Baltic
Dry Index. 2845 +245 Brent Crude 63.02
Spot Gold 4213 US 2 Year Yield 3.49 -0.02
US Federal Debt. 38.364 trillion
US GDP 31.617 trillion.
“I did not attend his
funeral, but I sent a nice letter saying I approved of it.
Mark Twain
In the global stock casinos, more disconnect and denial from a real global economy showing sign of turning from relative boom to bust.
Never mind the facts, buy more! The more I see in the stock casinos the more I think Warren Buffett is right to be selling out of stocks.
Besides, the Bank of England is clearly
spooked about something bad about to happen. But what and how soon?
Asia markets mostly rise after Wall Street gains
on rate-cut hopes fueled by weak jobs data
Published Wed, Dec 3 2025 6:59 PM EST
Asia-Pacific markets mostly rose Thursday,
after Wall Street gained on hopes the Federal Reserve could cut interest rates
next week following weaker-than-expected jobs data.
Payroll processor ADP reported that
private companies cut 32,000 workers in November, compared with 47,000
additions in October, and well below the 40,000 increase expected by economists
polled by Dow Jones.
Markets are pricing in an 89% chance of a
cut when the Federal Reserve meets on Dec. 9-10, significantly higher than
rate-cut bets just a couple of weeks ago, according to the CME FedWatch tool.
In Asia, Japan’s benchmark Nikkei 225 index added
1.77%, and the Topix index advanced 1.81%.
Industrials and tech stocks led gains on
the Nikkei index. Shares of Japan’s Fanuc skyrocketed more
than 12%. The industrial robot maker announced a partnership with Nvidia on Tuesday, which sent
shares up 6.51% that day.
Shares of tech-focused investment
giant SoftBank rallied
for a second straight day. The stock jumped more than 8%.
Japanese chip equipment maker Lasertec rallied for a
third consecutive session, rising 6.5%. Renesas Electronics jumped
more than 9% after California-based semiconductor company SiTime Corp was reportedly in
talks to acquire the Japanese chipmaker’s timing unit. A deal could value the
timing business at up to $2 billion, including debt, Bloomberg said, citing people familiar with the matter.
South Korea’s Kospi index fell 0.64%,
while the small-cap Kosdaq declined 0.12%.
Australia’s ASX/S&P 200 rose 0.19%.
Hong Kong’s Hang Seng Index added 0.19%,
and the CSI 300 added 0.28%.
India’s Nifty 50 advanced 0.27%,
while the BSE Sensex index climbed 0.22%. The Indian rupee opened at a record
low of 90.4 against the greenback, marking the third straight day of reaching
an all-time low.
Shares of IndiGo, the country’s biggest
airline, fell as much as 3% after it cancelled multiple flights since Monday.
IndiGo attributed the disruptions in the past two days to unforeseen issues
such as adverse weather conditions and increased congestion, as well as the implementation
of updated rostering rules, Reuters reported.
Flight disruptions reportedly continued for a fourth day, as a
spokesperson for the airport in Bengaluru said 73 IndiGo flights had been
cancelled Thursday.
Overnight, the Dow Jones Industrial Average gained
408.44 points, or 0.86%, to finish at 47,882.90. The S&P 500 traded up 0.30%
to end the day at 6,849.72, while the Nasdaq Composite added 0.17%
to settle at 23,454.09.
Stocks with exposure to the artificial
intelligence trade were the biggest drag on U.S. key benchmarks Wednesday
stateside, after The Information reported Microsoft was
cutting software sales quotas tied to artificial intelligence.
Other major tech names, including Nvidia and Broadcom, pulled the broad-based
S&P 500 lower.
Microsoft refuted the claims in the
report, which led the stock to recover slightly in after-hours trading.
Asia-Pacific
markets: AI, tech, Nikkei 225, Hang Seng Index, CSI 300
US Companies Keep Shedding Jobs
December 3, 2025 at 11:26 PM GMT
US companies fired employees or otherwise
reduced payrolls last month by
the most since early 2023, further accelerating a trend of job losses
that’s plagued the Trump administration for much of its second term.
Unemployment currently sits at 4.4%.
Private-sector payrolls decreased in
November by 32,000, according to ADP Research data released Wednesday. Payrolls
have now fallen four times in the last six months. The median estimate in a
Bloomberg survey of economists called for a 10,000 gain.
“Hiring has been choppy of late as
employers weather cautious consumers and an uncertain macroeconomic
environment,” said Nela Richardson, chief economist at ADP and a contributor to
Bloomberg Television. “And while November’s slowdown was broad-based, it was
led by a pullback among small businesses.”
Companies with fewer than 50
employees shed 120,000 jobs, the largest one-month decline since May 2020.
Those with 50 or more employees increased headcount. Until recently, many
economists have said the labor market is in a state of low hiring and low
firing. But a number of large companies,
including Apple and Verizon, recently undertook mass
terminations or announced plans to do so, which risks driving unemployment even
higher. —David
E. Rovella
US
Companies Keep Firing Their Workers: Evening Briefing Americas - Bloomberg
FTSE 100 Live: HSBC names new chair; Bloomsbury
and Google tie-up
Wednesday 03 December 2025 6:45
am | Updated: Wednesday 03 December 2025 7:36
am
Good morning and welcome back to the City
AM liveblog.
Are we on the verge of another financial
crisis?
It’s quite the eerie question but it was
one of many posed to the Governor of the Bank of England Andrew Bailey
following the latest financial stability report on Tuesday.
The head of the central Bank was asked
whether changes to banks capital requirements was “sowing the seeds” of another
2008-esque crash.
Bailey robustly denied this, in fact
calling it the “sensible” thing to do.
But one consistent area the Bank has drawn
2008 comparisons with is the ever-ballooning AI bubble.
In the Financial Policy Committee’s (FPC)
latest report, it said “risks to financial stability have increased during
2025”.
“Equity valuations in the US are close to
the most stretched they have been since the dot-com bubble, and in the UK since
the global financial crisis,” the committee added.
“This heightens the risk of a sharp
correction.”
Fears of an AI bubble have ramped up over
the last 12 months but the UK market has managed to avoid being swept up too
dramatically due to the FTSE 100’s weighting towards ‘traditional’ stocks such
as healthcare, banking and oil.
Still, the FPC report indicates the UK was
likely to get caught in “spillover” due its standing as an “open economy with a
large financial centre.”
“The UK is exposed to global shocks that
could transmit through multiple, interconnect channels,” it added.
More
In related news.
Bank of England sounds alarm on leveraged hedge
fund bond bets
Wednesday 03 December 2025 6:32 am
The Bank of England has sounded the alarm
on international hedge funds snapping up record levels of UK government debt,
warning that their highly leveraged bets leave Britain increasingly exposed to
a bond market meltdown.
In its biannual Financial
Stability Report,
the central bank said the large share of UK government debt held by
risk-seeking asset management firms means the economy is more vulnerable to a
sudden sell-off of British bonds – known as gilts.
The UK government has become more reliant
on a small number of little-known hedge funds to buy up its debt, after a
shake-up in capital market regulation allowed pension funds and insurance firms
to diversify away from the longer term bonds the government relies on selling.
Pension funds and insurers had tended to
keep their bond holdings until they matured, and given their risk-averse
mandates were not as likely to rack up debt to help fund investing elsewhere.
But hedge funds, which largely operate on much shorter time frames, have
increasingly taken out enormous
bets on small price fluctuations in the UK bond market, which they then
borrow against and reinvest to boost returns.
Bank of England officials warned the
amount of debt taken out against gilts has reached its highest level since the
central bank started monitoring the trend in 2017. Hedge funds used their gilt
portfolios to borrow some £100bn of extra cash in November, a pattern of
behaviour the Bank said “increase[s] the risk of sharp moves” in the UK
government bond market.
Bank of England explores limiting hedge
fund leverage
The leverage has left regulators concerned
about the strength of the bond market’s foundations during a downturn
in financial conditions, as the mostly foreign hedge funds would be forced to
extricate themselves from the risky trades to pay off debts, compounding a
rout. Any sharp sell-off would immediately send government borrowing costs
skyward, posing an acute threat to the public finances and a major systemic
risk to the financial system.
“Forced or widespread deleveraging would
have the result of amplifying initial moves and potentially triggering a
feedback loop of further forced selling,” the
Bank of England’s Financial Regulation Committee wrote, “especially if
funding conditions tightened to the extent that refinancing became unavailable
or prohibitively expensive.”
Andrew Bailey, the Bank of England
governor who chairs the regulation committee, said officials were exploring
plans to limit the size of hedge fund bets on gilts in a bid to avoid the worst
of any market fallout.
Elsewhere
in Bank’s report, officials highlighted the rapid
escalation of debt issuance for artificial intelligence infrastructure, the
“materially stretched” tech valuations and “opaque” shadow banking sector as
all raising the likelihood of a market meltdown in 2026.
“Risks to financial stability have
increased during 2025,” the Bank’s Financial Policy Committee wrote. “Global
risks remain elevated and material uncertainty in the global macroeconomic
outlook persists.”
Investor speculation over the
transformative potential of AI has driven shares in tech firms to historically
high valuations through 2025, and meant capital in global stock markets is
increasingly concentrated in a few large stocks.
More, much more.
Bank of England
sounds alarm on leveraged hedge fund bond bets
Exclusive: Goldman Sachs, Oaktree and Carlyle to
take part in private credit stress test
Wednesday 03 December 2025 1:39 pm
Goldman Sachs, Oaktree and Carlyle will
take part in the Bank of England’s inaugural stress test of the burgeoning
private credit sector this week, City AM can reveal.
Britain’s central bank is poised to carry out its
first ever “system-wide exploratory scenario exercise” of so-called shadow
banks in the coming weeks, in a bid to to probe how the increasingly pivotal
corner of UK finance would fare during a downturn in market conditions.
The UK’s largest UK-founded non-bank, ICG,
is also understood to be taking part. Sources familiar with the exercise’s
planning confirmed that the four companies – which are among the biggest names
in the private credit industry – will take part in the test, during which
officials will seek to understand “the actions [they take] in response to a
shock”.
Banking behemoth Goldman Sachs, which as
well as boasting its own private credit division also issues traditional loans
to specialist non-banking funds, will be submitted to tests both on the
response of its private debt practice and the underwriting of its loans to the
industry.
Oaktree, the Los Angeles-based private
markets giant established by investment luminary Howard Marks, Carlyle and ICG
will also submit to interrogation from the Bank over the systemic risk their
loans pose to the UK economy.
Private credit comes under regulators’
gaze
Watchdogs across the world have become
increasingly worried about the opaque role that private markets play in the
global financial system, after a string of high-profile corporate collapses
with ties to private lending.
The International Monetary Fund devoted a chapter of its 2024 financial stability
report to the systemic threat posed by the private credit industry, which now
boasts an estimated $2 trillion under management. Bank of England governor
Andrew Bailey has also compared some of the riskier lending issued by industry
players to the sub-prime mortgage crash that foreshadowed the 2008 financial
crisis, saying “alarm bells” were ringing.
The recent failures of car part maker
First Brands, and subprime auto lenders Primalend and Tricolor, were held up as
evidence of lax underwriting at private credit funds which could trigger a
future financial crisis. The industry has vigorously denied those charges,
claiming its long-term, closed-end nature makes it less vulnerable to contagion
than traditional banking.
As well as Oaktree, ICG and Goldman, earlier reports have revealed industry heavyweights Blackstone,
Apollo and KKR will also participate in the test. A source familiar with the
inaugural test said the Bank of England was planning to unveil a full list of
names taking part and reveal additional detail on how it will work on Thursday.
The exercise is similar to the
regulator’s biannual probe of the traditional lending sector, the
results of which it published this week alongside confirmation it would lower
capital requirements on licensed banks in a bid to boost lending. Private
markets are not as heavily regulated as banks, meaning the industry juggernauts
that are confirmed to be taking part have signed up voluntarily.
Oaktree, ICG, Carlyle and Goldman Sachs
declined to comment.
Goldman
Sachs, Oaktree and ICG join private credit stress test
In other news.
Toyota warns of ‘challenging road ahead’ after
profit falls £100m
Wednesday 03 December 2025 10:43 am
The UK manufacturing arm of Toyota has
warned “the road ahead may be challenging” after its profit slumped by more
than £100m during its latest financial year.
The division of the Japanese giant said
the “uncertainties of the automotive industry and infrastructure to support
vehicle type” were the main factors behind its pessimism.
However, Toyota added the future is “also
filled with opportunity” as its UK operation “remains committed to meeting
consumer expectations”.
The business also said it is “an exciting
time to be part of the automotive industry”.
Fewer Toyotas rolling off production line
The warning was included in new
accounts filed
with Companies
House for
Toyota Motor Manufacturing (UK), the division which makes the Corolla hybrid at
Burnaston in the East Midlands and engines in Deeside, North Wales.
In the year to 31 March, 2025, Toyota made
90,000 Corollas and 243,184 engines, down from 132,591 and 258,768 respectively
from the prior 12 months.
As a result, the division’s turnover fell
from €3.11bn (£2.7bn) to €2.25bn while its pre-tax profit slumped from €167.4m
to €40.4m.
In the accounts, Toyota said both its
sales and production volumes fell because of “a stabilisation of output in line
with European market demand”.
It said its prior financial year included
“elevated volumes” which were driven by “recovery efforts following global
parts shortages”.
Toyota added that despite the reductions,
it still delivered an operating profit in line with the directors’
expectations.
That operating profit totalled €70.7m for
the year, down from €200m.
In terms of the future, Toyota’s Burnaston
site is preparing to start production on the GR Corolla in November 2026.
A year ago, it was announced the factory
would be the first outside of Japan to manufacture the model.
More
Toyota warns of
'challenging road ahead' after profit falls £100m
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.
Bank of Japan faces a policy dilemma as government bond yields keep hitting new highs
Published
Wed, Dec 3 2025 11:01 PM EST
Japan’s
central bank is caught in a bind as soaring government bond yields risk
upending its policy normalization process.
The
Bank of Japan faces a stark choice: sticking with its policy of raising rates
and risking even higher yields and further slowing an already sagging economy,
or holding, even cutting rates to support growth that could accelerate
inflation further.
Japanese
government bonds have been scaling new peaks over the past month. On Thursday,
yield on the benchmark 10-year JGBs hit a high of 1.917%, surging to their
strongest level since 2007. The 20-year JGB yield reached 2.936%, a level not
seen since 1999, while 30-year hit a record high of 3.436%, LSEG data going
back to 1999 showed.
Japan
abandoned its yield curve control program in March 2024, under which benchmark
10-year bond yields were capped at around 1%, as part of its policy
normalization that also saw the country end the world’s last negative interest
rate regime.
Now,
as the country weighs increasing rates at a time when inflation has been rising
— it has stayed above the BOJ’s 2% target for 43 straight months — the specter
of bond yields spiking further looms large.
Anindya
Banerjee, head of currency and commodities at Kotak Securities, told CNBC’s
“Inside India” that if the BOJ reverts back to quantitative easing and YCC to
cap bond yields, the yen may also weaken and feed imported inflation, which is
already a problem.
Rising
bond yields mean higher borrowing costs for Japan, further straining the
country’s fiscal situation. Asia’s second-largest economy already boasts of the
world highest debt-to-GDP ratio, standing at almost 230%, according to data
from the International Monetary Fund.
Add
to that a government that is poised to unleash its largest stimulus package
since the pandemic to curb cost of living and prop up the struggling Japanese
economy, and the concerns around Japan’s ballooning debt become even more
stark.
More
Japan's
record JGB yields are presenting the BOJ with a policy problem
Dollar
heads for ninth straight loss as Fed outlook dominates
3
December 2025
Dec
3 (Reuters) - The dollar headed for its ninth straight decline on Wednesday as
traders ramped up bets on Federal Reserve rate cuts following U.S. economic
data and growing expectations of a more dovish central bank.
Fed
Governor Christopher Waller said last week the labour market is weak enough to
justify another quarter-point rate cut in December, while White House economic
adviser Kevin Hassett emerged as the frontrunner to become the next Fed chair.
U.S.
President Donald Trump said he would be announcing his pick as Fed chair early
in 2026.
“Such
an announcement, if it occurs this early, will create a ‘shadow Fed chair’
since current Fed Chair Powell’s term does not end until May," said
Kristina Hooper, chief market strategist at Man Group.
"This
could complicate the Fed’s ability to communicate monetary policy and could
create some confusion for markets at a time when they need clarity,” she added.
Markets
priced in an 87% chance of a rate cut this month on Wednesday, according to the
CME Group's FedWatch tool. The probability was at 30% on November 19.
Now
that a December move is almost fully priced in, investors will shift their
focus to the Fed following decisions, with markets indicating cuts for 88 basis
points by December 2026.
The
dollar index, which measures the U.S. currency against six other units, was
0.15% lower at 99.10, set for a nearly 9% decline in the year.
EURO
RISES WITH TALKS OVER UKRAINE IN FOCUS
The
euro rose 0.11% to $1.1639 as investors monitored progress in Ukraine peace
talks, which could bolster energy security and lower costs, supporting the
single currency.
However,
Russia and the U.S. did not reach a compromise on a possible peace deal to end
the war in Ukraine after a five-hour Kremlin meeting between President Vladimir
Putin and Trump's top envoys, the Kremlin said on Wednesday.
Analysts
said the euro could rally further if a ceasefire or full peace agreement is
reached, particularly if elevated defense spending, which is expected to
support the economy in coming years, remains in place.
Euro
zone inflation data came in slightly above expectations on Tuesday, but
bets on the policy rate path were unchanged, with the European Central Bank
expected to stay on hold through early 2027.
YEN
NOT FAR FROM DANGER ZONE FOR INTERVENTION
The
Japanese yen dropped 0.13% to 155.69 against the dollar on Wednesday after
rising 0.25% to 155.89 the day before as Bank of Japan Governor Kazuo Ueda
provided the strongest signal yet of a rate hike later this month.
"The
initial price action casts some doubt on whether an earlier BoJ rate hike will
be sufficient on its own to reverse the yen weakening trend that has been in
place since Sanae Takaichi won the Liberal Democratic Party (LDP) leadership
election in early October," said Lee Hardman senior currency economist at
MUFG.
Prime
Minister Takaichi is expected to favour an expansionary fiscal policy and lower
rates.
"It
may still require intervention if the yen continues to weaken," he added.
Analysts
said Washington is likely to push back against any yen slide to or beyond
160.00 making intervention likely around that level, while noting U.S. Treasury
Secretary Scott Bessent has repeatedly blamed BoJ policy for keeping the
currency undervalued.
More
Dollar heads for
ninth straight loss as Fed outlook dominates
Covid-19
Corner
This
section will continue only occasionally when something of interest occurs.
Study compares immune responses from three major COVID-19 vaccine types
December 2, 2025
A recent study has
provided the first side-by-side comparison of how three major COVID-19 vaccine
types differ in triggering immune responses and sustaining protection,
according to an analysis published in JCI
Insight.
While three vaccine subtypes (adenovirus-based,
mRNA, and protein-based) were widely deployed during the pandemic,
investigators say their immunological profiles and optimal use cases are more
nuanced than previously understood.
"During the COVID-19
pandemic, three main types of vaccines were used around the world: Adenovirus-based vaccines like the AstraZeneca, ChAdOx1, and Johnson & Johnson shots,
mRNA vaccines like Pfizer and Moderna, and protein vaccines like Novavax,"
said Pablo Penaloza-MacMaster, Ph.D., adjunct associate professor of
microbiology-immunology, who was senior author of the study. "All of them
worked, but we didn't have a clear and rigorous side-by-side comparison of how
they differ in the way they trigger the immune system… This study was designed
to fill that gap."
The study, conducted in
mice, revealed that adenovirus-based (Ad5) vaccines induced the most sustained
antigen expression lasting more than a week and produced stronger immune
responses after a single dose. In contrast, mRNA vaccines elicited robust
immune responses but only after two doses, and triggered early immune
activation within just a few hours, which could explain transient side effects.
Protein-based vaccines were the weakest overall, particularly for T-cell
responses, but caused less inflammation, potentially making them more tolerable
for individuals sensitive to vaccine reactions.
More
Study compares immune responses from three major COVID-19 vaccine types
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.
7 EVs That Lead the Pack in Battery Longevity
Discover
the electric vehicles with the best battery health, designed to retain capacity
and deliver long-term value for drivers.
December 1, 2025
All cars are depreciating assets, but electric vehicles (EVs) add
a whole new layer to the equation. In a marketplace where range is one of the
most significant factors influencing consumers, battery health is a major
concern.
The battery is the single most valuable component in the vehicle,
often representing 30-40% of the total manufacturing cost. That makes its
long-term health an important part of the ownership equation. Where
internal-combustion components tend to degrade gradually and predictably,
lithium-ion cells follow chemical aging pathways that are heavily influenced by
a myriad of variables. Considerations like charging habits, thermal exposure,
cell chemistry, and vehicle-level energy management all influence cell capacity
retention, and, therefore, car value.
High-voltage fast charging, for example, exposes cells to elevated
temperatures and higher current densities, which can cause wear in some
chemistries. Conversely, vehicles with conservative charging algorithms and
liquid cooling tend to preserve capacity far more effectively over time.
User behavior and environment also impact cell life. That’s why
two vehicles with the same odometer reading can have dramatically different
states of health. A pack that has spent years in a mild climate, routinely
charged between 20% and 80%, will age very differently from one that is
repeatedly fast-charged to 100% in extreme heat or cold.
A
Swedish used‑car broker, Kvdbil, recently analyzed 1,366 used EVs and
plug‑in hybrids and found that battery health depends more on use patterns than
on brand. Age, climate, charging habits, and driving style are the main drivers
of degradation. The Swedish study ranked vehicles by state of health (SoH), and
below are the seven vehicles with the best capacity retention. Read on to learn
about the seven EVs with the best battery lifetimes.
More
7 EVs That Lead
the Pack in Battery Longevity
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt Clocks
(usdebtclock.org)
“I am enclosing two tickets to the first night of my new play;
bring a friend ... if you have one."
George Bernard Shaw, playwright (to Winston Churchill)
"Cannot possibly attend first night; will attend second, if
there is one."
Churchill's response”
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