Written by John Lounsbury
Early Bird Headlines 01 October 2015
Econintersect: Here are some of the headlines we found to help you start your day. For more headlines see our afternoon feature for GEI members, What We Read Today, which has many more headlines and a number of article discussions to keep you abreast of what we have found interesting.
Global
Asia update: Markets up after upbeat China factory data (The Business Times) A slight improvement in an official gauge of Chinese factory activity gave a boost to investor confidence Thursday, rallying Asian equities and emerging market currencies for a second straight day. However, a dip in Japanese business confidence highlighted the struggle ahead for the country’s leaders in kickstarting the economy in the face of a growth slowdown in China and an expected US interest rate rise. The gains come after global stock markets suffered their worst quarter since 2011, with trillions wiped of valuations since China devalued its yuan currency in August, sparking fears about the worldwide impact of China’s struggles.
Foreigners pull record US$5 billion as Southeast Asia stocks sink (The Business Times) Foreign investors are selling Southeast Asian stocks at the fastest pace on record as the region’s economic outlook worsens and the US gets closer to raising interest rates. Overseas funds unloaded a net US$5.1 billion of Indonesian, Thai and Philippine shares in the third quarter as the MSCI Southeast Asia sank 21 per cent. The combined outflows are poised to be the largest since Bloomberg began collecting the data in 1999.
U.S.
Congress averts government shutdown, Obama signs funding measure (Reuters) Ending weeks of infighting, the U.S. Congress on Wednesday voted to avert a government shutdown just hours before a midnight deadline, passing a stop-gap measure to extend funding for federal agencies until Dec. 11.
Why America’s Oil Output Refuses to Collapse (Bloomberg) U.S. frackers are finding ways to get more oil for less money.
Pope’s meeting with Kentucky clerk divides public after U.S. visit (Reuters) Kim Davis, the Rowan County Kentucky county clerk who had been jailed for refusing to issue marriage licenses to same-sex couples, secretly met Pope Francis in a move that disappointed many liberal Catholics and encouraged officials who support her stance.
EU
Crude oil falters on European deflation (UPI) Eurostat, the statistics office for the European Union, said regional annual inflation of -0.1% for September was a contraction from the 0.1% reported the previous month. The seasonally-adjusted unemployment rate for the 19 countries that use the euro was 11%. This was seen as a significant factor in a decline of nearly 3% for oil.
UK
Lurch to the left: How Corbyn will impact market sentiment (City A.M.) Interesting discussion from the viewpoint of London’s financial district.
Germany
Migrant crisis: How long can Merkel keep German doors open? (BBC News) A growing number of political – and public – voices are starting to question both her motives for such a stance and her ability to control the consequences.
Afghanistan
Taliban Kunduz attack: Afghan forces ‘regain city’ (BBC News) The Afghan army has regained control of the northern city of Kunduz which was overrun by the Taliban two days ago.
India
A mob in India just dragged a man from his home and beat him to death – for eating beef (The Washington Post) A 50-year old Muslim farmer was dragged from his bed and beaten to death with bricks because it was rumored he had eaten beef. Cows are sacred to Hindus.
Japan
Japan on brink of technical recession (Financial Times) Japan is on the verge of a technical recession after data on industrial production raised the prospect of a second consecutive quarter of negative growth. Industrial production for August – a crucial input into gross domestic product – unexpectedly fell by 0.5% on the previous month after a 0.6%t fall in July. The figures suggest the shock from China’s economic slowdown, combined with sluggish consumption at home, is in danger of overwhelming the stimulus known as Abenomics.
Japan must not repeat 1980s ‘bubble’ era fiscal expansion: Finance Ministry (The Economic Times) Japan’s finance ministry on Wednesday called for policymakers to avoid repeating the mistake made during the 1980s “bubble” era, when expansionary fiscal policy led to a snowballing of public debt in the following two so-called lost decades. Econintersect: This is utterly incompetent nonsense. Avoid a bubble when the country is in a deflationary trap?
China
A tale of two China PMIs: Manufacturing still in contraction mode (CNBC) The government’s official gauge of factory activity improved with the manufacturing PMI (Purchasing Managers’ Index) rising to 49.8, up from August’s three-year low of 49.7 but still marking two straight months of decline. Meanwhile, a private survey by Caixin/Markit revealed PMI fell to a fresh six-and-a-half year low of 47.2, ticking down from August’s reading of 47.3 but still better than an earlier flash estimate of 47. A reading below 50 indicates activity is shrinking on a monthly basis, while one above indicates expansion. Both Services PMI showed expansion, although the Caixin/Markit number dipped slightly lower to 50.5, a 14-month low.
China’s economy unlikely to have hard landing: WEF report (Xinhuanet News) A hard landing of the Chinese economy seems unlikely, although recent developments have cast some doubt on China’s economic prospects, according to the Global Competitiveness Report 2015-2016 released by the World Economic Forum (WEF) on Wednesday.
Corruption and Pollution Top China’s Worry List, Poll Finds (Bloomberg) The Chinese public sees corrupt officials, pollution and rising inequality as their country’s top three problems and remains divided about how quickly those issues will improve over the next five years, according to a poll released Thursday. About 84% of 3,649 Chinese adults ranked corrupt officials as their biggest worry, while only about 20% cited corrupt businesspeople, education, unemployment, traffic and working conditions as very big problems, according to the Pew Research Center poll.
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