STOCK MARKET WATCH -- Wednesday, 29 October 2014

[Tansy_Gold]

[font size=3]STOCK MARKET WATCH, Wednesday, 29 October 2014[font color=black][/font]

SMW for 28 October 2014

AT THE CLOSING BELL ON 28 October 2014
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Dow Jones 17,005.75 +187.81 (1.12%)
S&P 500 1,985.05 +23.42 (1.19%)
Nasdaq 4,564.29 +78.36 (1.75%)


[font color=red]10 Year 2.29% +0.03 (1.33%)
30 Year 3.07% +0.02 (0.66%)[font color=black]


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[font size=2]Market Conditions During Trading Hours[/font]
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(click on link for latest updates)
http://tools.investing.com/market_quotes.php?
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[font size=2]Euro, Yen, Loonie, Silver and Gold[center]

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[font color=black][font size=2]Handy Links - Market Data and News:[/font][/font]
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Economic Calendar
Marketwatch Data
Bloomberg Economic News
Yahoo Finance
Google Finance
Bank Tracker
Credit Union Tracker
Daily Job Cuts
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[font color=black][font size=2]Handy Links - Economic Blogs:[/font][/font]
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The Big Picture
Financial Sense
Calculated Risk
Naked Capitalism
Credit Writedowns
Brad DeLong
Bonddad
Atrios
goldmansachs666
The Stand-Up Economist
The Automatic Earth
Wall Street on Parade
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[font color=black][font size=2]Handy Links - Essential Reading:[/font][/font]
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Matt Taibi: Secret and Lies of the Bailout


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[font color=black][font size=2]Handy Links - Government Issues:[/font][/font]
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LegitGov
Open Government
Earmark Database
USA spending.gov
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[font color=black][font size=2]Handy Links - Videos:[/font][/font]
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Charlie Rose talks with Roubini
Charlie Rose talks with Krugman
William Black: This Economic Disaster
Bill Moyers with Kevin Drum and David Corn
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[font color=red]Partial List of Financial Sector Officials Convicted since 1/20/09 [/font][font color=red]
2/2/12 David Higgs and Salmaan Siddiqui, Credit Suisse, plead guilty to conspiracy involving valuation of MBS
3/6/12 Allen Stanford, former Caribbean billionaire and general schmuck, convicted on 13 of 14 counts in $2.2B Ponzi scheme, faces 20+ years in prison
6/4/12 Matthew Kluger, lawyer, sentenced to 12 years in prison, along with co-conspirator stock trader Garrett Bauer (9 years) and co-conspirator Kenneth Robinson (not yet sentenced) for 17 year insider trading scheme.
6/14/12 Allen Stanford sentenced to 110 years without parole.
6/15/12 Rajat Gupta, former Goldman Sachs director, found guilty of insider trading. Could face a decade in prison when sentenced later this year.
6/22/12 Timothy S. Durham, 49, former CEO of Fair Financial Company, convicted of one count conspiracy to commit wire and securities fraud, 10 counts of wire fraud, and one count of securities fraud.
6/22/12 James F. Cochran, 56, former chairman of the board of Fair, convicted of one count of conspiracy to commit wire and securities fraud, one count of securities fraud, and six counts of wire fraud.
6/22/12 Rick D. Snow, 48, former CFO of Fair, convicted of one count of conspiracy to commit wire and securities fraud, one count of securities fraud, and three counts of wire fraud.
7/13/12 Russell Wassendorf Sr., CEO of collapsed brokerage firm Peregrine Financial Group Inc. arrested and charged with lying to regulators after admitting to authorities he embezzled "millions of dollars" and forged bank statements for "nearly twenty years."
8/22/12 Doug Whitman, Whitman Capital LLC hedge fund founder, convicted of insider trading following a trial in which he spent more than two days on the stand telling jurors he was innocent
10/26/12 UPDATE: Former Goldman Sachs director Rajat Gupta sentenced to two years in federal prison. He will, of course, appeal. . .
11/20/12 Hedge fund manager Matthew Martoma charged with insider trading at SAC Capital Advisors, and prosecutors are looking at Martoma's boss, Steven Cohen, for possible involvement.
02/14/13 Gilbert Lopez, former chief accounting officer of Stanford Financial Group, and former controller Mark Kuhrt sentenced to 20 yrs in prison for their roles in Allen Sanford's $7.2 billion Ponzi scheme.
03/29/13 Michael Sternberg, portfolio mgr at SAC Capital, arrested in NYC, charged with conspiracy and securities fraud. Pled not guilty and freed on $3m bail.
04/04/13 Matthew Marshall Taylor,fmr Goldman Sachs trader arrested, charged by CFTC w/defrauding his employer on $8BN futures bet "by intentionally concealing the true huge size, as well as the risk and potential profits or losses associated."
04/04/13 Matthew Taylor admits guilt, makes plea bargain. Sentencing set for 26 June; faces up to 20 years in prison but will likely only see 3-4 years. Says, "I am truly sorry."
04/11/13 Ex-KPMG LLP partner Scott London charged by federal prosecutors w/passing inside tips to a friend in exchange for cash, jewelry, and concert tickets; expected to plead guilty in May.
08/01/13 Fabrice Tourré convicted on six counts of security fraud, including "aiding and abetting" his former employer, Goldman Sachs
08/14/13 Javier Martin-Artajo and Julien Grout charged with wire fraud, falsifying records, and conspiracy in connection with JP Morgan's "London Whale" trade.
08/19/13 Phillip A. Falcone, manager of hedge fund Harbinger Capital Partners, agrees to admit to "wrongdoing" in market manipulation. Will banned from securities industry for 5 years and pay $18MM in disgorgement and fines.
09/16/13 Javier Martin-Artajo and Julien Grout officially indicted on charges associated with "London Whale" trade.
02/06/14 Matthew Martoma convicted of insider trading while at hedge fund SAC (Stephen A. Cohen) Capital Advisors. Expected sentence 7-10 years.
03/24/14 Annette Bongiorno, Bernard Madoff's secretary; Daniel Bonventre, director of operations for investments; JoAnn Crupi, an account manager; and Jerome O'Hara and George Perez, both computer programmers convicted of conspiracy to defraud clients, securities fraud, and falsifying the books and records.
05/19/14 Credit Suisse, which has an investment bank branch in NYC, agrees to plead guilty and pay appx. $2.6 billion penalties for helping wealthy Americans hide wealth and avoid taxes.
09/08/14 Matthew Martoma, convicted SAC trader, sentenced to 9 years in prison plus forfeiture of $9.3 million, including home and bank accounts







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[font size=3][font color=red]This thread contains opinions and observations. Individuals may post their experiences, inferences and opinions on this thread. However, it should not be construed as advice. It is unethical (and probably illegal) for financial recommendations to be given here.[/font][/font][/font color=red][font color=black]

[Demeter]

1. So, the DJIA has been reinflated to 17K

I sure hope they pay those fairies enough so they can flee the country when it all crashes down.

Instead of going to the regularly scheduled board meeting Tuesday night, I went to the Precinct Chairpeople's Pep Rally. My inability to stay alert and awake convinced me that I need to go to bed early if I get up at 6 AM, which means, no rehearsal next Monday....

Even if I get get one part of my life straightened out, there are so many other pieces that don't fit together properly...it's going to take all winter to work out a modus vivendi: one that isn't over-scheduled, over-stressful, and unrewarding.

[Crewleader]

2. Today's Cartoon

[xchrom]

3. Anyone Betting On Another 'Great Rotation' Is In For A Major Blow

http://www.businessinsider.com/r-the-equity-cult-alive-and-kicking-despite-deflation-threat-2014-10

LONDON (Reuters) - Anyone betting on another "Great Rotation" of investment flows out of bonds and into stocks is in for disappointment: it's not happening, and isn't going to.

In a world where deflation, never the most fertile ground for equities, is a bigger concern for policymakers than inflation, that seems a pretty safe call - but the surprise is that this time around both asset classes may be on to a winner.

Bonds tend to do better than stocks when inflation is weak because the value of the fixed income payments investors receive is protected. In periods of deflation the real rate of return is actually enhanced.

But many of the world's leading investment banks argue that the broader market backdrop - also characterized by low interest rates, low returns and high cash balances - leaves stocks just as well-positioned to benefit as bonds.



Read more: http://www.businessinsider.com/r-the-equity-cult-alive-and-kicking-despite-deflation-threat-2014-10#ixzz3HWqMqcpN

[xchrom]

4. Deutsche Bank Posts $117 Million Loss And Fires CFO

http://www.businessinsider.com/r-deutsche-bank-posts-quarterly-net-loss-as-legal-costs-weigh-2014-10

RANKFURT (Reuters) - Deutsche Bank reported a quarterly net loss of 92 million euros on Wednesday as heavy legal costs outweighed a rise in investment banking earnings.

Germany’s top lender reported quarterly pre-tax income of 266 million euros, lifted by a 4 percent pre-tax profit rise from investment banking.

Deutsche's CFO, Stefan Krause, is also being shuffled into a strategy role as of May 2015. He's being replaced by Marcus Schenck of Goldman Sachs, who'll start as Deputy CFO and then take over from Krause fully in 2015.

The bank spent 894 million euros on litigation costs in the quarter, bringing to around 7 billion euros the amount the bank has spent on fines and settlements since 2012.



Read more: http://www.businessinsider.com/r-deutsche-bank-posts-quarterly-net-loss-as-legal-costs-weigh-2014-10#ixzz3HWqnhrHR

[xchrom]

5. The 10 Most Important Things In The World Right Now

http://www.businessinsider.com/10-most-important-things-in-the-world-right-now-oct-29-2014-10

1. An unmanned resupply rocket headed to the International Space Station blew up just a few seconds after launching in Virginia.

2. Roughly 100,000 Hungarians gathered in central Budapest on Tuesday to protest a proposed tax on Internet data transfers, a levy that was reduced but not repealed after initial demonstrations on Sunday.

3. Russia and Ukraine are set to hold negotiations on Wednesday over the delivery of winter gas supplies.

4. Australia has angered health experts after calling for a full stop to the processing of visas from those West African nations worst hit by Ebola: Sierra Leone, Guinea, and Liberia.

5. Deutsche Bank, Germany's top lender, reported a quarterly loss of € 92 million ($117 million) on Wednesday.



Read more: http://www.businessinsider.com/10-most-important-things-in-the-world-right-now-oct-29-2014-10#ixzz3HWrD6xbb

[Demeter]

6. another US space failure

rockets made and launched by the USA blow up with astonishing regularity.

I used to think it was counterfeit components in the manufacture.

I doubted it was sabotage.

Now, I'm leaning towards incompetence.

[Hotler]

27. Worker: "Sir these parts are a few thousands of an inch off." .......

Supervisor: "Close enough, send them out. It cost too much to remake them correctly."
Mission Control: "We can't figure out why our rocket exploded."

[DemReadingDU]

28. Supply rocket owned by Orbital Sciences

Orbital Sciences is one of two companies (the other is SpaceX) NASA is using to haul supplies to the ISS, according to Reuters. This latest flight was its third of eight planned under a $1.9 billion contract with the space agency.

http://www.businessinsider.com/antares-rocket-explodes-2014-10

[Demeter]

30. The Wages of Privatization is Failure

and sometimes death....

[xchrom]

7. The Fed Is Preparing To Close A Controversial Chapter Of Its Response To The Crisis

http://www.businessinsider.com/r-fed-set-to-end-one-crisis-chapter-even-as-global-risks-rise-2014-10

WASHINGTON (Reuters) - The U.S. Federal Reserve on Wednesday is expected to shutter its bond-buying program, closing one controversial chapter in its crisis response even as it struggles to manage a full return to normal monetary policy.

The Fed is likely to announce at the end of a two-day meeting that it will no longer add to its holdings of Treasury bonds and mortgage-backed securities, halting the final $15 billion in monthly purchases under a program that at its peak pumped $85 billion a month into the financial system.

An important symbolic step, the end of the purchases still leaves the Fed far from a normal posture. Its balance sheet has swollen to more than $4 trillion, interest rates remain at zero, and, if anything, recent events have increased the risk the U.S. central bank may need to keep propping up the economy for longer than had been expected just a few weeks ago.

The statement the Fed will issue at 2 p.m. (1800 GMT) will be read carefully for signs of how weak inflation, ebbing global growth and recent financial market volatility have influenced U.S. policymakers. There is no news conference scheduled after the meeting and no fresh economic forecasts from Fed officials.



Read more: http://www.businessinsider.com/r-fed-set-to-end-one-crisis-chapter-even-as-global-risks-rise-2014-10#ixzz3HWutAGw4

[Demeter]

8. Made the Kid a Halloween Costume in 45 minutes (6am)

Necessity is a mother..... in a time squeeze

She'll be the best-dressed cave woman at the party, all in furs...leopard cape, the works!

Thank goddess holidays are short and annual....if I had to do this on a weekly business, I'd resign.

[xchrom]

10. i love it!!!

you're a good mom.

[Demeter]

12. I am certifiable

got to dash...will have time tonight, I hope.

[xchrom]

9. European Markets Are Mixed, Asian Markets Closed Way Up

http://www.businessinsider.com/market-update-oct-29-2014-2014-10

Here's the scorecard, so far:

France's CAC 40 is up 0.19%

Spain's IBEX is down 0.16%

Italy's FTSE MIB is down 1.43%

Britain's FTSE 100 is up 0.43%

Germany's DAX is up 0.65%

Asian markets had a good trading day and closed way up. The Nikkei finished up 1.46%. The Hang Seng closed up 1.27%.

US futures are basically flat: The S&P is up 0.25 points and the Dow is down 13 points.

Mortgage lending figures from the Bank of England are out at 5:30 a.m. ET, which should give some indication of the health of the housing market in September. Analysts are expecting a slight dip.



Read more: http://www.businessinsider.com/market-update-oct-29-2014-2014-10#ixzz3HWvOzX3o

[xchrom]

11. New Studies Show The SEC Is Giving Some Traders An Unfair Advantage

http://www.businessinsider.com/r-studies-find-fast-traders-get-data-from-sec-seconds-early-wsj-2014-10

(Reuters) - Hedge funds and other rapid-fire investors get access to market-moving documents before other users of the Securities and Exchange Commission's system for distributing company filings, giving them a possible edge on the rest of the market, the Wall Street Journal reported, citing two independent studies.

The two sets of researchers have been examining when paying subscribers receive SEC filings compared with when they become available on the agency's website, the newspaper reported.

They found a wide variation in the lag time, from no delay to one lasting more than a minute. The ability to get the information before it is on the SEC website can give traders extra seconds to act on the news, WSJ said.

The studies focus on the SEC's Electronic Data Gathering, Analysis and Retrieval system, or Edgar, which is used to disseminate earnings reports and other documents filed to the regulator.



Read more: http://www.businessinsider.com/r-studies-find-fast-traders-get-data-from-sec-seconds-early-wsj-2014-10#ixzz3HWwM0Gz9

[xchrom]

13. INSURER WELLPOINT HIKES 2014 FORECAST A THIRD TIME

http://hosted.ap.org/dynamic/stories/U/US_WELLPOINT_FORECAST?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2014-10-29-06-55-28

NDIANAPOLIS (AP) -- WellPoint is raising its 2014 earnings forecast again after trumping analyst expectations for the third quarter as health insurers continue to ease fears that the nation's health care overhaul would hamstring the industry.

The Blue Cross-Blue Shield insurer now expects 2014 adjusted earnings to range between $8.75 and $8.85 per share. That's up from a forecast it made in July for earnings of more than $8.60 per share, and it marks the third time this year that WellPoint has raised its outlook.

FactSet says analysts expect $8.74 per share.

WellPoint Inc. also posted adjusted earnings of $2.36 per share in the third quarter Wednesday.

Zacks Investment Research says analysts predicted $2.28 per share.

[Demeter]

31. Hamstring? Hamstring?

Don't they mean fatten up like hams going to the butcher?

[xchrom]

14. FED IS EXPECTED TO SIGNAL NO RATE HIKES IMMINENT

http://hosted.ap.org/dynamic/stories/U/US_FEDERAL_RESERVE?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2014-10-29-03-01-51

WASHINGTON (AP) -- The global economy has stumbled, and financial markets have endured some stomach-churning moments. But that doesn't mean the Federal Reserve plans any major policy shifts.

Ending a two-day discussion Wednesday, the Fed is expected to announce the end of its monthly bond buying program. It's also expected to signal that it remains in no hurry to raise its key short-term interest rate.

The discussions will conclude with a statement on the Fed's decisions. This month's events will not include a news conference by Chair Janet Yellen, whose next session with reporters will be in December. That's one reason most economists don't think the Fed will announce any major policy shifts until its next meeting, when Yellen would be able to explain any changes.

The economy the Fed is discussing has been strengthening, thanks to solid consumer and business spending, manufacturing growth and a surge in hiring that's reduced the unemployment rate to a six-year low of 5.9 percent. Still, the housing industry is still struggling, and global weakness poses a potential threat to U.S. growth.

[xchrom]

15. WORLD STOCKS GAIN AS FOCUS SHIFTS TO FED MEETING

http://hosted.ap.org/dynamic/stories/F/FINANCIAL_MARKETS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2014-10-29-05-07-11

KEEPING SCORE: Germany's DAX rose nearly 1 percent to 9,153.70 and the CAC-40 in Paris inched up 0.3 percent to 4,126.38. Britain's FTSE 100 rose 0.5 percent to 6,433.18. It was unclear whether Wall Street was headed for another day of gains. Futures for the Standard & Poor's 500 were little changed at 1,979.90. Dow Jones industrial average futures were up 0.1 percent to 16,955. On Wednesday, the S&P rose 1.2 percent, and the Dow Jones industrial had added 1.1 percent.

FED WATCHING: Global investors are looking ahead to Wednesday's announcement from the Federal Reserve's policymaking committee for insight into when the central bank might start raising interest rates. The Fed is winding down its $4 trillion bond-buying program, or quantitative easing. There are worries whether the U.S. economy is strong enough to keep growing without that. A hobbled U.S. economy is bad news for Asia's export-oriented nations.

THE QUOTE: Chang Wei Liang at Mizuho Bank in Singapore said global stock prices have been supported by the expectation that the Fed won't shift policy, "with the market anticipating no change in the forward guidance with continued emphasis on monetary accommodation." In Asia, industrial output figures showed Japan's recovery remains on track, adding to the optimism, according to Liang.

ASIA'S DAY: Tokyo's Nikkei, the benchmark for the region's biggest bourse, jumped 1.5 percent to 15,553.91. Japanese telecom Softbank Corp., which announced a large investment in Indian technology companies, rose 1.2 percent. South Korea's Kospi gained 1.8 percent to 1,961.17. Hong Kong's Hang Seng added 1.3 percent to 23,819.87 while Australia's S&P/ASX 200 slipped 0.1 percent to 5,447.70.

UPBEAT EARNINGS: Earnings season around the world has lifted sentiments so far. In the U.S., healthy reports from Caterpillar and Whirlpool were behind the rise on Wall Street overnight. The picture is likely to be more mixed in Asia. Honda, which reported a rise in quarterly profit but lowered its annual forecast Tuesday, finished down 0.1 percent on the Tokyo Stock Exchange.

[xchrom]

16. WORLD BANK: CHINA NEEDS REFORM, NOT GROWTH TARGETS

http://hosted.ap.org/dynamic/stories/A/AS_CHINA_WORLD_BANK?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2014-10-29-05-02-44

BEIJING (AP) -- China's growth could decline to close to 7 percent next year but Beijing should focus on overhauling its economy instead of trying to stick to official growth targets, the World Bank said Wednesday.

To avoid a sharper slowdown, Beijing needs to promote competition and efficiency by reforming its labor and real estate markets and its state-run financial system, the Washington-based lender said in a report.

Trying to stick to short-term official targets might set that back by prompting officials to pump credit into the economy and disrupt the development of markets, said the report's chief author, economist Karlis Smits.

"The policy focus should be on reforms rather than on meeting specific growth targets," said Smits at a news conference.

[xchrom]

17. ECONOMY 101: 5 THINGS TO KNOW ABOUT US GROWTH

http://hosted.ap.org/dynamic/stories/U/US_GDP_5_QUESTIONS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2014-10-29-04-01-18

Some questions and answers to consider:

- IS THE U.S. STRENGTH FOR REAL?

Probably so. Thanks to robust job gains, most analysts think the economy is finally emerging from five-plus years of stop-and-start expansion. They foresee growth at a healthy 3 percent annual rate from now through 2015. If so, next year would be the first full year of 3 percent growth since 2005 - two years before the Great Recession began.

Keep in mind, though: Nothing is certain. Economists made similar predictions for 2014, only to see a brutal winter and a plunge in exports cause the economy to shrink at a 2.1 percent annual pace from January through March. Growth did roar back in the April-June quarter. Still, for the first half of 2014, it was just 1.2 percent.

- WHY IS THE U.S. OUTPACING OTHERS?

Europe is on the brink of its third recession in seven years. Japan is faltering. Persistent weakness is slowing China, Brazil and other major economies.

Even as the United States enjoyed a second-quarter burst of growth - a vigorous 4.6 percent annual rate - the 18 nations that use the euro didn't grow at all. And Japan's economy, squeezed by a sharp sales tax increase, shrank 7.1 percent.

In China, the world's second-largest economy, year-over-year growth slowed from 7.5 percent in the second quarter to 7.3 percent in the third. That's still robust. But to keep things in perspective, growth in China had topped 10 percent for three decades.

Brazil's economy has been gasping after years of solid growth, partly because of slumping commodity prices.

The U.S. economy is benefiting from a range of factors. The Federal Reserve acted more aggressively to stimulate growth than central banks in other countries did. The nation has significantly strengthened its financial system. The economy is relatively insulated from weakness overseas because it depends much less on exports than most other countries do.

[xchrom]

18. Bank-Data Sharing Accord Expands Push to Find Tax Cheats

http://www.bloomberg.com/news/2014-10-29/bank-data-sharing-accord-expands-push-to-find-tax-cheats.html

Governments are closing in on tax evaders with a data-sharing agreement that broadens efforts by the U.S. and the five biggest European Union economies to at least 50 countries and territories.

The accord to be signed by finance ministers in Berlin today signals global determination by governments to capture tax revenue after the U.S. pursued banks such as Credit Suisse for helping Americans cheat on their taxes and German authorities bought CDs containing stolen bank data.

“It’s really the beginning of the end” of bank secrecy, Pascal Saint-Amans, head of the Organization for Economic Cooperation and Development’s center for tax policy and administration, said in a phone interview.

Joining today’s pledge to automatically exchange data collected by financial institutions are most EU countries, Liechtenstein, Mexico, Argentina, South Korea and jurisdictions such as Bermuda, the Cayman Islands and the Isle of Man. Ministers from Germany, France, the U.K., Italy and Spain are presenting the accord at a news conference at 3:30 p.m. Berlin time.

[xchrom]

19. Fed Decision Day Guide: FOMC Seen Focusing on Too-Low Inflation

http://www.bloomberg.com/news/2014-10-28/fed-decision-day-guide-fomc-seen-focusing-on-too-low-inflation.html

Here’s what to look for when the Federal Open Market Committee releases its policy statement at 2 p.m. today in Washington. Federal Reserve officials won’t provide new economic projections, and Chair Janet Yellen isn’t scheduled to give a post-meeting press conference.

-- With the FOMC poised to halt bond purchases, ending its third round of so-called quantitative easing, policy makers may want to underscore they are troubled by falling inflation and price expectations.

The Fed will “express concern about consistent undershooting of inflation,” said Jonathan Wright, who worked at the Fed’s division of monetary affairs from 2004 until 2008 and now teaches economics at Johns Hopkins University in Baltimore. The committee will “go into reverse to some extent,” restoring language it dropped in July expressing a warning that low inflation poses a risk to economic performance.

The committee in September said it “judges that the likelihood of inflation running persistently below 2 percent has diminished somewhat since early this year.” Thirty-three of 62 economists in a Bloomberg survey said they expect the FOMC to retain that language at this week’s meeting.

[xchrom]

20. Stocks Gain With Treasuries on Fed Rate Bets as Oil Rises

http://www.bloomberg.com/news/2014-10-28/u-s-futures-slip-before-fed-as-n-z-stocks-rise-with-oil.html

Stocks rose in Europe and Asia and Treasuries headed for their biggest monthly gain of 2014 amid speculation the Federal Reserve will signal today that interest rates will stay low. Oil advanced and Facebook Inc. (FB) declined.

The Stoxx Europe 600 Index rose 0.3 percent at 6:45 a.m. in New York and the MSCI Asia Pacific Index added 1.3 percent. Facebook slid 7.6 percent after projecting sales that trailed analysts’ highest predictions. Standard & Poor’s 500 Index futures were little changed. The U.S. 10-year note yield fell one basis point to 2.29 percent. The Norwegian krone weakened at least 0.4 percent against all of its 16 major peers. Oil rose for a second day while Russia’s ruble retreated to a record low for a sixth day.

There’s only a 50 percent chance the Fed will raise its interest-rate target to at least 0.5 percent by October next year, after ending its bond-buying program today and leaving its key rate near zero, futures data and analyst forecasts compiled by Bloomberg show. The S&P 500 Index (SPX) closed within 1.5 percent of a record yesterday amid better-than-estimated earnings.

“The market consensus is for the quantitative-easing program to end, and therefore the focus is shifted to the language,” said Vincent Chaigneau, global head of rates and foreign-exchange strategy at Societe Generale SA in Paris. “Overall, we expect the Fed to remain dovish, given inflation is pretty low and global-economic outlook has deteriorated. Yields should stay low.”

[xchrom]

21. Norway Oil Fund Has Weakest Return Since 2013 on European Losses

http://www.bloomberg.com/news/2014-10-29/norway-wealth-fund-gains-2-3-billion-in-quarter-on-bond-advance.html

Norway’s sovereign wealth fund, the world’s largest, reported its weakest return in more than a year as its investments were dragged down by turmoil in Europe.

The Government Pension Fund Global rose 0.1 percent in the quarter, its smallest return since mid-2013, the Oslo-based investor said today. The $860 billion fund’s stock holdings declined 0.5 percent, while its bonds returned 0.9 percent. Real estate returned 1.5 percent.

“Two quarters of strong returns were followed by a virtually flat quarter,” said Yngve Slyngstad, chief executive officer of Norges Bank Investment Management, which runs the fund. “Increased geopolitical uncertainty in the vicinity of the euro area contributed to a negative return.”

Slyngstad warned it will become more difficult for the fund to generate high returns as interest rates have plunged amid sluggish global economic growth. A slump in equities in the quarter came amid evidence of slowing growth and as the world prepares to wean itself off Federal Reserve stimulus. Energy stocks plunged amid a decline in crude prices.

The fund lost 4.3 percent on its stock holdings in Europe, which represented 43.6 percent of its equity portfolio. Its North American stocks gained 3.4 percent, while equity holdings in Asia and Oceania rose 2.3 percent.

[xchrom]

22. German Potholes Risk Growth Prospects in Land of Autobahn

http://www.bloomberg.com/news/2014-10-29/german-potholes-risk-growth-prospects-in-land-of-autobahn.html

The maker of metal-processing plants, which ships products around the world, says damaged bridges makes getting them from its headquarters in Hilchenbach, Germany, to harbors such as Hamburg or Antwerp the hardest part. Transport of parts that weigh between 50 tons and 300 tons takes four times longer than it did in 2010 and has become five times more expensive.

The disrepair of German roads and bridges is at odds with a nation known for the autobahn and has become a symbol of an infrastructure neglect that may jeopardize the country’s growth prospects. Calls for greater investment clash with Chancellor Angela Merkel’s promise of a balanced budget, a pledge she’s sticking to even as the economy stutters and the rest of the euro region finds scant resources for spending.

“If Germany continues on the economic path it’s currently pursuing and doesn’t boost investment, in only five years from now it could be in a much worse position internationally,” Marcel Fratzscher, president of the DIW Institute for Economic Research in Berlin, said in a phone interview.

The trend already shows. At 1.5 percent, German growth will be less than half that of the U.S. next year and lag expansions in the U.K., Canada and Spain, according to forecasts by the International Monetary Fund.

[xchrom]

23. How Sweden Joined Central Banking’s Hall of Shame

http://www.bloomberg.com/news/2014-10-28/how-sweden-joined-central-banking-s-hall-of-shame.html


European policy makers have been their own worst enemy in the fight to avoid recession and deflation.

Swedish central bankers’ decision to cut the benchmark interest rate to zero was the latest evidence that moving too fast to remove emergency stimulus is a risky business.

“They’ve blown it,” Nariman Behravesh, chief economist in Lexington, Massachusetts, for consultants IHS Inc., said, referring to policy makers in Europe. “The focus is exclusively on deficit, on debt, on keeping inflation under control. They’ve ignored the threat of deflation and recession.”

Sweden’s not alone in having to reverse tack. The European Central Bank raised rates in 2008 and twice in 2011 to combat inflation that quickly evaporated, and the euro area now faces its third recession in six years. They echoed mistakes made by the Bank of Japan in 2000, when policy makers raised the key rate only to cut it six months later as deflation set in.

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24. A New Twist in the Argentine Debt Saga

http://www.businessweek.com/articles/2014-10-28/a-surprise-appearance-in-the-argentine-debt-drama#r=hp-lst

Last week, Kenneth Dart, the billionaire heir to a Styrofoam cup fortune, jolted the Argentine debt negotiations by asking a New York judge to force Argentina to pay his bonds in full, too. Like Elliott Management’s Paul Singer, who has led a group of holdout bond investors trying to compel the Argentine government to reach a settlement with them, Dart is known as a “vulture investor” who has made a career of buying defaulted debt and then suing to be repaid at full value. Dart, it turns out, owns more defaulted Argentine bonds through his fund EM Ltd. than Singer’s fund NML Capital does, with $595 million worth to NML’s $503 million. Until now, though, he has remained quietly behind the scenes, as Singer and four other investors publicly battled the Argentine government through the U.S. court system. His sudden appearance shows that settling with Singer’s group of holdouts may not actually solve Argentina’s problems.

Argentina went into default on July 30 after a $539 million bond payment was blocked by a federal judge who said that the country can’t pay any of its exchange bondholders, who participated in the country’s two debt restructurings, until a group of holdout hedge funds are paid on their bonds. In addition to exacerbating what is already a difficult economic climate in Argentina, it has put the country’s leaders in something of a pickle. Argentine President Cristina Fernandez de Kirchner has made her battle against the American “vulture” hedge funds a central theme of her politics. To reverse course now, and pay Singer and the others what they want, would likely come at a high political cost. The goal then, from Argentina’s perspective, is to reach a resolution with the holdouts at the lowest price possible, and that can only be accomplished by diluting their leverage. Right now, their leverage is the fact that their actions pushed the country into default, so reducing it means finding a way to pay the exchange bondholders, which would get the country out of default, all without settling with the holdouts.

As of a week ago, the difference between what the holdouts were willing to accept and what Argentina was willing to pay had collapsed to a fraction of the $750 million or so that it was back in July. But Dart’s legal complaint draws attention to something that had been overlooked as the talks progressed: The so-called Gang of Five—the five holdouts at the center of Singer’s legal case: Singer’s NML Capital, Aurelius Capital, Blue Angel Capital, Oliphant, and a small group of retail investors—hold only about a quarter of all the New York bonds held by holdouts. In addition to Dart, there are approximately $2.4 billion worth of bonds out there that are governed by New York law and in the hands of other holdout investors. The minute Argentina settles with Singer’s group and the bondholder payments are allowed to flow through, all the other holdouts will likely rush forward to Judge Thomas Griesa’s court, demanding the same legal rulings and the same terms, which could block the payments again. The default could be cured temporarily, but then Argentina would be right back where it started.

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25. Currency Trading Skirts Turmoil as Volatility Drops

http://www.bloomberg.com/news/2014-10-29/currency-trading-skirts-turmoil-as-volatility-drops.html

Traders in the more than $5 trillion-a-day foreign-exchange market have largely sidestepped the rising volatility and turmoil that rocked stocks and bonds this month amid renewed concern the global economy is weakening.

A measure of volatility is poised for its biggest slide since April as price swings in U.S. Treasuries climb the most in a year. While turnover on CME Inc.’s currencies exchange jumped as much as 45 percent above its six-year average, liquidity has remained intact, with the spread between bids and offers below historical levels, JPMorgan Chase & Co. data show.

“The currency market proved that it’s the most liquid and most resilient market in the world, more so than the Treasury market even,” Jens Nordvig, a managing director of currency research at Nomura Holdings Inc., said by phone from New York on Oct. 23. “It would be even more worrying if the currency market became disorderly, but fortunately that has not been the case.”

Confidence is rising in the ability of the market to function normally during periods of stress even after more than 25 traders have been fired, suspended or put on leave since allegations emerged last year that dealers colluded to rig the WM/Reuters benchmark rate.

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26. Norway’s $860 Billion Wealth Fund Bets Big on Modi’s India

http://www.bloomberg.com/news/2014-10-29/norway-wealth-fund-gains-2-3-billion-in-quarter-on-bond-advance.html

Norway’s sovereign wealth fund, the world’s largest, will increase its holdings “significantly” in India as Prime Minister Narendra Modi opens Asia’s third-largest economy to investments and competition.

The fund today revealed that it raised its holdings of Indian bonds and stocks to 0.9 percent of its fixed-income and equities portfolios, as part of a broader plan to increase its presence in emerging markets and generate bigger returns.

“India is one of those markets where you should expect that we will continue to increase our investments over time, significantly,” Yngve Slyngstad, chief executive officer of the Oslo-based fund, said in an interview after a press conference today. “Relative to the size of the economy our investments are smaller than you would expect.”

Foreign investors are increasing investments in India at a faster pace than in any of the seven other Asian markets tracked by Bloomberg. The Sensex index has jumped 28 percent this year, rallying after Modi in May won elections by the biggest margin in three decades on promises to create more jobs and lift growth. Since taking power, Modi has shifted toward more market-based energy pricing, allowed more foreign investment in the defense industry and pushed to revive the manufacturing sector.

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29. knr

Still come here each day. Thanks for all your hard work! Dana ; )