Baltic Dry Index. 1388 -10 Brent Crude 78.87
Spot
Gold 2055 US
2 Year Yield 4.20 -0.07
February 2, 1922 It was 2:22:22 on 2/2/22
In the stock casinos, the Great Disconnect
goes on. Ignore what the Fed and other central banksters say, it’s an election
year, the casinos have them trapped over a barrel of lower interest rates
ahead.
Asia markets rise
as Wall Street rebounds from Fed day sell-off
UPDATED THU, FEB 1 2024 9:15 PM EST
Asia-Pacific
markets rose early Friday in Asia, mirroring Wall Street’s rebound from the
sell-off earlier this week after Chairman Jerome Powell indicated the U.S.
Federal Reserve was unlikely to cut rates in March.
In Asia, investors
will wrap up the week with January inflation figures out of South Korea and
producer prices from Australia.
South Korea’s
consumer price index grew 2.8% year on year, slightly below the 2.9% expected
in a Reuters poll of economists.
In Australia, the S&P/ASX 200 rose
1.1% in early trade, after its fourth-quarter producer price index grew at a
faster pace of 4.1% year on year, compared with 3.8% in the preceding quarter.
Japan’s Nikkei 225 also
rebounded 1.02%, while the broad based Topix climbed 0.41%.
South Korea’s Kospi rose
1.62%, and the small-cap Kosdaq also gained 2.19%.
Hong Kong’s Hang Seng index jumped
1.68%, while the mainland CSI 300 inched up 0.16%
Overnight in the U.S., the Dow
Jones Industrial Average added 0.97% to set a fresh record close for the
blue-chip index, which also wiped its losses from a day earlier. The S&P
500 added 1.25%, while the Nasdaq
Composite gained 1.3%.
Asia markets live
updates: U.S. stocks rebound, Asia inflation (cnbc.com)
S&P 500 futures gain after
Meta, Amazon results as jobs report looms: Live updates
UPDATED THU, FEB 1 2024 8:51 PM EST
S&P 500 futures rose
on Thursday night as a trio of megacap tech titans reported results and
investors looked ahead to the January jobs report.
Futures tied to the broader
market index rose about 0.6%, while Nasdaq 100 futures climbed
by 1%. On the other hand, Dow Jones
Industrial Average futures hovered
near the flatline.
In extended trading, shares of Meta popped
15% after the social-media
giant defied analysts’ expectations. The Facebook-parent also
announced it will pay a quarterly
dividend for the first time, and it authorized a $50 billion
share buyback program. Amazon shares
jumped 7% on fourth-quarter
beats. However, Apple slid
3% after the company posted a decline
in sales in China during the fiscal first quarter.
The moves follow a day of
rebounds during Thursday’s trading session. The Dow Jones Industrial Average added
0.97%, while the S&P 500 and Nasdaq Composite respectively
gained 1.25% and 1.3%. The action follows a Wednesday sell-off that started
after Federal Reserve chair Jerome Powell indicated that a rate cut at the
March meeting was unlikely.
The move upward on Thursday
indicates that investors are not only correcting Wednesday’s overreaction but
are ultimately optimistic on the rate cut outlook, said Art Hogan, chief market
strategist at B. Riley Wealth Management.
---- Investors — and the Fed — will have another
data point to mull over on Friday with the release of January’s jobs report.
Economists polled by Dow Jones are calling for payrolls to have grown by
185,000 positions, and for the unemployment rate to inch higher to 3.8%. That
compares to December’s blowout of 216,000 positions added and an
unemployment rate of 3.7%.
Stock
market today: Live updates (cnbc.com)
Bank of England says
rates 'under review' as inflation seen below 2%
By Andy Bruce, David Milliken and Suban Abdulla February 1,
2024 12:37 PM GMT
LONDON, Feb 1 (Reuters) - The Bank of England kept
interest rates at a nearly 16-year high on Thursday but softened its stance
about when it might cut them and one of its policymakers cast the first vote
for a reduction in borrowing costs since 2020.
The BoE's Monetary Policy Committee split three
ways on the right course for policy and ditched its warning that rates could
rise again, instead saying borrowing costs would be kept "under
review".
Six of the nine MPC members voted to keep rates at
5.25%. Jonathan Haskel and Catherine Mann opted voted for a 0.25
percentage-point hike, while Swati Dhingra voted for a cut of the same size.
It marked the first time since August 2008 - early
in the global financial crisis - that different policymakers have voted to move
interest rates up and down at the same meeting.
Market reaction was muted, with the pound and
British government bond yields rising modestly. Investors slightly reined in
bets on the extent of cuts to Bank Rate over 2024.
"We are beginning to see signs that the BoE
may move soon as there was a vote at today’s meeting for a cut," Lindsay
James, investment strategist at Quilter Investors, said.
Economists polled by Reuters had expected one
policymaker to vote for a rate rise, and for the remainder to vote to keep
rates on hold.
"We need to see more evidence that inflation
is set to fall all the way to the 2% target, and stay there, before we can
lower interest rates," BoE Governor Andrew Bailey said.
More
Bank of England says rates 'under review' as inflation seen below 2% | Reuters
In other news, not so good.
Demand for
shipments from China via rail through Russia has ‘skyrocketed’ since the Red
Sea attacks
PUBLISHED THU, FEB 1 2024 1:13 AM
EST
Shippers are scrambling to find alternative ways
to transport goods from China to Europe in light of the disruption caused
by attacks on the Red Sea,
a major ocean route.
Air cargo volumes on
the major apparel route between Vietnam and Europe increased by 65% in the week
ending Jan. 14 when compared to the week prior, according to data from Xeneta, a freight rate data platform.
And — while it only represents a very small
proportion of containers moved between the Far East and Europe — rail routes
via Russia have seen an uptick in interest too.
Freight forwarders and consolidators — companies
that organize the shipment of goods — have reported a sharp increase in
enquiries and bookings for the route. Rail is attractive to shippers as it is
cheaper than air freight and quicker than using ocean transportation.
RailGate Europe, a group of consolidators,
transports goods including furniture, toys, clothes and automotive parts from
China through Russia to European countries.
The journey takes between 14 and 25 days depending
on its origin and destination, a transit time that is “significantly better”
than ocean times, according to Julija Sciglaite, RailGate Europe’s chief
business development officer.
Ocean shipping from China to the Dutch port of
Rotterdam via the Red Sea takes around 27 days, but re-routing via South
Africa’s Cape of Good Hope adds about 10-12 days. Last week, German shipping
company Hapag Lloyd said
it would continue to re-route its vessels until further notice.
Rail through Russia
Firms have raised concerns about sending goods via
rail through Russia, Sciglaite said. “Since [the] war in Ukraine started, many
companies were afraid to deliver their cargos via Russia as train passes
[through] part of Russian territory,” she told CNBC by email.
“Since [the] war started, [the] number of bookings
decreased significantly via Russia, but within [the] last year, this route is
recovering due to good transit time and prices,” she said.
However, since the Houthis started attacking vessels in the Red
Sea toward the end of 2023, demand on the railways went up, Sciglaite said.
“After [the] incident in [the] Red Sea ... demand skyrocketed,” she said,
although the full impact on demand won’t be known for several months, she
added. The Lunar New Year, which starts on Feb. 10, is also likely to stimulate
demand, Sciglaite said.
More
China-Russia rail freight: Demand for shipments has
risen since Red Sea attacks (cnbc.com)
Red Sea disruption
threatens Italy's economic stability - minister
February
1, 2024 9:24 AM GMT
ROME, Feb 1 (Reuters) -
Ongoing disruption in the Red Sea threatens to destabilise Italy's economy and
marginalise ports in southern Europe, Italy's defence minister said on
Thursday.
Attacks since mid-November on commercial vessels by Iran-aligned
Houthi militants, who control the most populous parts of Yemen, have disrupted
international shipping, forcing some companies to suspend transit through
the Red Sea and instead take a much longer, costlier journey around South
Africa.
"From a geopolitical perspective, the
continuing of this situation could lead to the marginalisation of ports on the
Mediterranean Sea," Defence Minister Guido Crosetto told lawmakers from
parliament's defence committees.
"Not only does it threaten the security of
navigation but also (Italy's) economic stability".
The minister said that commercial traffic through
the Suez Canal -- which he estimated to represent some 40% of Italy's total
maritime trade -- had dropped by 38% by the last week of 2023. Navigation times
increased by 10-12 days and costs increased almost five-fold, he added.
Crosetto said that, within the framework of the European
operation in the area named Aspides, Italy was considering sending aircraft
with surveillance and data collection tasks, in addition to the military vessel
it will supply for 12 months.
Red Sea disruption threatens Italy's economic
stability - minister | Reuters
Your Evening Briefing: The Big Threat for Regional Banks in 2024
February
1, 2024
It was almost a year ago when the US regional
banking sector fell into turmoil. This year, there may be more rough sledding
thanks to a commercial real estate market that hasn’t been the same since the
pandemic struck. New York Community Bancorp and Japan’s Aozora Bank just delivered a reminder that some lenders are
only beginning to feel the pain. The former’s decision to slash its dividend
and stockpile reserves sent its stock plummeting to a 23-year low by Thursday.
The selling had bled overnight into Europe and Asia, where Aozora plunged more than 20% after warning of US
commercial-property losses.
The twin dives reflect the ongoing slide in commercial property values coupled with
the difficulty of predicting which loans might unravel. Banks are facing roughly
$560 billion in commercial real estate maturities by the end of 2025,
representing more than half of the total property debt coming due over that
period. And commercial real estate loans account for 28.7% of assets at small
banks. “It’s clear that the link between commercial property and regional banks
is a tail risk for 2024,” said Justin Onuekwusi, chief investment officer
at wealth manager St. James’s Place. “And if any cracks emerge, they could be
in the commercial, housing and bank sector.”
Bloomberg
Evening Briefing: The Big Threat This Year for Regional Banks - Bloomberg
Global Inflation/Stagflation/Recession
Watch.
Given
our Magic Money Tree central banksters and our spendthrift politicians,
inflation now needs an entire section of its own.
Factories deliver
mixed performance globally in January
By Jonathan Cable and Leika Kihara February 1, 2024 10:49 AM GMT
LONDON/TOKYO, Feb 1 (Reuters) - Global factories
delivered a largely patchy performance at the start of 2024, surveys showed on
Thursday, as soft Chinese demand left Asia's economies on a shaky footing while
disruption to Red Sea shipping delayed deliveries in Europe.
The prolonged downturn in euro zone manufacturing
activity eased for a third month but could stretch through this quarter as a
majority of sub-indices in the region's Purchasing Managers' Index (PMI)
remained within the contraction zone.
HCOB's final euro zone manufacturing
PMI, compiled by S&P Global, climbed to 46.6 in January from December's
44.4, matching a preliminary estimate, but still firmly below the 50 mark
separating growth in activity from contraction.
Almost all sub-indices moved in a positive direction while those
covering pricing showed inflationary pressures may have weakened last month.
Inflation in
the euro zone eased as expected last month but underlying price pressures fell
less than forecast, official preliminary data showed on Thursday.
The downturn in Germany's manufacturing
industry, which accounts for about a fifth of Europe's largest economy, eased
in January and it was a similar picture in France.
Italy's manufacturing
sector contracted in January for a tenth straight month but at a significantly
slower pace than at the end of last year while in Spain the pace of contraction
also slowed markedly.
In Britain,
which left the European Union four years ago, factories recorded an 18th
consecutive month of contraction albeit shallower than in December.
More
Factories deliver mixed performance globally in
January | Reuters
China’s economy is
about to implode. We will all feel the aftershocks
Tue,
January 30, 2024 at 3:13 PM GMT
Evergrande, the embattled Chinese real estate giant with debts of $300 billion, has just been ordered
to liquidate by a court in Hong Kong. What effect will this have, both within
China and across the global economy?
This latest twist is no surprise.
Evergrande has long been dead in the water. The point to grasp is that
Evergrande’s latest setback will not trigger a financial crisis in China; it is
rather the result of the financial crisis which has been deepening for at least
four years.
For far too long, up to 30 per
cent of the Chinese economy had depended on a grossly inflated domestic
property bubble. By 2020, when the government finally took urgent measures to
limit this debt, its corrosive effects had distorted and disabled both the
formal banking sector and also the much less accountable and manageable Shadow
Banking system. Both are now in serious disarray as a result.
Ramifications of this unregulated
borrowing and lending crisis have spread across the economy at large. The
collapse of the property and construction bubble has weakened domestic economic
confidence, deepening the unemployment crisis and posing major challenges to
local government budgets. These domestic concerns have led to the current
implosion of the Chinese stock market. In turn this has compelled foreign
investors to take a more realistic position on China risk than believing the
golden goose fables still being peddled by Beijing. Meanwhile, with some
notable exceptions such as EVs, contraction of markets abroad for Chinese products has
highlighted how much China remains export-dependent in a cooling global
economy.
All of this calls into question
the capacity of the Chinese leadership to halt and reverse the decline of the
wider economy. Western commentators have been saying for years that China still
has significant potential to revitalise its stagnant economy. Provided swift
and deep-rooted reform policies are driven through, China could still pull
itself out of the current downward spiral.
But this prospect is rapidly
vanishing. The piecemeal efforts Beijing has made to prop up failing property
giants like Evergrande and their backers, including the likes of Zhongzhi and
Wanxiang, have had no fundamental impact. The CCP needs to devolve more
economic powers to the private sector, and reverse the trend to ever-tightening
centralisation. Yet Xi Jinping, seemingly unable to relinquish the
self-defeating Marxist-Leninist ideology of strengthened Party and personal
control, has abandoned the former and doubled down on the latter.
Evergrande had effectively defaulted by late 2021. It lost
around 66.3 billion that year. Its founder sold $343 million of shares that
November. Losses in 2022 were around 14.6 billion. Complex efforts since to
manage debt down have all failed, which is reflected in Monday’s Hong Kong
ruling. Evergrande’s operation in the US applied for bankruptcy in August last
year. The chances are minimal that Evergrande creditors, whether in China or
abroad, will see any of their money back.
More
China’s economy is about to implode. We will all feel the aftershocks (yahoo.com)
Covid-19 Corner
This section will continue until it becomes unneeded.
No update today. Normal service resumes tomorrow.
The Battle of
Lincoln, or the First Battle of Lincoln, occurred on 2 February 1141
in Lincoln, England between King Stephen of England and forces loyal to Empress Matilda. Stephen was captured during the battle,
imprisoned, and effectively deposed while Matilda ruled for a short time.[
Technology
Update.
With events happening fast in the
development of solar power and graphene, among other things, I’ve added this section.
Updates as they get reported.
Today, more on EV madness. Due to its
importance, I will leave these up for the rest of the week.
When EVs explode. Approx. 29 minutes and approx. 32 minutes.
Prof.
PAUL CHRISTENSEN Electric Vehicle Battery Fires SUBSCRIBE NOW
Prof.
PAUL CHRISTENSEN Electric Vehicle Battery Fires SUBSCRIBE NOW (youtube.com)
FRANCESCO
RESTUCCIA - Lithium-Ion battery fires Subscribe now.
FRANCESCO
RESTUCCIA - Lithium-Ion battery fires Subscribe now to this channel
(youtube.com)
Another
weekend and after last week’s International Court of Justice finding of
probable cause of Gaza genocide against Israel, the coordinated PR fightback
against the UN, specifically UNRWA. The
UN relief agency is an arm of Hamas, goes the Netanyahu desperate fightback. In
proof, 12 UN workers took part in the Hama terrorist atrocity of October 7th.
UNRWA must be closed down!
Never
mind that UNRWA employs roughly 30,000 people, 13,000 of them in Gaza. Never
mind that Israel says that so far they have killed 10,000 Hamas terrorists out
of a death toll of 28,000 with another 8,000 missing. Never mind that there is
no replacement for UNRWA ready and able to instantly step in and replace UNRWA
in Gaza to assist the almost 2 million displaced wretched abject refugees.
A
desperate Israeli politician is fighting for his life after the disaster of October
7th happened on his watch. But why are Washington, London, Toronto
and Canberra supinely playing his anti-UNWRA game? Have a great weekend everyone.
J'Accuse...!
"J'Accuse...!" (French pronunciation: [ʒ‿a.kyz]; "I
Accuse...!") is an open
letter that was published on 13 January 1898 in the newspaper L'Aurore by Émile Zola in
response to the Dreyfus affair. Zola addressed President of France Félix Faure and
accused his government of antisemitism and
the unlawful jailing of Alfred Dreyfus,
a French Army General Staff officer who was sentenced to lifelong penal
servitude for espionage.
Zola pointed out judicial errors and lack of serious evidence. The letter was
printed on the front page of the newspaper and caused a stir in France and
abroad. Zola was prosecuted for libel and
found guilty on 23 February 1898. To avoid imprisonment, he fled to England,
returning home in June 1899.
Other pamphlets proclaiming Dreyfus's innocence include Bernard Lazare's A
Miscarriage of Justice: The Truth about the Dreyfus Affair (November
1896). As a result of the popularity of the letter, even in the
English-speaking world, J'accuse! has become a common
expression of outrage and accusation against someone powerful, whatever the
merits of the accusation.[1][2]
J'accuse! is one of the best-known newspaper
articles in the world
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