LONDON (Reuters) – Soothing sounds from the Federal Reserve propelled world stocks to their best January on record on Thursday although, having scored stellar gains this time last year only to flop spectacularly, traders were trying not to get too carried away. Crucially, it also said that the rundown of its balance sheet – or the stockpile of bonds it has accumulated over the past 10 years of quantitative easing – could slow too. That ticked all the boxes for financial markets. Wall Street and Asia both rallied and Europe ran up as much as 1 percent] until news that Italy was back in recession and other poor data took the wind out of the sails of most markets bar London. Futures pointed to the U.S. S&P 500 and Nasdaq both rising later though [.N]. That likely move added with Asia’s gains lifted the $4 trillion MSCI world index, which tracks 47 countries, for the 20th day out of the last 23. For January it is up more than 7 percent, which is its best January since the index began in 1990 and the best performance in any month since December 2015. “The rally really does lift all boats,” said Pictet emerging market portfolio manager Guido Chamorro. The gains for stocks were matched in bond markets. Benchmark U.S. Treasury yields, which tend to set the bar for global borrowing costs, had dived significantly and Europe’s big move saw Italian 2-year yields hit their lowest since May. But it was all pain for the dollar. It was struggling near a three-week trough against its major peers and emerging market currencies rose almost in unison having been crushed by the greenback last year. “Risk assets are dancing in the streets and the dollar’s down in the dumps,” Societe Generale strategist Kit Juckes said. “We may yet get a (Fed) rate hike in June, but if what matters is where policy’s heading in the medium term, the FX market would overlook that and sell the dollar anyway.” U.S. stocks were also set for another packed day of data and earnings. Jobless claims figures had already come out showing a 1-1/2 year high, Electric carmaker Tesla missed forecasts again but General Electric surged, marked up almost 10 percent after it beat estimates.
Foxconn is reconsidering plans to make advanced liquid crystal display panels at a $10 billion Wisconsin campus, and said it intends to hire mostly engineers and researchers rather than the manufacturing workforce the project originally promised.Announced at a White House ceremony in 2017, the 20-million square foot campus marked the largest greenfield investment by a foreign-based company in U.S. history and was praised by President Donald Trump as proof of his ability to revive American manufacturing. Foxconn, which received controversial state and local incentives for the project, initially planned to manufacture advanced large screen displays for TVs and other consumer and professional products at the facility, which is under construction. It later said it would build smaller LCD screens instead. Now, those plans may be scaled back or even shelved, Louis Woo, special assistant to Foxconn Chief Executive Terry Gou, told Reuters. He said the company was still evaluating options for Wisconsin, but cited the steep cost of making advanced TV screens in the United States, where labor expenses are comparatively high. Rather than manufacturing LCD panels in the United States, Woo said it would be more profitable to make them in greater China and Japan, ship them to Mexico for final assembly, and import the finished product to the United States. Heavily criticized in some quarters, the Foxconn project was championed by former Wisconsin Governor Scott Walker, a Republican who helped secure around $4 billion in tax breaks and other incentives before leaving office. Critics of the deal, including a number of Democrats, called it a corporate giveaway that would never result in the promised manufacturing jobs and posed serious environmental risks. The company’s own growth projections and employment goals suggest the taxpayer investment would take at least 25 years to recoup, according to budget think tank the Wisconsin Budget Project.
Staff shortages linked to the US government shutdown have caused significant delays to flights at north-eastern airports. The closure means some federal staff, including air traffic controllers, are currently working without pay. Nancy Pelosi, Speaker of the House of Representatives, has blamed President Trump for the disruption. The delays come one day after air industry unions issued a stark warning about the risk posed to public safety. “In our risk averse industry, we cannot even calculate the level of risk currently at play, nor predict the point at which the entire system will break,” air traffic control, pilot and flight attendant union leaders said in a joint statement. In total about 800,000 employees have been working without pay, or have been temporarily laid off, since areas of the federal government shut down due to lack of funding 35 days ago.
President Trump has refused to approve any new funding agreement that does not include $5.7bn (£4.4bn) for his southern border wall. Democrats in Congress refuse to approve wall funding, so the two sides are stuck at an impasse. In a tweet on Friday, Mrs Pelosi appealed to the president to “stop endangering the safety, security and well being of our nation” and reopen the government. Flights were halted at New York’s LaGuardia airport – the 20th busiest in the country – shortly before 10:00 local time (15:00 GMT). The US Federal Aviation Administration (FAA) confirmed the temporary ground stop was lifted about 45 minutes later – but hundreds of flights there are disrupted. In a statement, the FAA said a “slight increase” in sick leave absences at two air traffic control facilities had led to the schedule changes – which it said was to ensure safety levels were maintained. It said departure delays at Philadelphia, Newark and LaGuardia were linked to the shortages. The FAA has advised the public to check with individual airlines for more information. On Thursday, the CEO of JetBlue Airways said the impact on carriers from the shutdown had so far been limited, but warned it was nearing a tipping point. Southwest Airlines head Gary Kelly has described the shutdown as “maddening” – estimating they have lost out on $10-15m (£7.5-11m) in January sales. On Friday, the Association of Flight Attendants issued a blistering statement in response to the delays. “The aviation system depends on the safety professionals who make it run. They have been doing unbelievably heroic work even as they are betrayed by the government that employs them,” President Sara Nelson said in a statement.
US authorities are jumping into the ongoing investigation surrounding the Estonian branch of Danske Bank. According to a Bloomberg report, the Federal Reserve (Fed) is now looking at Deutsche Bank’s involvement in what is shaping up to be one of the largest money laundering cases in recent history. The investigation can be traced back to September of 2018. A whistle-blower, who has since been identified as Howard Wilkinson, the branch’s former Head of Trading, revealed that anti-money laundering procedures were not being properly adhered to. It is unclear exactly how much money passed through the Danish bank’s Estonian branch but some outlets have estimated that $230 billion of illicit cash was funnelled through it. According to the Danish Financial Services Authority, the bulk of the money came from Russia and countries that formerly made up the Soviet Union. Deutsche Bank fits into the picture because it allegedly acted as Danske Bank’s main correspondent bank. As with much of the case, many of the details surrounding Deutsche Bank remain murky and it is still unclear as to whether or not the German firm engaged in any wrongdoing.The company’s CEO, Christian Sewing, has already urged members of the public to not judge the firm until more evidence comes to light. Sewing has also said that the bank is pursuing its own internal investigation into the Danske Bank case. According to Bloomberg, the Fed’s investigation into the case, which is yet to be made public, will look at whether Deutsche Bank did enough to assess the funds that were flowing in from Danske Bank. In a statement, Deutsche Bank denied that there was a probe but said that it had received requests for information from regulators across the globe. The German banking giant said that this was “not surprising at all” as regulators want to look at the Dankse Bank case and see what lessons can be drawn from it. Nick Note :t hey are a dead broke piece of shit!
Delaying or cancelling Brexit would be a “calamitous” breach of trust with the electorate and worse than leaving the EU with no deal, Liam Fox has said.The Brexiteer minister told BBC’s Radio 4’s Today programme MPs pushing for a delay actually wanted to stop Brexit. He said this was the “worst outcome” of the current wrangles. MPs are proposing alternative plans to the PM’s deal with the EU, including seeking an extension to the UK’s exit date – which is scheduled for 29 March. But the prime minister has said the “right way” to rule out no-deal Brexit is to approve her withdrawal agreement. Under current law, the UK will exit the EU on 29 March, whether or not a deal has been struck. The decision to leave was taken by 52% to 48% in a referendum in June 2016.Liam Fox said MPs should think about the “political consequences” of delaying Brexit not just the “short-term economic consequences”. “There is no doubt that leaving with a deal and minimising disruption both to the UK and our EU trading partners is in our best interest,” the international development secretary said. “But I think the most calamitous outcome would be for Parliament, having promised to respect the result of the referendum, to turn around and say it wouldn’t.” But Conservative Remainer Anna Soubry said it was “not true” that Tory MPs backing a move to prevent a “no deal” Brexit – such as Nick Boles, Nicky Morgan and Sir Oliver Letwin – wanted to stop Brexit and had in fact voted for Theresa May’s withdrawal deal. Mr Boles said Mr Fox had “never been very good at detail”. Former Chancellor George Osborne, a key player in the Remain campaign during the referendum, has said delaying the UK’s exit from the EU was now the “most likely” option. Speaking to BBC business editor Simon Jack in Davos, Mr Osborne, now a newspaper editor, said that the prospect of no-deal meant “the gun is held to the British economy’s head”. “Russian roulette is a game which you should never play because there’s a one-in-six chance that the bullet goes into your head,” he said. Mr Osborne, who was sacked by Mrs May when she became prime minister after the referendum, said his successor Philip Hammond had “sensibly” told businesses that leaving without a deal was not a possibility. “But we now need to hear it from the British prime minister,” he said. The other 27 EU member states would need to agree to an extension of the UK’s departure date. Next Tuesday MPs will get to vote on Theresa May’s way forward on Brexit, after rejecting her initial plan by a record-breaking 230 votes last Tuesday. Mrs May is hoping to tweak the deal to address concerns about the Northern Irish “backstop” among her own backbenchers and Northern Ireland’s Democratic Unionist Party, which she relies on to keep her in power. But MPs are attempting to take control of the Brexit process by tabling amendments to Mrs May’s plans
NEW YORK (Reuters) – Oil prices steadied on Thursday, boosted by a rebound in U.S. equities, after earlier losses on fears about surging U.S. crude production and a weakening global economy. Brent crude oil futures LCOc1 were down 14 cents to 61.19 a barrel by 2:04 p.m. EST (1904 GMT). U.S. crude futures CLc1 fell 32 cents to $52 a barrel. Earlier in the session, both benchmarks dropped about 2 percent. The Organization of the Petroleum Exporting Countries in its monthly market report cut its forecast for the average demand for its crude in 2019 to 30.83 million barrels per day, down 910,000 bpd from the 2018 average.
OPEC, however, said it cut oil output sharply in December before a new accord to limit supply took effect, suggesting that producers have made a strong start to averting a glut in 2019 as a slowing economy curbs demand
Saudi Arabia led the cuts of 751,000 bpd in December, the biggest month-on-month drop in almost two years.
The group and its allies plan to meet on April 17-18 in Vienna to review the supply reduction deal that began in January.
U.S. crude output has climbed by 2.4 million bpd since January 2018 and stockpiles of crude and refined products have risen sharply, U.S. Energy Information Administration data showed. [EIA/S]“Going forward, we should start getting a little better indication of Saudi production trends. I think that’s going to be supportive to the market,” Ritterbusch said. In response to the drop in price in the second half of last year, OPEC and non-members plan to cut production by a joint 1.2 million bpd this year. Oil is still about 20 percent above the lows reached in late December, but analysts said Brent has been trading in the low $60s and U.S. crude in the low $50s due to ongoing nervousness about relations between Washington and Beijing and China’s economic outlook. “Brent needs to move past $62 before we can talk about $65,” BNP Paribas head of commodities Harry Tchilingurian told the Reuters Global Oil Forum.
PARIS: BNP Paribas, France’s largest listed bank, will close its proprietary trading desk unit Opera within the next three months, a source close to the matter said Friday, confirming an earlier report from Bloomberg.
The bank had already downsized its proprietary trading operations following the 2008 financial crisis in a bid to reduce exposure to market volatility. The bank held the operation in a distinct legal entity called Opera to comply with local banking regulations that ban French banks from directly trading on markets with their own funds. They are only allowed to do market-making for clients. Regulators in France, like in other countries, have toughened rules to prevent banks from speculating on markets with funds from depositors. BNP Paribas didn’t disclose Opera’s performance, but has said the entity handles 600 million euros in capital. The unit is not significant for the bank’s operations and only employs 17 people, mainly in London and Paris, the source said. Nick Note :F&%* you, you banking Corporate Assholes. one of many more to come