Here's my summary of the key overnight news in 90 seconds at 9 am, including news the can is about to be kicked again in Washington.
Rumours that Congress and the President could agree to a temporary increase in the debt ceiling – a period of 4-6 weeks is being mooted – have driven stocks higher and credit spreads tighter. A compromise would alleviate the immediate pressure and divert attention away from the October 17th default deadline. It's very temporary though, kicking the can back to the end of November for the next groundhog day.
Despite this 'progress', the Hong Kong stock exchange has become the first to require more collateral from investors who use US Government instruments to underpin their trades. I doubt they will be the last to do this.
Meanwhile, the number of Americans filing new claims for jobless aid touched a six-month high last week as a computer-related backlog of claims was processed and a partial US government shutdown began to hit some non-federal workers. It will be even higher in the next report.
In Britain, their central bank left rates unchanged. More interestingly though was news out of the ECB that they are done doing 'unchanged' signals and the next move there will be significant.
An agreement between the Chinese central bank and the ECB on a currency swap line shows the Chinese currency's growing importance on the international stage.
The Dow is up more than 1.5% in late trade, gold is down 0.5%, and oil has recovered back up to US$103/barrel. Meanwhile UST 10 yrs have seen their yield rise to 2.71%, its biggest rise in some time. At the same time, a large US Treasury bond auction of 30 year paper went off very successfully for them with lower yields than previously, at 3.76%.
The NZ dollar starts today little changed at 82.9 USc, 87.6 AUc, and the TWI is at 77.0.
The easiest place to stay up with today's event risk is by following our Economic Calendar here »
No chart with that title exists.
4 Comments
Big busineses playing chicken.
http://www.businessweek.com/articles/2013-10-09/costco-stands-behind-it…
Oil boom.
http://www.bloomberg.com/news/2013-10-10/montana-towns-struggle-with-oi…
Stock markets boom.
How can one lose.?
The USDept of Agriculture has released it's estimates for the 2013 corn harvest , and it's a bumper .... they're predictinfg a record 13.7 billion bushel ( 56 lbs or 25.4 kg = one bushel ) bonanza ... streets ahead of last years drought affected 10.7 billion bushels ...
... the price of corn has slumped from $US 8.00 to just $ 4.50 ...
Which is excellent news for those of us who love to chow down on a heaping helping of popcorn whilst watching the gloomsterisers here at interest.co.nz tear their hair out , 'cos the world still hasn't come to a firey apocalyptic end ...
Sir,
Pop-corn is only corn inflated with heat in a roundabout way, to add salt to the wounds, maybe to butter up those poor farmers banks to lend some more inflated dosh to the peasants who prefer the discounted popcorn, instead of a little reality to repeat the endless cycle.
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