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30Sep2016 Market Close: Markets Teetering On Investor Doubt, Will Collapse Of Deutsche Bank Matter, US Dollar Headed South Along With Gold, Higher Crude Prices Sure To Take Market Down

Written by Gary

Steep selloff at the session end on relatively heavy volume indicating profit taking for the weekend. Indexes closed in the green (SPY +0.8%), but crude prices refused to budge off their high water line. US dollar fell, 3% more to go says MS.

Todays S&P 500 Chart

The Market in Perspective

Here are the headlines moving the markets.

Drop in U.S. consumer spending clouds Fed rate hike outlook

WASHINGTON (Reuters) - U.S. consumer spending fell in August for the first time in seven months while inflation showed signs of accelerating, mixed signals that could keep the Federal Reserve cautious about raising interest rates.

Wall Street jumps as Deutsche Bank bounces back

(Reuters) - Wall Street rallied on Friday, lifted by a surge in Deutsche Bank shares and financial stocks after concerns eased about the health of the German bank.

Atlanta Fed trims U.S. third-quarter growth forecast to 2.4 percent

NEW YORK (Reuters) - The U.S. economy is on track to grow at a 2.4 percent annualized rate in the third quarter, the Atlanta Federal Reserve's GDP Now forecast model showed on Friday, following the latest data on inventories, trade and consumer spending this week.

Deutsche lifted by CEO letter, settlement report

FRANKFURT/LONDON (Reuters) - A report that Deutsche Bank was close to a cut-price settlement with U.S. authorities over the sale of toxic mortgage bonds helped to fuel a recovery in its shares on Friday after its chief executive said the group remained stable.

Betting on the U.S. election via the 'Trump ETF'

NEW YORK (Reuters) - An exchange-traded fund focused on Mexico has become a weather vane for Republican Donald Trump's chances winning the U.S. presidential election in November, investors said.

Russia, bowing to budget pressures, revives oil firm sell-off

SOCHI, Russia (Reuters) - Russia said on Friday that it was resuming the shelved privatisation of oil firm Bashneft, in a sign of how anxious the Kremlin is to raise money to fill holes in the budget left by the economic slump.

Indonesia's Garuda's U.S. return to generate 5 percent of 2017 revenue: CEO

MONTREAL (Reuters) - Garuda Indonesia's , the country's national carrier, expects its return to the United States next year with three flights a week to generate about 5 percent of the airline's top-line passenger revenue for 2017, its chief executive said.

Former drug company CEO charged in $100 million fraud scheme in U.S

WASHINGTON (Reuters) - The former CEO of drug company Inyx Inc has been charged in connection with a fraud scheme that caused more than $100 million in losses and led to the collapse of one of Puerto Rico's largest banks, the U.S. Justice Department said on Friday.

Anthem judge considering splitting merger trial into two sections

WASHINGTON (Reuters) - The judge who will rule on whether the government may stop health insurer Anthem from buying competitor Cigna said Friday that she was considering splitting the trial into phases.

Is America Still A Serious Nation?

Submitted by Patrick Buchanan via,

Is America still a serious nation?

Consider. While U.S. elites were denouncing Donald Trump as unfit to serve for having compared Miss Universe 1996 to "Miss Piggy" of "The Muppets," the World Trade Organization was validating the principal plank of his platform.

America's allies are cheating and robbing her blind on trade.

According to the WTO, Britain, France, Spain, Germany and the EU pumped $22 billion in illegal subsidies into Airbus to swindle Boeing out of the sale of 375 commercial jets.

Subsidies to the A320 caused lost sales of 271 Boeing 737s, writes journalist Alan Boyle. Subsidies for planes in the twin-aisle market cost the sale of 50 Boeing 767s, 777s and 787s. And subsidies to the A380 cost Boeing the sale of 54 747s. These represent crippling losses for Boeing, a crown jewel of U.S. manufacturing and a critical component of our national defense.

Earlier, writes Boyle, the WTO ruled that, "without the subsidies, Airbus would not have existed ... and there would be no Airbus aircraft on the market."

In "The Great Betrayal" in 1998, I noted that in its first 25 years the socialist cartel called Airbus Industrie "sold 770 planes to 102 airlines but did not make a penny of profit."

Richard Evans of British Aerospace explained: "Airbus is going to attack the Americans, including Boeing, until they bleed and scream." And another executive said, "If Airbus has to give away planes, we will do it."

When Europe's taxpayers objected to the $26 billion in subsidies Airbus had gotten by 1990, German aerospace coordinator Erich Riedl w ...

Citi Trader: "I Almost Feel Stupid Being Bearish "

A fun little comment from CitiFX's Brent Donnelly, showing what central planning does to everyone, even the smart money.


I am bearish. The European bank story, skyrocketing target balances out of Italy, widening EUR cross-currency basis and buying of CDS protection in Europe all add up to a compelling case for risk aversion. That said, I almost feel stupid being bearish given it has been such an incredibly popular and incredibly losing strategy for so long and there have been so many false starts over the past few years.

BofA Upgrades Deutsche Bank's Cap Structure Despite Admission "Does Not Particularly Like It"

On a day in which DB appeared set to tumble into the a abyss, we saw the defensive cavalry emerge in full force, starting with a letter by the CEO bashing "speculators", a massive short squeeze with no locate available, a twitter rumor of a settlement being picked up as unconfirmed "news" by a reputable French agency (which apparently has better access to events in Germany than the German press), and moments ago Bank of America chimed in when it upgraded DB's credit to "Neutral" even though BofA paradoxically admits that "DB's credit profile likely to remain weak" saying that "we do not particularly like the profile of a credit where performance is skewed to an outcome that is so inherently unpredictable - in this case, guessing what a regulatory fine will be."

BofA adds that in its view, the German bank "is now experiencing a nasty confidence shock which will likely impact its franchise into the medium-term. It could be that a capital increase is on the horizon, after the fines have largely been settled. In our opinion, DB is likely to be a weak bank for several years from now, though, even with a capital increase."

It concludes as follows: "in our opinion, DB is likely to be a weak bank for several years from now, though, even with a capital increase."

And after all that, it's tap on the shoulder upgrade time.

Confused? Don't worry: everything that happened today was only meant to make sure DB did not enter a 3-day weekend at its all time low price as hedge funds continue to withdraw any excess cash they have with the bank while buying up as much 1 Year CDS as they can find.

Here is the balance of the goalseeked piece:

Deutsche - wide enough. Upgrade to Neutral

With the strong spread widening that we have seen in recent days across the DB capital structure, we are recommending moving to a more Neutra ...

The USA Imports Record Amounts of Gold from Switzerland! Meanwhile, Deutsche Bank Faces Total Collapse

The USA Imports Record Amounts of Gold from Switzerland! Meanwhile, Deutsche Bank Faces Total Collapse Written by Nathan McDonald

I have been pointing out for months now that something fishy is going on behind the scenes. It began

Why Fear of a Deutsche Bank Bailout Is Wide of the Mark

The amount of money Deutsche Bank would have to lose even to hit its first line of defense is huge.

The One-Engine Economy

Consumers have been the only thing pushing the U.S. economy along. They could use some help.

NXP Can Help Qualcomm Shift Its Gears

Qualcomm remains too reliant on smartphone chips; a deal with NXP would add diversity.

Key Words: Debate commission says 'there were issues' with Trump audio at Hofstra on Monday

Donald Trump complained as early as Monday night that a problem with his microphone has led to his voice being difficult to hear in the auditorium at Hofstra University where his first debate with Hillary Clinton was being held. On Friday, in a single-sentence statement, the Commission on Presidential Debates allowed that there had been such an issue.

The Wall Street Journal: Constellation Brands weighs $1 billion sale of Canadian wine business

Constellation Brands has put its Canadian win business up for sale, according to a report in The Wall Street Journal.

Known Unknowns: Who's afraid of big, bad Deutsche Bank?

Deutsche Bank is seen as the biggest single risk to the global financial system, but the danger isn't on par with Lehman Brothers. Here's why.

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