Miners' Rout Deepens, Defying Rally in Metals,
Crude - (www.bloomberg.com) Rallies
in gold and oil evaporated as the selloff in commodities resumed even as the
dollar tumbled. U.S. stocks fluctuated as a potential merger that would be the
biggest in the chemicals industry boosted large caps, while Apple Inc. paced
declines among technology shares. The Standard & Poor’s 500 Index erased
earlier gains, while the Dow Jones Industrial Average clung to an advance after
people familiar with the matter said talks
between DuPont Co. and Dow Chemical Co. are in late stages. A rally in West
Texas Intermediate reversed as crude failed to rebound from its lowest
settlement since 2009. The Bloomberg Dollar Spot Index sank 0.6 percent.
The junk bond market's early warning signs are
all flashing red for the global economy - (www.telegraph.co.uk) This
high level of risk aversion makes the antennae of junk bond investors
particularly sensitive to the danger signals swirling around the financial
ether. And that’s particularly pertinent right now because multiple warning
signs are flashing in the US high-yield market, which, true to form, is acting
as an early warning mechanism for the global economy. The first red light on the dashboard appeared
in July, when analysts at Bank of America Merrill Lynch pointed out the huge
gap between high-yield spreads and equity volatility – a good proxy for the
level of complacency among equity investors. On August 14 the gap reached its
widest level since March 6, 2008 – less than a fortnight before the financial
crisis kicked off in earnest. The equity market sell-off over the summer closed
the chasm a bit but not completely. The question now: was this the quake or just
a pre-tremor?
Brazil Supreme Court Halts Creation of
Impeachment Committee - (www.bloomberg.com) Brazil’s
Supreme Court suspended for a week a congressional committee that would
recommend whether to continue impeachment proceedings against President Dilma
Rousseff after the government was defeated in a secret vote to appoint
members of that committee. Judge Luiz Edson Fachin, appointed by Rousseff to
the top court earlier this year, issued the ruling just hours after Congress
accepted the committee members appointed by the opposition on Tuesday evening.
In a tumultuous session marred by physical scuffles between congressmen,
pro-government lawmakers objected to the vote, saying it should have been
public. The Brazilian real gained 0.7 percent while the benchmark Ibovespa
stock index rose 1.6 percent at 10:35 a.m. in Sao Paulo as the creation of a
committee filled with pro-impeachment lawmakers was seen as a defeat for the
embattled president, who has been fighting for her political survival.
Investors believe a solution to the impasse would be positive for the economy,
which has stalled in part due to the political crisis.
Energy Sector’s Junk-Bond Pain Spreads - (online.wsj.com) Losses
in the energy sector’s junk-bond market are spreading beyond oil-and-gas
producers amid a prolonged slump in commodity prices, further rattling
investors who are now preparing for a wave of defaults next year. Bonds from
electric utilities including Dynegy Inc., AES Corp. andNRG Energy Inc. have declined in recent days,
reflecting concerns that falling natural-gas prices will drag down electricity
prices as well. A Dynegy bond is down 10.9 cents on the dollar over the past
week to 85.6 cents, an AES Corp. bond is down 4.8 cents to 85.3 cents and a
bond from NRG Energy is down 8.9 cents to 84 cents, according to trading data
from MarketAxess Holdings Inc. “Sentiment is awful,” said Henry
Peabody, who helps oversee the $1 billion Eaton Vance Bond Fund. “We’re
flirting with credit-crisis energy prices, and we’re probably flirting with
credit-crisis bond prices to some degree in these sectors.”
Whispers
Of Liquidation As Oil Trading "God" Loses 10% In November; Down 26%
In 2015 - (www.zerohedge.com) ...
with very close attention: the same person many had dubbed the oil trading
"god", former Citi and Phibro trader, Andy Hall. Andy Hall's
story has been closely documented here: about a year ago,
we learned that as a result of the dramatic move lower in oil and other
commodities, 113-year-old Phibro, where Hall worked, would shut down after it
was unable to find a buyer. Since then things have gone from bad to worse for
Hall, who suffered his second biggest monthly loss ever in July when he was
down a whopping $500 million. The next month many thought could be Hall's
last, with oil continuing its drop until the very end of the month, before a
mysterious and completely unexpected surge in oil (driven by a collapse in OVX,
or the oil VIX) send oil soaring on the last few days of trading. As oil spiked
in August to save Hall's month, it was clear that someone was buying calls in
massive size - sending volatility soaring (which would typically sync with
lower prices). However, as those calls matured and "real'" weakness
resumed so unmanipulated prices fell back to reality and Oil vol once again
surged.
ECB's Nowotny Criticizes `Absurd' Expectations for Stimulus - (www.bloomberg.com)
Abengoa's Woes Risk Widening Grain Glut on Biofuel Concern - (www.bloomberg.com)
Brazil November Consumer Prices Rise 1.01% From Previous Month - (www.bloomberg.com)
China's Fiscal Squeeze Challenges Xi Goal as Slowdown Grinds On - (www.bloomberg.com)
China Said to Form State-Owned Fund to Deal With Mining Debt - (www.bloomberg.com)
Interview-Japan's GPIF says ready to hedge against currency volatility - (www.reuters.com)
Exclusive: Australian police raid Sydney home of reported bitcoin creator - (www.reuters.com)
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