Monday, August 11, 2014

Today's Headlines

Bloomberg:  
  • Ukraine Says It Is Near End of Operation to Surround Rebels. Russia said it will go ahead with an aid mission to east Ukraine as the U.S. and Europe repeated warnings to President Vladimir Putin that such a convoy must not be used as a front for military action to support rebels. While Russia said it agreed with Ukraine on the details of extending humanitarian assistance to people in the mainly Russian-speaking Donetsk and Luhansk regions, there was no confirmation of a deal from Ukraine’s government or the Red Cross. The mission may start soon under the aegis of the International Red Cross, a step to which the Ukrainian government has also agreed, Russian Foreign Minister Sergei Lavrov said today.
  • Russian Economy Stalls as Putin Reprisal Risks Spillovers. Russia’s economic growth slumped to the weakest in five quarters, underlining the risks to a recovery in the region as President Vladimir Putin retaliates after penalties imposed over the deepening conflict in Ukraine. Gross domestic product advanced 0.8 percent in the second quarter from a year earlier after 0.9 percent growth in the first three months of the year, the Federal Statistics Service said today in an e-mailed statement, citing preliminary data. The Economy Ministry in Moscow had projected 1.1 percent expansion. GDP growth in Poland, Hungary and the Czech Republic probably slowed in the April-June period on a quarterly basis, according to analysts surveyed by Bloomberg.
  • Al-Abadi Asked to Form Iraq Government to Replace MalikiIraq’s President Fouad Masoum asked the deputy speaker of parliament to try to form a new cabinet and end a three-month political stalemate that’s helped Islamist insurgents seize large swaths of the country. While the U.S. quickly backed Masoum’s designation of Haidar al-Abadi, embattled Prime Minister Nouri al-Maliki rejected Masoum’s move, setting the stage for further political deadlock and potentially a confrontation after Maliki sent troops into the streets of Baghdad early today. 
  • China Probes Threaten to Squeeze Foreign Profits. China’s antitrust crackdown signals a new era of regulatory scrutiny in the country and threatens to end the days when products from Audi sedans to Starbucks lattes generate fatter profits in Beijing than in London or New York.
  • War Risks Slow Company Bond Sales to Least Since July ’13. Risks from conflicts in the Middle East and Ukraine are combining with concerns credit markets may have become too frothy to curb corporate bond sales. Just $53.6 billion of notes were sold globally in the first eight days of August, data compiled by Bloomberg show. That’s the slowest start to a month since July 2013 after then Federal Reserve Chairman Ben S. Bernanke discussed a timetable for scaling back central bank stimulus, spurring investors to sell riskier assets in an episode dubbed the taper tantrum.
  • European Stocks Advance After Russia Calls End to Drills. European stocks rose the most in more than three months after a report that Russian war planes have finished military exercises near Ukraine. Balfour Beatty Plc added 2.5 percent after rejecting a revised merger proposal from Carillion Plc. Banco Popolare SC surged 8.2 percent after the Italian lender unexpectedly posted a profit in the second quarter. Bayerische Motoren Werke AG and Daimler AG each rose more than 2 percent, contributing the most to gains by a gauge of auto-related stocks. The Stoxx Europe 600 Index rallied 1.4 percent to 329.36 at the close as more than 15 stocks climbed for every one that dropped.
Wall Street Journal:
CNBC:
ZeroHedge: 
Business Insider:
  • This Stanford Economist Has Obama's Attention — And It's Causing A Wall Street Freak-Out. Her solution is to "make banks behave more like other companies by forcing them to reduce sharply their reliance on borrowed money," according to The Times article. She says "large banks should be required to raise at least 30 percent of their funding in the form of equity" — which is "six times more than the current average for the largest American banks."

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