Early Headlines: Asia Stocks Uncertain, Climate Deal Breaker, Bottom For Oil, Salton Sea Gone, U.S. Support For ISIS, UK GDP Grows, India Flooding And More

Written by Econintersect

Early Bird Headlines 02 December 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 stocks wary, dollar knocked after weak U.S. data (Reuters) Asian stock markets wavered on Wednesday after downbeat U.S. manufacturing data raised questions about how aggressive the Federal Reserve would be when hiking interest rates, while the dollar retreated from 8-1/2-month highs. Still, spreadbetters forecast Britain’s FTSE .FTSE, Germany’s DAX .GDAXI and France’s CAC .FCHI would open slightly higher following gains on Wall Street overnight driven by health and consumer shares.

• Climate deal needed if Bill’s billions are to help poor nations (Reuters) Campaigners and experts warned that it will be hard to deploy any new technologies quickly in places where they are needed most unless negotiators at the two-week U.N. talks can work out a deal on how rich countries will help finance this.

• This is when oil will hit rock bottom: CNBC Survey (CNBC) OPEC is not expected to take any action this week to prop up oil prices, which have yet to hit rock bottom, according to a new CNBC Oil Survey. Oil is expected to reach new lows in the first half of next year, according to 46% of the analysts and traders surveyed by CNBC. Twenty-nine percent say the bottom could come even sooner, some time this month. Twenty-one percent believe oil has already touched its lows. Some 70% do not believe West Texas Intermediate crude will rise above $50 a barrel again before the end of this year, and 58% of the survey participants expect it to end the year between $40 and $50 per barrel. Brent, the international benchmark, is expected to end the year between $40 and $50 per barrel, according to 67%. The survey was conducted between Nov. 20 and Monday.

• New SDR (E-mail from Daily Reckoning, no URL) The U.S. dollar is almost unchanged in share of the IMF (International Monetary Fund) SDR (special drawing rights) with the addition of the yuan renminbi . The pound sterling loses 28% of current share, the euro loses 17% and the yen 11%.

U.S.

• Disaster looms as California’s largest inland sea disappears (Al Jazeera) The Salton Sea is fading, leaving in its place a toxic dustbowl that could cause a public health crisis.

• Obama’s Paris Climate Push Likely to Survive Republican Foes (Bloomberg) Obama’s foes want to undercut any climate accord from the United Nations summit in Paris, along with his credibility on the issue. But just as with the Republicans’ failed attempts to kill Obamacare, the efforts are likely to run aground over constitutional and legal constraints.

• Unprecedented diversity of support for ISIL in US, study says (Al Jazeera) ISIL-related activity leads to record arrests in 2015, but diverse profiles impede counterterrorism efforts. See report from George Washington University: ISIS in America: From Retweets to Raqqa.

• How US drillers weathered OPEC’s new oil order (CNBC) The U.S. has improved efficiency and lowered production costs far below what anyone anticipated, even a year ago. But part of the efficiency has included reduced investment in developing future production and that will eventually contribute to a production shortfall and a new spike in prices. Some think that spike may be as much as five years away, however.

EU

• The end of dreams: Why the EU is finally choosing reality over idealism (City A.M.) European Commission President Jean-Claude Juncker recently acknowledged that a two-speed – one might say two-tier – Europe is increasingly likely. This marks a significant break from the Barroso Commission, which sought to keep all member states on the same track towards “ever closer union.”

• The Case for Further Policy Stimulus in the Euro Area (Peterson Institute for International Economics) You know things are tight in the eurozone when the Peterson Institute calls for loose money.

UK

• Bank signals end of the crisis era (City A.M.) Will this headline become as (in)famous as Irving Fisher’s pronouncemnt that “stocks have reached a permanent high“?

• UK GDP is up – but not by much (City A.M.) The UK’s GDP is still growing – but 2015 is shaping up to be weaker than 2014, according to figures published by the Office for National Statistics Tuesday morning. The economy grew by 0.5% in the third quarter of the year, unrevised from the first estimate, with private spending and investment “robust”. It is the 10th consecutive quarter of growth, with an average annualized rate of 2.5%. It marks a drop-off from the second quarter, when GDP grew 0.7% and is lower than the three-year average, which stands at 0.6%.

India

• India’s Chennai hit by fresh rain and deadly flooding (BBC News) Fresh rains in the southern Indian city of Chennai have caused serious flooding, with flights and trains suspended and hundreds of people without power. The army has been deployed to rescue thousands of stranded people after two days of heavy rains. At least 188 people are now known to have died in floods in Tamil Nadu state since last month. A depression in the Bay of Bengal has triggered rains in coastal areas. Last month, non-stop rain for nearly a week brought the city to a standstill and massive flooding has ressumed with the new rains.

Brazil

• Brazil recession deepens, worst annual drop on record (Reuters) Brazil’s economy shrank 1.7% in the third quarter, deepening its sharpest recession in 25 years and stoking opposition to President Dilma Rousseff as she struggles to close a growing fiscal deficit and contain a vast corruption scandal. On an annual basis, Brazil’s $1.5 trillion economy dropped 4.5% in the third quarter, the steepest decline since the current data series began in 1996.

Puerto Rico

• Puerto Rico takes dramatic step to avoid default (CNBC) Facing a major debt deadline, Puerto Rico on Tuesday scrambled to free up $355 million to stave off a default. In addition, the governor announced an unprecedented plan that would take money from one group of bondholders to pay another. “Starting today, the commonwealth of Puerto Rico will have to claw back revenues pledged to certain bonds issued in order to maintain essential public services,” Gov. Alejandro Garcia Padilla said at a Senate Judiciary Committee hearing. “We have taken this difficult step in the hope that Congress will act soon.” The clawback refers to using revenues supporting certain commonwealth tax-supported bonds issued by the U.S. territory, including the Puerto Rico Sales Tax Financing Corporation (COFINA), and the Highway and Transportation Authority (HTA), to pay for debt backed by Puerto Rico’s Constitution.