Written by Econintersect
Early Bird Headlines 16 March 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 markets mixed as traders await Federal Reserve decision (CNBC) Asia markets were mixed Wednesday, following a weaker finish on Wall Street overnight as traders await the U.S. Federal Reserve decision due later.
Oil Leaks and Disruptions Doing the Job That Producers Won’t (Bloomberg) Pipeline leaks and shipping disruptions are doing more to reduce the global oil glut than producers who can’t seem to agree on whether to cap output. Outages from Iraq and Nigeria have disrupted more than 800,000 barrels a day of supply and tightened the Brent market, according to Citigroup Inc. That’s coincided with a 20% jump in Brent prices toward $40 a barrel since a proposed production cap from Saudi Arabia and Russia captivated the market and helped turn sentiment bullish. No deal has been struck and Iran has spurned the idea as it seeks to maximize output.
U.S.
Florida, Ohio and Other Primaries on March 15: Analysis (The New York Times) Donald Trump and Hillary Clinton have widened their delegate leads with convincing showings on the second biggest Tuesday of the primary season. John Kasich edged Trump in Kasich’s home state of Ohio in a winner take all contest, but Trump handily beat Marco Rubio on Rubio’s home turf in Florida. Rubio has announced his withdrawal from the race.
Obama axes plan for oil drilling on US Atlantic coast (Financial Times) The Obama administration has dealt a blow to the oil industry by dropping a plan to allow deepwater production off the US’s Atlantic coast for the first time in the face of strong opposition from coastal residents. The administration’s policy reversal on drilling is also a setback for elected officials in Virginia, North Carolina, South Carolina and Georgia, who were backing offshore production as a source of new jobs and economic growth. This comes as President Barack Obama – who has sent mixed signals on his attitude to oil and gas – seeks to cement a legacy of action to protect the environment in his final year in office.
Valeant Jolts Investors Again Over Earnings Goals, Debt (The Wall Street Journal) Shares of the drug maker plunged more than 51% after it said it is pulling back from its strategy. But that was a pitance compared to its almost $240 loss (88%) from its high near $270 less than 6 months ago.
UK
London Stock Exchange and Deutsche Börse unveil deal (Financial Times) Europe’s two largest exchanges by market capitalization, The London Stock Exchange Group and Deutsche Börse, announced they have formally agreed to combine, subject to regulatory approval. They had already disclosed that London will be the location for the holding company and the German exchange’s Carsten Kengeter its chief executive.
Syria
Russia expected to increase pressure on Syrian president (The Guardian) After Moscow withdraws troops, western diplomats believe Vladimir Putin will push Bashar al-Assad to accept loss of power.
Russia
Syrian mission restores pride in Russian military after years of decay (The Guardian) The Syrian adventure, or at least the television portrayal of it, has shown off a new, confident Russian military. Millions of Russians watch nightly bulletins in which their heroic fighter pilots drop precision bombs on terrorist targets, and while there has been no great public enthusiasm for engagement in Syria, it has enhanced the image of the military among Russians, and surprised foreign observers. But can Russia maintain this new status as it cuts its military budget by more than 5%?
India
India is a light in a gloomy world economy (Financial Times) The country has shifted from socialism with restricted entry to capitalism without exit, writes Martin Wolf. (See also next article.) Here is his four part summary of what is happening:
First, Prime Minister Narendra Modi‘s Hindu nationalist Bharatiya Janata party government, in power since 2014, represents continuity rather than the pro-market transformation many supporters naively expected. Second, short-term performance and prospects appear favorable relative both to the immediate past and to what is happening almost everywhere else. Third, medium-term performance should also be decent, provided the government implements the reforms it has already outlined. This is partly because India retains so much potential. Yet, fourth, it also faces risks, external and internal. Success must not be taken for granted.
India a ‘bright spot’ in an otherwise gloomy global economy (Hindustani Times) Read this almost identically titled (see preceding article) but differently constructed discussion of India’s economic resurgency for additional thoughts about the great subcontinent.
China
China parliament approves new five-year economic plan (BBC News) China’s parliament has ended its annual session by approving a new five-year economic plan, as Premier Li Keqiang says the country will push ahead with economic reforms. The aim of the plan is to achieve 6.7-7% growth a year by 2020 in the world’s second-largest economy. Measures include cutting high debt, streamlining state-owned enterprises, and reforming financial markets. China has been facing a period of slower growth and market volatility. Econintersect: Haven’t we heard about economic growth while cutting debt before? Europe?
North Korea
North Korea sentences US tourist to 15 years in prison (Associated Press) North Korea’s highest court sentenced an American tourist to 15 years in prison with hard labor on Wednesday for subversion. Otto Warmbier, a University of Virginia undergraduate, was convicted and sentenced in a one-hour trial in North Korea’s Supreme Court. He was charged with subversion under Article 60 of North Korea’s criminal code. The court held that he had committed a crime “pursuant to the U.S. government’s hostile policy toward (the North), in a bid to impair the unity of its people after entering it as a tourist“. Before the trial, the 21-year-old from Wyoming, Ohio, said he had tried to steal a propaganda banner as a trophy for an acquaintance who wanted to hang it in her church.
Cuba
Obama abolishes last major restrictions on US travel to Cuba (Associated Press) President Barack Obama sent an unmistakable message to Americans on Tuesday ahead of his historic trip to Havana: Cuba is open for business. Punching fresh holes in the generations-old U.S. embargo, Obama’s administration removed the last meaningful restrictions on travel, putting a Cuba vacation within reach for millions of Americans over the coming years. The sweeping changes also clear a path for Cuban athletes to one day play Major League Baseball and other professional sports.
