Against expectations of a 195k gain, ADP reported 200k (from a downwardly revised 205k -was 214k – in Feb). While manufacturing has been weak, Services sector job gains have been the pillar of this 'recovery' so with ISM Services Employment plumbing 2-year low depths, we simply ask Mark Zandi to explain how ADP sees such strength in that same sector. Services added 191k, goods added 9k as small businesses gained 86k jobs (the most of the cohorts)… as Zandi explains "the econmy is doing very well, ignore GDP."

 

All looks normal, right – steady recovery…

 

Dear Mark Zandi, explain this…

 

The Breakdown…

 

"The economy is doing well, pay no attention to GDP"

Goods-producing employment rose by 9,000 jobs in March, up from a downwardly revised 2,000 in February. The construction industry added 17,000 jobs, which was down from February’s 24,000. Meanwhile, manufacturing added 3,000 jobs after losing 9,000 the previous month.

 

Service-providing employment rose by 191,000 jobs in March, down from 204,000 in February. The ADP National Employment Report indicates that professional/business services contributed 28,000 jobs, down sharply from February’s 51,000. Trade/transportation/utilities grew by 42,000, well above the 24,000 jobs added the previous month. Financial activities added 14,000 jobs which is in line with the average monthly increase in that sector over the past year.

 

"The Trade, Transportation and Utilities sector had its best month of employment gains since last June,” said Ahu Yildirmaz, VP and head of the ADP Research Institute. “Steady employment growth and accelerating wage growth in the workforce appear to be benefitting the Trade segment in particular.”

 

Mark Zandi, chief economist of Moody’s Analytics, said, “The job market continues on its amazing streak. The March job gain of 200,000 is consistent with average monthly job growth of the past more than four years. The only industry reducing payrolls is energy as has been the case for over a year. All indications are that the job machine will remain in high gear.”

Full Breakdown…

 

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via Zero Hedge http://ift.tt/1UC1X49 Tyler Durden

Two weeks ago, in our latest warning to shorts just after Gartman decided to short the market by going long the VIX (just ahead of its Yellen-inspired clobbering) we said we have “bad news for the bear: Gartman will be long the VIX until the S&P hits 2,118.” This is what the regular CNBC Fast Money guest said:

Short One Unit of the US stock market via the VIX: Yesterday… Wednesday, March 17th… we “punted” on the short side of the equity market, but this time doing so by buying volatility; that is, we bought the VXX volatility index ETF listed on the NYSE upon the market’s opening. We’re giving this a rather wide birth and are willing to allow the equity market to move 5% against us before exiting the trade and that means a move by the S&P to and through 2118, but we intend to move that stop down sharply in the next day or two.

To which we said: “in other words, Gartman has basically doomed the market to soar back to its all time highs. Sorry bears.”

The S&P just closed at fresh 2016 highs, and is about 70 points, o3 3%, away from all time highs. It likely will get back there very soon just as Q1 earning season is set to unveil a -8.5% drop in S&P500 EPS, the biggest plunge since the crisis.

This was probably confirmed by the latest overnight Gartman note, in which we had hoped that the newsletter writer would flopflop and go long, thus ending the rally. No such luck, in fact, Gartman continues to be short.

SHARE PRICES ARE SHARPLY HIGHER as 8 of the 10 markets comprising our International Index have risen… two, the markets in Hong Kong and Shanghai, having risen by more than 1%…and as one (the market in Japan) has fallen modestly while the stock market in the UK was unchanged. Volumes were light until Dr. Yellen had gotten mid-way through her presentation to the Economics Club of New York, but once everyone had read her prepared speech and had understood just how uncommonly accommodative it was stocks in the US moved sharply higher and closed hard upon the highs for the day.

 

At the day’s end, the CNN Fear & Greed Index closed up a bit for the day… at 68 compared to 64 the day previous… but it is still well down from the highs of one week ago today when it was 78. Anything above 75 is “extreme greed” and historically when this index moves upward past 75 and then turns lower the stock market suffers… often quite seriously. Too, the volume continues to rise as prices falter and to falter as prices rise. Further, as noted here yesterday at some rather great length, the “Commercial hedgers” have gone from a material “net long” position several weeks ago to a small net short position, while the “small traders” in the futures markets have gone from a rather large net short position to a rather small net long position instead. History is not kind to those who join the “small traders” over any reasonably protracted period of time. History, on the other hand, is kind indeed to those allied with the “commercial hedgers.”

 

To this end, we are still going to err bearishly of stocks and certainly we shall not err bullishly of them. We are, in our retirement account here at TGL long of gold in EUR and Yen related terms; we are long of a small position in the corn ETF and we are long of the bond market ETF, which tends to be a bearishly construed position. As of the close of trading yesterday we are +8.2% for the year-to-date, compared to the loss thus far this year of our International Index of 3.0% and compared to the small gain by the S&P of 0.5%… a gain that many shall tout as evidence of a great bull run. We shall not.

We shall expect another ~1% rise in the “market” today.

via Zero Hedge http://ift.tt/1MSuYAh Tyler Durden

• Bad News Is Great News: Cautious Yellen drives world stocks near 2016 peaks (Reuters)
• Yellen Spurs Global Stock Rally as Oil Rebounds, Dollar Tumbles (BBG)
• Trump drops pledge to back Republican presidential nominee other than himself (Reuters)
• Second judge says Clinton email setup may have been in ‘bad faith’ (Reuters)
• Brussels Airport Remains Shut as Police Hunt Third Attacker (BBG)
• Europe Traders Aren’t Waiting Around to See If Rebound Holds (BBG)
• Western Digital Bond Sale Is Test for Junk Market (WSJ)
• Owe Back Taxes? Lose Your Passport (BBG)
• Most Americans support torture against terror suspects (Reuters)
• Europe’s Bond Shortage Means Draghi Is About to Shock the Market (BBG)
• Tata confirms plan to sell UK steel businesses (FT)
• Corporate Bond Yields Touch Record Lows in Europe’s Periphery  (WSJ)
• Zuma’s Friends the Guptas Face Probe by South African Police (BBG)
• Another Condo Bust Looms in Miami (WSJ)
• Obama Announces New Measures to Combat Heroin, Painkiller Abuse (WSJ)
• Foxconn agrees to buy Sharp after slashing original offer (Reuters)
• Hackers Breach Law Firms, Including Cravath Swaine and Weil Gotshal (WSJ)

 

Overnight Media Digest

WSJ

– Tata Steel of India, one of the world’s largest steelmakers, said Tuesday that it would explore a sale of its struggling UK holdings, including its Port Talbot plant in Wales, a move that could threaten thousands of local jobs. (http://on.wsj.com/1qgPy8W)

– Western Digital Corp is offering investors higher yields on $5.6 billion in junk bonds backing its takeover of SanDisk Corp, the latest sign that demand for low-rated debt remains mixed despite a market rally over the past six weeks. (http://on.wsj.com/1q0tEa9)

– Egyptian authorities said the EgyptAir hijacker arrested in Cyprus with fake explosives had no known links to any terrorist groups, and a Cypriot official described him as being in a ‘fragile mental state’. (http://on.wsj.com/1SsZODV)

– Audio-sharing platform SoundCloud on Tuesday began selling paid subscriptions to one of the biggest music catalogs online, a move that will test the willingness of consumers to pay for tunes from a service they are accustomed to using free of charge. (http://on.wsj.com/22XC4Ni)

– U.S. President Barack Obama announced new steps Tuesday to combat a deadly epidemic of heroin and painkiller abuse in the U.S., including improving access to drug-treatment programs and expanding distribution of a drug that can reverse overdoses. (http://on.wsj.com/1UBlXEb)

 

FT

*The British steel industry suffered a severe blow as Tata Steel Ltd, the Indian steel giant, confirmed it was about to put its entire UK business up for sale. (http://bit.ly/1VSjtAn)

*Senior engineers at French utility EDF SA have estimated a two-year delay for Hinkley Point nuclear project in the UK and suggested reassembling its reactor technology. (http://bit.ly/1VS8W8d)

*UniCredit SpA, Italy’s largest bank by assets, is in talks with the Roman government to seek support for capital raising targeted at 2 billion euros ($2.26 billion) at mutual bank Popolare di Vicenza, according to five people with direct knowledge of the matter. (http://bit.ly/1VSkl80)

*Bank of America Corp is extending caution to its senior staff not to use the word “Brexit” while talking to clients as it tries to keep its distance from the debate over the UK’s membership in the European Union. (http://bit.ly/1VSkata)

 

NYT

– Spotify is about to close on a $1 billion deal that would double the amount of financing the music-streaming company has raised since its founding a decade ago.(http://nyti.ms/1Y0e4FW)

– With an eye to President Obama’s legacy and his own, Treasury Secretary Jacob Lew on Wednesday will hail the success of economic sanctions against Iran and other global offenders, but warn that their overuse could threaten the primacy of the United States and the dollar in the world economy. (http://nyti.ms/1RxQI6v)

– Attorneys general from Massachusetts and the Virgin Islands announced Tuesday that they would join Eric T. Schneiderman, New York’s attorney general, in his investigation into whether Exxon Mobil lied in decades past to investors and the public about the threat of climate change. (http://nyti.ms/25vu6x0)

– Hedge fund billionaire Louis M. Bacon’s charitable foundation was a victim of a fraudulent scheme by Wall Street executive Andrew Caspersen, the foundation said on Tuesday. (http://nyti.ms/1q0sRG8)

– Janet Yellen, the Federal Reserve chairwoman, said on Tuesday that the United States economy remained on track despite a rough start to the year because the drag from weak growth in other countries was being offset by lower borrowing costs. (http://nyti.ms/1WWD0Oi)

 

Canada

THE GLOBE AND MAIL

** As overall complaints to Canada’s telecom ombudsman remain steady, Rogers Communications Inc has posted a significant drop in the number of times its customers take their gripes to the industry complaint body. The Federal Commissioner for Complaints for Telecommunications Services said in a midyear report that complaints relating to Rogers Communications was down 65 percent to 437 from the same period last year. (http://bit.ly/1Y0njpn)

** Prices for copper and oil are poised to fall, according to a report by Kevin Norrish, a widely followed analyst with Barclays PLC. (http://bit.ly/1WXkPYL)

** Credit rating agency DBRS Ltd delivered an upbeat assessment of Canada’s big banks, arguing that the geographic diversity of their operations will help them navigate a weak Canadian economy and a struggling energy sector. (http://bit.ly/1qhSzWo)

NATIONAL POST

** Equifax Canada and land registry company Teranet Enterprises Inc have signed a five-year agreement to create a service for clients that will use the analytical expertise and the credit and property data assets that each company possesses to assess homeowners’ credit-worthiness. (http://bit.ly/1RIO64S)

** Uber Technologies Inc may have suspended its operations in Edmonton this month, but it’s still calling on Toronto city council to emulate the Alberta capital when it votes on new ride-sharing regulations this spring. (http://bit.ly/1PF8Fy3)

 

Britain

The Times

– The Federal Trade Commission has accused Volkswagen AG of deceptively advertising “clean diesel” vehicles and promoting ones fitted with illegal pollution-cheating devices. (http://thetim.es/1VSkJ6y)

The Guardian

– Sports Direct has upped its stake in Findel Plc to nearly 30 percent, in the latest stage of its battle to wrest control of the online specialist. (http://bit.ly/1VSkKqQ)

– A.G.Barr Plc, the Scottish soft drinks maker best known for Irn-Bru, has reiterated its annoyance at George Osborne’s sugar tax but says it expects little financial impact because it will change its recipes to adapt to the measure. (http://bit.ly/1okJ3An)

The Telegraph

– Aviva Plc Chief Executive Mark Wilson saw his pay more than double last year on the back of the company’s acquisition of rival Friends Life. According to the company’s annual report, which was published today, Wilson received 5.67 million euros ($6.40 million) last year, up from 2.6 million euros in 2014. (http://bit.ly/1okJgTU)

Sky News

– Energy Secretary Amber Rudd has risked igniting a fresh Brexit row after it emerged that her department had urged electricity suppliers to echo her warning that leaving the European Union could cost consumers 500 million pounds a year. (http://bit.ly/21ShF9X)

The Independent

– Tata Steel Ltd is reportedly preparing to announce the sale of its entire UK operation, putting thousands of UK jobs at risk. The company held a board meeting in Mumbai on Tuesday to discuss the fate of the Port Talbot plant. (http://ind.pn/21SitM7)

via Zero Hedge http://ift.tt/1olKNZS Tyler Durden

Herding cats is a notoriously difficult task, but Janet Yellen served notice on Tuesday that no matter what emanates from other members of the US monetary politburo, there’s only one house view and that’s her’s. “As she spoke, I couldn’t help picturing a mother lion swatting her misbehaving cubs back into line,” Bloomberg’s Richard Breslow wrote this morning.

While there’s something disturbing about picturing the “diminutive” Fed chair as a “mother lion,” the analogy seems apt.

“[There was] a lot of ‘let’s not forget the far more hawkish statements other Fed officials made last week,’ [but] this was not a bolt out of the blue,” Breslow continues, noting that Yellen’s speech at the New York Economic Club “was the third dovish announcement in a matter of weeks: by the boss.”

Indeed. The biggest “boss” of them all has spoken, and this is one “mother lion” who was intent on playing the dove in March. And that’s great news for EM FX, which just had its best run in 18 years. “Developing currencies rallied in March by the most since 1998, with commodity exporters Russia and Brazil enjoying the biggest gains,” Bloomberg writes. “As an index of stocks covering developing countries headed for the best month since October 2011, Fed Chair Janet Yellen gave the rally a boost overnight by giving the strongest indication yet that she will go slow with rate increases.” Bloomberg’s dollar index is down 3.7% this month – its second consecutive monthly decline and the biggest drop in more than four and a half years.

Here’s what we wrote earlier this morning:

“Starting March 18, the Bloomberg Dollar Spot had risen as much as 1.9% as Fed officials including Lacker, Williams and Bullard noted upside risks on rate-hike projection and suggested a rate hike may be imminent as soon as April. And then Yellen unleashed the latest round of dovishness, when she made it very clear that the Fed is no longer just the U.S. central bank, but that of the world (and mostly China) and as such its prerogative is to not only keep stocks high, but to also assure there is no currency crisis in Beijing (where a month ago she met other G-20 central bankers to decide precisely this). The result of Yellen’s much discussed speech, was an immediate plunge in the Dollar spot index of 1.2% to 8 month lows, its worst month in 5 years, a drop which has continued this morning, and is on par to equal the dollar’s tumble from the first week of March when Bill Dudley likewise came out very dovish, and when the index dropped 1.7% within a week.” 

“Emerging-market currencies rallied during March mainly due to a dovish Fed statement, which undermined the USD,” said Khoon Goh, a Singapore-based FX strategist at Australia & New Zealand Banking Group. There was a time when EM was stuck in a kind of lose-lose scenario vis-a-vis the FOMC. Liftoff was bad because it presaged USD strength and thus accelerated capital outflows, but the longer the Fed waited to start hiking the more nervous the EM world became. For now anyway, the emerging world seems to have found a happy medium wherein the Fed has gotten the first hike out of the way, but is now set to prove that when the Committee says “gradual,” they really mean it.

But it’s not clear that Yellen is entirely pleased with the predicament she’s put herself in by effectively transforming the Eccles Building into the headquarters of what is now the Federal Reserve Bank of the World. “At February’s G-20 meeting, Yellen most assuredly heard some pretty undiplomatic language behind closed doors on her broader responsibilities [and] it wasn’t like the joy of a bank executive to learn she is now global rather than just U.S. head,” Breslow goes on to write, before asking if we “remember the photo-op picture at the end of the meeting when everyone but [Yellen] was smiling.”

Yes Richard, in fact we do remember that and much like a similar snapshot taken last year, we found it quite amusing:

As for the rally in EM currencies, we would note that there’s a very real possibility it will be short-lived. After all, part of the strength stems from higher commodity prices and that, in turn, is linked to the market’s (likely mistaken) assumption that next month’s meeting in Doha is actually going to yield some kind of concrete set of measures designed to change the exceptionally bearish fundamental backdrop that’s kept a lid on crude since the Saudis executed the petrodollar in November of 2014. Hopes for a (farcical) output freeze have combined with the weak dollar to give crude a boost, even as the rally now looks set to dissipate quickly.

Additionally, not everyone is buying the dovish overtones. Goldman, for instance, is hell bent on insisting that economic realities in the US will make it all but impossible for the Fed to hold off much longer on the nascent tightening cycle. Tune in on Friday to see if the BLS will give the Fed’s “mother lion” another excuse to stay dovish, or whether they’ll goalseek an upside surprise to perpetuate the illusion that the US labor market is still “robust.”

Then again, it doesn’t really matter. Even if the US economy added 500,000 jobs in March all it would take is one 8% selloff on the SHCOMP for “data dependent” Janet to get cold feet – or cold “paws,” as it were.

via Zero Hedge http://ift.tt/1VT5dHo Tyler Durden

Now that Yellen has taken us back to square one where the worse the news, the better for assets, the latest announcement by Boeing, which overnight announced it will eliminate about 4,000 jobs in its commercial airplanes division by the middle of this year and another roughly 550 jobs in a division that conducts flight and lab tests, should help push the iconic ExIm bank-supported company’s shares to new 2016 highs.

According to Reuters, the planemaker will reduce 1,600 positions in the commercial airplanes division through voluntary layoffs, while the rest of the cuts are expected to be completed by leaving open positions unfilled, spokesman Doug Alder said.

“While there is no employment reduction target, the more we can control costs as a whole the less impact there will be to employment,” Alder said.

The job cuts, which will include hundreds at executive and managerial positions, will not done through involuntary layoffs, Alder said.
Boeing will also cut about 10 percent of the approximately 5,700 jobs in its test and evaluation division, which conducts flight and lab tests, spokeswoman Sandra Angers told Reuters. The company had a total of 161,400 employees as of Dec. 31.

Reuters had reported last month that Boeing was considering offering voluntary layoffs to its professional engineers and technical workers.

In February, Ray Conner, chief executive of Boeing’s airplane business, warned employees that job cuts were necessary to “win in the market, fund our growth and operate as a healthy business.”

The Seattle Times had earlier reported that Boeing has taken steps to reduce its workforce.

And now we await president Obama to threaten 4,500 soon to be former Boeing workers to ignore the fiction peddlers and instead focus on daytrading the stock market, or better yet, the dollar: that 50x FX leverage should come in very handy in the “wealth creation” process.

via Zero Hedge http://ift.tt/1qi4PpN Tyler Durden

At the end of the day, it was all about the dollar.

Starting March 18, the Bloomberg Dollar Spot had risen as much as 1.9% as Fed officials including Lacker, Williams and Bullard noted upside risks on rate-hike projection and suggested a rate hike may be imminent as soon as April. And then Yellen unleashed the latest round of dovishness, when she made it very clear that the Fed is no longer just the U.S. central bank, but that of the world (and mostly China) and as such its prerogative is to not only keep stocks high, but to also assure there is no currency crisis in Beijing (where a month ago she met other G-20 central bankers to decide precisely this).

The result of Yellen’s much discussed speech, was an immediate plunge in the Dollar spot index of 1.2% to 8 month lows, its worst month in 5 years, a drop which has continued this morning, and is on par to equal the dollar’s tumble from the first week of March when Bill Dudley likewise came out very dovish, and when the index dropped 1.7% within a week.

 

What is notable about these two crying doves is that both have roundly ignored the advice of central banker incubator Goldman Sachs, that it is in the US interest to push the dollar higher (it had a report just last week titled “Inflation Finally Begins to Firm”). It will be very interesting to see how this particular conflict is resolved.

For now, however, the die has been cast, and the result is a surge in risk assets around the globe: stocks jumped in Asia (except in Japan where the Yen strength pushed the Nikkei lower by 1.3%, however the Shanghai’s 2.3% jump just over 3000 should more than make up for that) and Europe, with US equity futures 0.6% higher at this moment. Commodities climbed as the dollar extended its worst month in more than five years.

The reason for this stock surge, as we noted last night, is absurdly delightful: Yellen signaled “weakening world growth” and “less confidence in the renormalization process.” In other words, the “bad news is good news” mantra is back front and center. As such, calls for a slow approach to tightening policy ignited gains for shares from Shanghai to Frankfurt after U.S. equities erased their losses for the year. Diminishing prospects for a first-half Fed rate increase sent the Bloomberg Dollar Spot Index toward the lowest since June and drove emerging-market currencies toward their best month since 1998. Credit markets rallied and U.S. oil gained for the first time in five days.

“We have seen European markets broadly head higher on Yellen’s dovish
note last night,” said Michael Hewson, the London-based market analyst
at CMC Markets Plc. “It’s the only factor driving them up today.”

Indeed, the worse the global economy gets from this point on, the better for risk assets, even if it means that the S&P’s GAAP P/E is north of 23x as of this morning.

As Bloomberg adds, futures show traders now see no chance of Yellen changing policy next month, a roughly 20% chance of a June hike as of this moment, and only a 54% likelihood of an increase by November after she dialed back some of the commentary made by other officials the past two weeks. The Fed chair emphasized during her appearance at the Economic Club of New York that the central bank remains wary of raising rates amid threats to American growth from a slowing global economy.

The MSCI All-Country World Index added 0.8 percent as of 10:29 a.m. London time for a fourth-straight advance. The Shanghai Composite Index gained 2.8 percent and Germany’s DAX Index added 1.6 percent. The Bloomberg Dollar Spot Index fell 0.2 percent.

Global Market Snapshot

• S&P 500 futures up 0.5% to 2057
• Stoxx 600 up 1.2% to 341
• FTSE 100 up 1.5% to 6199
• DAX up 1.5% to 10034
• German 10Yr yield down less than 1bp to 0.14%
• Italian 10Yr yield down 1bp to 1.23%
• Spanish 10Yr yield down less than 1bp to 1.44%
• MSCI Asia Pacific up 0.9% to 129
• Nikkei 225 down 1.3% to 16879
• Hang Seng up 2.1% to 20803
• Shanghai Composite up 2.8% to 3001
• S&P/ASX 200 up 0.1% to 5010
• US 10-yr yield up less than 1bp to 1.81%
• Dollar Index down 0.26% to 94.91
• WTI Crude futures up 1.7% to $38.94
• Brent Futures up 1.4% to $39.69
• Gold spot down 0.2% to $1,239
• Silver spot up 0.2% to $15.39

Top Global News

• Boeing to Trim 4,000 Jobs Amid Makeover of Commercial Jet Unit: part of a broader effort to reduce costs amid fierce competition from Airbus Group SE
• Amazon Assembly, Installation Services Bolster Big-Product Sales: retailer has put together an army of workers who can handle everything from mounting flat TVs on walls to assembling treadmills
• Exxon Climate Science Probe Expands as New York Gains Allies: Massachusetts joins New York in investigating Exxon Mobil
• Yellen Spurs Global Stock Rally as Dollar Tumbles for Second Day: Stocks jumped around the world after Yellen reasserted the central bank’s gradual approach to raising interest rates
• Earnings Optimism Drawing Short Seller Wrath in U.S. Equities: Short interest in ETF tracking industry highest in 20 months

Looking at regional markets, we start in Asia, where in the aftermath of yesterday’s dovish deluge stocks traded mostly positive as the region cheered Fed Chair Yellen’s dovish remarks, which had already underpinned the S&P 500 to its highest close YTD. However Nikkei 225 (-1.3%) underperformed, weighed by a stronger JPY and poor Industrial Production figures which declined the most since 2011, while Shanghai Comp (+2.8%) outperforms amid upbeat earnings results and prospects China’s pension fund could start investment in the nation’s stock markets this year. 10yr JGBs tracked T-notes higher following the aforementioned dovish Yellen and amid weakness in Japanese stocks, while the BoJ were also in the market for JPY 1.2trl of government debt.

Top Asian News

• China Said to Accelerate Financial Regulatory Overhaul Plans: Proposals for new system of oversight could come in summer
• China’s Large Banks Wary on Li Keqiang’s Plan for Bad Loans: Higher risk weights for equity stakes would weaken banks
• Fortunes Reverse for Hedge Funds That Won in Past Selloffs: Hao’s China hedge fund lost 6.1% after last year’s 149% gain
• Takata Said to Put Worst-Case Recall Costs at $24 Billion: Supplier said to peg total recall at 287.5m inflators
• Antibiotic Apocalypse Fear Stoked by India’s Drugged Chickens: Feeding chickens antibiotics may speed diseases costing $100t

In Europe, risk on sentiment dominated the price action this morning as dovish comments by Fed’s Yellen on Tuesday prompted market participants to reassess their expectations of further rate hikes by the Fed. Consequently, USD index remained under pressure for the much of the first half of the EU session. Looking elsewhere, despite the upside in stocks and supply related positioning, Bunds traded little changed, though prices moved off the best levels after it was reported that inflation in German states edged back into positive territory. Also of note, peripheral bond yield spreads continued to tighten, supported by large quarter-end negative supply in April.

Top European News

• Metro Plans to Split in Two in Move to Boost Company’s Value: Shares jump as much as 10% in Frankfurt on demerger plan. Split should take place by middle of next year, company says
• Swedbank Chairman Fails to Win Re-Election After CEO Scandal: development follows the dismissal earlier this year of Chief Executive Officer Michael Wolf
• Tata Steel Will Study Sale of Its U.K. Unit as Market Worsens: Producer says its holding talks with British government. Slump in global prices has forced it to consider selling its U.K. business
• Europe’s Bond Shortage Means Draghi Is About to Shock the Market: ECB’s monthly debt purchases rise by 20 billion euros in April. Ten-year bunds headed for biggest quarterly gain since 2011

In FX, the early European session continued to the North American sell off in the wake of Fed Chair Yellen’s speech in NY yesterday, where the level of dovish rhetoric took the market by surprise. All the majors saw significant moves against the greenback, and these have all been extended, after a relatively quiet Asian session which was largely consolidative. EUR/USD has now pushed up to 1.1333 while USD/JPY printed a 112.00 low to push the USD index down towards key mid-March support.

The commodity currencies have also made some gains, but giving back some of this more recently, with USD/CAD meeting strong demand at 1.3000. NZD/USD took out key resistance around .6900 to suggest some much stronger gains ahead, though AUD/USD through the recent .7680 highs has only generated modest momentum since, with .7700 still intact.

Bloomberg’s dollar index, which tracks the greenback against 10 major peers, has lost 3.7 percent in March, set for a second straight monthly drop and the biggest decline since September 2010. The U.S. currency slipped 0.3 percent to $1.1321 per euro and weakened 0.4 percent to 112.27 yen as it dropped against all of its major counterparts.

The Fed would act “cautiously” as it looks to raise rates against a backdrop of deteriorating global growth, Yellen said. Policy makers including St. Louis Fed President James Bullard and San Francisco Fed boss John Williams said last week that higher borrowing costs were possible as soon as next month.

“Yellen indicated that core Fed members take into account the global context more than regional officials,” said Etsuko Yamashita, chief economist at Sumitomo Mitsui Banking Corp. in New York. “A June rate hike would be difficult as global financial turmoil earlier this year affects the real economy with a time lag.”

In commodities, WTI and Brent have both traded positively with WTI currently trading higher by USD 0.72/bbl just above the USD 39.00/ bbl level. Gold has also seen moves higher during European trade but has now started consolidating after reaching highs of 1244.27/oz. Meanwhile in base metals copper and iron ore price action was subdued with the red metal remaining at its lowest level since early March. Nickel for three-month delivery advanced 0.8 percent to $8,520 a metric
ton on the London Metal Exchange. Gold declined 0.3 percent to $1,238.22
an ounce in the spot market following a 1.7 percent jump last session.

West Texas Intermediate crude snapped a four-day, 7.7% tumble to rise 1.7 percent Wednesday, to $38.94 a barrel. Brent crude gained 1.2 percent to $39.59. The weaker dollar makes crude and other commodities cheaper in other currencies.

Bulletin Headline Summary from RanSquawk and Bloomberg

• European equities remain elevated on the back of dovish commentary from Fed Chair Yellen who stresses need to hike rates slowly.
• USD index remained under pressure consequently supporting flows into higher yielding currencies such as AUD and NZD.
• Going forward will see the latest US ADP report, weekly DoE inventories data, comments Fed’s Evans and also the US Treasury will sell USD 28b1n in 7y notes.
• Treasuries little changed in overnight trading, global equity markets rally on post-Yellen euphoria; this week’s auctions conclude with $28b 7Y notes, WI yield 1.59%, compares with 1.568% awarded in Feb., lowest 7Y auction stop since 1.496% in May 2013.
• U.S. Treasuries are poised for their best quarter in almost four years as bond traders cut the probability of a rate boost at the April meeting to zero after Yellen’s warning Tuesday about global economic risks; The dollar headed for its worst month in more than five years, the yen strengthened
• Boeing plans to cut about 4,000 jobs from its commercial airplanes division by mid-year as part of a broader effort to reduce costs amid fierce competition from Airbus Group SE. The U.S. planemaker doesn’t plan any involuntary layoffs, for now
• ECB Governor Draghi prepares to increase and broaden his bond-buying program, leaving investors to face even higher demand for government bonds with supply unable to keep up and some of Europe’s biggest banks are predicting yields are headed for even more record lows
• The European Central Bank isn’t discussing directly financing government stimulus, or “helicopter money,” Executive Board member Benoit Coeure said
• Euro-area economic confidence fell to the lowest level in more than a year just as the European Central Bank deployed fresh stimulus to spur growth and quash the threat of deflation
• Japan’s industrial production dropped 6.2% in February, the most since the March 2011 earthquake as falling exports sapped demand and a steel-mill explosion halted domestic car production at Toyota Motor Corp
• $6.45b IG credit priced yesterday, WTD $11.1b, MTD $155.905b, YTD $450.155b; $1.07b HY priced yesterday, WTD 4 deals $2.57b, MTD 26 deals for $16.435b, YTD 51 deals for $31.29b
• Sovereign 10Y bond yields mixed; European and Asian equity markets higher; U.S. equity-index futures rise. WTI crude oil rallies, gold and copper fall

US Event Calendar

• 7am: MBA Mortgage Applications, March 25 (prior -3.3%)
• 8:15am: ADP Employment Change, March, est. 195k (prior 214k)
• 10:30am: DOE Energy Inventories
• 1pm: Fed’s Evans speaks in New York

DB’s Jim Ried concludes the overnight wrap

Well after ten days or so of some surprisingly hawkish chatter from a handful of the regional Fed Presidents, it was back to the cautious FOMC script of two weeks ago for Fed Chair Yellen following her comments yesterday at the Economic Club of New York. In stark contrast to much of the rhetoric in the interim period since the last FOMC meeting to twenty-four hours ago from her colleagues, a dovish Yellen provided a firm and effective reminder that the Fed is clearly not going to be rushed into prematurely tightening further, while at the same time surely putting to bed any possibility that the Fed could move next month, as some of the previous Fedspeak comments had alluded to.

In terms of what Yellen said exactly, the main focus was on her comment that ‘given the risks to the outlook, I consider it appropriate for the committee to proceed cautiously in adjusting policy’. This was quickly followed up by the Fed Chair also making mention to the fact that ‘this caution is especially warranted because, with the federal funds rate so low, the FOMC’s ability to use conventional monetary policy to respond to economic disturbances is asymmetric’. Yellen also highlighted that the outlook for US inflation had become ‘somewhat more uncertain’ and that recent readings on the US economy are ‘somewhat mixed’. The Fed Chair even went as far as to say that the committee has ‘considerable scope’ to ease policy if necessary and that ‘while these tools may entail some risks and costs that do not apply to the federal funds rate, we used them effectively to strengthen the recovery from the Great Recession, and we would do so again if needed’. Both China and volatility in Oil prices were also made mention to several times as risks to the US outlook.

In the lead up another rough day for Oil markets, which we’ll touch on shortly, had seen US equity markets trend lower initially, but risk markets latched onto the dovish tone with sentiment swinging as Yellen spoke, culminating with the S&P 500 eventually finishing with a +0.88% gain and in turn reaching a fresh high for the year. Credit indices also took comfort in the comments with CDX IG (1bp tighter on the day) nearly 2.5bps tighter from the earlier intraday wides. Unsurprisingly the US Dollar was hit hard with the Dollar index (-0.82%) eventually concluding a second consecutive down day. Gold finished +1.62%, while elsewhere Treasury yields were already marching lower with the moves for Oil before the Fed Chair’s comments added an extra kick, the benchmark 10y eventually finishing the day over 8bps lower at 1.804%. The probability of a hike in June fell to a fresh post-FOMC low of 28% (around 10% lower than Monday’s close), although it’s worth reminding that we still have three employment reports to come before that meeting starting with the March report this Friday.

Refreshing our screens this morning, with the exception of Japan bourses in Asia are following much of the post-Yellen gains made in the US yesterday evening. The Shanghai Comp (+1.24%), Hang Seng (+1.38%), Kospi (+0.36%) and ASX (+0.26%) are all up while iTraxx credit indices in Asia and Australia are both tighter. US equity market futures are posting modest gains. The sell-off for the US Dollar has seen the Yen benefit the most and that’s weighing on Japanese equity markets with the Nikkei currently down -0.33%. A softer than expected industrial production report out of Japan (-6.2% mom vs. -5.9% expected) is also not helping sentiment there. Meanwhile there’s better news to come out of the latest Westpac consumer sentiment reading for March in China, with the index up nearly 7pts to 118.1 and the highest level since September.

Back to yesterday and specifically those moves for Oil. WTI closed down -2.82% yesterday and a shade above $38/bbl for its fifth consecutive daily decline. In fact prices are now $4 lower than the intraday highs of less than two weeks ago with much of this being attributed to the rising skepticism building for hopes of any material outcome from the upcoming April 17th meeting between major producers in Doha. The latest dent yesterday came out of Kuwait with the acting oil minister announcing that production is to restart in the Kharfi oil field, a 300k barrel-a-day joint operation by state owned Kuwait and Saudi Arabian oil producers which had been closed since October 2014. Oil had been rallying on hopes that the upcoming Doha meeting may bring about a production freeze but questions are being asked about the seriousness of such an outcome in light of news such as this.

With regards to the economic data yesterday, the main takeaway of note was a decent rise in the March consumer confidence index to 96.2 (vs. 94.0 expected) from an upwardly revised 94.0 last month. While the details showed the present situation index declining for the second consecutive month, the expectations index did retrace nearly its entire February decline. The only other data of note in the US was the S&P/Case-Shiller house price index which showed that house prices increased +0.8% mom during January (vs. +0.7% expected) in the 20 major cities. Prior to this in Europe we saw the ECB report its money and credit aggregates for February. The M3 money supply growth rate was unchanged at 5.0% yoy as expected, however there was a reported increase in loans to both households and non-financial corporates.

Staying in Europe, European equity markets reopened from the long weekend with broad-based gains yesterday, the Stoxx 600 (+0.50%) in particular snapping the four days of consecutive losses which had made up last week. Meanwhile sovereign bond yields in Europe continue to close in on their February lows. 10y Bund yields were over 4bps lower yesterday and at 0.136% are only just above the 0.107% we reached at the end of last month. It was noted that Spanish 5y yields struck a new record low yesterday at 0.318%.
Before we take a look at today’s calendar, there was actually some other Fedspeak away from Yellen yesterday although this was clearly overshadowed by the comments from the Fed Chair. San Francisco Fed President Williams said that the future pace of rate hikes will be gradual and thoughtful while offering a slightly more positive outlook for global growth relative to that of Yellen. Meanwhile Dallas Fed President Kaplan said that although he considers all eight Fed meetings to be ‘live’, the Fed President stressed the need for the Central Bank to move in a ‘cautious, deliberate and patient’ manner.

Looking at the day ahead now then, the early data out of Europe this morning will see the release of the March confidence indicators for the Euro area (where little change is expected in the economic confidence index) before we get the first read of the March CPI reading for Germany (expected at +0.6% mom). This afternoon in the US the focus will be on the ADP employment change reading for March as a prelude for the Friday employment report, with market expectations currently sitting at 195k. Away from this it’s fairly quiet although we are due to hear from Chicago Fed President Evans (at 6.00pm BST) where he is expected to speak in NY on the economy and monetary policy, with Q&A scheduled for after.

via Zero Hedge http://ift.tt/1RIarTp Tyler Durden

 

 

Hold your real assets outside of the banking system in one of many private international facilities  –>  http://ift.tt/1M1FiG5 

 

 

The Most Powerful Weapon Ever – Gold, Uranium, Pen?

Posted with permission and written by Rory Hall, The Daily Coin (CLICK FOR ORIGINAL)

 

 

We have the power and the weaponry to change every community, every state and the entire nation without ever firing a single bullet. How is this possible?

Whenever a person, anywhere in the world, exchanges their fiat currency for gold or silver coins or bars, they are “firing a shot” at that currency. Gold is “the money of Kings” and silver is “the money of Gentlemen”. Gold and silver have been money for thousands of years and no amount of market rigging, made up rules or government intervention will change this law of man. People around the world still conduct business using gold and silver as a medium of exchange. Simply because gold, in particular, is not used on a large scale and we are continually told that gold is a “ pet rock” or held by Central Banks as a “tradition” this is not the case. Gold and silver have value and worth. To acquire them from the source builds into them a certain amount of value. The labor, the time and various resources used to acquire these precious metals goes into every ounce pulled out of the ground. If gold is a “pet rock” or a “tradition” then why is there so much secrecy surrounding gold held at Central Banks? Why does the Federal Reserve, in conjunction with the U.S. Treasury, refuse to conduct an audit of OUR gold? The gold held at Fort Knox and the New York Federal Reserve, that is assigned to the Federal Reserve System, belongs to the people of the United States. If gold is nothing more than a tradition, audits are also a tradition that every responsible person does on a regular basis. Who among us doesn’t audit (balance) their checking account regularly? Who among us doesn’t audit their personal belongs of every type? Ever go through your closet, clean it out and donate the clothes, shoes, whatever to charity? It’s that an audit?

Every gram of gold or silver you acquire using fiat currency effectively removes that many “dollars” from the current financial and economic system. What you have done is removed those “dollars” from the hands of government. They now have fewer “dollars” to use to purchase weapons of war, surveillance technology and the other weapons they use against us. Today would be a good day to remove a few “dollars” from their hands and place another weapon in your back pocket. Gold and silver are free from tyranny, accepted around the world in good faith and provides a piece of insurance from, what appears to be, a system in change.

Marin Katusa, Katusa Research, and I were able to sit down and discuss gold, silver and mining. What happened was much more than I could have imagined. The conversation started out discussing gold, silver and the miners. It ramped up and made me to realize how jacked-up our world is when we began discussing uranium. I know little about uranium and the impact it has on our world, that is now changing because of Mr. Katusa. What I do know is it used to create energy in nuclear power plants and it is used in making weapons.

The two primary uses for uranium make it another of the weapons we discussed. When I say weapon that is to say both sides of the coin – good and bad. The good that uranium can do for our world is to make our air much cleaner by “firing a shot” at both coal and oil. If we use less coal and oil our air will greatly improve. I am not a tree-hugger nor do I believe in “global warming/climate change”. I also report regularly on what has occurred in Fukushima, Japan. I understand the implications of nuclear power and how it can impact our world. I also learned, from Marin, that the United Arab Emirates has three brand new nuclear power plants coming online. Why would an OPEC member nation ever consider nuclear power, even on a small scale, unless there was a specific need, specific goal or something is going on with oil as energy? They already have all the energy they will need for a very long time to come – or do they? It is question that begs to be ask.

Our conversation then turned to the “presidential election show “.

I see two things: First of all the first the thing people should be asking is – the existing establishment, on both sides, wether GOP or the Democrats, should be asking themselves “Wholly crap how bad have we been, how screwed up and pathetic have we been for Bernie and Donald to do what they’ve also done?”

The other thing people have to understand is, if you read history, weapons would always evolve; the success of the Roman Empire was always adapting and evolving their weaponry. But today every person in America holds the most powerful weapon ever in their back pocket… Marin Katusa

With the American people seemingly awakening, in a way that I can not remember ever seeing, it would be a disservice to you to not ask Marin what he see’s happening. The media has lied, deceived and continually programmed the people to believe what the establishment wanted us to believe. As Marin points out the people have the greatest weapon ever seen. The one weapon that can not be controlled, can not be stopped and has the power to mobilize millions in a flash. You may be using it to read these words. The smartphone has the power to educate in a way that bypasses all the noise, all the propaganda and allows the person using the weapon to use it in a way that changes their lives and the world. Wonder why the establishment is so concerned about websites like The Daily Coin?

You are holding the wonder-weapon of change.

 

Give this a listen and allow Marin Katusa, Katusa Research, to share his wisdom and knowledge that has made him a very wealthy man at a very young age.

 

 

 

Please email with any questions about this article or precious metals HERE

 

 

 

 

The Most Powerful Weapon Ever – Gold, Uranium, Pen?

Posted with permission and written by Rory Hall, The Daily Coin (CLICK FOR ORIGINAL)

 

 

 

 

Rory Hall, Editor-in-Chief of The Daily Coin, has written over 700 articles and produced more than 200 videos about the precious metals market, economic and monetary policies as well as geopolitical events since 1987. His articles have been published by Zerohedge, SHTFPlan, Sprott Money, GoldSilver and Silver Doctors, SGTReport, just to name a few. Rory has contributed daily to SGTReport since 2012. He has interviewed experts such as Dr. Paul Craig Roberts, Dr. Marc Faber, Eric Sprott, Gerald Celente and Peter Schiff, to name but a few. Visit The Daily Coin website and The Daily Coin YouTube channels to enjoy original and some of the best economic, precious metals, geopolitical and preparedness news from around the world.

 

 

 

 

 

via Zero Hedge http://ift.tt/230NpMr Sprott Money