Friday August 14 Housing and Economic stories

TOP STORIES:

Coal Miner Alpha Natural Resources Files for Bankruptcy - (www.bloomberg.com) Alpha Natural Resources Inc. filed for bankruptcy in Virginia Monday, becoming the latest victim of the coal industry’s worst downturn in decades. The second-largest U.S. coal company has lost almost all its market value since 2011, when it bought Massey Energy Co. for about $7 billion. The deal made it the biggest U.S. producer of metallurgical coal, used in steelmaking -- and steeped it in debt -- right before prices began their plunge. “The fall has been precipitous and the effect on the debtors has been extreme,” Kevin Crutchfield, chairman and chief executive officer of Bristol, Virginia-based Alpha, said in a court filing. The CEO predicted continuing failures of major companies in the industry as a result of collapsing demand and pricing, plus a “burdensome regulatory environment.”

Commodity Rout Spurs Worst Resource Currency Meltdown in 7 Years - (www.bloomberg.com) Commodity currencies are off to the worst start to a year since the financial crisis amid signs of a slowdown in China, the world’s biggest consumer of raw materials. The Canadian, Australian and New Zealand dollars plunged against their U.S. counterpart as Bloomberg’s commodity index tumbled to a more than 13-year low. The currencies of commodity-exporting nations suffered after an official Chinese factory gauge slipped to the least in five months, dimming the demand outlook. “In the Group-of-10 space, I continue to maintain short positions in all three: Australia, Canada and New Zealand,” Alessio de Longis, a money manager in the Global Multi-Asset Group at Oppenheimer Funds Inc., said from New York. “Even if commodities were to stabilize, I think this weakness will feed into additional policy easing in these countries.” A short position is a bet that an asset will decline in value.

A Towering Bond Trade Has Been Quietly Falling Apart - (www.bloomberg.com) Will the brisk business in CCC-rated debt recover or collapse?  If credit ratings were food, AAA-rated bonds would be quinoa, healthy and entirely unsatisfying. BBB-rated debt might be roast potatoes, not so bad for you and flavorful. And CCC-rated debt would be a double cheeseburger with bacon, unhealthy but oh so very tasty.  Years of low interest rates have encouraged some of the riskiest corporate borrowers to tap yield-hungry investors to finance their growth (or share buybacks and dividend payouts), spurring issuance of debt that comes with triple-C credit ratings. Such bonds are just a few notches above D for default and are typically classified as carrying "substantial risks." For investors willing to shoulder the burden of those extra risks in exchange for heftier returns, CCC-rated bonds have been alluring.

Greek Stocks Plunge Most in Decades as Market Reopens to Crisis - (www.bloomberg.com) Greece’s stock market reopened after five weeks to the most savage wave of selling in decades, underlining a crisis that’s crippled the economy and pushed the country’s euro membership to the brink. Banks led the plunge following the shutdown, which was due to capital controls to prevent the lenders from bleeding more deposits. Piraeus Bank SA and National Bank of Greece SA sank 30 percent, the daily maximum allowed by the Athens Stock Exchange. The benchmark ASE Index dropped 16 percent on Monday after sliding as much as 23 percent. “The situation in Greek equity markets will have to get a lot worse before it gets better,” said Luca Paolini, Pictet Asset Management’s chief strategist in London. “There are still critical risks to be resolved.”

Pain Worsens for Oil Giants Exxon and Chevron – (www.nasdaq.com)  America's two biggest oil companies, Exxon Mobil Corp. and Chevron Corp., reported their worst profits from pumping oil and natural gas in more than a decade as low crude prices lopped off billions of dollars from their quarterly haul. Exxon's second-quarter profit plunged 52% to $4.2 billion. The energy giant's division that pumps oil and gas accounted for just $2 billion of that, the lowest level since 2002. Chevron eked out a quarterly profit of $571 million thanks to its fuel-making refineries, which made up for the company's $2.2 billion loss from pumping oil and gas--the first such loss in nearly 20 years. Chevron lowered its outlook for crude prices and wrote down the value of its energy holdings by $2 billion.

OTHER STORIES:

Debt Traders Flee Junkyard’s Dogs as Oil Rout Extends Yield Gap - (www.bloomberg.com)

Pro-Hadi fighters, Houthis battle over Yemen's largest military base

Here's The Latest Signal of a Lull in Manufacturing - (www.bloomberg.com)
Greek Stocks Plunge Most in Decades as Market Reopens to Crisis - (www.bloomberg.com)
Emerging-Stock Rout Worsens on Signs of China to Russia Slowdown - (www.bloomberg.com)

A Towering Bond Trade Has Been Quietly Falling Apart - (www.bloomberg.com)
Ruble Drops Most in Emerging Markets With Crude at Six-Month Low - (www.bloomberg.com)
Puerto Rico Agency Poised to Default on $58 Million Bond Payment - (www.bloomberg.com)