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Moody’s revises forecast for G20 economies’ growth downwards to 2.8% in 2016 -Full Text

Moody’s Investors Service has revised downward its forecast for GDP growth in the G20 economies to 2.8% next year, from 3.1%. Moody’s says that the revision mainly reflects the impact of a more marked slowdown now forecast in China and more prolonged negative effects of low commodity prices on G20 producers than earlier expected.

Moody’s report, entitled “Downward Revisions to 2016 Global Economic Outlook,” is available on www.moodys.com. Moody’s subscribers can access this report via the link provided at the end of this press release. The rating agency’s report is an update to the markets and does not constitute a rating action.

Moody’s has slightly revised downwards its GDP growth forecast for China in 2016 to 6.3%, from 6.5% previously. Recently published economic indicators show that China’s slowdown in exports and investment has continued into Q3 2015. In addition, signs that employment growth is weakening point to a more marked and broadly-based deceleration in the Chinese economy than previously expected.

Ongoing policy support from the Chinese government is likely to only partly offset the underlying slowdown in the Chinese economy, according to the rating agency.

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Overnight US Market-Dow Up 370 Points.In 2 sessions Jumped by 620 Points

Stocks surged again Thursday as Wall Street builds on the Dow’s historic rally Wednesday as order is restored to the U.S. stock market following its first dip into correction territory in four years.

The Dow Jones industrial average jumped about 375 points, or 2.1% in afternoon trading and the Standard & Poor’s 500-stock index gained 2.5%. The Nasdaq composite index jumped 2.6%.

Oil prices surged 9% and jumped way back above the $40 level as benchmark U.S. crude was up $3.48 to $42.09 a barrel.

Investor angst is on the decline and stock prices are again on the rise following the Dow’s nearly 620-point, 4% gain Wednesday — a much-needed rebound that restored a sense of stability to a nervous market following a nearly 15% drop for the blue-chip stock gauge from its May 19 high.

Powering the rally were fresh signs that the U.S. economy is still powering on despite slowing growth in China — including a super-strong revised reading released today on second-quarter GDP, which came in at 3.7%, up from an initial estimate of 2.3% — and comments from a Federal Reserve member Wednesday that pointed out that the reasons for a September interest-rate hike were “less compelling” following the recent market turbulence caused by China’s growth scare.

Today’s follow-through rally is what Wall Street was hoping for, as investors want to see clear signs that appetite for risk-taking is back and build on Wednesday’s historic gains. Wall Street traders also got confirmation that Wednesday’s rally had legs when stock markets in China, Japan and then Europe all rallied earlier today.

 

Chinese Man Jumps From 17th Floor In First Stock Market Casualty

It appears the collapse of China’s stock market has officially taken its first victim. While we have heard from desperate farmers who lost everything after realizing that making money in stocks is not easier than farmwork, RT reports that a 57-year-old man has allegedly committed suicide in Shenyang, the largest city in Liaoning Province, by jumping off the 17th floor of a building with a black briefcase “full of stock-related materials,” local press reported.

As we previously heard from one Chinese farmer, 

From the hope-filled exuberance of early June to Yang Cheng’s utter hopelessness, “I have lost everything,” after he followed the government’s ‘grand plan’ to open the economy and encourage stock market speculation.

Having piled his life savings (plus his relatives’ money) into the market, thanks to encouragement from his broker he borrowed $1 million in margin and bet it all on one stock – a local mining company.

Now, after being forced to liquidate by the same risk-encouraging brokerage, he has suffered catastrophic losses… and he is not alone…

“I don’t know what to do… I trusted the government too much...” he exclaims, adding “I won’t touch stocks again, I have ruined everyone in my family.”

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Former Greek Finance Minister Varoufakis Launches Pan-European Anti-Austerity Political Party

Varoufakis’ fans get ready! The ex finance minister is preparing to launch a European movement that will develop into a political party. Yanis Varoufakis will push for a Pan-?uropean network for fight austerity. Instead of running for the upcoming elections, he will put his energy into political action on European level.

Speaking to Late Night Live program of Australian ABC National Radio, Yanis Varoufakis described the elections campaign as “sad and fruitless” and said that he will not be running for Greek parliament in the September elections, as he no longer believes in what Syriza and its leader, Tsipras, are doing. 

‘The party that I served and the leader that I served has decided to change course completely and to espouse an economic policy that makes absolutely no sense, which was imposed upon us.

I don’t believe that we should have signed up to it, simply because within a few months the ship is going to hit the rocks again. And we don’t have the right to stand in front of our courageous people who voted no against this program, and propose to them that we implement it, given that we know that it cannot be implemented.”

 

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Exactly what the Fed’s Dudley said on Wednesday

I always like to refer to the verbatim quotes

The next events to watch are Jackson Hole speeches this weekend.

“From my perspective, at this moment, the decision to begin the normalization process at the September FOMC meeting seems less compelling to me than it was a few weeks ago.

But an initial rate hike “could become more compelling by the time of the meeting as we get additional information on how the U.S. economy is performing and (on) international financial market developments, all of which are important to shaping the U.S. economic outlook.”

He doesn’t commit either way but the door is still open.

European Indices Closed in DEEP GREEN…BOOM BOOM

European stock market close 27 August 2015

  • FTSE +3.7%
  • Cac +3.6%
  • Dax +3.4%
  • Ibex +3.0%
  • FTSE Mib +3.4%

European bonds

  • Italy 1.93% -5bp
  • Spain 2.06% -5bp
  • Portugal 2.62% -7bp
  • Germany 0.741% +4bp
  • Greece 9.20% -10bp

Apple sets up iPhone event for September 9

Apple has scheduled its annual iPhone unveiling for Wednesday September 9, a year to the day after 2014’s launch of its latest handset alongside Apple Pay and the Watch.

Invitations were sent out to members of the press and analysts on Thursday morning, California time, bearing the teaser: “Hey Siri, give us a hint,”

Unlike last year’s Silicon Valley location, next month’s event will be held at the Bill Graham Civic Auditorium in San Francisco.

The large 7,000-person capacity venue is better known for concerts, playing host to musicians including Janet Jackson, Jack White and Ellie Goulding.

The venue is expected to see the debut of the iPhone 6S, which in keeping with previous “S” models is likely to see upgrades to the handset’s internal technology, such as a faster processor, while maintaining the current size and design.

New features are rumoured to include the addition of “Force Touch”, where pressing harder on the iPhone’s screen will allow for new kinds of interaction, a concept first introduced on the Apple Watch.

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