The Banking and Strategy Initiative

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It’s Monday Again: A $99-kit DNA test banned by US FDA, A new Mustang GT 500, will banks get into a better week?

English: The mdonalds logo from the late 90s

English: The mdonalds logo from the late 90s (Photo credit: Wikipedia)

US Yields moved into the last days of December even as the PIMCO Total Return Fund confirms a large holding in US Bonds. As Barclays points out i in the 2014 Crystal Ball game, the Economy will be so strong in 1 that it would be tough for the new Fed Chairperson to hold on to the Taper and putting it in motion will surely start the 2014 equity rally (long expected and due, 2013 was nothing to stop the markets)

McDonalds’ not loving it! (Reuters Insider, Marketwatch)

The media is equally pressed for headlines of significance on Monday though McDonalds reported November sales down again  and the 0.8% downtick in compsales does not augur well for its almost $100 effort in the equity markets after an almost record breaking ‘substitution effect led’  performnce maximums through a downturn in Europe since the Lehman September in 2007

JP Morgan unruffled as Lao Jiao is repealed

As Lao Jiao is repealed in the new charter recently established by the Communist Party for a New China. JP Morgan is still answering questions about the China bribery case, which doth highlight the relative ease of getting big deals in China in a robust start to 2014 globally, though most eyes are still on the High Yield market. Banks were down 1-2% last week, Citi and BofA taking the heat. US Bank and Wells Fargo are going strong at previous levels since results season broke their continuing strength in mortgages and the smaller private banks like SBNY continue to do well with relationship changeover by SMB businesses.   Lao Jiao is a more unsavory form of Chinese government oppression to Lao Gai which is used aas prison camps for making honest men out of Criminals. However, even as China scores the best on PMI, Banks are stillcrying unde r the strain of unrestrained lending and China may not sustain the re-emergence in 2014 as reforms needed go far and wide and the new Chinese President maintains a low profile in the relative shadow of such a bol proposition (albeit already watered down by the party )

Glaxo and Big Pharma also continues under the shadow in China this year because of large scale nets cast for catching corruption induced by Foreigners

Banks have lost heady gains of 2013 but are still up more than 30% to date in ’13 and will likely lead again once the rally commences post taper for answers of small quantity of taper and better GDP performance. Q4 GDP in the meantime is likely going to e another 2% which is the real rate in the last two uarters once we net out the increase from inventories as big as 1.8% in September data

The Friday Jobs Report

New Home Sales were also exceptionally robust on Friday if once ignores the better performance earlier since Q3 2012 at a 444k increase in October sustaining 2012 gains in the first report after a September 25 release that predated the sequester. The Data was up 25% from October 2012 and with 5 months of robus inventory average prices had also moved up to $321k

However private Non Farm Payrolls struck a confident 196k of a total 203k increase in NFP in the Friday report as Personal spending rose 0.3% in consonance ( for a chang) with the Michigan Consumer Sentiment score that is up to 97.9 on the currnt coonditions and 82.5 on the expectations(sentiment) and fritters away the worry lines that kept the taper out of form in discussions with deflation creeping in from retail PPI and import price data in other late Thanks giving reports

Even ECRI has turned up again thought the ECRI index is still likely pointing to an undiscovered recession after the take off in Oil inventories probably stabilised consumer sentiment and pointed to Refinery capacities being put to work again. The November unemployment report is down to 7%, down in 280 of the 372 metro areas (also used for Network advertising districts?)

The Chicago PMI also confirmed a better employment trend that could affect national data positively

American Airlines flies post merger

In a one off since, American is on Bloomberg, reporting its revival, out of bankruptcy protection and after creating the World’s largest airline with US Airways

Charles Evans, the Chicago Fed President, outlined the idea that the Fed could be cajoled to  lower target of 6% on the Emloyment right to seet right the market prognostication of an inverse market sentiment to good economic reports. However , that is probably not needed as most worries about the Taper have faded despite the 2014 Barclays report released today

The Week Ahead

James Bullard(Mo) and Fisher will be attending speaking engagements on monday with the T Bill auction rates something one can check in for, while Tuesday sees early morning rushes of Chinese production and retail sales data. Europe remains the story with month end data for November taking most of Tuesday and Wednesday(esp pre noon trading in Stocks like Ford and McDonalds). Draghi also takes the stage again on Tuesday befiore Japanese data reports end the day on Tuesday and America celebrates more American Jobs returned to manufacturing sector in the USA More reports of Amazon Drones otherwiseas global media catches the ancy perhaps? and a lot of Merry Christmas stuff for market makers

What Global Recovery?

The South Korea and Singapore stories have most to gain froma  Global recovery as US runs par close to 2.5% for the year and India enjoys a resurgence of investor interest and a small uptick in the Diamond trade from the repressed Gold trade, the latest trade and IIP data hitting on Thursday

Brazil at least reports its first post recession recovery data on Thursday with Russia and Israel also report production and trade data and US only reporting Retail sales and PI inflation data towards the end of the week with Singapore and India reporting Global data series of particular interest but Jobless claims data expected to return to normal after a low 298k score last week

More legal action against Deutsche Bank, UBS

Deutsche Bank faces a Japanese government probe for entertaining pension fund officials even as the bank joins global banks but cutting off commodity trading

Another employee of the bank in Hongkong, Ma Sinchi is in the dock for $3.2 mln he accepted in bribes for ‘insider trading’ with investor Ha But yee being put i n prison for seven years for accepting tips

Rate fines for six banks including Socgen and Citi were a record $2.4 Bln imposed by the EU competition commission for rate cartels in the ongoing LIBOR gate fixes. Earlier settlements were confined to banks closed on by UK and US regulators including Barclays and UBS of around $3.5 Bln (FT report: )

HSBC and JPMC have rejected settlement offers and one looks forward to news from the litigation front in 2014


The China Banking market for Foreigners

While DB competitors in Trade/Transaction Banking continue to swap client tales at HSBC(volume) and StanChart (rice pressures?), Deutsche Bank’s Fund arm is trying a resurgence placing its China A share ETFs in the US last wekek and now going for a European ETF for these China offerings

The Headlined stories here:


Shelby Mustang GT vs the Ford 2015 Mustang

A New WTO settlement also allows Developing Country Bloc a big win in agri subsidies over the OECD while Eagles are under threat in Wind farm country


DNA testing






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This entry was posted on December 9, 2013 by in Financial Markets and tagged , , , , , , , , .


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