, and data releases from the US include the weekly initial jobless claims, existing home sales for September, the Conference Board’s leading index for September, and the Philadelphia Fed’s business outlook for October. Central bank speakers will include the Fed’s Waller and the ECB’s Visco, while the Central Bank of Turkey will be making its latest monetary policy decision. Otherwise, earnings releases include Intel, Danaher, AT&T and Union Pacific. Market Snapshot S&P 500 futures down 0.3% to 4,515.25 STOXX Europe 600 down 0.2% to 469.02 MXAP down 0.7% to 199.61 MXAPJ down 0.4% to 659.34 Nikkei down 1.9% to 28,708.58 Topix down 1.3% to 2,000.81 Hang Seng Index down 0.5% to 26,017.53 Shanghai Composite up 0.2% to 3,594.78 Sensex down 1.1% to 60,560.47 Australia S&P/ASX 200 little changed at 7,415.37 Kospi down 0.2% to 3,007.33 Brent Futures down 1.0% to $84.98/bbl Gold spot up 0.2% to $1,785.09 U.S. Dollar Index up 0.11% to 93.67 German 10Y yield up 0.7 bps to -0.119% Euro down 0.1% to $1.1639 Top Overnight News from Bloomberg China Evergrande Group scrapped talks to offload a stake in its property-management arm and said real estate sales plunged about 97% during peak home-buying season, worsening its liquidity crisis on the eve of a dollar-bond deadline that could tip the company into default. Its shares plunged as much as 14% on Thursday. China’s goods imports from the U.S. have only reached about 53% of the $200 billion worth of additional products and services it promised to buy under the trade deal signed last year, far behind its purchasing target. Signs that policy makers are accelerating toward an interest-rate hike have traders fumbling around to figure out what that means for sterling. Money managers at Jupiter Asset Management and Aberdeen Asset Management turned neutral in recent days, following similar moves by Amundi SA and William Blair Investment Management. The price on eight out of 10 bonds sold in the first three quarters of this year by European investment-grade borrowers fell after issuance, wiping almost 23.5 billion euros ($27.3 billion) from portfolios. The Turkish lira is looking vulnerable as speculation grows that policy makers will cut interest rates again despite the deteriorating inflation outlook. Option traders see a more than 60% chance that the currency will weaken to an all-time-low of 9.50 per U.S. dollar over the next month, according to Bloomberg pricing. That’s the next key psychological threshold for a market trading largely in uncharted territory ahead of Thursday’s decision. A more detailed look at global markets courtesy of Newsquawk Asia-Pac indices traded somewhat mixed after the similar performance stateside where the broader market extended on gains in which the DJIA touched a fresh record high and the S&P 500 also briefly approached within 5 points of its all-time peak as attention remained on earnings, although the Nasdaq lagged with tech and duration-sensitive stocks pressured by higher longer-term yields. ASX 200 (+0.1%) was positive as Victoria state approaches the end of the lockdown at midnight and with the index led by outperformance in mining stocks and real estate. However, gains were capped amid weakness in energy as shares in Woodside Petroleum and Santos were pressured following their quarterly production results in which both posted a decline in output from a year ago, albeit with a jump in revenue due to the rampant energy prices, while Woodside also flagged a 27% drop in Wheatstone gas reserves. Nikkei 225 (-1.9%) felt the pressure from the pullback in USD/JPY and with focus shifting to upcoming elections whereby election consulting firm J.A.G Japan sees the LDP losing 40 seats but win enough to maintain a majority with a projected 236 seats at the 465-strong Lower House. Hang Seng (-0.5%) and Shanghai Comp. (+0.2%) were varied despite another respectable PBoC liquidity effort with the mood slightly clouded as Evergrande concerns persisted with Co. shares suffering double-digit percentage losses after it resumed trade for the first time in three weeks and after its deal to sell a stake in Evergrande Property Services fell through, while reports that Modern Land China cancelled its USD 250mln bond repayment plan on liquidity issues added to the ongoing default concerns although it was later reported that Evergrande secured a three-month extension on USD 260mln Jumbo Fortune bond which matured on October 3rd. Finally, 10yr JGBs traded flat with the underperformance in Japanese stocks helping government bonds overlook the pressure in global counterparts and continued losses in T-note futures following the weak 20yr auction stateside, although demand for JGBs was limited by the absence of BoJ purchases. Top Asian News China Vows to Keep Property Curbs, Evergrande Risk Seen Limited Abu Dhabi Funds Hunt for Asian Unicorns Ahead of IPOs: ECM Watch Biden’s Pick for China Envoy Draws Sharp Lines With Beijing Carlyle, KKR Among Firms Said to Mull $2 Billion Tricor Bid Bourses in Europe have held onto the downside bias seen since the cash open, but with losses less pronounced (Euro Stoxx 50 -0.4%; Stoxx 600 -0.2%) despite a distinct lack of news flow in the EU morning, and as Chinese property woes weighed on APAC markets, but with earnings seasons picking up globally. US equity futures are also softer with modest and broad-based losses ranging from 0.2-0.3%. Back to Europe, the Netherland’s AEX (+0.3%) outperforms as Unilever (+3.3%) also lifts the Personal & Household Goods sector (current outperformer) following its earnings, whereby underlying sales growth of +2.5%, as +4.1% price growth offset a -1.5% decline in volumes, whilst the group noted: "Cost inflation remains at strongly elevated levels, and this will continue into next year". The AEX is also lifted by Randstad (+4.5%) post earnings after underlying EBITDA topped forecasts. Sectors in Europe are mixed with a slight defensive bias. On the downside, there is clear underperformance in Basic Resources as base metals pull back, whilst Oil & Gas names similarly make their way down the ranks. In terms of individual movers. ABB (-5%) resides at the foot of the SMI (+0.2%) as the group sees revenue growth hampered by supply constraints. Nonetheless, flows into Food & Beverages supports heavy-weight Nestle (+1.0%) which in turn supports the Swiss index. Other earnings-related movers include Barclays (-0.4%), SAP (+1.5%), Carrefour (+1.5%), Nordea (-1.8%), and Swedbank (+2.7%). Top European News Volvo Warns More Chip Woes Ahead Will Curtail Truck Production Hermes Advances After Dispelling Worries on China Demand Stagflation Risk Still Means Quick Rate Hikes for Czech Banker Weidmann Exit Could Pave Way for Bundesbank’s First Female Chief In FX, the Dollar has regained some composure across the board amidst a downturn in broad risk sentiment, but also further retracement in US Treasuries from bull-flattening to bear-steepening in wake of an abject 20 year auction that hardly bodes well for the announcement of next week’s 2, 5 and 7 year issuance, or Usd 19 bn 5 year TIPS supply due later today. In index terms, a firmer base and platform around 94.500 appears to be forming between 93.494-701 parameters ahead of initial claims, the Philly Fed and more housing data as the focus switches to existing home sales, while latest Fed speak comes via Daly and Waller. However, the DXY and Greenback in general may encounter technical resistance as the former eyes upside chart levels at 93.884 (23.6% Fib of September’s move) and 93.917 (21 DMA), while a major basket component is also looking in better shape than it has been of late as the Yen reclaims more lost ground from Wednesday’s near 4 year lows to retest 114.00 in the run up to Japanese CPI tomorrow. NZD/AUD/NOK - No real surprise to see the high beta Antipodeans bear the brunt of their US rival’s revival and the Kiwi unwind some of its post-NZ CPI outperformance irrespective of the nation’s FTA accord in principle with the UK, while the Aussie has also taken a deterioration in NAB quarterly business business confidence into consideration. Nzd/Usd is back below 0.7200 and Aud/Usd has retreated through 0.7500 after stalling just shy of 0.7550 before comments from RBA Governor Lowe and the flash PMIs. Elsewhere, the Norwegian Crown has largely shrugged off the latest Norges Bank lending survey showing steady demand for credit from households and non-financial institutions, but seems somewhat aggrieved by the pullback in Brent from just above Usd 86/brl to under Usd 85 at one stage given that Eur/Nok is hovering closer to the top of a 9.7325-9.6625 range. EUR/CHF/GBP/CAD - All softer against their US counterpart, albeit to varying degrees as the Euro retains a relatively secure grip around 1.1650, the Franc straddles 0.9200, Pound pivots 1.3800 and Loonie tries to contain declines into 1.2350 having reversed from yesterday’s post-Canadian CPI peaks alongside WTI, with the spotlight turning towards retail sales on Friday after a passing glance at new housing prices. SEK/EM - Some traction for the Swedish Krona in a tight band mostly sub-10.0000 vs the Euro from a fall in the nsa jobless rate, but the Turkish Lira seems jittery following a drop in consumer confidence and pre-CBRT as another 100 bp rate cut is widely expected, and the SA Rand is on a weaker footing ahead of a speech by the Energy Minister along with Eskom’s CEO. Meanwhile, the Cnh and Cnh have lost a bit more momentum against the backdrop of ongoing stress in China’s property market, and regardless of calls from the Commerce Ministry for the US and China to work together to create conditions for the implementation of the Phase One trade deal, or fees on interbank transactions relating to derivatives for SMEs being halved. In commodities, WTI and Brent Dec futures have gradually drifted from the overnight session peaks of USD 83.96/bbl and USD 86.10/bbl respectively. The downturn in prices seems to have initially been a function of risk sentiment, with APAC markets posting losses and Europe also opening on the back foot. At the time of writing, the benchmark resides around under USD 83/bbl for the former and sub-USD 85/bbl for the latter. Participants at this point are on the lookout for state interventions in a bid to keep prices from running. Over in China, it’s worth keeping an eye on the COVID situation – with China's Beijing Daily stating "citizens and friends are not required to leave the country, do not gather, do not travel or travel to overseas and domestic medium- and high-risk areas", thus translating to lower activity. That being said, yesterday’s commentary from the Saudi Energy Minister indicated how adamant OPEC is to further open the taps. UBS sees Brent at USD 90/bbl in December and March, before levelling off to USD 85/bbl for the remainder of 2022 vs prev. USD 80/bbl across all timelines. Elsewhere, spot gold and silver are relatively flat around USD 1,785 and USD 22.25 with nothing new nor interesting to report thus far, and with the precious metals moving in tandem with the Buck. Base metals meanwhile are softer across the board as global market risk remains cautious, with LME copper trading on either side of USD 10k/t. US Event Calendar 8:30am: Oct. Continuing Claims, est. 2.55m, prior 2.59m 8:30am: Oct. Initial Jobless Claims, est. 297,000, prior 293,000 8:30am: Oct. Philadelphia Fed Business Outl, est. 25.0, prior 30.7 9:45am: Oct. Langer Consumer Comfort, prior 51.2 10am: Sept. Existing Home Sales MoM, est. 3.6%, prior -2.0% 10am: Sept. Leading Index, est. 0.4%, prior 0.9% 10am: Sept. Home Resales with Condos, est. 6.09m, prior 5.88m DB's Jim Reid concludes the overnight wrap I watched the first of the new series of Succession last night. I like this program as it makes me think I’ve got a totally normal and non-dysfunctional family. It’s a good benchmark to have. There are few dysfunctional worries in equities at the moment as even with the pandemic moving back onto investors’ radars, the resurgence in risk appetite showed no sign of diminishing yesterday, with the S&P 500 (+0.37%) closing just a whisker below early September’s record high. It’s an impressive turnaround from where the narrative was just a few weeks ago, when the index had fallen by over -5% from its peak as concerns from Evergrande to a debt ceiling crunch set the agenda. But the removal of both risks from the immediate horizon along with another round of positive earnings reports have swept away those anxieties. And this has come even as investors have become increasingly sceptical about the transitory inflation narrative, as well as fresh signs that Covid-19 might be a serious issue once again this winter. Starting with the good news, US equities led the way yesterday as a number of global indices closed in on their all-time highs. As mentioned the S&P 500 rallied to close just -0.02% beneath its record, which came as part of a broad-based advance that saw over 75% of the index move higher. Elsewhere, the Dow Jones (+0.43%) also closed just below its all-time high back in August. After the close, Tesla fell short of revenue estimates but beat on earnings, despite materials shortages and port backlogs that have prevented production from reaching full capacity, a common refrain by now. Overall 17 out of 23 S&P 500 companies beat expectations yesterday, meaning that the US Q3 season beat tally is now 67 out of 80. Meanwhile in Europe, equities similarly saw advances across the board, with the STOXX 600 (+0.32%) hitting its highest level in over a month, as it moved to just 1.2% beneath its record back in August. For sovereign bonds it was a more mixed picture, with 10yr Treasury yields moving higher again as concerns about inflation continued to mount. By the close of trade, the 10yr yield had risen +2.0bps to 1.57%, which was driven by a +4.6bps increase in inflation breakevens to 2.60%, their highest level since 2012. That came as oil prices hit fresh multi-year highs after the US EIA reported that crude oil inventories were down -431k barrels, and gasoline inventories were down -5.37m barrels, which puts the level of gasoline inventories at their lowest since November 2019. That saw both WTI (+1.10%) and Brent crude (+0.87%) reverse their earlier losses, with WTI closing at a post-2014 high of $83.87/bbl, whilst Brent hit a post-2018 high of $85.82/bbl. Yields on 2yr Treasuries fell -1.0bps however, after Fed Vice Chair Quarles and President Mester joined Governor Waller in pushing back against the more aggressive path of Fed rate hikes that has recently been priced in. Even so however, money markets are still implying around 1.75 hikes in 2022, about one more hike than was priced a month ago. Separately in Europe, sovereign bonds posted a much stronger performance, with yields on 10yr bunds (-2.0bps), OATs (-2.6bps) and BTPs (-3.4bps) all moving lower. Overnight in Asia stocks are trading higher this morning with the Shanghai Composite (+0.46%), CSI (+0.35%) and KOSPI (+0.23%) all advancing, whilst the Hang Seng (-0.20%) and the Nikkei (-0.45%) have been dragged lower by healthcare and IT respectively. Meanwhile Evergrande Group (-12.60%) fell sharply in Hong Kong after news that it ended talks on the sale of a majority stake in its property services division to Hopson Development. And we’ve also seen a second day of sharp moves lower in Chinese coal futures (-11.0%) as the government is mulling measures to curb speculation. And there have also been a number of fresh Covid cases in China, with 21 new cases reported yesterday, as the city of Lanzhou moved to shut down schools in response. Elsewhere in Asia, with just 10 days now until Japan’s general election, a poll by Kyodo News found that the ruling Liberal Democratic Party would likely maintain its parliamentary majority. Futures markets are indicating a slow start for markets in the US and Europe, with those on the S&P 500 (-0.09%) and the DAX (-0.05%) both pointing lower. As we’ve been mentioning this week, the Covid-19 pandemic is increasingly returning onto the market radar, with the number of global cases having begun to tick up again. This has been reflected in a number of countries tightening up restrictions, and yesterday saw Russian President Putin approve a government proposal that October 31 to November 7 would be “non-working days”. In the Czech Republic, it was announced that mask-wearing would be compulsory in all indoor spaces from next week, and New York City moved to mandate all municipal workers to get vaccinated, with no alternative negative test result option now available. In Singapore, it was announced that virus restrictions would be extended for another month, which includes a limit on outdoor gatherings to 2 people and a default to work from home. Finally in the UK, the weekly average of cases has risen above 45k per day, up from just under 30k in mid-September. There is lots of talk about the need to put in place some additional restrictions but it feels we’re a fair way from that in terms of government-mandated ones. From central banks, it was announced yesterday that Bundesbank president Weidmann would be stepping down on December 31, leaving his position after just over a decade. He said that he was leaving for personal reasons, and in his letter to the Bundesbank staff, said that “it will be crucial not to look one-sidedly at deflationary risks, but not to lose sight of prospective inflationary dangers either.” It’ll be up to the next government to decide on the new appointment. Staying on Europe, our economists have just released an update to their GDP forecasts, with downgrades to their near-term expectations as supply shortages for goods and energy have created headwinds for the recovery. They now see 2021 growth at +4.9% (down -0.1pp from their previous forecast), whilst 2022 has been downgraded to 4.0% (-0.5pp). Alongside that, they’ve also included the latest oil and gas price movements into their inflation forecasts, and now project Euro Area 2022 HICP at 2.3%, although they don’t see this above-target inflation persisting, with their 2023 HICP forecast remaining unchanged at 1.5%. You can read the full note here. Speaking of inflation, we had a couple of inflation releases yesterday, including the UK’s CPI data for September, which came in slightly beneath expectations at 3.1% (vs. 3.2% expected), whilst core CPI also fell to 2.9% vs. 3.0% expected). As we discussed earlier this week though, there was some downward pressure from base effects, since in September 2020 we had a recovery in restaurant and cafe prices after the government’s Eat Out to Help Out scheme in August ended, and that bounce back has now dropped out of the annual comparisons. UK inflation will rise a fair amount in the months ahead. Otherwise, we also had the CPI release from Canada for September, which rose to 4.4% (vs. 4.3% expected), which is its highest reading since February 2003. Finally, bitcoin hit an all-time high, with the cryptocurrency up +2.92% to close at a record $65,996, which was slightly down from its intraday peak of $66,976. Bitcoin has surged over recent weeks, and as it stands it’s up +49.3% so far this month at time of writing, which would mark its strongest monthly performance so far this year. This latest move has occurred along with the first trading of options on Bitcoin-linked ETFs, which the US first listed the day prior. To the day ahead now, and data releases from the US include the weekly initial jobless claims, existing home sales for September, the Conference Board’s leading index for September, and the Philadelphia Fed’s business outlook for October. Central bank speakers will include the Fed’s Waller and the ECB’s Visco, while the Central Bank of Turkey will be making its latest monetary policy decision. Otherwise, earnings releases include Intel, Danaher, AT&T and Union Pacific. Tyler Durden Thu, 10/21/2021 - 08:20.....»»

Category: blogSource: zerohedgeOct 21st, 2021

Futures Slide On Renewed China Slowdown, Rate Hike Fears

Futures Slide On Renewed China Slowdown, Rate Hike Fears US equity futures and world shares drifted lower following poor Chinese macro data which saw the country's GDP slide to a weaker than expected 4.9%, and as surging energy prices and inflation reinforced bets that central banks will be forced to react to rising inflation and hike rates faster than expected. Calls by China’s President Xi Jinping on Friday to make progress on a long-awaited property tax to help reduce wealth gaps also soured the mood. With WTI crude rising to a seven-year high, and Brent back over $85, investors remain concerned that living costs will be driven higher. The economic recovery also remains uneven with China’s gross domestic product slowing more than expected in the third quarter, increasing aversion to riskier assets. The dollar rose against all of its Group-of-10 peers as concerns about an acceleration in inflation damped risk appetite, while bircoin traded above $61K and just shy of an all time high ahead of the launch of the Proshares Bitcoin ETF on Tuesday. An MSCI gauge of global stocks was down 0.1% by 0808 GMT as losses in Asia and a weak open in Europe erased part of the gains seen last week on a strong start to the earnings season. U.S. stock futures were also lower with S&P 500 e-minis last down 0.2%, while Dow and Nasdaq e-minis were both down 0.3%. China’s gross domestic product grew 4.9% in the July-September quarter from a year earlier, its weakest pace since the third quarter of 2020. The world’s second-largest economy is grappling with power shortages, supply bottlenecks, sporadic COVID-19 outbreaks and debt problems in its property sector. Additionally, industrial output and fixed investment also missed expectations, while retail sales beat modestly (more here). Not even the latest attempt by China to ease Evergrande contagion fears was enough to offset worries about China's economy: on Sunday, PBOC Governor Yi Gang said authorities can contain risks posed to the Chinese economy and financial system from the struggles of China Evergrande Group. Because of course he will say that. Oil prices extended a recent rally amid a global energy shortage with U.S. crude touching a seven-year high while Brent was set to surpass its 2018 highs just above $86, as Russia kept a tight grip on Europe’s energy market, opting against sending more natural gas to the continent even after President Vladimir Putin said he was prepared to boost supplies. “The lingering energy crisis, while benefiting miners and other oil & gas related stocks, is otherwise weighing on the overall sentiment,” said ActivTrades’ Pierre Veyret. Investors will stay focused on macro news this week with major Chinese and U.S. releases as well as new monetary policy talks from Jerome Powell, he said. Investors continue to grapple with worries that energy shortages and supply-chain disruptions will drive up living costs in most economies. At the same time, the recovery remains patchy and central bankers are inching closer to paring back stimulus. U.S. consumer sentiment fell unexpectedly in early October, but retail sales advanced. “We are starting to see some cracks in the transitory narrative that we’ve been hearing for quite some time,” Meera Pandit, global market strategist at J.P. Morgan Asset Management, said on Bloomberg Radio. “Rates will continue to ground higher from where we are. But I don’t think from a Fed perspective, when you think about the short end of the curve, that they are going to move much earlier than 2023. They are going to be a little bit more patient than the market expects right now.” And then there were rates: the global bond selloff gathered pace, with U.K. yields surging after Bank of England Governor Andrew Bailey warned on the need to respond to price pressures. Rate-hike bets have also picked up in the U.S., Australia and New Zealand, where inflation accelerated to the fastest pace in 10 years. Ten-year Treasury yields extended a climb , rising as high as 1.62%. Mohammed El-Erian, the chief economic adviser at Allianz SE and a Bloomberg columnist, said investors should prepare for increased market volatility if the Federal Reserve pulls back on stimulus measures set in motion by the Covid-19 pandemic. On the other side of the argument, Goldman's flow trading desk said odds of a November meltup are rising as a result of a relentless appetite for stocks and an upcoming surge in stock buybacks. In any case, Virgin Galactic Holdings Inc. shares fell 3% in U.S. premarket, extending losses from Friday that came after the firm pushed back the start of commercial flights further into next year after rescheduling a test flight. Here are some of the other notable U.S. pre-movers today: Baidu (BIDU US) shares erased earlier losses and climbed as much as 4.3% in Hong Kong, as China debates rules to make hundreds of millions of articles on Tencent’s WeChat messaging app available via search engines like Baidu’s. Crypto-related stocks in action as Bitcoin leaps as much as 5.3% and is just shy of a fresh six- month high. Riot Blockchain (RIOT US), Marathon Digital (MARA US) and Coinbase (COIN US) are all up Tesla (TSLA US) shares rise 0.2% in premarket trading Monday, poised for 50% rally from a March 8 low, ahead of its third-quarter results on Wednesday Dynavax (DVAX US) shares rise as much as 10% in U.S. pretrading hours after the biopharmaceutical company announced that Valneva reported the trial of inactivated, adjuvanted Covid-19 vaccine candidate VLA2001 met its co-primary endpoints Disney (DIS US) drops in premarket trading after Barclays downgrades to equal-weight as the company faces a “tough” task to get to its long-term streaming subscription guidance NetApp (NTAP US) slips 2.2% in premarket trading after Goldman Sachs analyst Rod Hall cut the recommendation on NetApp Inc. to sell from neutral European stocks traded on the back foot from the open, with the benchmark Stoxx 600 Index down 0.4%, led by losses in retail stocks. The Euro Stoxx 50 dropped as much as 0.9%, FTSE 100 outperforms slightly. Mining stocks were among Europe's only gainers thanks to the ongoing metals rally: the Stoxx Europe 600 basic resources sub-index climbs for a third day for the first time since early September as the record rally of base metals is extended. The gauge rose 0.6%, outperforming main benchmark which trades 0.4% lower. Notable movers: Glencore +1.2%; BHP +1%; Norsk Hydro +2.5%; ArcelorMittal +0.9% Rio Tinto +0.3%. Offsetting these gains, European luxury stocks slipped after a Chinese Communist Party journal published a speech of President Xi Jinping that includes advancing legislation on property taxes. Here are some of the biggest European movers today: Playtech shares rise as much as 59% in London after the British gambling software developer agreed to be bought by Australia’s Aristocrat for $3.7 billion. Valneva SE shares rise as much as 42% as its experimental Covid-19 vaccine elicited better immunity than AstraZeneca Plc’s shot in a clinical trial that will pave the way for regulatory submissions. Shares of hydraulics manufacturer Concentric rise as much as 14%, the most since April 2020, after Danske Bank upgraded the stock to buy from hold, calling the company a strong performer in a difficult market. THG shares jump as much 12%, most since May 11, after founder and CEO Matthew Moulding confirmed his intention to cancel his special share rights. The removal of the special share points to the e-commerce company’s “willingness to engage on shareholder concerns,” according to Jefferies. Rational AG shares rise as much as 6.1%, the most since Aug. 5, after the German kitchen machinery maker is upgraded to buy from hold at Berenberg, which considers the shares “inexpensive” despite stretched multiples. Atrium European Real Estate share rises as much as 7.6% to the highest since March 2020 after controlling shareholder Gazit Globe raises the offer price to EU3.63 per Atrium share from EU3.35. Earlier in the session, Asian equities fell, putting them on track to snap a three-day rally, as China’s economic growth slowed and prospects of higher bond yields weighed on some tech shares. The MSCI Asia Pacific Index fell as much as 0.4%, with tech and consumer staples shares setting the pace for declines. TSMC and Sony Group were among the biggest drags. Official data showed that China’s economy weakened in the third quarter amid tighter restrictions on the property market and China Evergrande Group’s debt crisis. For Asia stock traders, the concerns about China are adding to persistent inflation worries and energy shortages, which are sending bond yields higher. While inflation worries are “alive and well,” Asian markets will be predominantly focused on China data today, Jeffrey Halley, senior market analyst at Oanda Asia Pacific, wrote in a note. The weak data print “will lift expectations of an imminent PBOC RRR rate cut,” he added. China’s benchmark underperformed as the country explored property- and consumption tax-related changes and international funds sold shares of Kweichow Moutai Co., the country’s largest stock by market value. Tencent, Meituan and Alibaba pared losses prompted by the Chinese government saying it will introduce more regulations on the tech sector. China is considering asking media companies from Tencent Holdings Ltd. to ByteDance Ltd. to let rivals access and display their content in search results, according to people familiar with the matter. India’s Sensex index bucked the regional trend and is on track to rise for the seventh day, the longest such streak since January, helped by easy money. Japanese equities declined, paring last week’s rally, weighed down by losses in electronics makers. The Topix dipped 0.2%, following a 3.2% gain last week. The Nikkei 225 fell 0.2%, with M3 Inc. and KDDI the biggest drags. Almost 30% of respondents to a Kyodo weekend poll said they plan to vote for the ruling Liberal Democratic Party in the proportional representation section of Japan’s Oct. 31 election. U.K. rates steal the limelight amid a violent selloff that saw 2y gilt yields rise as much as 17bps to trade close to 0.75%. Weekend comments from BOE’s Bailey triggered a snap lower in short-sterling futures and bear-flattening across the gilt curve. MPC-dated OIS rates price in ~20bps of hiking by the November meeting. Bunds and Treasuries follow gitls lower, peripheral spreads widen to core with Italy underperforming. Australian stocks closed higher as miners and banks advanced. The S&P/ASX 200 index rose 0.3% to close at 7,381.10, led by miners and banks. Nickel Mines surged after a subsidiary signed a limonite ore supply agreement with PT Huayue Nickel Cobalt. Domino’s was among the worst performers, closing at its lowest since Aug. 17. In New Zealand, the S&P/NZX 50 index fell 0.1% to 12,998.51. In FX, the Bloomberg Dollar Spot Index advanced as the dollar traded higher versus all of its Group-of-10 peers Traders pulled forward rate- hike bets after BoE governor Bailey said the central bank “will have to act” on inflation. U.K. money markets now see 36 basis points of BoE rate increases in December and are pricing 15 basis points of tightening next month. Traders are also now betting the BoE’s key rate will rise to 1% by August, from 0.1% currently. The euro struggled to recover after falling below the $1.16 handle in the Asian session; money markets are betting the ECB will hike the deposit rate to -0.4% in September as expectations for global central-bank policy tightening gather pace. Resilience in the spot market and a divergence with rate differentials in the past sessions has resulted in a flatter volatility skew for the euro. Commodity-linked currencies such as the Australian dollar and the Norwegian krone underperformed after Chinese data including third-quarter growth and September factory output trailed economists’ estimates. The kiwi rose to a one-month high versus the dollar, before giving up gains, and New Zealand’s bond yields rose across the curve after 3Q annual inflation rate surged, beating estimates. The yen steadied around a three-year low as U.S. yields extended their rise in Asian trading; the Japanese currency still held up best against the dollar among G-10 currencies, after performing worst last week. In rates, treasuries were under pressure led by belly of the curve as rate-hike premium continues to increase in global interest rates. Yields, though off session highs, remain cheaper by nearly 5bp in 5-year sector; 2s5s30s fly topped at -12.5bp, cheapest since 2018; 10-year is up 2.8bp around 1.60% vs 3.4bp increase for U.K. 10-year. Belly-led losses flattened U.S. 5s30s by as much as 5.4bp to tightest since April 2020 at around 86.1bp; U.K. 5s30s curve is flatter by ~8bp after its 5-year yield rose as much as 14bp. Gilts led the move, with U.K. 2-year yield climbing as much as 16.8bp to highest since May 2019 as money markets priced in more policy tightening after Governor Andrew Bailey said the Bank of England “will have to act” on inflation. With latest moves, U.S. swaps market prices in two Fed hikes by the end of 2022. In commodities, WTI rose 1%, trading just off session highs near $83.20; Brent holds above $85. Spot gold drifts lower near $1,762/oz. Most base metals are in the green with LME lead and tin outperforming. Looking at today's calendar, we have industrial production, US September industrial production, capacity utilisation, October NAHB housing market index. Fed speakers include Quarles, Kashkari. Market Snapshot S&P 500 futures down 0.2% to 4,451.75 STOXX Europe 600 down -1.6% to 467.76 MXAP down 0.2% to 198.11 MXAPJ little changed at 650.02 Nikkei down 0.1% to 29,025.46 Topix down 0.2% to 2,019.23 Hang Seng Index up 0.3% to 25,409.75 Shanghai Composite down 0.1% to 3,568.14 Sensex up 1.0% to 61,918.22 Australia S&P/ASX 200 up 0.3% to 7,381.07 Kospi down 0.3% to 3,006.68 Brent Futures up 0.9% to $85.65/bbl Gold spot down 0.3% to $1,762.70 U.S. Dollar Index up 0.17% to 94.10 German 10Y yield rose 3.5 bps to -0.132% Euro down 0.1% to $1.1586 Brent Futures up 0.9% to $85.65/bbl Top Overnight News from Bloomberg Germany’s prospective ruling coalition is targeting about 500 billion euros ($580 billion) in spending over the coming decade to address climate change and will seek loopholes in constitutional debt rules to raise the financing The ECB is exploring raising its limit on purchases of debt issued by international bodies such as the European Union from the current cap of 10%, the Financial Times reported, citing four ECB governing council members The ECB should keep some of the flexibility embedded in its pandemic bond-buying program for post-crisis stimulus measures, Governing Council member Ignazio Visco said People’s Bank of China Governor Yi Gang said authorities can contain risks posed to the Chinese economy and financial system from the struggles of China Evergrande Group A more detailed look at global markets courtesy of Newsquawk Asia-Pac stocks traded cautiously after disappointing Chinese GDP and Industrial Production data, while inflationary concerns lingered after the recent firmer than expected US Retail Sales data, a continued rally in oil prices and with New Zealand CPI at a decade high. Nonetheless, the ASX 200 (+0.1%) bucked the trend on reopening optimism with curbs in New South Wales to be further eased after having fully vaccinated 80% of the adult population and with the Victoria state capital of Melbourne set to lift its stay-at-home orders this week. Furthermore, the gains in the index were led by outperformance in the top-weighted financials sector, as well as strength in most mining names aside from gold miners after the precious metal’s retreat from the USD 1800/oz level. Nikkei 225 (-0.3%) was subdued after a pause in the recent advances for USD/JPY and with criticism of Japan after PM Kishida sent an offering to the controversial war shrine which sparked anger from both China and South Korea. Hang Seng (-0.5%) and Shanghai Comp. (-0.4%) were subdued after Chinese Q3 GDP data missed expectations with Y/Y growth at 4.9% vs exp. 5.2% and Industrial Production for September fell short of estimates at 3.1% vs exp. 4.5%, while the beat on Retail Sales at 4.4% vs exp. 3.3% provided little consolation. There was plenty of focus on China’s property sector with PBoC Governor Yi noting authorities can contain risks posed to the Chinese economy and financial system from the struggles of Evergrande, and with its unit is said to make onshore debt payments due tomorrow. However, attention remains on October 23rd which is the end of the grace period for its first payment miss that would officially place the Co. in default and it was also reported on Friday that China Properties Group defaulted on notes worth USD 226mln. Finally, 10yr JGBs were lower amid spillover selling from T-notes which were pressured after the recent stronger than expected Retail Sales data and higher oil prices boosted the inflation outlook, with demand for JGBs is also hampered amid the absence of BoJ purchases in the market today. Top Asian News Tesla Shares Roaring Back, Set for 50% Gain From March Lows Kishida’s Offering to Japan War Shrine Angers Neighbors Baidu Jumps as China Said to Weigh More Access to WeChat Content AirAsia X Proposes Paying Creditors 0.5% of $8 Billion Owed European equities (Eurostoxx 50 -0.7%; Stoxx 600 -0.4%) have kicked the week off on the backfoot as market participants digest disappointing Chinese GDP metrics, a continued rally in energy prices and subsequent inflationary concerns which has seen markets price in more aggressive tightening paths for major global central banks. Overnight, Chinese Q3 GDP data missed expectations with Y/Y growth at 4.9% vs exp. 5.2% and Industrial Production for September fell short of estimates at 3.1% vs exp. 4.5%, while the beat on Retail Sales at 4.4% vs exp. 3.3% provided little consolation. Stateside, index futures have conformed to the downbeat tone with the ES softer to the tune of -0.3%, whilst the RTY narrowly lags with losses of 0.4%. In a note this morning, JP Morgan has flagged that investor sentiment remains that “the upcoming reporting season will be challenging, given the combination of the activity slowdown, significant supply distortions impacting volumes, and the energy price acceleration that is seen to be hurting profit margins and consumer disposable incomes”. That said, the Bank is of the view that investors are likely braced for such disappointments. In Europe, sectors are mostly lower with Retail names lagging post-Chinese GDP as Kering (accounts for 28.7% of the Stoxx 600 Retail sector) sits at the foot of the CAC with losses of 3.2%; other laggards include LVMH (-2.7%) and Hermes (-2.3%). To the upside, Banking names are firmer and benefitting from the more favourable yield environment, whilst Basic Resources and Oil & Gas names are being supported by price action in their respective underlying commodities. In terms of individual movers, THG (+7.6%) sits at the top of the Stoxx 600 after confirming that it intends to move its listing to the 'premium segment' of the LSE in 2022; as part of this, CEO & Executive Chairman Moulding will surrender his 'founders share' next year. Finally, Umicore (-4.5%) sits at the foot of the Stoxx 600 after cutting its FY21 adj. EBIT outlook. Top European News Traders Ramp Up U.K. Rate-Hike Bets on Bailey Inflation Warning Nordea Equity Research Hires Pareto Analyst for Tech Team ECB’s Visco Says Flexible Policy Should Remain Part of Toolkit Scholz Coalition Eyes $580 Billion in Spending on German Reboot In FX, the broader Dollar and index has waned off its 94.174 pre-European cash open high but remains underpinned above 94.000 by risk aversion and firmer yields, with the US 10yr cash now hovering around 1.60%. Stateside, US President Biden confirmed that the reconciliation package will likely be less than USD 3.5trln, although this was widely expected in recent weeks. Aside from that, the Greenback awaits further catalysts but until then will likely derive its impetus from the yield and risk environment. From a tech standpoint, a breach of 94.000 to the downside could see a test of the 21 DMA (93.865) – which has proven to provide some support over the last two trading sessions, with Friday and Thursday’s lows at 93.847 and 93.759 respectively. The upside meanwhile sees the YTD high at 94.563, printed on the 12th of Oct. CNH - The offshore is relatively flat on the day in a contained 6.4265-4387 range following a set of overall downbeat Chinese activity metrics. GDP growth momentum waned more than expected whilst industrial production was lower than expected, largely impacted by the electricity crisis and local COVID outbreaks during Q3. Retail sales meanwhile rebounded more than expected – albeit due to reopening effects, with inflation a concern heading forward. The Chinese National Bureau of Stats later hit the wires suggesting that major economic data are seen in reasonable ranges from Q1-Q3. The PBoC governor meanwhile downplayed the current risks of spillover from default fears. AUD, NZD, CAD - The overall cautiousness across the market has pressured high-betas. The AUD fails to glean support from the firmer base metal prices and the surge in coal prices overnight, with overall downbeat Chinese data proving to be headwinds for the antipodean. The NZD is more cushioned as inflation topped forecasts and reinforced the RBNZ’s hawkishness, whilst AUD/NZD remains capped at around 1.0500. AUD/USD fell back under its 100 DMA (0.7409) from a 0.7437 peak, whilst NZD/USD hovers around 0.7050 (vs high 0.7100), with the 100 DMA at 0.7021. The Loonie narrowly lags as a pullback in oil adds further headwinds. USD/CAD aims for a firmer footing above 1.2400 from a 1.2348 base. EUR, GBP- The single currency and Sterling are relatively flat on the day and within tight ranges of 1.1572-1.1605 and 1.3720-65 respectively. The latter was unreactive to weekend commentary from the BoE governor, sounding cautious over rising inflation but ultimately labelling it temporary, although suggesting that monetary policy may have to step in if risks materialise. From a Brexit standpoint, nothing major to report in the runup to negotiations on the Northern Ireland protocol. Across the Channel, FT sources suggested that four ECB GC members would support upping the PSPP share of APP from the current 10% - with the plan to be discussed across two meetings next month and requiring a majority from the 25 members. All-in-all, the EUR was unswayed ahead of a plethora of ECB speakers during the week and as the clock ticks down to flash PMIs on Friday. JPY, CHF - The traditional safe-havens have fallen victim to the firmer Buck, with USD/JPY extending on gains north of 114.00 as it inches closer towards 114.50 – which also matches some highs dating back to 2017. The Swiss Franc is among the laggards after USD/CHF rebounded from its 50 DMA (0.9214) as it heads back towards 0.9300, with the weekly Sight deposits also seeing W/W increases. In commodities, WTI and Brent front-month futures have drifted from best levels as the cautious risk tone weighs on prices, but nonetheless, the complex remains overall firmer with the former within a USD 82.55-83.06 range and the latter in a 84.93-85.31 intraday parameter. Fresh catalysts remain quiet for the complex, while there were some comments over the weekend from Iraq's Oil Ministry which noted that prices above USD 80/bbl are a positive indicator. Elsewhere on the supply-side, Iran is to resume nuclear negotiations on October 21, an Iranian lawmaker said Sunday, although it is unclear how far talks will go as the US and Iran affirm their stances. It is also worth noting that a fire was reported at Kuwait's Mina al-Ahmadi (346k BPD) refinery, but refining and export operations are unaffected. UK nat gas futures meanwhile are relatively flat in a tight range, although prices remain elevated on either side of GBP 2.5/Thm. Elsewhere, spot gold and silver trade sideways amid a lack of catalysts, although the firmer found some support at 1,760/oz - matching its 21 DMA. Over to base metals, LME copper remains supported around USD 10,250/t. Overnight, Shanghai zinc and Zhengzhou coal hit a record high and limit up respectively, with some citing supply constraints. US Event Calendar 9:15am: Sept. Industrial Production MoM, est. 0.2%, prior 0.4%; Capacity Utilization, est. 76.5%, prior 76.4% Manufacturing (SIC) Production, est. 0.1%, prior 0.2% 10am: Oct. NAHB Housing Market Index, est. 75, prior 76 2:15pm: Fed’s Kashkari Discusses Improving Financial Inclusion 4pm: Aug. Total Net TIC Flows, prior $126b DB's Jim Reid concludes the overnight wrap Straight to China this morning where the monthly data dump has just landed. GDP expanded in Q3 by +4.9% on a year-on-year basis, which is a touch below the +5.0% consensus expectation and a shift down from the +7.9% expansion back in Q2. That’s come as their economy has faced multiple headwinds, ranging from the property market crisis with the issues surrounding Evergrande group and other developers, an energy crisis that’s forced factories to curb output, alongside a number of Covid-19 outbreaks that have led to tight restrictions as they seek to eliminate the virus from circulating domestically. Industrial production for September also came in beneath expectations with a +3.1% year-on-year expansion (vs. +3.8% expected), though retail sales outperformed in the same month with +4.4% year-on-year growth (vs. +3.5% expected), and the jobless rate also fell back to 4.9% (vs. 5.1% expected). That data release alongside continued concerns over inflation has sent Asian markets lower this morning, with the Shanghai Composite (-0.35%), Hang Seng (-0.36%), CSI (-1.40%) KOSPI (-0.01%), and the Nikkei (-0.16%) all trading lower. Speaking of inflation, there’ve also been fresh upward moves in commodity prices overnight, with WTI up a further +1.58% this morning to follow up a run of 8 successive weekly moves higher, which takes it to another post-2014 high, whilst Brent crude is also up +1.14%. Furthermore, data overnight has shown that New Zealand’s CPI surged to a 10-year high of +4.9% in Q3, which was some way above the +4.2% expected. Looking forward, equity futures in the US are pointing lower, with those on the S&P 500 down -0.11%. Another interesting weekend story comes again from the Bank of England, which seems to be using the weekends of late to prime the markets for imminent rate hikes. Governor Bailey yesterday said inflation “will last longer and it will of course get into the annual numbers for longer as a consequence… That raises for central banks the fear and concern of embedded expectations. That’s why we, at the Bank of England have signalled, and this is another signal, that we will have to act. But of course that action comes in our monetary policy meetings.” It’s difficult to get much more explicit than this and it’ll be interesting to see if we get even more priced into the very immediate front end this morning. For now, sterling has seen little change, weakening -0.13% against the US dollar, but markets were already pricing in an initial +15bps move up to 0.25% by the end of the year before the speech. Now the big China data is out of the way we’ll have to wait until Friday for the main releases of the week, namely the global flash PMIs. Outside of that, there’s plenty of Fedspeak as they approach the blackout period at the weekend ahead of their November 3rd meeting where they’re expected to announce the much discussed taper. On top of this, earnings season will ramp up further, with 78 companies in the S&P 500 reporting. Early season positive earnings across the board have definitely helped sentiment over the last few days. 18 out of 19 that reported last week beat expectations across varying sectors. As examples, freight firm JB Hunt climbed around 9% after beating, Alcoa over 15% and Goldman Sachs nearly 4%. So much for inflation squeezing margins. My view remains that we’re still seeing “growthflation” and not “stagflation”, particularly in the US even if there are obvious risks to growth. For now, there is still a buffer before we should get really worried. On the back of the decent earnings, the S&P 500 had its best week since July last week and is now only less than -1.5% off its record high from early September. Given that earnings season has made a difference the 78 companies in the S&P 500 and 58 from the Stoxx 600 will be important for sentiment this week. In terms of the highlights, tomorrow we’ll get reports from Johnson & Johnson, Procter & Gamble, Netflix, Philip Morris International and BNY Mellon. Then on Wednesday, releases include Tesla, ASML, Verizon Communications, Abbott Laboratories, NextEra Energy and IBM. On Thursday, there’s Intel, Danaher, AT&T, Union Pacific and Barclays. Lastly on Friday, well hear from Honeywell and American Express. It’ll also be worth watching out for the latest inflation data, with CPI releases for September from the UK, Canada (both Wednesday) and Japan (Friday). The UK is by far and away the most interesting given the recent pressures and likely imminent rate hike. This month is likely to be a bit of calm before the future storm though as expectations are broadly similar to last month. Given the recent rise in energy prices, this won’t last though. In terms of the main US data, today’s industrial production (consensus +0.2% vs. +0.4% previously) will be a window into supply-chain disruptions, particularly in the auto sector. Outside of that, you’ll see in the day-by-day week ahead guide at the end that there’s a bit of US housing data to be unveiled (NAHB today, housing starts and permits tomorrow). Housing was actually the most interesting part of the US CPI last week as rental inflation came in very strong, with primary rents and owners’ equivalent rent growing at the fastest pace since 2001 and 2006, respectively. The strength was regionalised (mainly in the South) but this push from recent housing market buoyancy into CPI, via rents, has been a big theme of ours in recent months. The models that my colleague Francis Yared has suggest that we could be at comfortably above 4% inflation on this measure by next year given the lags in the model. Rents and owners’ equivalent rent makes up around a third of US CPI. So will a third of US inflation be above 4% consistently next year before we even get to all the other things? Moving to Germany, formal coalition negotiations are set to commence soon between the SPD, the Greens and the FDP. They reached an agreement on Friday with some preliminary policies that will form the basis for talks, including the maintenance of the constitutional debt brake, a pledge not to raise taxes or impose new ones, along with an increase in the minimum wage to €12 per hour. There are also a number of environmental measures, including a faster shift away from coal that will be complete by 2030. The Green Party voted in favour of entering the formal negotiations over the weekend, with the SPD agreeing on Friday, and the FDP is expected to approve the talks today. Reviewing last week now and strong earnings, along with the rather precipitous decline in long-end real yields drove the S&P 500 +1.82% higher over the week (+0.75% Friday), while the STOXX 600 gained +2.65% (+0.74% Friday). No major sector ended the week lower in Europe, while only communications (-0.52%) were down in the U.S. Interest rate sensitive sectors were among the outperformers in each jurisdiction. The 2s10s yield curve twist flattened -11.7bps over the week, as investors brought forward the timing of an increase to the Fed’s policy rate, driving the 2-year +7.8bps higher (+3.5 bps Friday), whilst the 10-year declined -4.2 bps (+6.0bps Friday). This is consistent with our US econ team bringing forward their call for the Fed lift-off to late 2022. Markets are actually pricing in a 50/50 likelihood of a hike by June. Particularly notable was the decline in long-end real yields, with 10yr real yields finishing the week -9.5bps lower, and at one point closed beneath the -1.00% mark for the first time in a month. Hence breakevens were up +5.4bps to 2.565%, leaving them right around their year-to-date highs last reached in May. The curve flattening trend was a global one last week, with 2-year gilts yields up +3.7bps whilst the 10-year fell -5.2bps. The bund curve flattened mildly as well, with 2-year bunds increasing +2.6 bps and the 10-year -1.6 bps. 10-year breakevens increased +7.9 bps in the UK, and +7.3 bps in Germany, which marks the highest reading since 2008 in the UK and the highest in Germany since 2013. The increases in inflation compensation were matched by commodities. WTI and Brent futures increased +3.69% and +3.00%, respectively last week, whilst metals also posted strong gains, with copper up +10.62% and aluminium +6.93% higher on the week. On the data front, September retail sales were much stronger than expectations, with the prior month’s components being revised higher across the board as well. The University of Michigan consumer survey saw sentiment and 5yr inflation expectations dip, while year ahead inflation expectations inched up to 4.8%. Friday’s strong data brought a brief reprieve from the curve flattening exhibited the rest of the week. Tyler Durden Mon, 10/18/2021 - 07:41.....»»

Category: worldSource: nytOct 18th, 2021

BTFD Arrives: Futures Rebound, Europe Surges While Asia Slumps On Evergrande Fears

BTFD Arrives: Futures Rebound, Europe Surges While Asia Slumps On Evergrande Fears Even though China was closed for a second day, and even though the Evergrande drama is nowhere closer to a resolution with a bond default imminent and with Beijing mute on how it will resolve the potential "Lehman moment" even as rating agency S&P chimed in saying a default is likely and it does not expect China’s government “to provide any direct support” to the privately owned developer, overnight the BTFD crew emerged in full force, and ramped futures amid growing speculation that Beijing will rescue the troubled developer... Algos about to go on a rampage — zerohedge (@zerohedge) September 21, 2021 ... pushing spoos almost 100 points higher from their Monday lows, and European stock were solidly in the green - despite Asian stocks hitting a one-month low - as investors tried to shake off fears of contagion from a potential collapse of China’s Evergrande, although gains were capped by concerns the Federal Reserve could set out a timeline to taper its stimulus at its meeting tomorrow. The dollar dropped from a one-month high, Treasury yields rose and cryptos rebounded from yesterday's rout. To be sure, the "this is not a Lehman moment" crowed was out in full force, as indicated by this note from Mizuho analysts who wrote that “while street wisdom is that Evergrande is not a ‘Lehman risk’, it is by no stretch of the imagination any meaningful comfort. It could end up being China’s proverbial house of cards ... with cross-sector headwinds already felt in materials/commodities.” At 7:00 a.m. ET, S&P 500 e-minis were up 34.00 points, or 0.79% and Nasdaq 100 e-minis 110.25 points, or 0.73%, while futures tracking the Dow  jumped 0.97%, a day after the index tumbled 1.8% in its worst day since late-July,  suggesting a rebound in sentiment after concerns about contagion from China Evergrande Group’s upcoming default woes roiled markets Monday. Dip-buyers in the last hour of trading Monday helped the S&P 500 pare some losses, though the index still posted the biggest drop since May. The bounce also came after the S&P 500 dropped substantially below its 50-day moving average - which had served as a resilient floor for the index this year - on Monday, its first major breach in more than six months. Freeport-McMoRan mining stocks higher with a 3% jump, following a 3.2% plunge in the S&P mining index a day earlier as copper prices hit a one-month low. Interest rate-sensitive banking stocks also bounced, tracking a rise in Treasury yields. Here are some of the biggest U.S. movers today: U.S.-listed Chinese stocks start to recover from Monday’s slump in premarket trading as the global selloff moderates. Alibaba (BABA US), Baidu (BIDU US), Nio (NIO US), Tencent Music (TME US)and Bilibili (BILI US) are among the gainers Verrica Pharma (VRCA US) plunges 30% in premarket trading after failing to get FDA approval for VP-102 for the treatment of molluscum contagiosum ReWalk Robotics (RWLK US) shares jump 43% in U.S. premarket trading amid a spike in volume in the stock. Being discussed on StockTwits Aprea Therapeutics gains 21% in U.S. premarket trading after the company reported complete remission in a bladder cancer patient in Phase 1/2 clinical trial of eprenetapopt in combination with pembrolizumab Lennar (LEN US) shares fell 3% in Monday postmarket trading after the homebuilder forecast 4Q new orders below analysts’ consensus hurt by unprecedented supply chain challenges ConocoPhillips (COP US) ticks higher in U.S. premarket trading after it agreed to buy Shell’s  Permian Basin assets for $9.5 billion in cash, accelerating the consolidation of the largest U.S. oil patch SmileDirect (SDC US) slightly higher in premarket trading after it said on Monday that it plans to enter France with an initial location in Paris KAR Global (KAR US) shares fell 4.6% in post-market trading on Monday after the company withdrew is full-year financial outlook citing disruption caused by chip shortage Sportradar (SRAD US) shares jumped 4.5% in Monday postmarket trading, after the company said basketball legend Michael Jordan will serve as a special adviser to its board and also increase his investment in the sports betting and entertainment services provider, effective immediately Orbital Energy Group (OEG US) gained 6% postmarket Monday after a unit won a contract  to construct 1,910 miles of rural broadband network in Virginia. Terms were not disclosed “So much of this information is already known that we don’t think it will necessary set off a wave of problems,” John Bilton, head of global multi-asset strategy at JPMorgan Asset Management, said on Bloomberg TV. “I’m more concerned about knock-on sentiment at a time when investor sentiment is a bit fragile. But when we look at the fundamentals -- the general growth, and direction in the wider economy -- we still feel reasonably confident that the situation will right itself.” Aside from worries over Evergrande’s ability to make good on $300 billion of liabilities, investors are also positioning for the two-day Fed meeting starting Tuesday, where policy makers are expected to start laying the groundwork for paring stimulus.  Europe's Stoxx 600 index climbed more than 1%, rebounding from the biggest slump in two months, with energy companies leading the advance and all industry sectors in the green. Royal Dutch Shell rose after the company offered shareholders a payout from the sale of shale oil fields. Universal Music Group BV shares soared in their stock market debut after being spun off from Vivendi SE. European airlines other travel-related stocks rise for a second day following the U.S. decision to soon allow entry to most foreign air travelers as long as they’re fully vaccinated against Covid-19; British Airways parent IAG soars as much as 6.9%, extending Monday’s 11% jump. Here are some of the biggest European movers today: Stagecoach shares jump as much as 24% after the company confirmed it is in takeover talks with peer National Express. Shell climbs as much as 4.4% after selling its Permian Basin assets to ConocoPhillips for $9.5 billion. Bechtle gains as much as 4.3% after UBS initiated coverage at buy. Husqvarna tumbles as much as 9% after the company said it is suing Briggs & Stratton in the U.S. for failing to deliver sufficient lawn mower engines for the 2022 season. Kingfisher slides as much as 6.4% after the DIY retailer posted 1H results and forecast higher profits this fiscal year. The mood was decidedly more sour earlier in the session, when Asian stocks fell for a second day amid continued concerns over China’s property sector, with Japan leading regional declines as the market reopened after a holiday. The MSCI Asia Pacific Index was down 0.5%, headed for its lowest close since Aug. 30, with Alibaba and SoftBank the biggest drags. China Evergrande Group slid deeper in equity and credit markets Tuesday after S&P said the developer is on the brink of default. Markets in China, Taiwan and South Korea were closed for holidays. Worries over contagion risk from the Chinese developer’s debt problems and Beijing’s ongoing crackdowns, combined with concern over Federal Reserve tapering, sent global stocks tumbling Monday. The MSCI All-Country World Index fell 1.6%, the most since July 19. Japan’s stocks joined the selloff Tuesday as investor concerns grew over China’s real-estate sector as well as Federal Reserve tapering, with the Nikkei 225 sliding 2.2% - its biggest drop in three months, catching up with losses in global peers after a holiday - after a four-week rally boosted by expectations for favorable economic policies from a new government. Electronics makers were the biggest drag on the Topix, which declined 1.7%. SoftBank Group and Fast Retailing were the largest contributors to a 2.2% loss in the Nikkei 225. Japanese stocks with high China exposure including Toto and Nippon Paint also dropped. “The outsized reaction in global markets may be a function of having too many uncertainties bunched into this period,” Eugene Leow, a macro strategist at DBS Bank Ltd., wrote in a note. “It probably does not help that risk taking (especially in equities) has gone on for an extended period and may be vulnerable to a correction.” “The proportion of Japan’s exports to China is greater than those to the U.S. or Europe, making it sensitive to any slowdown worries in the Chinese economy,” said Hideyuki Ishiguro, a senior strategist at Nomura Asset Management in Tokyo. “The stock market has yet to fully price in the possibility of a bankruptcy by Evergrande Group.” The Nikkei 225 has been the best-performing major stock gauge in the world this month, up 6.2%, buoyed by expectations for favorable policies from a new government and an inflow of foreign cash. The Topix is up 5.3% so far in September. In FX, the Bloomberg Dollar Spot Index inched lower and the greenback fell versus most of its Group-of-10 peers as a selloff in global stocks over the past two sessions abated; the euro hovered while commodity currencies led by the Norwegian krone were the best performers amid an advance in crude oil prices. Sweden’s krona was little changed after the Riksbank steered clear of signaling any post-pandemic tightening, as it remains unconvinced that a recent surge in inflation will last. The pound bucked a three-day losing streak as global risk appetite revived, while investors look to Thursday’s Bank of England meeting for policy clues. The yen erased earlier gains as signs that risk appetite is stabilizing damped demand for haven assets. At the same time, losses were capped due to uncertainty over China’s handling of the Evergrande debt crisis. In rates, Treasuries were lower, although off worst levels of the day as U.S. stock futures recover around half of Monday’s losses while European equities trade with a strong bid tone. Yields are cheaper by up to 2.5bp across long-end of the curve, steepening 5s30s spread by 1.2bp; 10-year yields around 1.3226%, cheaper by 1.5bp on the day, lagging bunds and gilts by 1bp-2bp. The long-end of the curve lags ahead of $24b 20-year bond reopening. Treasury will auction $24b 20-year bonds in first reopening at 1pm ET; WI yield ~1.82% is below auction stops since January and ~3bp richer than last month’s new-issue result In commodities, crude futures rose, with the front month WTI up 1.5% near $71.50. Brent stalls near $75. Spot gold trades a narrow range near $1,765/oz. Base metals are mostly in the green with LME aluminum the best performer Looking at the day ahead now, and data releases include US housing starts and building permits for August, along with the UK public finances for September. From central banks, we’ll hear from ECB Vice President de Guindos. Otherwise, the General Debate will begin at the UN General Assembly, and the OECD publishes their Interim Economic Outlook. Market Snapshot S&P 500 futures up 1.0% to 4,392.75 STOXX Europe 600 up 1.1% to 459.10 MXAP down 0.5% to 200.25 MXAPJ up 0.2% to 640.31 Nikkei down 2.2% to 29,839.71 Topix down 1.7% to 2,064.55 Hang Seng Index up 0.5% to 24,221.54 Shanghai Composite up 0.2% to 3,613.97 Sensex up 0.4% to 58,751.30 Australia S&P/ASX 200 up 0.4% to 7,273.83 Kospi up 0.3% to 3,140.51 Brent Futures up 1.6% to $75.13/bbl Gold spot down 0.1% to $1,761.68 U.S. Dollar Index little changed at 93.19 German 10Y yield fell 5.0 bps to -0.304% Euro little changed at $1.1729 Top Overnight News from Bloomberg Lael Brainard is a leading candidate to be the Federal Reserve’s banking watchdog and is also being discussed for more prominent Biden administration appointments, including to replace Fed chairman Jerome Powell and, potentially, for Treasury secretary if Janet Yellen leaves Federal Reserve Chair Jerome Powell will this week face the challenge of convincing investors that plans to scale back asset purchases aren’t a runway to raising interest rates for the first time since 2018 ECB Vice President Luis de Guindos says there is “good news” with respect to the euro-area recovery after a strong development in the second and third quarter The ECB is likely to continue purchasing junk-rated Greek sovereign debt even after the pandemic crisis has passed, according to Governing Council member and Greek central bank chief Yannis Stournaras U.K. government borrowing was well below official forecasts in the first five months of the fiscal year, providing a fillip for Chancellor of the Exchequer Rishi Sunak as he prepares for a review of tax and spending next month U.K. Business Secretary Kwasi Kwarteng warned the next few days will be challenging as the energy crisis deepens, and meat producers struggle with a crunch in carbon dioxide supplies The U.K.’s green bond debut broke demand records for the nation’s debt as investors leaped on the long-anticipated sterling asset. The nation is offering a green bond maturing in 2033 via banks on Tuesday at 7.5 basis points over the June 2032 gilt. It has not given an exact size target for the sale, which has attracted a record of more than 90 billion pounds ($123 billion) in orders Germany cut planned debt sales in the fourth quarter by 4 billion euros ($4.7 billion), suggesting the surge in borrowing triggered by the coronavirus pandemic is receding Contagion from China Evergrande Group has started to engulf even safer debt in Asia, sparking the worst sustained selloff of the securities since April. Premiums on Asian investment-grade dollar bonds widened 2-3 basis points Tuesday, according to credit traders, after a jump of 3.4 basis points on Monday Swiss National Bank policy makers watching the effects of negative interest rates on the economy are worrying about the real-estate bubble that their policy is helping to foster Global central banks need to set out clear strategies for coping with inflation risks as the world economy experiences faster-than-expected cost increases amid an uneven recovery from the pandemic, the OECD said A quick look at global markets courtesy of Newsquawk Asian equities traded cautiously following the recent downbeat global risk appetite due to Evergrande contagion concerns which resulted in the worst day for Wall Street since May, with the region also contending with holiday-thinned conditions due to the ongoing closures in China, South Korea and Taiwan. ASX 200 (+0.2%) was indecisive with a rebound in the mining-related sectors counterbalanced by underperformance in utilities, financials and tech, while there were also reports that the Byron Bay area in New South Wales will be subject to a seven-day lockdown from this evening. Nikkei 225 (-1.8%) was heavily pressured and relinquished the 30k status as it played catch up to the contagion downturn on return from the extended weekend with recent detrimental currency inflows also contributing to the losses for exporters. Hang Seng (-0.3%) was choppy amid the continued absence of mainland participants with markets second-guessing whether Chinese authorities will intervene in the event of an Evergrande collapse, while shares in the world’s most indebted developer fluctuated and wiped out an early rebound, although affiliate Evergrande Property Services and other property names fared better after Sun Hung Kai disputed reports of China pressuring Hong Kong developers and with Guangzhou R&F Properties boosted by reports major shareholders pledged funds in the Co. which is also selling key assets to Country Garden. Finally, 10yr JGBs were higher amid the underperformance in Japanese stocks and with the Japan Securities Dealers Association recently noting that global funds purchased the most ultra-long Japanese bonds since 2014, although upside was limited amid softer demand at the enhanced liquidity auction for 2yr-20yr maturities and with the BoJ kickstarting its two-day policy meeting. Top Asian News Richest Banker Says Evergrande Is China’s ‘Lehman Moment’ Hong Kong Tycoons, Casino Giants Find Respite in Stock Rebound Taliban Add More Male Ministers, Say Will Include Women Later Asian Stocks Drop to Lowest Level This Month; Japan Leads Losses European equities (Stoxx 600 +1.1%) trade on a firmer footing attempting to recoup some of yesterday’s losses with not much in the way of incremental newsflow driving the upside. Despite the attempt to claw back some of the prior session’s lost ground, the Stoxx 600 is still lower by around 1.6% on the week. The Asia-Pac session was one characterised by caution and regional market closures with China remaining away from market. Focus remains on whether Evergrande will meet USD 83mln in interest payments due on Thursday and what actions Chinese authorities could take to limit the contagion from the company in the event of further troubles. Stateside, futures are also on a firmer footing with some slight outperformance in the RTY (+1.2%) vs. peers (ES +0.8%). Again, there is not much in the way of fresh positivity driving the upside and instead gains are likely more a by-product of dip-buying; attention for the US is set to become increasingly geared towards tomorrow’s FOMC policy announcement. Sectors in Europe are firmer across the board with outperformance in Oil & Gas names amid a recovery in the crude complex and gains in Shell (+4.4%) after news that the Co. is to sell its Permian Basin assets to ConocoPhillips (COP) for USD 9.5bln in cash. Other outperforming sectors include Tech, Insurance and Basic Resources. IAG (+4.1%) and Deutsche Lufthansa (+3.8%) both sit at the top of the Stoxx 600 as the Co.’s continue to enjoy the fallout from yesterday’s decision by the US to allow travel from vaccinated EU and UK passengers. Swatch (-0.7%) is lagging in the luxury space following a downgrade at RBC, whilst data showed Swiss watch exports were +11.5% Y/Y in August (prev. 29.1%). Finally, National Express (+7.7%) is reportedly considering a takeover of Stagecoach (+21.4%), which is valued at around GBP 370mln. Top European News U.K. Warns of Challenging Few Days as Energy Crisis Deepens Germany Trims Planned Debt Sales as Pandemic Impact Recedes U.K.’s Green Bond Debut Draws Record Demand of $123 Billion Goldman Plans $1.5 Billion Petershill Partners IPO in London In FX, all the signs are constructive for a classic turnaround Tuesday when it comes to Loonie fortunes as broad risk sentiment improves markedly, WTI consolidates within a firm range around Usd 71/brl compared to yesterday’s sub-Usd 70 low and incoming results from Canada’s general election indicate victory for the incumbent Liberal party that will secure a 3rd term for PM Trudeau. Hence, it’s better the devil you know as such and Usd/Cad retreated further from its stop-induced spike to just pips short of 1.2900 to probe 1.2750 at one stage before bouncing ahead of new house price data for August. Conversely, the Swedish Krona seems somewhat reluctant to get carried away with the much better market mood after the latest Riksbank policy meeting only acknowledged significantly stronger than expected inflation data in passing, and the repo rate path remained rooted to zero percent for the full forecast horizon as a consequence. However, Eur/Sek has slipped back to test 10.1600 bids/support following an initial upturn to almost 10.1800, irrespective of a rise in unemployment. NOK/AUD/NZD - No such qualms for the Norwegian Crown as Brent hovers near the top of a Usd 75.18-74.20/brl band and the Norges Bank is widely, if not universally tipped to become the first major Central Bank to shift into tightening mode on Thursday, with Eur/Nok hugging the base of a 10.1700-10.2430 range. Elsewhere, the Aussie and Kiwi look relieved rather than rejuvenated in their own right given dovish RBA minutes, a deterioration in Westpac’s NZ consumer sentiment and near reversal in credit card spending from 6.9% y/y in July to -6.3% last month. Instead, Aud/Usd and Nzd/Usd have rebounded amidst the recovery in risk appetite that has undermined their US rival to top 0.7380 and 0.7050 respectively at best. GBP/CHF/EUR/JPY/DXY - Sterling is latching on to the ongoing Dollar retracement and more supportive backdrop elsewhere to pare losses under 1.3700, while the Franc continues its revival to 0.9250 or so and almost 1.0850 against the Euro even though the SNB is bound to check its stride at the upcoming policy review, and the single currency is also forming a firmer base above 1.1700 vs the Buck. Indeed, the collective reprieve in all components of the Greenback basket, bar the Yen on diminished safe-haven demand, has pushed the index down to 93.116 from 93.277 at the earlier apex, and Monday’s elevated 93.455 perch, while Usd/Jpy is straddling 109.50 and flanked by decent option expiry interest either side. On that note, 1.4 bn resides at the 109.00 strike and 1.1 bn between 109.60-70, while there is 1.6 bn in Usd/Cad bang on 1.2800. EM - Some respite across the board in wake of yesterday’s mauling at the hands of risk-off positioning in favour of the Usd, while the Czk has also been underpinned by more hawkish CNB commentary as Holub echoes the Governor by advocating a 50 bp hike at the end of September and a further 25-50 bp in November. In commodities, WTI and Brent are firmer in the European morning post gains in excess of 1.0%, though the benchmarks are off highs after an early foray saw Brent Nov’21 eclipse USD 75.00/bbl, for instance. While there has been newsflow for the complex, mainly from various energy ministers, there hasn’t been much explicitly for crude to change the dial; thus, the benchmarks are seemingly moving in tandem with broader risk sentiment (see equities). In terms of the energy commentary, the Qatar minister said they are not thinking of re-joining OPEC+ while the UAE minister spoke on the gas situation. On this, reports in Russian press suggests that Russia might allow Rosneft to supply 10bcm of gas to Europe per year under an agency agreement with Gazprom “as an experiment”, developments to this will be closely eyed for any indication that it could serve to ease the current gas situation. Looking ahead, we have the weekly private inventory report which is expected to post a headline draw of 2.4mln and draws, albeit of a smaller magnitude, are expected for distillate and gasoline as well. Moving to metals, spot gold is marginally firmer while silver outperforms with base-metals picking up across the board from the poor performance seen yesterday that, for instance, saw LME copper below the USD 9k mark. Note, the action is more of a steadying from yesterday’s downside performance than any notable upside, with the likes of copper well within Monday’s parameters. US Event Calendar 8:30am: Aug. Building Permits MoM, est. -1.8%, prior 2.6%, revised 2.3% 8:30am: Aug. Housing Starts MoM, est. 1.0%, prior -7.0% 8:30am: Aug. Building Permits, est. 1.6m, prior 1.64m, revised 1.63m 8:30am: Aug. Housing Starts, est. 1.55m, prior 1.53m 8:30am: 2Q Current Account Balance, est. -$190.8b, prior -$195.7b DB's Jim Reid concludes the overnight wrap Global markets slumped across the board yesterday in what was one of the worst days of the year as an array of concerns about the outlook gathered pace. The crisis at Evergrande and in the Chinese real estate sector was the catalyst most people were talking about, but truth be told, the market rout we’re seeing is reflecting a wider set of risks than just Chinese property, and comes after increasing questions have been asked about whether current valuations could still be justified, with talk of a potential correction picking up. Remember that 68% of respondents to my survey last week (link here) thought they’d be at least a 5% correction in equity markets before year end. So this has been front and centre of people’s mind even if the catalyst hasn’t been clear. We’ve all known about Evergrande’s woes and how big it was for a while but it wasn’t until Friday’s story of the Chinese regulatory crackdown extending into property that crystallised the story into having wider implications. As I noted in my chart of the day yesterday link here Chinese USD HY had been widening aggressively over the last couple of months but IG has been pretty rock solid. There were still no domestic signs of contagion by close of business Friday. However as it stands, there will likely be by the reopening post holidays tomorrow which reflects how quickly the story has evolved even without much new news. Before we get to the latest on this, note that we’ve still got a bumper couple of weeks on the calendar to get through, including the Fed decision tomorrow, which comes just as a potential government shutdown and debt ceiling fight are coming into view, alongside big debates on how much spending the Democrats will actually manage to pass. There has been some respite overnight with S&P 500 futures +0.58% higher and 10y UST yields up +1.5bps to 1.327%. Crude oil prices are also up c. 1%. On Evergrande, S&P Global Ratings has said that the company is on the brink of default and that it’s failure is unlikely to result in a scenario where China will be compelled to step in. The report added that they see China stepping in only if “there is a far-reaching contagion causing multiple major developers to fail and posing systemic risks to the economy.” The Hang Seng (-0.32%) is lower but the Hang Seng Properties index is up (+1.59%) and bouncing off the 5 plus year lows it hit yesterday. Elsewhere the ASX (+0.30%) and India’s Nifty (+0.35%) have also advanced. Chinese and South Korean markets are closed for a holiday but the Nikkei has reopened and is -1.80% and catching down to yesterday’s global move. Looking at yesterday’s moves in more depth, the gathering storm clouds saw the S&P 500 shed -1.70% in its worst day since May 12, with cyclical industries leading the declines and with just 10% of S&P 500 index members gaining. There was a late rally at the end of the US trading session that saw equity indices bounce off their lows, with the S&P 500 (-2.87%) and NASDAQ (-3.42%) both looking like they were going to register their worst days since October 2020 and late-February 2021 respectively. However, yesterday was still the 5th worst day for the S&P 500 in 2021. Reflecting the risk-off tone, small caps suffered in particular with the Russell 2000 falling -2.44%, whilst tech stocks were another underperformer as the NASDAQ lost -2.19% and the FANG+ index of 10 megacap tech firms saw an even bigger -3.16% decline. For Europe it was much the same story, with the STOXX 600 (-1.67%) and other bourses including the DAX (-2.31%) seeing significant losses amidst the cyclical underperformance. It was the STOXX 600’s worst performance since mid-July and the 6th worst day of the year overall. Unsurprisingly, there was also a significant spike in volatility, with the VIX index climbing +4.9pts to 25.7 – its highest closing level since mid-May – after trading above 28.0pts midday. In line with the broader risk-off move, especially sovereign bonds rallied strongly as investors downgraded their assessment of the economic outlook and moved to price out the chances of near-term rate hikes. By the close of trade, yields on 10yr Treasuries had fallen -5.1bps to 1.311%, with lower inflation breakevens (-4.1bps) leading the bulk of the declines. Meanwhile in Europe, yields on 10yr bunds (-4.0bps), OATs (-2.6bps) and BTPs (-0.9bps) similarly fell back, although there was a widening in spreads between core and periphery as investors turned more cautious. Elsewhere, commodities took a hit as concerns grew about the economic outlook, with Bloomberg’s Commodity Spot Index (-1.53%) losing ground for a third consecutive session. That said, European natural gas prices (+15.69%) were the massive exception once again, with the latest surge taking them above the peak from last Wednesday, and thus bringing the price gains since the start of August to +84.80%. Here in the UK, Business Secretary Kwarteng said that he didn’t expect an emergency regarding the energy supply, but also said that the government wouldn’t bail out failed companies. Meanwhile, EU transport and energy ministers are set to meet from tomorrow for an informal meeting, at which the massive spike in prices are likely to be discussed. Overnight, we have the first projections of the Canadian federal election with CBC News projecting that the Liberals will win enough seats to form a government for the third time albeit likely a minority government. With the counting still underway, Liberals are currently projected to win 156 seats while Conservatives are projected to win 120 seats. Both the parties are currently projected to win a seat less than last time. The Canadian dollar is up +0.44% overnight as the results remove some election uncertainty. Turning to the pandemic, the main news yesterday was that the US is set to relax its travel rules for foreign arrivals. President Biden announced the move yesterday, mandating that all adult visitors show proof of vaccination before entering the country. Airline stocks outperformed strongly in response, with the S&P 500 airlines (+1.55%) being one of the few industry groups that actually advanced yesterday. Otherwise, we heard from Pfizer and BioNTech that their vaccine trials on 5-11 year olds had successfully produced an antibody response among that age group. The dose was just a third of that used in those aged 12 and above, and they said they planned to share the data with regulators “as soon as possible”. Furthermore, they said that trials for the younger cohorts (2-5 and 6m-2) are expected as soon as Q4. In Germany, there are just 5 days left until the election now, and the last Insa poll before the vote showed a slight tightening in the race, with the centre-left SPD down a point to 25%, whilst the CDU/CSU bloc were up 1.5 points to 22%. Noticeably, that would also put the race back within the +/- 2.5% margin of error. The Greens were unchanged in third place on 15%. Staying with politics and shifting back to the US, there was news last night that Congressional Democratic leaders are looking to tie the suspension of the US debt ceiling vote to the spending bill that is due by the end of this month. If the spending bill is not enacted it would trigger a government shutdown, and if the debt ceiling is not raised it would cause defaults on federal payments as soon as October. Senate Majority Leader Schumer said the House will pass a spending bill that will fund the government through December 3rd and that the “legislation to avoid a government shutdown will also include a suspension of the debt limit through December 2022.” Republicans may balk at the second measure, given that it would take the issue off the table until after the 2022 midterm elections in November of that year. There wasn’t a great deal of data out yesterday, though German producer price inflation rose to +12.0% in August (vs. +11.1% expected), marking the fastest pace since December 1974. Separately in the US, the NAHB’s housing market index unexpectedly rose to 76 in September (vs. 75 expected), the first monthly increase since April. To the day ahead now, and data releases include US housing starts and building permits for August, along with the UK public finances for September. From central banks, we’ll hear from ECB Vice President de Guindos. Otherwise, the General Debate will begin at the UN General Assembly, and the OECD will be publishing their Interim Economic Outlook. Tyler Durden Tue, 09/21/2021 - 07:45.....»»

Category: blogSource: zerohedgeSep 21st, 2021

Sen. Kyrsten Sinema"s filibuster speech has reenergized progressive efforts to find someone to primary and oust the Arizona Democrat

Grassroots groups in Arizona are working feverishly to find someone to challenge and unseat Democrat Kyrsten Sinema over her blockage of Biden's agenda and objection to nixing the filibuster. They saw a fundraising boost after her floor speech. Arizona Democratic Sen. Kyrsten Sinema speaks to Sen. James Lankford, a Republican of Oklahoma before the start of a Senate Finance Committee hearing on October 19, 2021.Photo by Mandel Ngan-Pool/Getty Images Her reelection isn't until 2024, but Sen. Sinema's critics are looking for a challenger to oust her. The Arizona Democrat renewed critics' anger with a speech saying she would never nix the filibuster. But the grassroots efforts to oust her are a risky bid in a state that still is heavily Republican. Sen. Kyrsten Sinema's declaration on the Senate floor that she'll never vote to end the filibuster ignited "white-hot rage" from progressives in her home state of Arizona where grassroots efforts to find someone to challenge her are gaining steam."People feel betrayed and absolutely fed up with her actions with her obstruction," Arizona-based activist Kai Newkirk told Insider on Thursday, shortly after Sinema's speech.Newkirk is one of the founders of the Sinema Primary Pledge, one of at least three homegrown operations that are seeking to draft or support a Democratic primary challenger for Sinema in 2024. The efforts indicate a growing and well-funded determination by Sinema's critics within the Democratic Party to punish her for what they see as an unnecessary and harmful obstruction to President Joe Biden's agenda, and could portend trouble for the swing state senator in two years.—Kai Newkirk (@kai_newkirk) January 13, 2022 Democrats have sought to end the Senate filibuster, which allows the minority party to block a vote on legislation, in the face of Republican opposition to Biden's big-ticket agenda items. But Sinema, along with fellow conservative Democrat Joe Manchin of West Virginia, has refused to go along with her party. The latest furor centers on the Democrats' push to pass the John Lewis Voting Rights Act and the Freedom to Vote Act. Neither has any chance of passage in the Senate while the filibuster, which requires a 60-vote minimum, remains in place."I will not support separate actions that worsen the underlying disease of division infecting our country," Sinema declared in her speech on the Senate floor, even as she said she supports both bills.Democratic Sen. Kyrsten Sinema of Arizona speaks as Republican Sens. Lisa Murkowski of Alaska and Susan Collins of Maine stand by on Capitol Hill on July 28, 2021.Alex Wong/Getty Images'I fear that she's wrong'Sinema's office did not immediately respond to a request for comment on the furor that followed her speech and the primary efforts. But some of her colleagues expressed frustration with her choice. "Well, it looks like the path forward is very difficult, particularly based upon Senator Sinema's statement today," Senator Angus King, a Maine Independent who caucuses with Democrats, told reporters at the Capitol a few hours after her speech. "She believes that the risk of changing the filibuster is greater than the risk of what's going on in the states. I hope profoundly that she's right. I fear that she's wrong."After Sinema's speech, progressives on Twitter lit into her and drew attention to the primary efforts and their corresponding donation pages.One campaign, The Primary Sinema Pledge,  has raised $108,746 on CrowdPAC so far, and counts Arizona progressives like Belén Sisa, a former spokesperson for Sen. Bernie Sanders, and Brianna Westbrook, a candidate for the Arizona legislature, as backers."Either Sinema votes to end the filibuster OR we fund a primary challenger," the campaign says on its website.A separate but similar-sounding effort, the Primary Sinema Project, was founded in September 2021 by the progressive organization Way to Lead, and saw a spike in fundraising on January 13. In its short existence, the group says it has raised more than $250,000 from 10,000 grassroots donors, with $28,000 of the money coming in after Sinema's speech."Arizonans and Democrats across the country are damn angry -- and they should be," said Luis Avila, a spokesperson for the Primary Sinema Project. The Primary Sinema Project was bankrolled by an initial investment of $400,000 from progressive organization Way to Lead, a spokesperson said, and it raises money through an entity called Change for Arizona 2024 PAC. With no actual primary challenger, however, the Project says its "money will go to support grassroots groups on the ground in Arizona." A group called Living United for Change in Arizona (LUCHA) is the only named recipient, but the project says it will name future beneficiaries.The group also blasted out a lengthy memo to reporters on Thursday, taking Sinema to task for her policy positions. "Unfortunately, instead of getting things done, Senator Kyrsten Sinema has decided to use her power in the Senate to obstruct much of Biden's agenda—including on the crucial issue of voting rights, which she claims to support," the Primary Sinema Project memo read.Jana Morgan of Declaration for American Democracy joins hunger strikers and activists at a press conference in front of the U.S. Capitol Building to demand that the Senate pass the Freedom To Vote: John Lewis Act on January 13, 2022 in Washington, DC.Photo by Paul Morigi/Getty Images for Un-PAC A risky effort for DemocratsA third, more specific drive led by Sanders alumnus and Democratic strategist Chuck Rocha, aims to draft Rep. Ruben Gallego of Arizona to challenge Sinema in 2024."Many of us felt it was time to bring an explicit electoral threat into the fight and to make it clear that Sinema has not just a moral choice to make, but a political one between the filibuster and her political future," said Newkirk of the Primary Sinema Pledge. "We wanted to draw a line and say, this far and no further. If she won't vote to end the filibuster…we will replace her with someone who will."Sinema has faced outrage from Democrats before over her votes against party initiatives. She drew scorn for voting not to include a $15 minimum wage provision in a March 2021 coronavirus relief bill. Seven other Democrats voted with her, but Sinema's thumbs-down gesture went viral for all the wrong reasons.The senator has maintained a more conservative stance than her Democratic counterparts since she was elected to the Senate from Arizona in 2018, claiming the late Republican Sen. John McCain's old seat from his temporary replacement, Sen. Martha McSally. Sinema has electoral realities to contend with; Arizona remains very much a swing state, with a strong base of Republican voters and a powerful Republican Party that sided with Trump's baseless claims of voter fraud in the 2020 presidential election despite Biden's win. While both of its US Senators are currently Democrats, its governor, Doug Ducey, is a Republican. Until 2018, both Senate seats were held by Republicans.It makes intra-party warfare in 2024 a risky proposition, as Democrats defend a seat that could determine their power in Washington. But it's a risk that Newkirk said Sinema's critics were willing to take in order to enact Democrat's priorities on voting rights.Not all Democrats, however, are convinced that spending time, energy, and money primarying a sitting senator from their own party is worth the effort when they face a tough electoral landscape in 2022. "It can't hurt," one Democratic operative focused on state-level contests said. "Do I think it's the most effective use of money today? No."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJan 14th, 2022

The leader of the right-wing Oath Keepers was arrested and charged with seditious conspiracy in the DOJ"s Capitol-riot probe

Rhodes' arrest is the most significant to date in the Capitol-riot probe and marks the first time that prosecutors have brought sedition charges. Elmer Stewart Rhodes, the founder of the citizen militia group known as the Oath Keepers, speaking during a rally outside the White House in Washington, DC.Susan Walsh/AP Photo The head of the far-right group Oath Keepers has been arrested in the Capitol-riot investigation. Elmer Stewart Rhodes and 10 others were charged with seditious conspiracy on Thursday. Thursday's arrests are the first time prosecutors have brought sedition charges related to the riot. The leader of the right-wing extremist group Oath Keepers, Elmer Stewart Rhodes, was arrested on Thursday. He and 10 others were charged with seditious conspiracy in connection to the Capitol riot, the Justice Department announced on Thursday.It's the most significant arrest yet and marks the first time that federal prosecutors have brought sedition charges in connection to the Justice Department's sprawling investigation into the deadly January 6, 2021, Capitol siege.Rhodes has said he was at the Capitol that day but did not enter the building, The Washington Post reported.But prosecutors said key members of right-wing extremist groups, including the Oath Keepers, not only forced their way into the Capitol but also extensively planned for it beforehand by, among other things, keeping a "quick reaction force" on standby at a Virginia hotel.The Post reported that prosecutors also alleged that some of the pro-Trump rioters specifically traveled to Washington, DC, at Rhodes' urging, and that he began discussing how to keep Trump in the White House as early as November 9, 2020, two days after major news networks declared Joe Biden the winner of the presidential election.Thursday's seditious-conspiracy indictment alleged that Rhodes and other codefendants conspired to "oppose by force the lawful transfer of presidential power."The charging document accused Rhodes and his codefendants of using encrypted messaging apps in late December 2020 to coordinate and plan to travel to Washington, DC, to disrupt Congress' certification of Joe Biden's victory on January 6, 2021. Prosecutors also alleged that Rhodes and some of the codefendants made plans to bring weapons to the Capitol.Investigators have repeatedly emphasized the nature of the Oath Keepers throughout the course of the Capitol-riot probe. Thursday's indictment described the group as a "large but loosely organized collection of individuals," adding that "though the Oath Keepers will accept anyone as members, they explicitly focus on recruiting current and former military, law enforcement, and first-responder personnel."In all, the DOJ said, 19 defendants connected to the Oath Keepers were charged with corruptly obstructing an official proceeding. Eighteen of the 19 were charged with conspiring to obstruct an official proceeding and conspiring to prevent an office of the United States from discharging a duty. And 11 of the 19 were charged with seditious conspiracy.Rhodes' arrest came after the House select committee investigating the riot subpoenaed him and the leaders of other far-right groups, including the Proud Boys and the 1st Amendment Praetorian.The groups are the most high-profile right-wing extremists to have been involved in the violent breach of the Capitol while Congress was in the process of certifying Biden's victory.Rhodes' arrest also came days after Attorney General Merrick Garland delivered remarks on the eve of the anniversary of the Capitol siege and vowed that the Justice Department had "no higher priority" than holding those involved accountable.He also characterized the Capitol-riot investigation as "one of the largest, most complex, and most resource-intensive investigations in our history."The last time the department brought sedition charges connected to white-supremacist violence was in 1987, when it charged 13 white supremacists in Arkansas with conspiring to overthrow the federal government, said Kathleen Belew, a historian and assistant professor at the University of Chicago.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJan 13th, 2022

House committee probing Capitol riot wants to hear from Kevin McCarthy

This is a sign that the investigation is increasingly touching some of the most powerful figures in the Republican Party. House Minority Leader Kevin McCarthyAP Photo/Jose Luis Magana House lawmakers want to know what President Donald Trump told Kevin McCarthy. The committee investigating the Capitol riot has now asked for McCarthy's cooperation. This is a sign that the probe is increasingly touching some of the GOP's most powerful figures. The House Select Committee investigating the January 6 riot on Wednesday asked House Minority Leader Kevin McCarthy for his voluntary cooperation, a sign that the probe is increasingly touching some of the most powerful figures in the Republican Party."You have acknowledged speaking directly with the former President while the violence was underway on January 6th. And you summarized your conclusions regarding President Trump's conduct on January 6th in a speech you made January 13th on the House floor," the committee wrote in a letter to McCarthy.McCarthy said on the House floor just days after the riot that Trump bore "responsibility" for the attack on the Capitol. He also briefly suggested that Trump should be censured for his actions before Democrats moved to impeach the president for a second time. It's not entirely clear what Trump told McCarthy as rioters were ransacking the Capitol. Rep. Jaime Herrera Beutler, one of the 10 House Republicans who voted to impeach Trump, cited what McCarthy told her about the call in her decision to vote to impeach the president. CNN reported that Trump told McCarthy: "Well, Kevin, I guess these people are more upset about the election than you are."McCarthy previously told reporters that he would cooperate with a then-proposed bipartisan, independent panel. His opposition to a 9/11-style commission investigating the insurrection failed to stop its passage in the House, but Senate Republicans later blocked it from becoming law.In the year since January 6, McCarthy has criticized Democrats for focusing too much on the attack. He has also defended his efforts to overturn election results in Pennsylvania and Arizona, arguing to The New York Times that not certifying results from either state wouldn't have changed President Joe Biden's victory. In the same story, The Times reported that McCarthy's allies say his support of Trump is rooted in the belief that the GOP needs the former president to help retake the House and thus to fulfill McCarthy's long-held ambition to become speaker.McCarthy has also undermined efforts to investigate the insurrection. The California Republican reportedly asked Rep. John Katko of New York to negotiate on his behalf for a bipartisan commission modeled after the widely-praised panel that investigated the terror attacks on September 11, 2001. But McCarthy later came out against such a commission, citing its "limited scope" as some Republicans pushed for unrest during summer 2020 to be included alongside any investigation of the insurrection. House Speaker Nancy Pelosi then moved to create a House select committee after the Senate failed to pass the bill. McCarthy later named a slate of Republican lawmakers to the panel, but Pelosi took the unprecedented step of rejecting two of his selections due to the lawmakers' support of efforts to reject the certification of state election results. McCarthy then withdrew his entire slate from the panel. He has since threatened telecommunications companies if they complied with the House select committee's subpoenas. Rep. Jim Jordan of Ohio, another Republican the panel wants to hear from, has said he will not cooperate with their request. It is unclear whether House lawmakers have the legal authority to subpoena their colleagues in order to compel their cooperation.McCarthy's office did not immediately respond to Insider's request for comment.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJan 13th, 2022

Almost no Republican lawmakers were on Capitol Hill on the anniversary of the January 6 attack

Rep. Pramila Jayapal slammed GOP lawmakers who refuse to address the riot and "have just completely undermined that it even happened." Senate Minority Leader Mitch McConnell (R-KY) walks to the Senate Chamber on Capitol Hill on November 3, 2021.Joshua Roberts/Getty Images Almost no Republican lawmakers were on Capitol Hill on the anniversary of the January 6 attack. Rep. Liz Cheney of Wyoming and her father Dick Cheney were the only two Republicans who attended a moment of silence in the House. GOP Reps. Matt Gaetz and Marjorie Taylor Greene used the day to spin conspiracy theories and rewrite history. On the anniversary of the deadly January 6 insurrection, Republicans were scarce on Capitol Hill. Democrats organized and attended the day's events, which included President Joe Biden and Vice President Kamala Harris' speeches at the Capitol, a conversation about January 6, 2021, with historians Doris Kearns Goodwin and Jon Meacham, testimonials from House Democrats, and a prayer vigil on the Capitol steps.Former Vice President Dick Cheney and his daughter, Wyoming Rep. Liz Cheney, were the only two Republicans seen by reporters on the House floor for a moment of silence commemorating the Capitol siege led by Speaker Nancy Pelosi.Both the House and Senate were in session today for events commemorating January 6, 2021, though no votes were scheduled.Democratic lawmakers told Insider they were appreciative of the Cheneys attending the Capitol riot commemoration and disturbed by Republicans' absence.  "I just went to thank Liz Cheney who was in the chamber," Rep. Pramila Jayapal, a Washington Democrat and chair of House progressive caucus, said after she exited the House chamber. "I said one of the hardest things has been not only what happened on the day but the fact that there has been no recognition, and worse than that, people who have just completely undermined that it even happened. That they're not here today. That there's no presence marking the duty that we all have to the same Constitution." Rep. Sheila Jackson Lee, a veteran Texas Democrat, told Insider that she was "delighted" Dick Cheney had attended Pelosi's remarks and moment of silence. "I think we have some of the same views about the love of this country," she said. But Rep. Andy Kim, who was famously photographed picking up debris left by the rioters in the Capitol rotunda last year, told Insider he wasn't thinking about who attended the events on Thursday and was instead focused on law enforcement and Hill staffers who were impacted.  "I really don't think about them today," Kim said of his GOP colleagues. "The reason I came here was to pay tribute and express my gratitude to the Capitol police and the staff. And that's how I wanted to spend my January 6. A lot of my Democratic colleagues aren't here, either." When reporters asked Liz Cheney what she thought about the fact that so few Republicans showed up for the anniversary, she responded, "I think it's a reflection where our party is," adding that it was "very concerning."The only other House Republican lawmakers Insider spotted on the Hill on Thursday were Reps. Marjorie Taylor Greene of Georgia and Matt Gaetz of Florida, who held a press conference to promote false and unsubstantiated claims about the federal government's involvement in the riot.They attacked Sen. Ted Cruz, a Texas Republican, for calling the Capitol riot a "violent terrorist attack" and said it was a mistake for former President Donald Trump to cancel his scheduled Thursday press conference. Reps. Cheney and Adam Kinzinger of Illinois are the only two Republicans serving on the House select committee investigating the Capitol riot, which led to the deaths of at least seven people. Both lawmakers have fielded sharp criticism from their pro-Trump colleagues, and Cheney was removed from her House GOP leadership position after giving a defiant speech in May saying she would not "sit back and watch in silence" while Trump peddled lies about the 2020 election.GOP senators were a no-showMany Senate Republicans spent the day in Georgia at the funeral of former GOP Sen. Johnny Isakson, who died last month at 76. Their offices released statements from the lawmakers largely condemning the riot and praising the Capitol police and other law enforcement who responded to the attack. Some Republican lawmakers, including Senate Minority Leader Mitch McConnell, took the opportunity to accuse Democrats of trying to "exploit this anniversary" for political gain, specifically in their push to reform the filibuster."It is especially jaw-dropping to hear some Senate Democrats invoke the mob's attempt to disrupt our country's norms, rules and institutions as a justification to discard our norms, rules and institutions themselves," McConnell said in a statement. "Senators should not be trying to exploit this anniversary to damage the Senate in a different way from within."McConnell attended Isakson's funeral services on Thursday and was not at the Capitol.Some Republicans slammed President Joe Biden's speech at the Capitol commemorating the anniversary, accusing him of politicizing the event. They said Biden did so by specifically blaming Trump for inciting the violence by, among other things, urging thousands of his supporters to "fight like hell" to stop Congress from certifying Biden's 2020 election victory."What brazen politicization of January 6 by President Biden," tweeted Sen. Lindsey Graham, a South Carolina Republican who did not publicly recognize Biden's victory until after the siege. "I wonder if the Taliban who now rule Afghanistan with al-Qaeda elements present, contrary to President Biden's beliefs, are allowing this speech to be carried?"Florida Gov. Ron DeSantis called the day Democrats' and the media's "Christmas." "This is their Christmas: January 6," he said at a press conference on Thursday in response to a question from an Insider reporter. "They are going to take this and milk this for anything they can to be able to smear anyone who ever supported Donald Trump."But a few Republican lawmakers issued harsh condemnations of their own party on Thursday. Sen. Lisa Murkowski, an Alaska Republican who voted to impeach Trump for inciting the insurrection, called out Trump in a statement and blamed him for the violence.  "Today marks one year since the U.S. Capitol was stormed by a mob incited by our former president," she said. "Those of us who were there to fulfill our constitutional responsibilities can never erase what we saw and heard."Trump has endorsed a Republican challenger to Murkowski. Far-right lawmakers rewrite historyGaetz and Greene used the anniversary of the deadly attack to spin conspiracy theories and attack GOP colleagues who acknowledged the extent of the violence that unfolded on January 6. The far-right lawmakers appeared on former White House chief strategist Steve Bannon's podcast on Thursday, where Gaetz defended the rioters as "patriotic Americans" and falsely claimed they had "no intent of breaking the law or doing violence."The two lawmakers also peddled the bogus claim that some of the Trump supporters who stormed the Capitol were "trapped" into doing so by government actors and left-wing activists. There is no evidence to support this theory.At a news conference shortly after their podcast appearance, Gaetz and Greene also taunted Texas Sen. Ted Cruz, who on Wednesday described the riot as a "violent terrorist attack.""I think Senator Cruz is smart enough to know, since he's an attorney, that no one's been charged with terrorism, just like no one has been charged with insurrection," Greene said.Gaetz tacked on: "The establishment will never love you, Ted. You know, you can bend over and bend a knee for them, but they're just not going to love you."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJan 6th, 2022

January 6: A Legacy Of Troubling Questions

January 6: A Legacy Of Troubling Questions Authored by Joseph Hannemann via The Epoch Times, The hardened-steel baton made the most disturbing sound as it bounced off Victoria White’s skull. It varied between a hollow click and a deeper snap, depending on where on her head the metal weapon made contact. “Please don’t beat her!” a man in the crowd yelled. It was chaos in the West Terrace tunnel entrance of the U.S. Capitol on the afternoon of Jan. 6, 2021. Outside, thousands who had attended President Donald Trump’s “Save America” rally milled about the terrace, while groups of rioters battled police near the tunnel. An almost demonic cacophony emanated from under the tunnel arch. “I didn’t even touch you,” a woman cried. “I need help! I need help,” a man shouted. “Stand up, dammit!” intoned a police officer in riot gear. “Get out!” boomed another. Then a blood-curdling scream, followed by the ear-splitting sound of an emergency siren. Victoria White appears prone or near-collapse in several parts of a five-minute video. (Screen Captures/Joseph McBride) After repeatedly striking White in the head, the officer in white holstered his baton. Then he made a fist with his bare left hand and punched White in the face. “Oh, no-no-no! Please! Please don’t beat her!” someone shouted, to no effect. After three full-force knuckle shots to White’s head, the officer in white paused. Then he went in for two more blows. He grabbed the hair at the back of her head and pulled it hard. White looked dazed and confused. She wore a blank stare. Another officer reached in with his baton in an apparent attempt to prevent more blows. The officer in white grabbed his colleague’s arm and shoved it back at him. The almost unbelievable violence meted out on the unarmed, 5-foot-4-inch White provides a stark contrast to the often-preached narrative that Jan. 6 was strictly an insurrection carried out by mobs of Trump supporters wanting to overthrow the government. White was a victim of brutality. Her lawyer is preparing a civil suit. Hers is one of the hidden stories of Jan. 6, exposed only after a federal judge ordered that three hours of surveillance video held by the U.S. Department of Justice be released to White’s attorney. Political Divide Widens The voluminous media coverage in the weeks leading up to the one-year anniversary of Jan. 6 demonstrates the substantial and growing divide between Americans of differing political stripes. The prevailing narrative is that supporters of Trump, whipped into a frenzy by his Jan. 6 speech at the Ellipse, descended on the U.S. Capitol in a violent attempt to upend democracy. A large crowd of Trump supporters—estimates ranged from 30,000 on the low end to 2 million on the high end—crowded the Ellipse to hear the president rail against the 2020 presidential election. Trump contended, along with millions of supporters, that widespread election fraud in key states like Pennsylvania, Michigan, Georgia, Arizona, and Wisconsin had robbed him of a second term and placed Democrat Joe Biden in an illegitimate presidency. The speech started approximately an hour later than scheduled. Well before Trump concluded his remarks, a group of protesters breached a lightly guarded barrier on the Capitol’s pedestrian walkway. They quickly headed for the Capitol building. By the time the throngs of rally-goers made the long walk to the Capitol grounds, the perimeter fencing and security signs indicating the site was restricted had been methodically removed. As tens of thousands of protesters surrounded the Capitol, pockets of violence broke out. Windows were broken, and protesters climbed inside, just after 2 p.m. At other entrances, protesters found doors propped open and proceeded inside like tourists. The circumstances of the worst violence are hotly contested, but the results were real. Trump supporter Ashli Babbitt, 35, was shot and killed by a Capitol Police officer as she attempted to enter the Speaker’s Lobby. White and others were beaten by police in or near the West Terrace tunnel, attorneys say. Aaron Babbitt with his wife, Ashli, who was killed at the U.S. Capitol on Jan. 6, 2021. “She loved life,” he said. (Courtesy of Aaron Babbitt) Some 140 police were injured during battles with rioters. Capitol Police Officer Brian Sicknick died on Jan. 7, 2021, although his death was eventually determined to be from natural causes. Capitol Police Officer Howard Liebengood and Washington Metropolitan Police Officer Jeffrey Smith—both of whom were on duty at the Capitol—took their own lives in the weeks after Jan. 6. President Joe Biden described Jan. 6 as the “worst attack on our democracy since the Civil War.” The Associated Press asserted it was “the most sustained attack on the seat of American democracy since the War of 1812.” Steven Sund, former U.S. Capitol Police chief, called it “a coordinated violent attack on the United States Capitol by thousands of well-equipped armed insurrectionists.” Many Americans don’t see those words as hyperbole, insisting Trump-fueled mobs fully intended to disrupt the U.S. Congress and overthrow the federal government. Across the political chasm are those who reject that dominant narrative, and assert that while Jan. 6 was many things, it was no insurrection. They view that characterization as a convenient way to suppress the truth. The real Jan. 6 story, they believe, remains hidden on some 14,000 hours of surveillance video from around the Capitol grounds. Portions of that video will undoubtedly be unsealed as some of the more than 725 people arrested for alleged Jan. 6-related crimes go on trial. Whatever the chaos of that infamous day is called, one thing seems clear. The full Jan. 6 story hasn’t been told. One year later, the legacy of Jan. 6 is a trail of troubling questions—the answers to which could rock American politics and deepen the divide between its citizens. Is There Evidence of Treason or Sedition? In response to the violence at the Capitol, the FBI launched one of the most sweeping investigations in its history. Agents pored over cell phone video, social media postings, surveillance video, and police bodycam footage to identify those who were at the Capitol that day. The FBI opened a national tip line and posted videos and photographs of protesters. Tips came from many sources, including neighbors and family members who turned in their relatives. Of the more than 725 people arrested over the past year, no one was charged with treason or sedition. At least 225 defendants were charged with assaulting, resisting, or impeding police, including 75 who allegedly used a deadly or dangerous weapon, or caused serious bodily injury to an officer. Two men climb over other protesters and lunge at police officers guarding the entrance to the West Terrace tunnel at the U.S. Capitol on Jan. 6, 2021. (Screen Capture via The Epoch Times) The most common charge issued by federal prosecutors—involving 640 individuals—was for entering or remaining in a restricted federal building or grounds. About 40 percent of all those arrested were charged with impeding or attempting to impede an official proceeding—the certification of the Electoral College votes from the 2020 presidential election. Of the 165 people who have pleaded guilty to date, nearly 90 percent of the cases involved misdemeanors. The rest were felonies. Are There Any Investigative Conclusions? House Speaker Nancy Pelosi (D-Calif.) appointed a select committee to investigate the Jan. 6 breach and subsequent violence. That group’s work is ongoing. Preliminary findings could be made public by summer. Republican House members are conducting their own probe, but complain that Democrats refuse to cooperate or share records with their GOP colleagues. The Senate Committee on Homeland Security and Governmental Affairs, and the Committee on Rules and Administration, issued a report on the Capitol breach that cited a range of intelligence and law enforcement failures that enabled the violence. Among the findings in the Senate report was that neither the FBI nor the Department of Homeland Security issued formal intelligence bulletins about the potential for violence at the Capitol on Jan. 6. The FBI’s Norfolk field office sent out a situational information report late on Jan. 5, warning of individuals traveling to Washington for “war” at the Capitol, but the agency overall didn’t view as credible online posts calling for violence. Capitol Police didn’t have a department-wide operational plan or staffing plan for the Jan. 6 joint session of Congress, the report said. It faulted a lack of training in civil disturbances and a failure to provide basic protective equipment to rank-and-file officers. Who Incited the Capitol Breach and Violence? Independent media and online sleuths sounded alarms about the presence of unindicted individuals among those who first breached the Capitol at about 12:50 p.m. These men played a central role in the breach, encouraged protesters to go to the Capitol, and directed people into the building. Yet they haven’t been arrested, indicted, or identified by the FBI as among the wanted. Who were they? A man—now known to be Ray Epps of Queen Creek, Arizona—was captured on video on Jan. 5, 2021, attempting to recruit Trump supporters to assault the Capitol the next day. “Tomorrow, we need to go into the Capitol,” Epps says, as seen in a video clip. “Into the Capitol!” A man near him says, “What?” and others are heard shouting, “No!” Then the crowd breaks into a chant: “Fed! Fed! Fed! Fed!”—accusing Epps of being a federal agent. Ray Epps seen on Jan. 5, 2021, trying to recruit men to attack the Capitol. They accuse him of being a federal agent. (CapitolPunishmentTheMovie.com/Bark at the Hole Productions) Epps gets into verbal sparring with some of the Trump supporters. “You’re counterproductive to our cause,” one young man shouts. Epps shouts back, staying on message: “It doesn’t matter. … That’s not what we’re here for. … You’re getting off the subject. … We’re here for another reason.” Another video shows Epps saying, “Tomorrow—I don’t even like to say it because I’ll be arrested,” prompting a man nearby to reply, “Then let’s not say it.” Epps responds: “I’ll say it. We need to go into the Capitol!” A young man in the crowd, wearing an American flag neck gaiter, replies, “I didn’t see that coming!” On Jan. 6, as crowds milled about the Washington Monument in long lines to get in to watch Trump’s speech, Epps could be heard shouting through a megaphone: “As soon as our president is done speaking, we are going to the Capitol, where our problems are. It’s that direction. Please spread the word!” Epps is seen again in video footage taken at the metal barricades outside the Capitol at 12:50 p.m., as a small crowd chants, “USA! USA!” He whispers something in the ear of a man wearing a backward Make America Great Again cap. A few seconds later, the young man helps push over the barricade as Epps steps back to watch. This first breach of the security perimeter was 20 minutes before Trump finished his speech. Epps is then seen sprinting with the crowd up the steps toward the Capitol. A few days after the Jan. 6 violence, the FBI placed a photo of Epps on a “Seeking Information” poster, asking for the public’s help in identifying those who breached the Capitol. He could be seen in Photograph No. 16. That photo has since been scrubbed from the FBI website. Ray Epps is shown at lower left on an early FBI wanted poster, but his photo has since been scrubbed from the FBI website. (FBI.gov/Wayback Machine) On the current list of 1,559 photographs of people the FBI wants to identify, there is no longer a No. 16. The list skips from Photograph No. 15 to Photograph No. 17. Epps hasn’t been arrested or charged. John Guandolo, a former FBI agent and counter-terrorism expert who was on the Capitol grounds on Jan. 6, said he saw FBI agents dressed as protesters. “For a good portion of the day, I was with law enforcement, FBI, etcetera,” Guandolo said in an interview for the documentary “Capitol Punishment.” “Guys would walk by, and we’d look at each other and be like, ‘Two more right there. Here comes another. There’s another one.’ They were everywhere.” Revolver, an alternative news outlet, identified others around the Capitol grounds who were active participants in the breach but whose photos weren’t included on the FBI’s wanted list. One man, wearing a grey Bulwark jacket, knit cap, and sunglasses, is seen on video rolling up the green plastic fencing around the security perimeter. He pulls up the stakes and removes the “Area Closed” signs. A man in a blue cap with a blue bullhorn is seen in multiple videos atop the media tower erected for the inauguration. Dubbed “Scaffold Commander” by online researchers, he barks out directives and encouragement for 90 minutes. “Don’t just stand there! Keep moving!” “Move forward! Help somebody over the wall!” Once the crowd filled in around the Capitol, Scaffold Commander switched gears. “We’re in! Come on! We gotta fill up the Capitol! Come now, we need help!” Revolver’s video investigation said that whether or not Epps and Scaffold Commander knew each other, their words and actions worked well together. “So we have Scaffold Commander directing the body of the crowd from the tower above, and Ray Epps directing the vanguard front-liners at the police line below,” the Dec. 18 story read. “Yet neither one of them has been prosecuted, nor is either presently ‘wanted’ by the FBI.” Revolver founder Darren Beattie took to Twitter to ask Epps to expose who his handlers were. “But now, it is time to think for yourself, Ray. Forget about your boat and your ranch and your grill. If you make the right move and tell the truth, you change everything,” Beattie wrote on Dec. 29. Neither Epps, the FBI, nor federal prosecutors have commented on Epps’s actions that day, on whether he worked for the FBI, or on why he hasn’t been indicted. Epps told an Arizona Republic reporter on Jan. 12, 2021, “I didn’t do anything wrong.” Rep. Thomas Massie (R-Ky.) asked Attorney General Merrick Garland on Oct. 21 to dispel concerns about the Epps videos, but Garland wouldn’t comment. I just played this video for AG Merrick Garland. He refused to comment on how many agents or assets of the federal government were present in the crowd on Jan 5th and 6th and how many entered the Capitol. pic.twitter.com/lvd9n4mMHK — Thomas Massie (@RepThomasMassie) October 21, 2021 “You’ve said this was one of the most sweeping investigations in history,” Massie said during a public hearing. “Have you seen that video, those frames from that video?” Garland began talking about a standing practice of not commenting on investigative specifics, before Massie interrupted him: “How many agents or assets of the federal government were present on January 6th, whether they agitated to go into the Capitol, and if any of them did?” Garland’s reply: “I’m not going to comment on an investigation that’s ongoing.” What Is the Significance of Unindicted Actors? Attorneys who represent Jan. 6 defendants say if Epps or other participants were FBI informants or agents, then it blows a hole in the idea that Trump supporters were solely responsible for violence at the Capitol. Participation by government actors could legally invalidate conspiracy charges, they say. Attorney Jonathon Moseley, who represents Jan. 6 defendant Kelly Meggs of Dunnellon, Florida, a member of the Oath Keepers, issued subpoenas to Epps, Oath Keepers founder Stewart Rhodes, and other men who played visible roles on Jan. 6. As Meggs’s April trial on conspiracy charges approaches, Moseley wants to know why Epps was at the Trump rally and Capitol, and whether he was working for the government. Moseley said Epps was seen at the first breach of a police line at the pedestrian walkway, about 200 yards from the Capitol building. Video shows Epps as he appears to rush the makeshift barricade erected by police, “then stops short,” Moseley said. Ray Epps at the U.S. Capitol on Jan. 6, 2021, shortly before pepper gas is shot into the crowd. “Been a long time,” he says after coughing. “Aah, I love it!” (Screen Capture/Rumble) “It’s like he’s head-faking people to rush with him, but then he never touches it,” he said. “A police officer falls—I think it may be a woman—and his immediate instinct is to go help her, and he thinks better of it and steps back. It really looks like he’s undercover.” Moseley said the involvement of government-paid actors in facilitating or inciting the breach of the Capitol complex would create reasonable doubt in just about any of the Jan. 6 cases. “There are legal consultants who keep emphasizing that, legally, you can’t conspire with the government. So if he’s working directly or indirectly for the government, then people are innocent of the conspiracy,” Moseley said. “It’s a legal rule. If there are 10 people conspiring and one of them is with the government, not only could it be entrapment, but it also may invalidate a conspiracy.” That type of legal issue has been raised in a Michigan case in which a group of men stand accused in federal court of a plot to kidnap Michigan Gov. Gretchen Whitmer, a Democrat. Defense attorneys recently filed a motion to dismiss the case, contending that government agents and informants concocted the kidnapping plan and pushed to convince the defendants to participate. Are Jan. 6 Detainees Political Prisoners? Third-world banana republics are notorious for terrible prison conditions and brutal treatment of the accused and convicted alike. Some lawyers, family members, and defendants believe the District of Columbia operates a jail that would be at home in any of those countries. The jail is sometimes called “DC-GITMO,” after the U.S.-run terrorist detention camp in Guantánamo Bay, Cuba. The poor accommodations at the D.C. jail have long been the subject of discussion in the nation’s capital. The Washington Post said conditions there were “deplorable,” an ironic descriptor, considering who the jail’s primary occupants are these days. The issue got national attention in 2021 because of repeated allegations of brutal, abusive treatment of men accused of Jan. 6 crimes. A 28-page report issued in late 2021 by Rep. Marjorie Taylor Greene (R-Ga.) said treatment of Jan. 6 detainees was “inhumane.” (Document Cover/Marjorie Taylor Greene) “American citizens are being tortured right now within five miles of the White House,” said Joseph McBride, a New York attorney who represents a half-dozen Jan. 6 defendants. “America does not punish its citizens pre-trial,” McBride wrote on Twitter. “Authoritarian regimes do.” McBride said his clients have suffered treatment that should never happen in America, all because they supported Trump by being at the U.S. Capitol on that fateful day. During incarceration, they’ve suffered—among other things—severe beatings by guards; the denial of medical attention, including medications for chemotherapy; and refusal of food, McBride said. Christopher Quaglin, charged with assaulting police officers during the riot, suffers from celiac disease, but the jail feeds him only food with gluten, McBride said. He has been refused medical treatment. “Yes, we are extremely concerned that he will die,” McBride wrote on Twitter on Dec. 27. Ted Hull, the superintendent of Northern Neck Regional Jail, where Quaglin is housed, said McBride’s assertions are wrong. Christopher Quaglin with his wife, Moria, who fears her husband could die without medical attention in federal custody. (Courtesy Quaglin Family) “Regardless of Mr. McBride’s fictitious assertions,” Hull told The Epoch Times, “inmate Quaglin is and has been receiving the appropriate dietitian-designed diet consistent with his specific dietary requirements and the appropriate level of medical services consistent with his diagnosis.” Rep. Marjorie Taylor Greene (R-Ga.) toured the D.C. jail with Rep. Louie Gohmert (R-Texas) in November, then issued a 28-page report titled “Unusually Cruel.” The report said the conditions for the Jan. 6 detainees were “inhumane.” Couy Griffin, the founder of Cowboys for Trump who attended the Jan. 6 Trump rally and was on the Capitol grounds, never went inside the Capitol building. He was charged with entering and remaining in a restricted building, and disorderly and disruptive conduct in a restricted building. He was arrested and jailed, but eventually released while awaiting trial. “I spent the next nine days in that cell in total solitary confinement. No shower, no phone, no attorney,” Griffin said in the film “Capitol Punishment.” The guards, he said, often chanted “F Trump! F Trump!” and called him an “[expletive] white cracker.” He complained about his treatment to the deputy warden, who he said told him, “The only job these guards have is to keep your chest moving up and down.” Richard Barnett of Gravette, Arkansas, faced seven charges for his alleged actions on Jan. 6, including sitting in the office chair of House Speaker Nancy Pelosi, captured in a now-iconic news photograph. One day during his four-month detention, Barnett experienced tightness in his chest and arm pain. He called for help, but the guard who responded only mocked and laughed at him. Barnett then called out to a female staff member, who said she would get help. “Richard [lay] there for a significant period of time—certainly enough for him to die,” read McBride’s report on jail conditions, which he sent to Amnesty International. After being given a medical checkup and returned to his cell, Barnett fell asleep. A guard began pounding on the glass door to his cell, jolting him awake so quickly he stood up and then fainted, hitting his head on the sink. Now bleeding from a head wound, Barnett screamed for an hour before help came, the report said. One day, Barnett’s cell door opened, and some nine officers entered, cuffing his wrists and shackling his legs. Guards violently shook him back and forth, lifted him off his feet by the shackles, and slammed him headfirst into the concrete floor, according to McBride’s report, a copy of which was also sent to the American Civil Liberties Union. The U.S. Marshals Service conducted a surprise inspection of the D.C. jail facilities in October and interviewed 300 detainees. Conditions at the jail “do not meet the minimum standards of confinement,” the Marshals report said. As a result, the Marshals Service removed all of its detainees and transferred them to facilities in the federal Bureau of Prisons. This didn’t include the Jan. 6 detainees. Emery Nelson, spokesperson for the Bureau of Prisons, said the agency doesn’t comment on “anecdotal allegations” or provide information about individual inmates. “The Bureau of Prisons (BOP) is committed to accommodating the needs of federal offenders and ensuring the safety and security of all inmates in our population, our staff, and the public,” Nelson said. “The BOP takes seriously our duty to protect the individuals entrusted in our care.” Who Died at the Capitol on Jan. 6? One person was killed at the hands of U.S. Capitol Police, and police action might have contributed to the death of two others, but the four other deaths related to Jan. 6 were either from natural causes or suicides. Ashli Babbitt was shot in the left shoulder and killed as she crawled through a broken window at the entry to the Speaker’s Lobby. Ashli’s husband, Aaron Babbitt, said a careful examination of video footage from the hallway indicates Ashli was upset with rioters who smashed glass in the double doors. He thinks she panicked and sought escape through the window, only to be shot by Lt. Michael Byrd as a result. She was unarmed and presented no threat to anyone, Aaron Babbitt said. Capitol Police Lt. Michael Byrd aims his Glock 22 at the window where Ashli Babbitt was about to appear. (CapitolPunishmentTheMovie/Bark at the Hole Productions) Rosanne Boyland, 34, of Georgia, died in or near the West Terrace tunnel at the Capitol. McBride says surveillance video shows Boyland was beaten by a police officer as she lay on the ground. The D.C. medical examiner ruled the death accidental: intoxication from a prescription medication. Kevin Greeson, 51, of Georgia, died on the Capitol grounds of a heart attack brought on by cardiovascular disease, the medical examiner ruled. Benjamin Phillips, 50, of Pennsylvania, died of atherosclerosis, heart disease characterized by fatty plaques that build up in the arteries, the medical examiner ruled. Of the three police officers who died in the weeks following Jan. 6, Sicknick died from natural causes, and Liebengood and Smith died from suicide. Did Democrats Weaponize Jan. 6? Rep. Rodney Davis (R-Ill.), ranking member of the Committee on House Administration, accused House Speaker Nancy Pelosi (D-Calif.) and House Democrats of “weaponizing events of January 6th against their political adversaries.” Davis sent a letter to Pelosi on Jan. 3, 2022, complaining that House Democrats repeatedly obstructed attempts by Republican lawmakers to investigate security vulnerabilities at the U.S. Capitol before and during Jan. 6 violence. The obstruction came through denial of House records and ignoring repeated requests for documents, Davis wrote. “Unfortunately, over the past twelve months, House Democrats have been more interested in exploiting the events of January 6th for political purposes than in conducting basic oversight of the security vulnerabilities exposed that day,” Davis wrote. Specifically, lawmakers want to know about a request that former U.S. Capitol Police Chief Steven Sund said he made to then-House Sergeant-at-Arms Paul Irving prior to Jan. 6 for “the assistance of the National Guard,” Davis wrote. Sund reported that Irving was “concerned about the ‘optics’ of a National Guard presence at the Capitol.” During violence on Jan. 6, when Sund asked about getting authorization for the National Guard, Irving responded that he “needed to run it up the chain of command,” the letter said. Former U.S. Capitol Police Chief Steven Sund testifies at a Senate Homeland Security and Governmental Affairs and Senate Rules and Administration committees joint hearing on Capitol Hill in Washington on Feb. 23, 2021. (Erin Scott/Pool/AFP via Getty Images) In February 2021 testimony before the U.S. Senate, Irving denied Sund’s claims. Republican lawmakers then requested access to Irving’s communications to substantiate that denial. Davis said he wrote to House General Counsel Douglas Letter to request those records, but Letter never replied. “Both the Sergeant at Arms and the chief administration officer failed to produce any documents to Republicans pursuant to our requests,” Davis wrote, “suggesting that these House officers may be providing documents only to Democrats on a partisan basis.” Davis said Republicans want to know why Sund’s Jan. 4, 2021, request for National Guard support on Jan. 6 was denied, and whether Pelosi or her staff ordered the refusal. They also want to know what conversations occurred during Capitol violence on Jan. 6, when Sund again asked for National Guard help. Finally, they want to know why the select committee on Jan. 6, appointed by Pelosi, won’t examine the speaker’s role “in ensuring the proper House security preparations,” the letter said. When asked whether the speaker had responded to Davis, Henry Connelly, Pelosi’s communications director, referred The Epoch Times to a statement issued by House Administration Committee Chair Zoe Lofgren (D-Calif.). “The Ranking Member’s letter is pure revisionist fiction. The Chief Administrative Officer and House Sergeant at Arms have already notified Ranking Member Davis they are complying with preservation requests and will fully cooperate with various law enforcement investigations and bonafide congressional inquiries,” Lofgren said in the statement. From the inception of the Select Committee to Investigate the January 6th Attack on the United States Capitol, Republican leadership discounted its work because Pelosi rejected two of the five Republicans chosen by House Minority Leader Kevin McCarthy (R-Calif.) for the probe. McCarthy then withdrew his picks. Pelosi appointed Reps. Liz Cheney (R-Wyo.) and Adam Kinzinger (R-Ill.) to serve on the nine-member panel. The select committee could issue at least an interim report by mid-2022 and a final report in the fall, committee sources told several media outlets. Committee chairman Rep. Bennie Thompson (D-Miss.) said in December that there was no set schedule for public hearings to release the group’s findings. The Epoch Times asked the Department of Justice for comment on the presence of federal agents on Jan. 6, but didn’t receive a reply by press time. The Epoch Times contacted Epps through his business for comment, but didn’t receive a reply by press time. Tyler Durden Thu, 01/06/2022 - 16:20.....»»

Category: blogSource: zerohedgeJan 6th, 2022

A guide to the most important primary elections of the 2022 midterms, which will test Trump"s influence over the GOP

The 2022 primaries, starting in March, will test former President Trump's power over the GOP and could reshape both parties' bases in Congress. The U.S Capitol is visible at sunset as a man plays fetch with a dog in Washington, Thursday, Sept. 30, 2021AP Photo/Andrew Harnik Critical primary elections for the 2022 midterms are kicking off in March.  Primaries will hold greater importance in 2022 with fewer competitive districts in Congress. The 2022 primaries will also test Trump's influence over the GOP and shape both parties' futures.  The 2022 midterm elections are just 10 months away, and primaries for key congressional and statewide races will be more crucial and decisive than ever for both political parties. The 2022 primaries will test the power of former President Donald Trump's endorsement — and his status as the leader of the Republican Party. This year's primaries could substantially reshape the composition of Congress and each party's bases. And the unprecedented effort to overturn the results of the 2020 presidential election will loom large in 2022's elections, which will determine who runs and oversees future elections. In Congress, Republicans have their sights set on winning back the US Senate, currently evenly split between 50 Democrats and 50 Republicans, by flipping Democratic-held seats in Arizona and Georgia and holding control of competitive open seats in North Carolina and Pennsylvania. Republicans are well-positioned to win back the House of Representatives, where Democrats hold just a slim three-vote majority, due to President Joe Biden's poor approval ratings and the historical norm of the president's party losing seats in midterm elections. But not all majorities are created equal. On the GOP side, more Trump-style conservatives could replace moderate and establishment Republicans, especially in the US Senate, where five such Republicans are retiring.  And Democrats could see more young candidates and candidates of color, who are underrepresented in both chambers of Congress, replace retiring members. In this June 5, 2021, file photo, former President Donald Trump, right, announces his endorsement of North Carolina Rep. Ted Budd, left, for the 2022 North Carolina U.S. Senate seat vacated by retiring Sen. Richard BurrChris Seward/APAs of January 5, 36 House members and counting are retiring, setting off a nationwide reshuffling that will play out during the primary season. Over two-thirds of already-announced retirements are from the Democratic side of the aisle, a possible indication of how Democrats view their prospects of holding the House majority. Complicating matters further, the national House primary calendar is still in flux due to the ongoing process of states drawing new congressional lines following the 2020 Census, which was delayed due to the COVID-19 pandemic. Long-term trends of negative polarization, partisan self-sorting, and a decline in voters who split their tickets between parties are being exacerbated by states shoring up incumbents at the expense of competitiveness in redistricting. This means the 2022 elections are likely to see a historically low number of competitive House districts in general elections, making primaries even more important. Many states have yet to complete their congressional redistricting, and some key states that have finalized maps, like Ohio and North Carolina, are facing lawsuits over congressional and state legislative lines that could delay their filings periods and primary dates. North Carolina has already pushed back its primaries, and Pennsylvania could be next, delays that also affect marquee Senate and gubernatorial contests.Here are the most important and most competitive primaries happening over the next nine months as currently scheduled: Texas Attorney General Ken Paxton, left, next to his wife and Texas State Sen. Angela Paxton, speaks to anti-abortion activists at a rally outside the Supreme Court, Monday, Nov. 1, 2021.AP Photo/Jacquelyn MartinMarch: The 2022 primary cycle is set to kick off in Texas on March 1. Embattled Republican Attorney General Ken Paxton is facing multiple high-profile primary challenges from Rep. Louie Gohmert, Texas Land Commissioner George P. Bush, and former State Supreme Court Justice Eva Guzman. Gov. Greg Abbott will also face primary challengers including former state Sen. Don Huffines, who has been endorsed by several Trumpworld figures, and Allen West, the former state party chairman. Democrat Beto O'Rourke is likely to secure the Democratic nomination for the governorship in Texas, which hasn't elected a Democrat to statewide office in three decades. Texas also gained two House seats in post-2020 Census reapportionment and has three members of its delegation retiring, setting up competitive primaries in some House districts. Texas will hold runoff elections in May for any contests where no candidate earns a majority of the vote outright. May: On May 3, Ohio is holding a hotly-contested Republican primary for US Senate to replace longtime retiring GOP Sen. Rob Portman. The candidates include former state party chair Jane Timken, former State Treasurer Josh Mandel, state Sen. Mike Dolan, venture capitalist and author JD Vance, and businessmen Mike Gibbons and Bernie Moreno. Rep. Tim Ryan and former Consumer Financial Protection Bureau adviser Morgan Harper are the two main contenders for the Democratic nomination. Gov. Mike DeWine is facing primary challenges from former Rep. Jim Renacci and Joe Blystone, who are appealing to Trump's supporters.May 10 will see the first confirmed House primary between two incumbents with Trump-endorsed Rep. Alex Mooney facing off against Rep. David McKinley for West Virginia's 1st Congressional District. The two Republicans were drawn into the same district as a result of the state losing a congressional seat after the 2020 Census. May 17 is set to see primaries for high-stakes statewide races in the swing states of Pennsylvania and North Carolina (if either state's primaries don't get delayed).In Pennsylvania, competitive Republican and Democratic primaries will determine the nominees for the open US Senate seat being vacated by retiring Republican Sen. Pat Toomey. Physician and television personality Mehmet Oz, hedgefund executive David McCormick, former US Ambassador Carla Sands, and real estate developer Dave Bartos are competing for the GOP nomination.Rep. Conor Lamb, Lieutenant Governor John Fetterman, State Rep. Malcolm Kenyatta, and Montgomery County Commissioner and physician Val Arkoosh are the lead contenders vying for the Democratic nomination for Senate to flip the seat. State Rep. Malcolm Kenyatta, left, and Rep. Conor Lamb, right, are two of the Democrats seeking to flip control of a key US Senate seat in PennsylvaniaAP Photo/Marc Levy, AP Photo/Dave DermerNorth Carolina is holding primaries for an open US Senate seat held by retiring GOP Sen. Richard Burr. The Republican field includes Trump-endorsed Rep. Ted Budd, Rep. Mark Walker, and former Gov. Pat McCrory while Cheri Beasley, former Chief Justice of the North Carolina Supreme Court, appears poised to secure the Democratic nomination. North Carolina, home to some of the most contentious partisan and legal battles over redistricting in recent history, is back in court defending its congressional maps after GOP lawmakers drew an aggressive Republican gerrymander, a case with significant implications for the state's House primaries. On May 19, Idaho's Lieutenant Governor Janice McGeachin is waging a Trump-backed primary challenge against incumbent GOP Gov. Brad Little.On May 24, Trump-backed congressman Mo Brooks and former Senate chief of staff Katie Britt are the leading candidates in the GOP primary for the Alabama US Senate seat vacated by retiring Sen. Richard Shelby.While Brooks has Trump's support (for now, at least), Britt has received the backing of Shelby, her former boss, and quietly gotten financial support from several members of the Senate Republican caucus. Lynda Blanchard, former US Ambassador to Slovenia under the Trump administration, was also initially in the running for Senate but dropped out of that race and is now mounting a primary challenge to incumbent GOP Gov. Kay Ivey.Georgia gubernatorial Democratic candidate Stacey Abrams speaks during an interview with The Associated Press on Thursday, Dec. 16, 2021, in Decatur, GaBrynn Anderson/APAlso on May 24, a series of blockbuster primaries in Georgia will set the battle lines for November's elections in the key battleground state which after years as a reliable GOP stronghold, voted for Biden in 2020 and handed control of the Senate to Democrats in 2021.Former NFL star Herschel Walker, endorsed by Trump, is the frontrunner in the GOP primary to take on Democratic Sen. Raphael Warnock, who was elected in a 2021 special runoff election, for a full term. Two top Republicans who endured Trump's wrath for defending the integrity of the 2020 election in Georgia are now contending against Trump-backed primary challengers.Gov. Brian Kemp will face primary challengers from former US Senator David Perdue, who has been endorsed by Trump, and state Rep. Vernon Jones. Republican Secretary of State Brad Raffensperger is facing a Trump-endorsed primary challenge from GOP Rep. Jody Hice, one of the congressmen who led the charge to object to counting electoral votes on January 6. Stacey Abrams is the strong frontrunner in the Democratic primary for a potential rematch against Kemp. In the House, two Democratic incumbents, Rep. Lucy McBath and Rep. Carolyn Bourdeaux, will also face off in the primary for the new 7th District. North Carolina, Georgia, and Alabama all hold runoff elections later in the summer for races in which no one candidate earns a plurality or a majority of the vote outright. In this Sunday, Oct. 10, 2021, photo Republican Adam Laxalt, flanked by pictures of Presidents Abraham Lincoln and Ronald Reagan, talks to a supporter at the Douglas County Republican Party Headquarters on the final day of his Senate campaign's statewide tour in Gardnerville, NevAP Photo/Sam MentzJune:The battleground state of Nevada will hold primaries for races including its competitive Senate contest, on June 14, where former Attorney General Adam Laxalt is the frontrunner to run against Democratic Sen. Catherine Cortez-Masto.South Carolina is holding House primaries on June 14 in which GOP Reps. Nancy Mace and Tom Rice, who vocally criticized Trump over the January 6 insurrection, could both face Trump-backed primary challengers.California, Illinois, and New York, key Democratic strongholds which all lost one House seat each in post-2020 reapportionment, are also holding their House primaries in June. California's independent redistricting commission drew a Democratic-friendly map that, along with four House retirements, avoided pitting incumbents against each other but sets the stage for some competitive primaries on June 14.On June 28, Illinois, where state lawmakers drew an aggressive Democratic gerrymander, will see two member-on-member primaries: one between Democratic Reps. Sean Casten and Marie Newmanin the Chicago suburbs and downstate between two Republicans, Trump-endorsed Rep. Mary Miller, and Rep. Rodney Davis.New York's congressional lines aren't close to being finalized yet. But further up the ballot, Gov. Kathy Hochul, who ascended to the office in August 2021, is seeking the nomination for a full term against challengers including Rep. Tom Suozzi, New York City Public Advocate Jumaane Williams, and likely New York City Mayor Bill de Blasio.In this Dec. 14, 2020, file photo, Arizona Secretary of State Katie Hobbs, a Democratic candidate for governor, addresses the members of Arizona's Electoral College in Phoenix.AP Photo/Ross D. Franklin, Pool, FileAugust:August will be a significant test of Trump's ability to punish high-profile members of Congress who voted to impeach and convict him for inciting the January 6 insurrection, and to shape competitive Republican primaries. And two more Trump-backed candidates are running for key election administration positions in the presidential swing states of Arizona and Michigan.The month starts on August 2 with competitive primaries in Arizona, Missouri, Michigan, and Washington.  In Arizona, Trump-endorsed candidate and former TV anchor Kari Lake is seeking the GOP nomination to replace Gov. Doug Ducey, who is term-limited, against State Treasurer Kimberly Yee, state Regent Karrin Taylor Robson, former Rep. Matt Salmon, and businessman Steve Gaynor. Secretary of State Katie Hobbs, who gained a national profile for defending the 2020 election results and rebuffing the partisan review of the 2020 election results in Arizona, is seeking the Democratic nomination for governor along with former state Rep. Aaron Lieberman. A crowded field of candidates, including Attorney General Mark Brnovich, Thiel Foundation president Blake Masters, and businessman Jim Lamon, are competing for the GOP nomination for US Senate to take on Democratic Sen. Mark Kelly. Trump-endorsed state Rep. Mark Finchem, who has echoed Trump's lies that the 2020 election was stolen, is competing for the Republican nomination for secretary of state against fellow state Rep. Shawnna Bolick and State Sen. Michelle Ugenti-Rita. Former Maricopa Recorder Adrian Fontes and Arizona's House Minority Leader Reginald Bolling are running in the Democratic primary for the top election job. Former Gov. Eric Greitens, left, and Attorney General Eric Schmitt, right, are the leading candidates for the GOP nomination for US Senate in MissouriAP Photo/Jeff RobersonIn Missouri, a crowded field of Republicans, including former Gov. Eric Greitens, Attorney General Eric Schmitt, Reps. Vicky Hartzler and Billy Long, and personal injury lawyer Mark McCloskey, are competing for the nomination for US Senate to replace retiring GOP Sen. Roy Blunt in the now solidly-Republican state. Trump has not yet endorsed candidates in either the Arizona or Missouri Senate primaries. In the key swing state of Michigan, Republicans will select nominees to run against Gov. Gretchen Whitmer, Attorney General Dana Nessel, and Secretary of State Jocelyn Benson. Trump-endorsed Kristina Karamo is seeking to challenge Benson for the state's top election post.Due to redistricting, Democratic Reps. Haley Stevens and Andy Levin will face off in the primary for Michigan's new 11th Congressional District. Rep. Peter Meijer, one of the Republicans who voted to impeach Trump over January 6, is also set to face a Trump-backed primary challenger.Two Washington State House Republicans who voted to impeach Trump, Rep. Dan Newhouse and Rep. Jaime Herrera Beutler, who has a Trump-endorsed primary challenger, are also seeking reelection on August 2.On August 9, voters in battleground Wisconsin will select a Democratic nominee for Senate to run for the seat currently held by GOP Sen. Ron Johnson, who hasn't yet confirmed whether he's running for election, and a Republican nominee to take on Democratic Gov. Tony Evers. Rep. Liz Cheney speaks with U.S. Capitol Police Sgt. Aquilino Gonell after a House select committee hearing on the Jan. 6 attack on Capitol Hill. Cheney is facing a primary challenger endorsed by Trump.Jim Bourg/Pool via AP, FileOn August 16, two of Trump's most high-profile Republican foes in Congress will face primary challenges. Sen. Lisa Murkowski will face off against Trump-endorsed primary challenger Kelly Tshibaka under Alaska's first-ever top-four primary election system. And Rep. Liz Cheney, the Republican vice-chair of the House Select Committee probing the January 6 insurrection, will face Trump-backed Harriet Hageman in Wyoming's at-large House seat. Florida rounds out the month with its August 23 primaries. Democrats will decide on a nominee to take on GOP Gov. Ron DeSantis between Agriculture Commissioner Nikki Fried, Rep. Charlie Crist, and State Sen. Annette Taddeo. Voters will also pick a Democratic nominee to take on Sen. Marco Rubio out of a field currently led by Rep. Val Demings.September: New England will finish out the primary cycle. Republicans, who have struggled to recruit a candidate to run against vulnerable Democratic Sen. Maggie Hassan in New Hampshire, will select a nominee on September 13. And in the House, a crowded field of GOP candidates including Gail Huff Brown, former TV anchor and wife of former Sen. Scott Brown, former State Department spokesman Matt Mowers, and former Trump White House spokeswoman Karoline Leavitt are competing to take on Rep. Chris Pappas. Massachusetts will select nominees to replace outgoing GOP Gov. Charlie Baker, whose decision not to run for a third term creates a prime pickup opportunity for Democrats. Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJan 5th, 2022

Futures Surge To A Record Above 4,800 As Euphoria Grips Global Markets

Futures Surge To A Record Above 4,800 As Euphoria Grips Global Markets US stock futures, European bourses and Asian markets all rose, extending the blistering start to 2022 (just as Goldman predicted in its $125 billion January inflow case), with more strategists cementing their bullish projections as investors shrugged off worries Omicron could choke the global economic recovery as data on U.S. manufacturing and job openings due today will further show the world’s largest economy is resilient against the spread of omicron. Nasdaq 100 futures rose 0.4% and contracts on the S&P 500 climbed 0.3% to a new all time high above 4,800 after the underlying gauge closed at a record on Monday. European stocks also gained. Waning demand for haven assets pushed the yen to a five-year low, while oil fluctuated ahead of an OPEC+ meeting. The dollar and U.S. treasury yields extended their surge - with the 10Y last yielding 1.6630% - after Monday’s worst start to a year since 2009. JPMorgan Chase & Co. strategists advised staying bullish on global stocks, saying positive catalysts are not exhausted, while Credit Suisse reiterated a bullish view on U.S. stocks. In premarket trading, Apple shares rose as much as 0.5%, putting the iPhone maker on track to reclaim $3 trillion in market cap as appetite for risk returns. Meanwhile, Jowell Global plunged 11% after a volatile trading session for the Chinese e-commerce stock on Monday that saw it plunge 59%. Travel stocks rallied for a second day even as the U.S. reported a record of over 1 million Covid cases, amid growing evidence that the omicron variant leads to milder infections. The S&P Supercomposite Airlines Index rose 3.3% Monday to the highest since Nov. 24 and appears set for further gains Tuesday. Most airline companies rose about 1% in premarket trading, while cruise lines were also higher with Carnival +1.8%, Royal Caribbean +1%, Norwegian +1.4%. General Electric rose after the stock was raised to outperform at Credit Suisse and Hewlett Packard Enterprise climbed with an overweight rating from Barclays. Here are some other notable pre-market movers today: Coca-Cola (KO US) sits in a stronger position following a transition year in 2021, Guggenheim Securities writes in note upgrading to buy after almost exactly a year with a neutral stance. Shares up 1% in premarket. Stryker (SYK US) and Globus Medical (GMED US) both upgraded to overweight at Piper Sandler, which says in a note that the two stocks have momentum to continue delivering above-average share performance this year. Stryker up 1.4% premarket. Tiny U.S. biotech stocks gain in high premarket volume amid a broader return of risk appetite and following positive updates on studies. Oragenics (OGEN US) +23%, Indaptus Therapeutics (INDP US) +7%. Intra-Cellular Therapies (ITCI US) falls 7% in premarket after launching a $400 million share sale. AFC Gamma (AFCG US) falls 11% premarket after launching a stock offering. Core & Main (CNM US) dropped 7.6% postmarket after holders offered a stake. In Europe, the Euro STOXX 600 gained as much as 0.9% in early trading, pushing beyond its all-time high of 489.99 points scaled a day earlier, with the FTSE 100 and CAC 40 up over 1.25%. Travel and leisure stocks jumped 2.7%, with Ryanair adding 8% and British Airways-owner IAG gaining over 9%, reflecting expectations Omicron's impact on the industry would be less severe than initially feared. Euro Stoxx 50 added as much as 1% with travel, autos and banks the best performing sectors so far. Investors have set aside worries about the highly infectious omicron variant as they continue to trade on the economic recovery from the pandemic which may soon be ending thanks to Omicron which could make covid endemic. “Globally, there is a lot of news regarding the rising omicron cases, but there is also a lot of news that the cases are not as deadly as the previous variants of Covid,” Ipek Ozkardeskaya, a senior analyst at Swissquote, wrote in a note. “And investors prefer focusing on a glass half full rather than a glass half empty at the start of the year.” "The chief reason behind the return of investor confidence is Omicron," said Jeffrey Halley, an analyst at Oanda. Yes, the virus variant is much more contagious, but it is not leading to a proportionally larger number of hospital admissions... (so) it won't stop the global economic recovery." This, incidentally, is precisely what we said over a month ago. That said, markets anticipate an uptick in volatility as they navigate through the omicron variant, supply-chain disruptions and more central banks winding back pandemic stimulus. More than one million people in the U.S. were diagnosed with Covid-19 on Monday, a new global daily record, and yet markets barely winced. Asian stocks gained behind rallies in Japan and Australia on their first trading sessions of 2022, with much of the region tracking the strong performance in the U.S. as investors maintained growth optimism despite a worsening pandemic.  The MSCI Asia Pacific Index rose as much as 1%, the most in two weeks, lifted by technology and financial shares. Metals and mining stocks gave the Australian benchmark gauge a boost, while a weaker yen allowed exporters to provide support for Japan’s Topix. Chinese stocks bucked the regional trend to suffer their weakest start to a year since 2019. The CSI 300 Index fell 0.5% as some investors took profit and assessed developments in the property sector while renewable energy and health-care firms paced declines. Also souring the mood, the People Bank of China cut its net injection of short-term cash to the markets, prompting concerns over support for the financial system. Tuesday’s activities in Asia also showed some traders setting aside their worries over the rapid spread of omicron strain for now to bet on resilience in the global economy.  While the omicron variant will be a negative factor in the short term, Chinese equities will likely help drive emerging markets higher in 2022 as monetary and fiscal stimulus spur economic growth, said Kristina Hooper, chief global market strategist at Invesco.  The Philippine Stock Exchange had to cancel trading following a system glitch, according to a statement by bourse President Ramon Monzon Japanese equities rose in their first trading session of the year, helped by the yen’s drop to a five-year low and a tailwind from U.S. peers’ climb to fresh all-time highs. Electronics and auto makers were the biggest boosts to the Topix, which gained 1.9%, the most in four weeks. All industry groups advanced except papermakers and energy explorers. Tokyo Electron and Advantest were the largest contributors to a 1.8% rise in the Nikkei 225.  The S&P 500 rose to a record and Treasury yields climbed Monday as traders braced for the start of a potentially volatile year and three expected rate hikes from the Federal Reserve. The White House is likely to nominate economist Philip Jefferson for a seat on the Fed board of governors, according to people familiar with the matter. “It’s gradually coming to light who will be the new members of the FRB and it looks like they will be those with quite a dovish stance, which very supportive factor for stocks,” said Hiroshi Matsumoto, senior client portfolio manager at Pictet Asset Management in Tokyo.  Australian stocks jumped themost in over a year, with fresh records in sight. The S&P/ASX 200 index rose 2% to 7,589.80, marking its best session since October 2020. The benchmark closed about 40 points away from the all-time high it reached in August as all sectors gained. Pilbara Minerals was among the top performers, jumping to a record. St. Barbara was among the worst performers after giving an update on its Simberi mine. In New Zealand, the market was closed for a holiday. India’s Sensex rallied for a third day as the outlook for lenders improved on the back of a continued recovery in the economy.  The S&P BSE Sensex rose 1.1% to 59,855.93 in Mumbai, while the NSE Nifty 50 Index rallied 1%. All but three of the 19 sector sub-indexes compiled by BSE Ltd. climbed, led by a gauge of power companies. The S&P BSE Bankex added 1.3% to stretch its rally to a fourth day, its longest streak of gains since Oct. 26.   Financial stocks in India offer an attractive entry point after foreign funds sold more than $3 billion of sector stocks over Nov.-Dec., Jefferies analyst Prakhar Sharma wrote in a note. He expects improved growth, stable asset quality and manageable omicron impact to aid a re-rating of the sector. “Markets are currently following their global counterparts while the domestic factors are showing mixed indications,” Religare Broking analyst Ajit Mishra said in a note.  Reliance Industries contributed the most to the Sensex’s gain on Tuesday, increasing 2.2%. Out of 30 shares in the index, 25 rose and five fell. In FX, Bloomberg Dollar Spot Index trades notably higher for the second day in a row, with AUD and CHF top the G-10 leader board, while the JPY lags pushing through Asia’s worst levels near 116.31/USD.  The euro was confined in a narrow range around $1.13 while the greenback weakened versus all of its Group-of-10 peers apart from the yen and risk-sensitive currencies were the best performers. The pound edged higher, continuing its ascent over the holiday period that was based on firmer global risk sentiment and bets the U.K. economy won’t be derailed by omicron. Gilts slumped as traders caught up with Monday’s jump in U.S. and euro-area yields after the U.K. was closed for a holiday. Australia’s government bonds and the nation’s currency both rose amid speculation the global economic recovery will weather the surge in omicron infections. New Zealand’s markets remained shut for New Year holidays. Purchasing managers’ index for the Australia’s manufacturing sector declined for the first time in four months in December, Markit data showed. The yen dropped to a five-year, with the USDJPY rising above 116 as speculation the global economic recovery will weather omicron saps demand for haven assets. Japanese bonds declined before debt auctions later this week. Options pricing suggests there may be more gains for the dollar in a rally against the yen that’s already taken it to the strongest since 2017. In rates, 10-year Treasury yield spiked to 1.66% after surging 12 basis points on Monday, the biggest jump to start a year since 2009. The two-year rate was at 0.77%. Treasury yields were cheaper by up to 1.5bp across front- and belly of the curve with long-end yields slightly richer vs. Monday close. IG dollar issuance includes a number of bank names headed by NAB 5-part offering. Three-month dollar Libor +0.69bp at 0.21600%. Bunds richen 1.5bps across the belly with a mixed peripheral complex with expectations for a busy issuance slate ahead. Gilts underperform, playing catch up to Monday’s move in bunds and treasuries, cheapening as much as 10bps across the curve with 10s near 1.07%. Looking beyond the current risk-on momentum, traders expect Fed tightening to further boost yields and reset equity valuations. This week’s U.S. December payroll data and minutes from the Fed’s meeting last month may throw more light on the pace of such shift. “We expect 2022 to be far more challenging from an investment perspective,” Heather Wald, vice president at Bel Air Investment Advisors, said in an emailed note. “Rarely has a market delivered three consecutive years of double-digit returns, as we have seen from 2019-2021. With the Federal Reserve set to accelerate tightening and a fairly valued stock market, we anticipate more muted returns for the S&P next year but still expect equities to remain attractive versus other liquid asset classes.” In commodities, crude futures flip a short-lived dip to rise ~0.7%. WTI trades near best levels of the session close to $76.70, Brent near $79.50 ahead of today’s OPEC+ gathering. Spot gold trades a tight range, holding above $1,800/oz. Base metals are mixed, LME copper underperforms. U.S. economic data slate includes the December ISM manufacturing survey, which will show the early impact of the variant on supply chains, while the JOLTS data will show the balance between job openings and unemployment numbers; also this week brings ADP employment change, durable goods orders and December jobs report. Market Snapshot S&P 500 futures up 0.3% to 4,799 STOXX Europe 600 up 0.5% to 492.53 German 10Y yield little changed at -0.13% Euro little changed at $1.1307 MXAP up 0.9% to 194.72 MXAPJ up 0.6% to 633.00 Nikkei up 1.8% to 29,301.79 Topix up 1.9% to 2,030.22 Hang Seng Index little changed at 23,289.84 Shanghai Composite down 0.2% to 3,632.33 Sensex up 1.1% to 59,815.19 Australia S&P/ASX 200 up 1.9% to 7,589.76 Kospi little changed at 2,989.24 Brent Futures up 0.4% to $79.26/bbl Gold spot up 0.3% to $1,806.40 U.S. Dollar Index little changed at 96.18 Top Overnight News from Bloomberg Treasury traders are betting the rapid spread of omicron will increase inflationary pressures in the U.S. economy, rather than weaken them Global central banks are set to spend 2022 diverging, as some take on the menace of inflation and others stay focused on boosting economic growth French inflation stabilized in December, indicating price pressures may be near a peak in the euro area after surging on energy costs in the past few months OPEC and its allies are poised to revive more halted oil production when they meet on Tuesday after predicting a tighter outlook for global markets A more detailed breakdown of global markets courtesy of Newsquawk Asia-Pac stocks eventually traded mixed on the first trading session of the year for most bourses, with the region catching some tailwinds from the positive Eurozone and US sessions on Monday. On Wall Street, the Nasdaq outpaced with gains of 1.2% as Apple became the first-ever public company to reach USD 3tln in market value, whilst Tesla shares were catapulted 13.5% after beating Q4 delivery expectations despite the chip shortage and in spite of last week's mass recall. US equity futures overnight resumed trade with a mild positive bias and thereafter drifted higher - with the US ISM Manufacturing PMI, FOMC Minutes, US labour market report and Fed speakers all on this week’s docket. The ASX 200 (+2.0%) saw gains across its Energy, Mining, Tech and Financial sectors. The Nikkei 225 (+1.8%) briefly dipped under 29k before rising to session highs – with Autos among the top gainers amid a similar performance Stateside, whilst the softer JPY underpinned the index. The KOSPI (U/C) was flat in early trade but thereafter swung between gains and losses. In China, the Shanghai Comp (-0.2%) gave up early gains on its first trading day of 2022 following a CNY 260bln daily liquidity drain by the PBoC, whilst reports also suggested that China is facing USD 708mln cash demand this month, +18% Y/Y according to calculations, amid maturing debt and seasonal demand for cash ahead of the Lunar New Year on 1st February. The Hang Seng (+0.1%) kicked off its second day of trade the year in the green after Monday’s losses. China Evergrande shares resumed trade with gains of 5% after it yesterday suspended its Hong Kong shares in a bid to raise cash and following the order to demolish 39 buildings. Meanwhile, Hong Kong-listed and US-blacklisted AI firm SenseTime shares rose another 20% to almost triple its IPO price. In fixed income, US 10yr Mar'22 futures saw some light buying in early trade, with some suggested regional Asia demand following the heavy cheapening on Monday, albeit this early mild upside faded. Top Asian News Amazon Plays Down Reports It’s Pulling Kindle From China H.K. Finds One Prelim. Local Case With Unknown Source: HK01 China High-Yield Dollar Bonds Fall 1-2 Cents; Developers Lead China South City USD Bonds Slump; Firm Denies Debt-Swap Report European equities trade on a firmer footing with the Stoxx 600 (+0.8%) once again at a record high. The FTSE 100 leads the charge within the region; however, this is largely on account of a catch-up play from yesterday’s bank holiday. Initially to the downside resided the SMI (+0.1%) as the only major bourse in the red amid losses in index-heavyweight Roche (-1.4%); however, this has abated modestly throughout the morning. The lead from the APAC region was a mixed one as the Nikkei 225 (+1.8%) benefited from a softer JPY, the ASX 200 (+1.95%) was lifted by gains in Energy, Mining, Tech and Financial sectors, whilst Chinese bourses (Hang Seng +0.1%, Shanghai Comp. -0.2%) were kept subdued by a PBoC liquidity drain and unable to benefit from an unexpected expansion in the December Chinese Caixin Manufacturing PMI. Stateside, futures are modestly firmer across the board (ES +0.4%, NQ +0.4%, RTY +0.5%) after yesterday’s session which was characterised by Nasdaq outperformance, +1.2%, as Apple became the first-ever public company to reach USD 3tln in market value, whilst Tesla shares were catapulted 13.5% after beating Q4 delivery expectations. In a recent note, analysts at JP Morgan stated they are of the view that there is further upside for stocks as the Omicron variant appears to be milder than previous strains and the impact on mobility is more manageable than previous ones. Furthermore, the bank suggests that there are signs that constraints in supply chains are passing their peak and power prices are easing. Sectors in Europe are mostly firmer with Travel & Leisure names clearly top of the pile UK as airline names benefit from ongoing optimism about the Omicron variant’s impact on mobility and a December passenger update from Wizz Air which has sent its shares higher by 10.1%. Of note for the European banks (which are also a notable gainer on the session), Citigroup is “overweight” on the sector for the upcoming year, citing profit growth, interest rate hikes and potential for capital returns. In terms of specific names, BNP Paribas, Lloyds and UBS were flagged as top picks. Elsewhere, other cyclically-led sectors such as Autos, Oil & Gas and Basic Resources are also trading on a firmer footing. To the downside, Healthcare names sit in the red amid aforementioned losses in Roche, whilst Sanofi (-0.7%) are also seen lower after flagging that Q4 2021 vaccine sales are expected to be lower on a Y/Y basis. Finally, Rolls-Royce (+3.6%) is seen higher on the session after concluding the sale of Bergen Engines. Top European News Italy Starts Search for New President With Draghi as Contender U.K. Mortgage Approvals Fall to 66,964 in Nov. Vs. Est. 66,000 Ukraine Says Russia Reinforced Military Units in Occupied Donbas European Gas Prices Jump a Second Day as Russian Shipments Drop In FX, the Dollar index looks comfortable enough above 96.000 within a 96.336-146 range after eclipsing yesterday’s best (96.328) marginally, but the technical backdrop remains less constructive given its failure to end last week (and 2021) above a key chart level at 96.098. Nevertheless, the most recent spike in US Treasury yields has given the Greenback sufficient impetus to claw back losses, and in DXY terms fresh incentive to rebound firmly or extend gains against funding currencies in particular ahead of the manufacturing ISM and the remainder of a hectic first week of the new year that culminates in NFP and a trio of scheduled Fed speakers, but also comprises minutes of the December FOMC taper and more hawkishly aligned tightening policy meeting. JPY/AUD - As noted above, low yielders are underperforming or lagging in the current environment, and the Yen is also succumbing to the increasingly divergent BoJ vs Fed trajectory that is exacerbating technical forces behind the rally in Usd/Jpy to new 5 year highs just shy of 115.90. Stops are said to have been triggered during the latest leg up and there is little of significance in terms of resistance ahead of 116.00, while option expiry interest is relatively light until 1.13 bn at the half round number above. Conversely, the Aussie has been boosted by higher coal prices overnight and an unexpected return to growth from contraction in China’s Caixin manufacturing PMI, with Aud/Usd trying to establish a base around 0.7200 in wake of an upward revision to the final manufacturing PMI. GBP/NZD/EUR/CHF/CAD - The Pound is next best major, but mainly due to Gilts playing catch-up following Monday’s UK Bank Holiday and only in part on the back of an upgrade to the final manufacturing PMI allied to better than forecast BoE data including consumer credit, mortgage lending and approvals. Cable is probing 1.3500 and Eur/Gbp is edging towards 0.8360 even though the Euro has regained some poise against the Buck to retest 1.1300 with some traction gleaned from stronger than anticipated German retail sales and jobs metrics. Back down under, the Kiwi is trying to keep tabs on 0.6800 in the face of Aud/Nzd headwinds as the cross climbs over 1.0600, while the Franc is holding above 0.9200 post-Swiss CPI that was close to consensus and the Loonie is meandering between 1.2755-23 parameters pre-Canadian PPI and Markit’s manufacturing PMI against the backdrop of firmer crude prices. In commodities, WTI and Brent are firmer this morning and have been grinding towards fresh highs throughout the European session after slightly choppy APAC trade; currently, the peaks are USD 76.82/bbl and USD 79.67/bbl respectively. Newsflow has been fairly slow throughout the morning with catch-up action occurring for participants. Today’s focal point for the space is very much the OPEC+ gathering; albeit, this is expected to result in a continuation of the existing quota adjustments of 400k BPD/month. Thus far, the JTC has reviewed market fundamentals and other developments determining that the Omicron variant’s impact is expected to be both mild and short-term. For reference, today’s timings are 12:00GMT/07:00EST for the JMMC and 13:00GMT/08:00EST for OPEC+ - though, as always with OPEC, these serve only as guidance. While the main decision is expected to be a straightforward one, there is the possibility that underproduction by certain members could cause some tension. Elsewhere, spot gold and silver are contained with a modest positive-bias but are yet to stray too far from the unchanged mark with spot gold, for instance, in a sub-USD 10/oz range just above USD 1800/oz. Separately, coal futures were notable bid in China following reports that Indonesia, a large supplier to China, has banned exports for the month, given domestic power concerns. US Event Calendar 10am: Nov. JOLTs Job Openings, est. 11.1m, prior 11m 10am: Dec. ISM Employment, est. 53.6, prior 53.3 ISM New Orders, est. 60.4, prior 61.5 ISM Prices Paid, est. 79.2, prior 82.4 ISM Manufacturing, est. 60.0, prior 61.1         Tyler Durden Tue, 01/04/2022 - 07:59.....»»

Category: blogSource: zerohedgeJan 4th, 2022

Check out 30 pitch decks from fintechs disrupting trading, banking, and lending that helped them raise millions

Looking for examples of real fintech pitch decks? Check out pitch decks that Qolo, Lance, and other startups used to raise money from VCs. Check out these pitch decks for examples of fintech founders sold their vision.Yulia Reznikov/Getty Images Insider has been tracking the next wave of hot new startups that are blending finance and tech.  Check out these pitch decks to see how fintech founders sold their vision. See more stories on Insider's business page. Fintech VC  funding hit a fresh quarterly record of $22.8 billion in the first three months of 2021, according to CB Insights data. While mega-rounds helped propel overall funding, new cash was spread across 614 deals. Insider has been tracking the next wave of hot new startups that are blending finance and tech. Check out these pitch decks to see how fintech founders are selling their vision and nabbing big bucks in the process. You'll see new financial tech geared at freelancers, fresh twists on digital banking, and innovation aimed at streamlining customer onboarding. A trading app for activismAntoine Argouges, CEO and founder of Tulipshare.TulipshareAn up-and-coming fintech is taking aim at some of the world's largest corporations by empowering retail investors to push for social and environmental change by pooling their shareholder rights.London-based Tulipshare lets individuals in the UK invest as little as one pound in publicly-traded company stocks. The upstart combines individuals' shareholder rights with other like-minded investors to advocate for environmental, social, and corporate governance change at firms like JPMorgan, Apple, and Amazon.The goal is to achieve a higher number of shares to maximize the number of votes that can be submitted at shareholder meetings. Already a regulated broker-dealer in the UK, Tulipshare recently applied for registration as a broker-dealer in the US. "If you ask your friends and family if they've ever voted on shareholder resolutions, the answer will probably be close to zero," CEO and founder Antoine Argouges told Insider. "I started Tulipshare to utilize shareholder rights to bring about positive corporate change that has an impact on people's lives and our planet — what's more powerful than money to change the system we live in?"Check out the 14-page pitch deck from Tulipshare, a trading app that lets users pool their shareholder votes for activism campaignsThe back-end tech for beautyDanielle Cohen-Shohet, CEO and founder of GlossGeniusGlossGeniusDanielle Cohen-Shohet might have started as a Goldman Sachs investment analyst, but at her core she was always a coder.After about three years at Goldman Sachs, Cohen-Shohet left the world of traditional finance to code her way into starting her own company in 2016. "There was a period of time where I did nothing, but eat, sleep, and code for a few weeks," Cohen-Shohet told Insider. Her technical edge and knowledge of the point-of-sale payment space led her to launch a software company focused on providing behind-the-scenes tech for beauty and wellness small businesses.Cohen-Shohet launched GlossGenius in 2017 to provide payments tech for hair stylists, nail technicians, blow-out bars, and other small businesses in the space.Here's the 11-page deck GlossGenius, a startup that provides back-end tech for the beauty industry, used to raise $16 millionPrivate market data on the blockchainPat O'Meara, CEO of Inveniam.InveniamFor investors in publicly-traded stocks, there's typically no shortage of company data to guide investment decisions. Company financials are easily accessible and vetted by teams of regulators, lawyers, and accountants.But in the private markets — which encompass assets that range from real estate to private credit and private equity — that isn't always the case. Within real estate, for example, valuations of a specific slice of property are often the product of heavily-worked Excel models and a lot of institutional knowledge, leaving them susceptible to manual error at many points along the way.Inveniam, founded in 2017, is a software company that tokenizes the business data of private companies on the blockchain. Using a distributed ledger allows Inveniam to keep track of who is touching the data and what they are doing to it. Check out the 16-page pitch deck for Inveniam, a blockchain-based startup looking to be the Refinitiv of private-market dataHelping freelancers with their taxesJaideep Singh is the CEO and co-founder of FlyFin, an AI-driven tax preparation software program for freelancers.FlyFinSome people, particularly those with families or freelancing businesses, spend days searching for receipts for tax season, making tax preparation a time consuming and, at times, taxing experience. That's why in 2020 Jaideep Singh founded FlyFin, an artificial-intelligence tax preparation program for freelancers that helps people, as he puts it, "fly through their finances." FlyFin is set up to connect to a person's bank accounts, allowing the AI program to help users monitor for certain expenses that can be claimed on their taxes like business expenditures, the interest on mortgages, property taxes, or whatever else that might apply. "For most individuals, people have expenses distributed over multiple financial institutions. So we built an AI platform that is able to look at expenses, understand the individual, understand your profession, understand the freelance population at large, and start the categorization," Singh told Insider.Check out the 7-page pitch deck a startup helping freelancers manage their taxes used to nab $8 million in funding Shopify for embedded financeProductfy CEO and founder, Duy Vo.ProductfyProductfy is looking to break into embedded finance by becoming the Shopify of back-end banking services.Embedded finance — integrating banking services in non-financial settings — has taken hold in the e-commerce world. But Productfy is going after a different kind of customer in churches, universities, and nonprofits.The San Jose, Calif.-based upstart aims to help non-finance companies offer their own banking products. Productfy can help customers launch finance features in as little as a week and without additional engineering resources or background knowledge of banking compliance or legal requirements, Productfy founder and CEO Duy Vo told Insider. "You don't need an engineer to stand up Shopify, right? You can be someone who's just creating art and you can use Shopify to build your own online store," Vo said, adding that Productfy is looking to take that user experience and replicate it for banking services.Here's the 15-page pitch deck Productfy, a fintech looking to be the Shopify of embedded finance, used to nab a $16 million Series AReal-estate management made easyAgora founders Noam Kahan, CTO, Bar Mor, CEO, and Lior Dolinski, CPO.AgoraFor alternative asset managers of any type, the operations underpinning sales and investor communications are a crucial but often overlooked part of the business. Fund managers love to make bets on markets, not coordinate hundreds of wire transfers to clients each quarter or organize customer-relationship-management databases.Within the $10.6 trillion global market for professionally managed real-estate investing, that's where Tel Aviv and New York-based startup Agora hopes to make its mark.Founded in 2019, Agora offers a set of back-office, investor relations, and sales software tools that real-estate investment managers can plug into their workflows. On Wednesday, Agora announced a $9 million seed round, led by Israel-based venture firm Aleph, with participation from River Park Ventures and Maccabee Ventures. The funding comes on the heels of an October 2020 pre-seed fund raise worth $890,000, in which Maccabee also participated.Here's the 15-slide pitch deck that Agora, a startup helping real-estate investors manage communications and sales with their clients, used to raise a $9 million seed roundCheckout made easyBolt's Ryan Breslow.Ryan BreslowAmazon has long dominated e-commerce with its one-click checkout flows, offering easier ways for consumers to shop online than its small-business competitors.Bolt gives small merchants tools to offer the same easy checkouts so they can compete with the likes of Amazon.The startup raised its $393 million Series D to continue adding its one-click checkout feature to merchants' own websites in October.Bolt markets to merchants themselves. But a big part of Bolt's pitch is its growing network of consumers — currently over 5.6 million — that use its features across multiple Bolt merchant customers. Roughly 5% of Bolt's transactions were network-driven in May, meaning users that signed up for a Bolt account on another retailer's website used it elsewhere. The network effects were even more pronounced in verticals like furniture, where 49% of transactions were driven by the Bolt network."The network effect is now unleashed with Bolt in full fury, and that triggered the raise," Bolt's founder and CEO Ryan Breslow told Insider.Here's the 12-page deck that one-click checkout Bolt used to outline its network of 5.6 million consumers and raise its Series DHelping small banks lendCollateralEdge's Joel Radtke, cofounder, COO, and president, and Joe Beard, cofounder and CEO.CollateralEdgeFor large corporations with a track record of tapping the credit markets, taking out debt is a well-structured and clear process handled by the nation's biggest investment banks and teams of accountants. But smaller, middle-market companies — typically those with annual revenues ranging up to $1 billion — are typically served by regional and community banks that don't always have the capacity to adequately measure the risk of loans or price them competitively. Per the National Center for the Middle Market, 200,000 companies fall into this range, accounting for roughly 33% of US private sector GDP and employment.Dallas-based fintech CollateralEdge works with these banks — typically those with between $1 billion and $50 billion in assets — to help analyze and price slices of commercial and industrial loans that previously might have gone unserved by smaller lenders.On October 20th, CollateralEdge announced a $3.5 million seed round led by Dallas venture fund Perot Jain with participation from Kneeland Youngblood (a founder of the healthcare-focused private-equity firm Pharos Capital) and other individual investors.Here's the 10-page deck CollateralEdge, a fintech streamlining how small banks lend to businesses, used to raise a $3.5 million seed round Quantum computing made easyQC Ware CEO Matt Johnson.QC WareEven though banks and hedge funds are still several years out from adding quantum computing to their tech arsenals, that hasn't stopped Wall Street giants from investing time and money into the emerging technology class. And momentum for QC Ware, a startup looking to cut the time and resources it takes to use quantum computing, is accelerating. The fintech secured a $25 million Series B on September 29 co-led by Koch Disruptive Technologies and Covestro with participation from D.E. Shaw, Citi, and Samsung Ventures.QC Ware, founded in 2014, builds quantum algorithms for the likes of Goldman Sachs (which led the fintech's Series A), Airbus, and BMW Group. The algorithms, which are effectively code bases that include quantum processing elements, can run on any of the four main public-cloud providers.Quantum computing allows companies to do complex calculations faster than traditional computers by using a form of physics that runs on quantum bits as opposed to the traditional 1s and 0s that computers use. This is especially helpful in banking for risk analytics or algorithmic trading, where executing calculations milliseconds faster than the competition can give firms a leg up. Here's the 20-page deck QC Ware, a fintech making quantum computing more accessible, used to raised its $25 million Series BSimplifying quant modelsKirat Singh and Mark Higgins, Beacon's cofounders.BeaconA fintech that helps financial institutions use quantitative models to streamline their businesses and improve risk management is catching the attention, and capital, of some of the country's biggest investment managers.Beacon Platform, founded in 2014, is a fintech that builds applications and tools to help banks, asset managers, and trading firms quickly integrate quantitative models that can help with analyzing risk, ensuring compliance, and improving operational efficiency. The company raised its Series C on Wednesday, scoring a $56 million investment led by Warburg Pincus with support from Blackstone Innovations Investments, PIMCO, and Global Atlantic. Blackstone, PIMCO, and Global Atlantic are also users of Beacon's tech, as are the Commonwealth Bank of Australia and Shell New Energies, a division of Royal Dutch Shell, among others.The fintech provides a shortcut for firms looking to use quantitative modelling and data science across various aspects of their businesses, a process that can often take considerable resources if done solo.Here's the 20-page pitch deck Beacon, a fintech helping Wall Street better analyze risk and data, used to raise $56 million from Warburg Pincus, Blackstone, and PIMCOInvoice financing for SMBsStacey Abrams and Lara Hodgson, Now cofounders.NowAbout a decade ago, politician Stacey Abrams and entrepreneur Lara Hodgson were forced to fold their startup because of a kink in the supply chain — but not in the traditional sense.Nourish, which made spill-proof bottled water for children, had grown quickly from selling to small retailers to national ones. And while that may sound like a feather in the small business' cap, there was a hang-up."It was taking longer and longer to get paid, and as you can imagine, you deliver the product and then you wait and you wait, but meanwhile you have to pay your employees and you have to pay your vendors," Hodgson told Insider. "Waiting to get paid was constraining our ability to grow."While it's not unusual for small businesses to grapple with working capital issues, the dust was still settling from the Great Recession. Abrams and Hodgson couldn't secure a line of credit or use financing tools like factoring to solve their problem. The two entrepreneurs were forced to close Nourish in 2012, but along the way they recognized a disconnect in the system.  "Why are we the ones borrowing money, when in fact we're the lender here because every time you send an invoice to a customer, you've essentially extended a free loan to that customer by letting them pay later," Hodgson said. "And the only reason why we were going to need to possibly borrow money was because we had just given ours away for free to Whole Foods," she added.Check out the 7-page deck that Now, Stacey Abrams' fintech that wants to help small businesses 'grow fearlessly', used to raise $29 millionInsurance goes digitalJamie Hale, CEO and cofounder of Ladder.LadderFintechs looking to transform how insurance policies are underwritten, issued, and experienced by customers have grown as new technology driven by digital trends and artificial intelligence shape the market. And while verticals like auto, homeowner's, and renter's insurance have seen their fair share of innovation from forward-thinking fintechs, one company has taken on the massive life-insurance market. Founded in 2017, Ladder uses a tech-driven approach to offer life insurance with a digital, end-to-end service that it says is more flexible, faster, and cost-effective than incumbent players.Life, annuity, and accident and health insurance within the US comprise a big chunk of the broader market. In 2020, premiums written on those policies totaled some $767 billion, compared to $144 billion for auto policies and $97 billion for homeowner's insurance.Here's the 12-page deck that Ladder, a startup disrupting the 'crown jewel' of the insurance market, used to nab $100 millionEmbedded payments for SMBsThe Highnote team.HighnoteBranded cards have long been a way for merchants with the appropriate bank relationships to create additional revenue and build customer loyalty. The rise of embedded payments, or the ability to shop and pay in a seamless experience within a single app, has broadened the number of companies looking to launch branded cards.Highnote is a startup that helps small to mid-sized merchants roll out their own debit and pre-paid digital cards. The fintech emerged from stealth on Tuesday to announce it raised $54 million in seed and Series A funding.Here's the 12-page deck Highnote, a startup helping SMBs embed payments, used to raise $54 million in seed and Series A fundingAn alternative auto lenderDaniel Chu, CEO and founder of Tricolor.TricolorAn alternative auto lender that caters to thin- and no-credit Hispanic borrowers is planning a national expansion after scoring a $90 million investment from BlackRock-managed funds. Tricolor is a Dallas-based auto lender that is a community development financial institution. It uses a proprietary artificial-intelligence engine that decisions each customer based on more than 100 data points, such as proof of income. Half of Tricolor's customers have a FICO score, and less than 12% have scores above 650, yet the average customer has lived in the US for 15 years, according to the deck.A 2017 survey by the Federal Deposit Insurance Corporation found 31.5% of Hispanic households had no mainstream credit compared to 14.4% of white households. "For decades, the deck has been stacked against low income or credit invisible Hispanics in the United States when it comes to the purchase and financing of a used vehicle," Daniel Chu, founder and CEO of Tricolor, said in a statement announcing the raise.An auto lender that caters to underbanked Hispanics used this 25-page deck to raise $90 million from BlackRock investorsA new way to access credit The TomoCredit team.TomoCreditKristy Kim knows first-hand the challenge of obtaining credit in the US without an established credit history. Kim, who came to the US from South Korea, couldn't initially get access to credit despite having a job in investment banking after graduating college. "I was in my early twenties, I had a good income, my job was in investment banking but I could not get approved for anything," Kim told Insider. "Many young professionals like me, we deserve an opportunity to be considered but just because we didn't have a Fico, we weren't given a chance to even apply," she added.Kim started TomoCredit in 2018 to help others like herself gain access to consumer credit. TomoCredit spent three years building an internal algorithm to underwrite customers based on cash flow, rather than a credit score.TomoCredit, a fintech that lends to thin- and no-credit borrowers, used this 17-page pitch deck to raise its $10 million Series AAn IRA for alternativesHenry Yoshida is the co-founder and CEO of retirement fintech startup Rocket Dollar.Rocket DollarFintech startup Rocket Dollar, which helps users invest their individual retirement account (IRA) dollars into alternative assets, just raised $8 million for its Series A round, the company announced on Thursday.Park West Asset Management led the round, with participation from investors including Hyphen Capital, which focuses on backing Asian American entrepreneurs, and crypto exchange Kraken's venture arm. Co-founded in 2018 by CEO Henry Yoshida, CTO Rick Dude, and VP of marketing Thomas Young, Rocket Dollar now has over $350 million in assets under management on its platform. Yoshida sold his first startup, a roboadvisor called Honest Dollar, to Goldman Sachs' investment management division for an estimated $20 million.Yoshida told Insider that while ultra-high net worth investors have been investing self-directed retirement account dollars into alternative assets like real estate, private equity, and cryptocurrency, average investors have not historically been able to access the same opportunities to invest IRA dollars in alternative assets through traditional platforms.Here's the 34-page pitch deck a fintech that helps users invest their retirement savings in crypto and real estate assets used to nab $8 millionConnecting startups and investorsHum Capital cofounder and CEO Blair Silverberg.Hum CapitalBlair Silverberg is no stranger to fundraising.For six years, Silverberg was a venture capitalist at Draper Fisher Jurvetson and Private Credit Investments making bets on startups."I was meeting with thousands of founders in person each year, watching them one at a time go through this friction where they're meeting a ton of investors, and the investors are all asking the same questions," Silverberg told Insider. He switched gears about three years ago, moving to the opposite side of the metaphorical table, to start Hum Capital, which uses artificial intelligence to match investors with startups looking to fundraise.On August 31, the New York-based fintech announced its $9 million Series A. The round was led by Future Ventures with participation from Webb Investment Network, Wavemaker Partners, and Partech. This 11-page pitch deck helped Hum Capital, a fintech using AI to match investors with startups, raise a $9 million Series A.Payments infrastructure for fintechsQolo CEO and co-founder Patricia Montesi.QoloThree years ago, Patricia Montesi realized there was a disconnect in the payments world. "A lot of new economy companies or fintech companies were looking to mesh up a lot of payment modalities that they weren't able to," Montesi, CEO and co-founder of Qolo, told Insider.Integrating various payment capabilities often meant tapping several different providers that had specializations in one product or service, she added, like debit card issuance or cross-border payments. "The way people were getting around that was that they were creating this spider web of fintech," she said, adding that "at the end of it all, they had this mess of suppliers and integrations and bank accounts."The 20-year payments veteran rounded up a group of three other co-founders — who together had more than a century of combined industry experience — to start Qolo, a business-to-business fintech that sought out to bundle back-end payment rails for other fintechs.Here's the 11-slide pitch deck a startup that provides payments infrastructure for other fintechs used to raise a $15 million Series ASoftware for managing freelancersWorksome cofounder and CEO Morten Petersen.WorksomeThe way people work has fundamentally changed over the past year, with more flexibility and many workers opting to freelance to maintain their work-from-home lifestyles.But managing a freelance or contractor workforce is often an administrative headache for employers. Worksome is a startup looking to eliminate all the extra work required for employers to adapt to more flexible working norms.Worksome started as a freelancer marketplace automating the process of matching qualified workers with the right jobs. But the team ultimately pivoted to a full suite of workforce management software, automating administrative burdens required to hire, pay, and account for contract workers.In May, Worksome closed a $13 million Series A backed by European angel investor Tommy Ahlers and Danish firm Lind & Risør.Here's the 21-slide pitch deck used by a startup that helps firms like Carlsberg and Deloitte manage freelancersPersonal finance is only a text awayYinon Ravid, the chief executive and cofounder of Albert.AlbertThe COVID-19 pandemic has underscored the growing preference of mobile banking as customers get comfortable managing their finances online.The financial app Albert has seen a similar jump in activity. Currently counting more than six million members, deposits in Albert's savings offering doubled from the start of the pandemic in March 2020 to May of this year, from $350 million to $700 million, according to new numbers released by the company. Founded in 2015, Albert offers automated budgeting and savings tools alongside guided investment portfolios. It's looked to differentiate itself through personalized features, like the ability for customers to text human financial experts.Budgeting and saving features are free on Albert. But for more tailored financial advice, customers pay a subscription fee that's a pay-what-you-can model, between $4 and $14 a month. And Albert's now banking on a new tool to bring together its investing, savings, and budgeting tools.Fintech Albert used this 10-page pitch deck to raise a $100 million Series C from General Atlantic and CapitalGRethinking debt collection Jason Saltzman, founder and CEO of ReliefReliefFor lenders, debt collection is largely automated. But for people who owe money on their credit cards, it can be a confusing and stressful process.  Relief is looking to change that. Its app automates the credit-card debt collection process for users, negotiating with lenders and collectors to settle outstanding balances on their behalf. The fintech just launched and closed a $2 million seed round led by Collaborative Ventures. Relief's fundraising experience was a bit different to most. Its pitch deck, which it shared with one investor via Google Slides, went viral. It set out to raise a $1 million seed round, but ended up doubling that and giving some investors money back to make room for others.Check out a 15-page pitch deck that went viral and helped a credit-card debt collection startup land a $2 million seed roundBlockchain for private-markets investing Carlos Domingo is cofounder and CEO of Securitize.SecuritizeSecuritize, founded in 2017 by the tech industry veterans Carlos Domingo and Jamie Finn, is bringing blockchain technology to private-markets investing. The company raised $48 million in Series B funding on June 21 from investors including Morgan Stanley and Blockchain Capital.Securitize helps companies crowdfund capital from individual and institutional investors by issuing their shares in the form of blockchain tokens that allow for more efficient settlement, record keeping, and compliance processes. Morgan Stanley's Tactical Value fund, which invests in private companies, made its first blockchain-technology investment when it coled the Series B, Securitize CEO Carlos Domingo told Insider.Here's the 11-page pitch deck a blockchain startup looking to revolutionize private-markets investing used to nab $48 million from investors like Morgan StanleyE-commerce focused business bankingMichael Rangel, cofounder and CEO, and Tyler McIntyre, cofounder and CTO of Novo.Kristelle Boulos PhotographyBusiness banking is a hot market in fintech. And it seems investors can't get enough.Novo, the digital banking fintech aimed at small e-commerce businesses, raised a $40.7 million Series A led by Valar Ventures in June. Since its launch in 2018, Novo has signed up 100,000 small businesses. Beyond bank accounts, it offers expense management, a corporate card, and integrates with e-commerce infrastructure players like Shopify, Stripe, and Wise.Founded in 2018, Novo was based in New York City, but has since moved its headquarters to Miami. Here's the 12-page pitch deck e-commerce banking startup Novo used to raise its $40 million Series ABlockchain-based credit score tech John Sun, Anna Fridman, and Adam Jiwan are the cofounders of fintech startup Spring Labs.Spring LabsA blockchain-based fintech startup that is aiming to disrupt the traditional model of evaluating peoples' creditworthiness recently raised $30 million in a Series B funding led by credit reporting giant TransUnion.Four-year-old Spring Labs aims to create a private, secure data-sharing model to help credit agencies better predict the creditworthiness of people who are not in the traditional credit bureau system. The founding team of three fintech veterans met as early employees of lending startup Avant.Existing investors GreatPoint Ventures and August Capital also joined in on the most recent round.  So far Spring Labs has raised $53 million from institutional rounds.TransUnion, a publicly-traded company with a $20 billion-plus market cap, is one of the three largest consumer credit agencies in the US. After 18 months of dialogue and six months of due diligence, TransAmerica and Spring Labs inked a deal, Spring Labs CEO and cofounder Adam Jiwan told Insider.Here's the 10-page pitch deck blockchain-based fintech Spring Labs used to snag $30 million from investors including credit reporting giant TransUnionDigital banking for freelancersJGalione/Getty ImagesLance is a new digital bank hoping to simplify the life of those workers by offering what it calls an "active" approach to business banking. "We found that every time we sat down with the existing tools and resources of our accountants and QuickBooks and spreadsheets, we just ended up getting tangled up in the whole experience of it," Lance cofounder and CEO Oona Rokyta told Insider. Lance offers subaccounts for personal salaries, withholdings, and savings to which freelancers can automatically allocate funds according to custom preset levels. It also offers an expense balance that's connected to automated tax withholdings.In May, Lance announced the closing of a $2.8 million seed round that saw participation from Barclays, BDMI, Great Oaks Capital, Imagination Capital, Techstars, DFJ Frontier, and others.Here's the 21-page pitch deck Lance, a digital bank for freelancers, used to raise a $2.8 million seed round from investors including BarclaysDigital tools for independent financial advisorsJason Wenk, founder and CEO of AltruistAltruistJason Wenk started his career at Morgan Stanley in investment research over 20 years ago. Now, he's running a company that is hoping to broaden access to financial advice for less-wealthy individuals. The startup raised $50 million in Series B funding led by Insight Partners with participation from investors Vanguard and Venrock. The round brings the Los Angeles-based startup's total funding to just under $67 million.Founded in 2018, Altruist is a digital brokerage built for independent financial advisors, intended to be an "all-in-one" platform that unites custodial functions, portfolio accounting, and a client-facing portal. It allows advisors to open accounts, invest, build models, report, trade (including fractional shares), and bill clients through an interface that can advisors time by eliminating mundane operational tasks.Altruist aims to make personalized financial advice less expensive, more efficient, and more inclusive through the platform, which is designed for registered investment advisors (RIAs), a growing segment of the wealth management industry. Here's the pitch deck for Altruist, a wealth tech challenging custodians Fidelity and Charles Schwab, that raised $50 million from Vanguard and InsightPayments and operations support HoneyBook cofounders Dror Shimoni, Oz Alon, and Naama Alon.HoneyBookWhile countless small businesses have been harmed by the pandemic, self-employment and entrepreneurship have found ways to blossom as Americans started new ventures.Half of the US population may be freelance by 2027, according to a study commissioned by remote-work hiring platform Upwork. HoneyBook, a fintech startup that provides payment and operations support for freelancers, in May raised $155 million in funding and achieved unicorn status with its $1 billion-plus valuation.Durable Capital Partners led the Series D funding with other new investors including renowned hedge fund Tiger Global, Battery Ventures, Zeev Ventures, and 01 Advisors. Citi Ventures, Citigroup's startup investment arm that also backs fintech robo-advisor Betterment, participated as an existing investor in the round alongside Norwest Venture partners. The latest round brings the company's fundraising total to $227 million to date.Here's the 21-page pitch deck a Citi-backed fintech for freelancers used to raise $155 million from investors like hedge fund Tiger GlobalFraud prevention for lenders and insurersFiordaliso/Getty ImagesOnboarding new customers with ease is key for any financial institution or retailer. The more friction you add, the more likely consumers are to abandon the entire process.But preventing fraud is also a priority, and that's where Neuro-ID comes in. The startup analyzes what it calls "digital body language," or, the way users scroll, type, and tap. Using that data, Neuro-ID can identify fraudulent users before they create an account. It's built for banks, lenders, insurers, and e-commerce players."The train has left the station for digital transformation, but there's a massive opportunity to try to replicate all those communications that we used to have when we did business in-person, all those tells that we would get verbally and non-verbally on whether or not someone was trustworthy," Neuro-ID CEO Jack Alton told Insider.Founded in 2014, the startup's pitch is twofold: Neuro-ID can save companies money by identifying fraud early, and help increase user conversion by making the onboarding process more seamless. In December Neuro-ID closed a $7 million Series A, co-led by Fin VC and TTV Capital, with participation from Canapi Ventures. With 30 employees, Neuro-ID is using the fresh funding to grow its team and create additional tools to be more self-serving for customers.Here's the 11-slide pitch deck a startup that analyzes consumers' digital behavior to fight fraud used to raise a $7 million Series AAI-powered tools to spot phony online reviews Saoud Khalifah, founder and CEO of Fakespot.FakespotMarketplaces like Amazon and eBay host millions of third-party sellers, and their algorithms will often boost items in search based on consumer sentiment, which is largely based on reviews. But many third-party sellers use fake reviews often bought from click farms to boost their items, some of which are counterfeit or misrepresented to consumers.That's where Fakespot comes in. With its Chrome extension, it warns users of sellers using potentially fake reviews to boost sales and can identify fraudulent sellers. Fakespot is currently compatible with Amazon, BestBuy, eBay, Sephora, Steam, and Walmart."There are promotional reviews written by humans and bot-generated reviews written by robots or review farms," Fakespot founder and CEO Saoud Khalifah told Insider. "Our AI system has been built to detect both categories with very high accuracy."Fakespot's AI learns via reviews data available on marketplace websites, and uses natural-language processing to identify if reviews are genuine. Fakespot also looks at things like whether the number of positive reviews are plausible given how long a seller has been active.Fakespot, a startup that helps shoppers detect robot-generated reviews and phony sellers on Amazon and Shopify, used this pitch deck to nab a $4 million Series ANew twists on digital bankingZach Bruhnke, cofounder and CEO of HMBradleyHMBradleyConsumers are getting used to the idea of branch-less banking, a trend that startup digital-only banks like Chime, N26, and Varo have benefited from. The majority of these fintechs target those who are underbanked, and rely on usage of their debit cards to make money off interchange. But fellow startup HMBradley has a different business model. "Our thesis going in was that we don't swipe our debit cards all that often, and we don't think the customer base that we're focusing on does either," Zach Bruhnke, cofounder and CEO of HMBradley, told Insider. "A lot of our customer base uses credit cards on a daily basis."Instead, the startup is aiming to build clientele with stable deposits. As a result, the bank is offering interest-rate tiers depending on how much a customer saves of their direct deposit.Notably, the rate tiers are dependent on the percentage of savings, not the net amount. "We'll pay you more when you save more of what comes in," Bruhnke said. "We didn't want to segment customers by how much money they had. So it was always going to be about a percentage of income. That was really important to us."Check out the 14-page pitch deck fintech HMBradley, a neobank offering interest rates as high as 3%, used to raise an $18.25 million Series ARead the original article on Business Insider.....»»

Category: topSource: businessinsiderDec 21st, 2021

Peso Hits Record Lows As Leftist Boric Wins Chile Presidency In "Worst Scenario Markets Could Have Envisioned"

Peso Hits Record Lows As Leftist Boric Wins Chile Presidency In "Worst Scenario Markets Could Have Envisioned" Leftist Gabriel Boric, a former student protest leader, won the final round of Chile’s presidential election by a wide margin as the copper-rich Latin American country took a decisive shift to the left after several years of civil unrest. Boric secured 56% of the vote in Sunday’s runoff, well ahead of José Antonio Kast, his ultra-conservative rival, on 44%.  The victory, Bloomberg notes, is likely to spook markets that fear interventionist policies. Boric, 35, will take office in March as one of the youngest presidents in the world and with an ambitious agenda. “I am going to be the president of all Chileans, whether you voted for me or not,” said Boric. The 35-year-old president-elect, who will take office on March 11, said he would strive for unity after a bitter contest between extremes of the political spectrum. Gabriel Boric during an election night rally in Santiago, on Dec. 19 Boric, who is unmarried, bearded and tattooed, first gained prominence a decade ago when he led nationwide demonstrations calling for free and high-quality education. He ran successfully for lower house deputy in 2013 and was re-elected to a second term in a landslide vote. He is the first leader to come from outside the centrist political mainstream that has largely ruled Chile since its return to democracy in 1990. He is also the youngest Chilean president in more than two centuries and the first to secure a second-round victory after losing the first round. His win in a runoff paves the way not only for a generational shift but also for the biggest economic changes in decades for one of Latin America’s richest countries, a global financial market favorite. It was a highly polarized campaign that only moderated in the final stretch as both contenders wooed centrists. He will face enormous challenges including a divided congress, sharp economic slowdown, the writing of a new constitution and the lingering threat of social unrest. “We cannot continue to allow the poor to pay for the inequalities of Chile,” Boric told thousands of cheering supporters in a fiery victory speech which also acknowledged all he needs to do to build alliances. “We will reach out and build bridges so our citizens can live a better life.” He repeated something he told President Sebastian Pinera in a conversation between them broadcast after results were announced: “The agreements need to be among all Chileans and not made behind closed doors.”  They will meet Monday to begin the transition. Kast quickly conceded and spoke to Boric on Sunday evening. ​​During his victory speech, Boric, who is part of a broad leftwing coalition that includes the Chilean Communist party, said he would oppose mining initiatives that “destroy” the environment. That included the contentious $2.5Bn Dominga mining project that was approved this year. “We are a generation that emerged in public life demanding our rights be respected as rights, and not treated like consumer goods or a business,” he said. He has also pledged to enact higher taxes, greater public spending, the scrapping of private pension schemes and student debt, as well as other reforms intended to empower women, indigenous groups and minorities. Boric wants to dismantle some pillars of Chile’s economy such as its private pension funds, which form the bedrock of the local capital markets. He backs higher taxes on both the rich and the nation’s crucial mining industry -- Chile is the world’s biggest copper producer -- while also promising to keep government debt in-check. * * * Boric's victory was greeted with joy (for now, although check back in a few months): streets across the nation of 19 million were filled with honking cars and waving banners in celebration of the changing of the guard. Turnout was about 56% of registered voters, nearly 10 percentage points higher than the first round last month. Supporters of Gabriel Boric celebrate following results from the runoff presidential election in Santiago, on Dec. 19. Boric’s early focus on outreach has an undeniable logic: as he seeks a set of radical shifts including raising taxes on the rich and mining industry, dismantling the country’s private pensions system and boosting social services, he needs to build a coalition with centrists and hard leftists who have clashed for decades. “He will face a divided parliament, so passage of legislation will be difficult and will require strong negotiating skills and pragmatism,” noted Jennifer Pribble, professor of political science at the University of Richmond. Boric describes himself as a moderate socialist who shuns the hard left models of Cuba and Venezuela. Still, Kast and his supporters warned of Boric’s alliance with the communist party as a risk. Meanwhile, Boric’s supporters saw Kast as a dangerous throwback to the right-wing dictatorship of General Augusto Pinochet due to an emphasis on public order and conservative social mores. As Bloomberg notes, Boric's emphasis on social justice dovetailed with a period of unrest that exploded over a transit fare hike in 2019 and quickly ballooned into a broader movement demanding better health care, public transport and pensions. During the campaign, Boric often vowed that, “if Chile was the birthplace of neo-liberalism, it will also be its grave.” Boric wants to dismantle some pillars of Chile’s economy such as its private pension funds, which form the bedrock of the local capital markets. He backs higher taxes on both the rich and the nation’s crucial mining industry -- Chile is the world’s biggest copper producer -- while also promising to keep government debt in-check. In March, Boric will take the helm of a nation that’s facing unprecedented political upheaval. Social unrest kicked off the process of drafting a new constitution, now being done by a left-leaning assembly, which will be put to a national referendum in 2022. Regionally, Chile’s election follows the triumph of Pedro Castillo in Peru earlier this year, and stands to add momentum to leftist candidates in Colombia and Brazil, which will hold presidential elections next year. Similarly to Chile, both of those countries are facing increasingly polarized politics. “Chile’s president-elect could become the face of Latin America’s new left, inspiring other candidates in the region,” said Oliver Stuenkel, professor of international relations at Fundacao Getulio Vargas in Sao Paulo. Meanwhile, traders were not impressied: "This is the worst scenario that the markets could have envisioned,” said Klaus Kaempfe, portfolio solutions director at Credicorp Capital in Santiago. “They were waiting for a much tighter vote showing a desire for dialogue.” Boric will have to contend with economic growth that will come to a halt, slowing from a record high near 12% this year to a rate closer to 2%, according to the central bank. Policy makers are also raising interest rates quickly to tame soaring inflation and, while Chile still has relatively sound fiscal accounts, the debt-to-GDP ratio has increased quickly amid pandemic spending. Chilean companies and individuals have moved money abroad at a historic clip over the past few years, weighing on the currency. The Chilean peso sank on Monday, dropping 1.9% after tumbling more than 3% at the open as traders adjust positions for the uncertainty that lies ahead. As Bloomberg notes, Boric’s potential push for higher taxes, greener industries and greater equality are seen leading to more uncertainty among traders, and more bearish bets. CLP lacks a significant dollar resistance level until 880/USD, last seen in March 2020. The Colombian peso was also down 0.7%, testing major dollar resistance are near 4,005/USD as a decline in oil prices outweighed the boost provided by a hawkish central bank decision. And by the close, CLP had plunged to a new record low against the dollar... On Friday, Colombia’s central bank raised the benchmark rate by 50 basis point to 3% as expected; surprise was that three officials voted for a 75bps rate increase, showing a tilt toward a more hawkish stance. In October, five officials opted for an increase of 50bps and two for 25 basis points. The currency would likely have seen a positive market reaction if it wasn’t for oil’s 4.3% decline in the U.S. after Senator Joe Manchin blindsided the White House on Sunday by rejecting Biden’s $1.75 trillion economic plan, leaving Democrats with few options for reviving it.   Tyler Durden Mon, 12/20/2021 - 14:26.....»»

Category: blogSource: zerohedgeDec 20th, 2021