26Dec2016 Pre-Market Commentary: Wall Street Quiet After Holiday, Markets Point To A Fractional Green Opening, Analysts Do Not Expect Much To Happen Until Tomorrow

Here is the current market situation from CNN Money

European markets finished mixed as of the most recent closing prices. The CAC 40 gained 0.10% and the FTSE 100 rose 0.06%. The DAX lost 0.05%.

Stocks could suffer as Trump trade policy takes shape

NEW YORK (Reuters) – The year-end stocks rally on the heels of the election of Donald Trump as U.S. president was built on expectations of reduced regulations, big tax cuts and a large fiscal stimulus.

How JPMorgan could not save Italy’s problem bank

MILAN/LONDON (Reuters) – On the morning of July 29, former Italian Industry Minister Corrado Passera was traveling in a high-speed train toward the medieval city of Siena, racing to meet the directors of the world’s oldest bank to present them with a rescue plan.

Iran says it sealed Boeing plane deal at half price

DUBAI (Reuters) – Iran said on Sunday it had negotiated to pay only about half the announced price for 80 new Boeing airliners in an order that the American planemaker had said was worth $16.6 billion.

Snapchat buying Israeli augmented reality start-up Cimagine: report

TEL AVIV (Reuters) – Messaging app Snapchat is buying Israeli augmented reality startup Cimagine Media for an estimated $30-$40 million, marking Snapchat’s first acquisition in Israel, the Calcalist financial daily reported on Sunday.

Blindsided by SUV boom, Hyundai Motor trims costs, perks

SEOUL (Reuters) – Headed for a fourth straight annual profit decline, Hyundai Motor is trimming its cost fat; scaling back on business class flights and annual family home trips for overseas employees, executives told Reuters.

Power surge: Chinese electric car battery maker charges for global market

NINGDE, China (Reuters) – A dusty village on the outskirts of Ningde, a third-tier city in China’s southeast, seems an unlikely place for the headquarters of a potential global leader in future automotive technology.

Chinese firms face competition to maintain role in developing Iranian oilfields

DUBAI (Reuters) – Iran plans to ask international oil companies to bid for the second phase of development of its Yadavaran and North Azadegan oilfields, a senior official said on Saturday.

ECB’s Weidmann says Monte dei Paschi bailout must be carefully weighed: Bild

FRANKFURT (Reuters) – European Central Bank policymaker Jens Weidmann said plans for a state bailout of Italian bank Monte dei Paschi di Siena should be weighed carefully as many questions remain to be answered, according to German newspaper Bild.

How Deutsche’s big bet on Wall Street turned toxic

FRANKFURT (Reuters) – Deutsche Bank’s pursuit of success on Wall Street has come at a high price, a $7 billion plus penalty illustrating the extent of its decline since 2008 when its then chief executive claimed it was one of the “strongest banks in the world”.

Chinese Carrier Sails By Taiwan, Enters Contested South China Sea

Two days after China demonstratively showed off a live-fire exercise involving its one and only aircraft carrier, the Liaoning, in the Yellow Sea, with the Defense Ministry hinting that the carrier would next sail to the South China Sea after announcing that “as a next step it will conduct scheduled cross-sea training and tests,” Beijing did just that and as Reuters reports, a group of Chinese warships led by the country’s sole aircraft carrier passed south of Taiwan on Monday, and entered the top half of the South China Sea, in what China has termed a routine exercise.

Taiwan’s Defense Ministry said the carrier, accompanied by five vessels, passed southeast of the Pratas Islands, which are controlled by Taiwan, heading southwest. The carrier group earlier passed 90 nautical miles south of Taiwan’s southernmost point via the Bashi Channel, between Taiwan and the Philippines. The Liaoning and five escorts sailed 20 nautical miles outside Taiwan’s air defence identification zone (ADIZ) in the Bashi Channel between Taiwan and the Philippines on Sunday, the defense ministry said.

“The military has been on guard and fully monitoring the Liaoning. We urge the public to rest assured,” the ministry said. Taiwanese media said an unspecified number of F-16 fighter jets and warships were deployed in Taiwan’s ADIZ to closely watch the Chinese warships. The ministry …

Global Shares Trade Mixed In Thin Holiday Trade; Yen Rises As China Rebounds

With most global market closed for Christmas holiday, and traders taking the day and the week off, global stocks traded mixed in thin, subdued conditions as the dollar dipped against the yen, with the USDJPY sliding for a fourth straight day to 117, while the EUR was flat at 1.0450, taking stock of the US 10Y yield which closed lower on Friday.

The Tokyo Topix index slipped 0.4% on trading volumes 40% below the 30-day average, while the Nikkei225 dipped 0.16% to 19,397. The Shanghai Composite Index erased a drop of as much as 1.3%, which had dragged it to the lowest level since October, closing 0.4% higher at 3,123 with construction stocks rebounding after the government said it aims to invest 1.8 trillion yuan in highways and waterways next year. Despite the rebound in stocks Chinese commodity futures tumbled, with coking coal closing 6.4% lower, coke lost near 6%, rubber and lead fell 5.1%, steel rebar down 3%. Adding to the concerns, Chinese liquidity continued to tighten, with Shibor mostly higher across the board, and the benchmark 3M index higher for the 48th consecutive day.

India’s Sensex Index resumed its decline, falling to the lowest in more than a month.

“There are technical indicators flashing certain signs, but there aren’t any events left this year, and I see 2016 ending with little disturbance, and small moves,” Seiji Iwama, a fund manager with Daiwa SB Investments Ltd. in Tokyo told Bloomberg.

Treasury yields pulled back further from 27-month highs hit in mid December following Friday’s release of U.S. economic indicators that included strong housing and consumer confidence data but also numbers that pointed to slower household income. Of note: rising concern about Trump’s policies, which threatens the euphoria-driven rally since the election, once trading resumes in earnest.

“The currency market is likely to lack incentives as major markets in Asia, Europe and North America will be closed. That said, …

How Americans Spent Their Money In The Last 75 Years (In 1 Simple Chart)

Consumer spending makes up a large percentage of the United States economy. We all have bills to pay and mouths to feed, but where do Americans spend their money? Here is a breakdown of how Americans spent their money in the last 75 years…

In the chart above, spending is broken into 12 categories: Reading, alcohol, tobacco, education, personal care, miscellaneous, recreation & entertainment, healthcare, clothing, food, transportation and housing. Each category is further broken down into spending by year, from 1941 to 2014, and each category is given a unique color. The data were collected from the Bureau of Labor Statistics. The data is adjusted for inflation and measures median spending of all Americans.

Unsurprisingly, housing expenses have almost always been the largest area of spending in America for over 70 years. The only exception is 1941, when spending on food averaged $8,311, whereas spending on housing came to $7,537. However, in 1941 the government included alcohol in the food spending category, which inflates the food spending data for that year. In the other years, alcohol was given its own category. In every other year measured, spending on housing outpaced every other category.

Another interesting trend is the downward slope of spending on clothing. Americans spent the most on clothing in 1961 for an average of $4,157. In every year measured since 1961, spending on clothing fell, even when accounting for inflation. …

Obama Quietly Signs The “Countering Disinformation And Propaganda Act” Into Law

Late on Friday, with the US population embracing the upcoming holidays and oblivious of most news emerging from the administration, Obama quietly signed into law the 2017 National Defense Authorization Act (NDAA) which authorizes $611 billion for the military in 2017.

In a statement, Obama said that:

Today, I have signed into law S. 2943, the “National Defense Authorization Act for Fiscal Year 2017.” This Act authorizes fiscal year 2017 appropriations principally for the Department of Defense and for Department of Energy national security programs, provides vital benefits for military personnel and their families, and includes authorities to facilitate ongoing operations around the globe. It continues many critical authorizations necessary to ensure that we are able to sustain our momentum in countering the threat posed by the Islamic State of Iraq and the Levant and to reassure our European allies, as well as many new authorizations that, among other things, provide the Departments of Defense and Energy more flexibility in countering cyber-attacks and our adversaries’ use of unmanned aerial vehicles.”

Much of the balance of Obama’s statement blamed the GOP for Guantanamo’s continued operation and warned that “unless the Congress changes course, it will be judged harshly by history,” Obama said. Obama also said Congress failed to use the bill to reduce wasteful overhead (like perhaps massive F-35 cost overruns?) or modernize military health care, which he said would exacerbate budget pressures facing the military in the years ahead.

But while the passage of the NDAA – and the funding of the US military – was hardly a surprise, the biggest news is what was buried deep inside the provisions of …

Art of the Deal: Barclays Takes Mortgage Fight to Court

Deutsche Bank and Credit Suisse settle multi-billion-dollar probes, but U.K. bank declines.

Italy’s Bank Rescue Is a Precarious Balancing Act

The bailout of Monte dei Paschi di Siena will have important implications for other weak lenders in Italy and the rest of Europe.

Much Ado About Not Much as OPEC Oil Deal Is Set to Kick Off

The group’s oil-output agreement, set to begin next month, may deliver a modest cut in production compared with what it was in September.

A Shifting U.S. Policy: Global Rewards And Risks

from the International Monetary Fund

— this post authored by Maurice Obstfeld

After a year marked by financial turbulence, political surprises, and unsteady growth in many parts of the world, the Fed’s decision this month to raise interest rates for just the second time in a decade is a healthy symptom that the recovery of the world’s largest economy is on track.

Does Lower Pay Mean Smaller Raises?

from the Atlanta Fed

— this post authored by John Robertson

I have been asked a few questions about the relative wage growth of low-wage versus high-wage individuals that are measured by the Atlanta Fed’s Wage Growth Tracker. Do individuals who were relatively lower (or higher) paid also tend to experience lower (or higher) wage growth? If they do, then wage inequality would increase pretty rapidly as low-wage earners get left further and further behind.

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