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09Sep2015 Pre-Market Commentary: Bull Or Bear?

Written by Gary

Bull or Bear. Will global markets be appeased with the stimulus from the central banks?

Here is the current market situation from CNN Money

European markets are sharply higher today with shares in London leading the region. The FTSE 100 is up 2.03% while Germany's DAX is up 1.83% and France's CAC 40 is up 1.38%.

What Is Moving the Markets

Here are the headlines moving the markets.

Global Stocks Up as China Vows to Stimulate Economy

Global stocks rise following signs that China would do more to stimulate its slowing economy.

Japan Stocks Post Biggest One-Day Gain Since 2008

The Nikkei Stock Average posted its biggest percentage gain since October 2008, driven by investors buying beaten-down shares and forced covering of negative bets against Japan.

Beyond 9/11: Mutual-Fund Firm Alger Is Thriving, and Remembering

Fred Alger Management, 14 years after being devastated, has proved its staying power. Can it successfully expand?

Buiter: Only "Helicopter Money" Can Save The World From The Next Recession

It is to be expected that economists â€" even economists working for the same team â€" have different views about the likelihood of different future outcomes. Economics isn't rocket science, and even rockets frequently land in the wrong place or explode in mid-air.

That rather hilarious characterization of the pseudoscience that is economics comes from the desk of Citi's Chief Economist Willem Buiter and it's apparently evidence that even if you don't think too much of his views on "pet rocks" (gold is a 6,000 year-old bubble) or on the efficacy and/or utility of physical banknotes (ban cash), you'd be hard pressed to disagree with him when it comes to critiquing his profession. Of course we don't want to give Buiter too much credit here because the quote shown above could simply be an attempt to stamp a caveat emptor on his latest prediction in case, like his predictions on when Greece would ultimately leave the euro, it turns out to be wrong.

As tipped by comments made at the Council of Foreign Relations in New York late last month, Buiter is out with a damning look at the global economy which he says will be drug kicking and screaming into a recession by the turmoil in China and the unfolding chaos in EM. Here's the call:

In the Global Economics team, however, we believe that a moderate global recession scenario has become the most likely global macroeconomic scenario for the next two years or so. To clarify further, the most likely scenario (40% probability), in our view, for the next few years is that global real ...

Car Crashes Are On the Rise and Warren Buffett Blames Texting

A 14% surge in fatal car accidents in the first half of the year has surprised big car insurers, and Warren Buffett, whose Berkshire Hathaway owns Geico, says it's because of distracted drivers.

In China, a Forceful Crackdown in Response to Stock Market Crisis

In addition to imposing extraordinary restrictions on the sale of stocks, the authorities have harnessed a security apparatus usually more focused on political dissent.

Britain's £173 Billion "Debt Timebomb"

UK households are sitting on a £173 billion debt time bomb after once again being lured into a spending splurge by banks and credit card companies.

The startling rise in debt levels due to people splashing out on new cars, TVs, conservatories, luxury items, consumer goods and home improvements was uncovered in an investigation by Money Mail.

With a rise in interest rates imminent for the first time in more than eight years, fears are growing that many families will be left struggling with repayments.

The amount of borrowing being taken on by households continues to grow at a startling rate, spurred on by hundreds of offers for credit cards and loans.

Bank of England governor Mark Carney has sent a letter to all fund managers asking for reassurance they are able to deal with an anticipated rush of investors making emergency cash withdrawals to cover their mortgages and other debts.

Tax concerns on Yahoo's Alibaba stake spinoff prompt target cuts

(Reuters) - Wall Street analysts tempered their view on Yahoo Inc's stock after the company's plans for a tax-free spinoff of its stake in Alibaba Group Holdings Ltd hit a snag.

Lockheed Martin to lay off 500 in information systems, government services unit

WASHINGTON (Reuters) - Lockheed Martin Corp will announce plans on Wednesday to lay off about 500 people across its information systems and government services division, which it plans to sell or spin off later this year, a person familiar with the plans said.

CFTC probes JPMorgan for alleged client steering: WSJ

(Reuters) - The U.S. Commodity Futures Trading Commission (CFTC) is investigating whether JPMorgan Chase & Co is steering its private-banking clients to its own hedge-fund investment products without proper disclosures, the Wall Street Journal reported, citing people close to the probe.

Gartman Covers His Shorts, Goes "Marginally Net Long" One Day After Calling For Bear Market

Yesterday we asked a simple question: "is this the real reason futures are soaring" and pointed to Gartman's latest flipflo,p as follows:

Trend Line Support, We Fear, Is A Very Long Way Down: This is a sobering thought, but this chart… which we included in our commentary yesterday… should give everyone a case of very real concern for support for the S&P is several hundred points below where the market closed on Friday. Strength is to be sold into.... We remain here at TGL modestly net short of the market generally and we've no intention of changing that focus other than to become a bit shorter still as time and market conditions demand.

Less than 24 hours later we find that he did indeed have an "intention of changing that focus." Here is his latest "focus":

In our retirement fund here at TGL… the only money which we manage directly… we came into yesterday's session decently net short; not aggressively so, but not marginally so either. However, it made no difference; we were short in a rampaging bullish move and we had no choice but to rush to cover much of the net short position immediately upon the opening of trade on the NYSE.... Within moments of the opening we had reduced that net short position almost entirely. Would that we had had the temerity and the foresight to have reversed our derivatives position entirely, but we are neither that insightful nor that heroic.

Chinese premier seeks to quell global markets' China fears

DALIAN, China/SHANGHAI (Reuters) - China has fended off the major risks to its financial system while its economic prospects remain positive, Premier Li Keqiang said on Wednesday, as he tried to reassure global markets that Beijing can keep its economy on track and stock markets in check.

Futures rise on hopes of more Chinese stimulus steps

(Reuters) - U.S. stock index futures rose sharply on Wednesday as positive comments from Chinese officials kept alive hopes of further stimulus measures for the economy calmed investors.

Frontrunning: September 9

Global stocks rally as investors scent fresh stimulus (Reuters)

Japan's Nikkei 225 Rises 7.7% for Biggest Gain Since October 2008 (BBG)

China's Stocks Advance for Second Day Amid Stimulus Speculation (BBG)

Abe Pledges Corporate Tax Cut as Investments Slump (BBG)

U.S. to shift 50 staff to boost office handling Clinton emails (Reuters)

Chinese Premier Li Keqiang Says China Doesn't Want a Currency War (BBG)

One Thing China Got Right (BBG)

Apple's pressure-based screens promise a world beyond cold glass (Reuters)

Citigroup Sees 55% Risk of a Global Recession Made in China (BBG)

Investors Make Their Case for Buying Chinese Stocks Now

Despite dour economic reports and volatility rattling Chinese markets in recent weeks, many portfolio managers are scouring for insurance, health-care, food and technology companies that they think are poised to benefit from China's transition to a more consumer-oriented economy.

K.K.R. Takes 24.9% Stake in Hedge Fund Marshall Wace

The private equity giant has formed a long-term strategic partnership with the fund and can increase its ownership stake up to 39.9 percent.

Malaysia's 1MDB Fund Scandal Spreads to U.A.E.

Officials at a United Arab Emirates state investment vehicle are raising questions about a payment of $1.4 billion from 1MDB that they said they never received.

Apple to show off new iPhones, Apple TV on Wednesday

SAN FRANCISCO (Reuters) - With its highly profitable iPhone due for an upgrade, Apple is expected to unveil a pair of new handsets at an event in San Francisco on Wednesday, analysts say, in addition to showing off a larger iPad and an updated Apple TV.

McDonald's Shifts to Eggs From Only Cage-Free Hens

The fast-food giant will eventually stop buying eggs laid by hens housed in cages the size of a file drawer.

Global Risk-On Euphoria: Japan's Nikkei Soars 7.7%, Biggest One Day Move In Seven Years; Futures Surge

And to think all it took was Gartman going short of stocks in 25% correction terms yesterday...

Yesterday morning we remarked that while China staged a massive intervention in the market in the last hour of trading to push stocks higher, it came far too late to benefit Japan's Nikkei225, which closed red for the year, just before a dramatic move lower in the Yen prompted by the latest Chinese intervention. Because it was just after yesterday's Nikkei close that we saw the coordinated effort of Chinese and Japanese authorities send the world's carry trade, the USDJPY, soaring by over 100 pips, and combined with today's latest jump of over 50 pips, the result has been nothing short of a near-record one-day move in the Japanese Nikkei stock average, which jumped the most in nearly seven years in percentage terms, and the biggest point move in over 21 years.

The Nikkei Stock Average surged 7.7%, or 1343.43 points, to 18,770.51, marking the benchmark's biggest daily percentage gain since October 2008. In point terms, it was the biggest gain since January 1994.

In addition to the central bank intervention to push the USDJPY higher over the past 24 hours, a major catalyst of the move was short covering. According to Mizuho's head of equity research, Yoshihisa Okamoto, hedge funds shorted Japanese index futures Tuesday afternoon speculating that Chinese stocks would fall after weak trade data, and are pushing Japan shares higher Wednesday as they close out ...

China Premier says economic prospects positive, to maintain policy direction

DALIAN, China (Reuters) - The prospects for China's economy were positive even though the world's second largest economy continued to experience downward pressure, Chinese Premier Li Keqiang said on Wednesday.

July 2015 Consumer Credit Growth Rate Continues to Slow

Written by Steven Hansen

The headlines say consumer credit rate of growth rose - and came in at market expectations. Our analysis shows year-over-year consumer credit growth rate insignificantly declined. There was significant upward revision of the 2015 data which did not change direction of trends - but did flatten the trends.

Global stocks rally as investors scent fresh stimulus

LONDON (Reuters) - Global shares rose on Wednesday, led by an 8 percent surge in Japanese stocks, helping lift the dollar as the prospect of more stimulus from China soothed investors rattled by recent market turmoil.

What to Watch at the Apple Event

The company is expected to introduce significant enhancements to Apple TV and an upgraded version of the iPhone at a much-anticipated event in San Francisco.

Alibaba's Slowdown Isn't the Same as China's

Alibaba warned that turmoil in China's economy is affecting its sales. But the e-commerce giant has its own problems to resolve.

August 2015 CBO Monthly Budget Review: Estimated Deficit $62 Billion. Continued Decline In Military Spending

from the Congressional Budget Office

The federal government's budget deficit amounted to $528 billion for the first 11 months of fiscal year 2015, CBO estimates. That deficit was $61 billion smaller than the one recorded during the same period last year. Revenues and outlays were both higher than last year's amounts, by 8 percent and 5 percent, respectively. Adjusted for shifts in the timing of certain payments (which otherwise would have fallen on a weekend), the deficit for the 11-month period decreased by $42 billion.

Blogger Sentiment Significantly Bearish Entering September 2015

The latest Blogger Sentiment Poll released 08 September 2015 by Ticker Sense shows bullish sentiment significantly higher than last month.

Global Stocks Rally Amid Talk of Fresh Stimulus

Global shares rose on Wednesday, led by an 8 percent surge in Japanese stocks, helping lift the dollar as the prospect of more stimulus from China soothed investors rattled by recent market turmoil.

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