Here's my summary of the key news overnight in 90 seconds at 9 am, including news of a giant court award.
But first, in the US there was more positive manufacturing news overnight with the Dallas Fed saying that factories in its area picked up their expansion pace in July.
And the giant US services sector saw growth that held its post-recession high in July, but new business and employment both expanded at slower rates.
And after three consecutive months of solid gains, pending home sales in the US slowed "modestly" in June from May, although they are are down -7.3% from the same month a year ago. As we have noted before, housing is not the driver of the US economy it once was.
Across the Atlantic in The Hague, an international court has ruled that Russia owes shareholders of the now-defunct oil giant Yukos more than US$50 billion for what it described as the Kremlin's "devious and calculated expropriation" of assets designed to bankrupt the firm.
The compensation award is the largest the Permanent Court of Arbitration has ever made. It is a final decision and cannot be appealed. Collecting the settlement is the next challenge and is likely to be very messy and protracted for everyone involved. The Argentinian bond default case shows how it is likely to drag on and hurt Russia in the end.
In late trade today, UST 10yr yields edged slightly higher at 2.48% possibly pushed up by the US sale of US$29 billion in two-year notes that attracted lower-than average demand. Stocks are level-pegging in late trade in New York.
The oil price fell on the US benchmark to under US$102/barrel and fell on the Brent benchmark to under US$108/barrel. Gold is higher at US$1,305/oz.
We start today with the NZ dollar lower again. We are now just under 85.5 USc, at 90.9 AUc. The TWI is at 79.7.
If you want to catch up with all the changes yesterday we have an update here.
The easiest place to stay up with today's event risk is by following our Economic Calendar here »
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Across the Atlantic in The Hague, an international court has ruled that Russia owes shareholders of the now-defunct oil giant Yukos more than US$50 billion for what it described as the Kremlin's "devious and calculated expropriation" of assets designed to bankrupt the firm.
The compensation award is the largest the Permanent Court of Arbitration has ever made. It is a final decision and cannot be appealed. Collecting the settlement is the next challenge and is likely to be very messy and protracted for everyone involved. The Argentinian bond default case shows how it is likely to drag on and hurt Russia in the end.
While the casual reader could be excused for imagining Russian markets as an ongoing train wreck, the data may surprise. Although Russia was widely written off as a failed state in 1998, the country’s long-dated Eurobonds returned 20 times your investment over the ensuing decade. That almost matched the returns on the equity market, which gained 2,500 percent, and handily outperformed any peer group you choose. Read more
Moreover, Eric Kraus had this to say about the Yukos ruling:
I think the timing is extremely suspicious. The entire judgment is rotten. Mr. Khodorkovsky was found guilty not only in Russian courts, but that guilty sentence for tax evasion and fraud was upheld by the European Court of Human Rights. It is an outrage that anyone should imagine that Russia is going to pay 50 billion dollars to these criminals. Read more
Vladimir Putin seems less than anxious to find a resolution. We think we know why, and it's very concerning.
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