Saturday, May 3, 2025
Home Blog Page 102

Whoa! Stocks move off huge losses, Nasdaq positive – USA TODAY

Red
-
0
Whoa! Stocks move off huge losses, Nasdaq positive – USA TODAY

[ad_1]

The global sell-off intensified wednesday. Stocks plunged more than 500 points. Oil dipped below $27 a barrel for the first time since 2003.
Wochit

Wednesday was a wild roller coaster on Wall Street, with stocks moving off of earlier, huge losses and the Nasdaq almost landing in positive territory.

After skydiving more than 500 points earlier in the day, the Dow ended down about 250. The Nasdaq, after being hammered earlier, ended down 0.1%.

In the previous session, the Dow had eked out a 28-point gain.

The sell-off that has engulfed global stock markets early in 2016 intensified from the market open, with the Dow plunging as much as 565 points and oil breaking below $27 a barrel for the first time since 2003, Japanese stocks skidding into bear market territory and European shares shedding more than 3%.

"It is fear based selling," says Nick Sargen senior investment advisor at Fort Washington Investment Advisors. But it is not yet "panic selling" like back in 2008, he adds.

Sparking Wednesday's stock sell-off around the world were many of the same worries that have dragged down shares all year: fears of slowing growth around the globe and the continued plunge in oil at a time when markets are craving stabilization in the oil patch. U.S.-produced crude, which tumbled as low as $26.19, was down $1.85 a barrel around 2:15 p.m. ET, or 6.5%, to $26.63, its lowest level since May 2003.

For now, as many Wall Street pros have been saying, "As oil goes, so goes the stock market." Unfortunately, signs of stabilization in the oil patch have not appeared amid a supply gut, slowing global growth and Iran brining on more supply after economic sanctions were lifted.

.

"De-risking remains the name of the game in today's financial markets," David Rosenberg, chief economist and strategist at Gluskin Sheff, noted in a report.

The broader Standard & Poor's 500 stock index was off 2% to 1843, and if that drop sticks it will put the closely followed U.S. stock benchmark below its closing low in August at the bottom of the market's last correction. A drop below that key 1867.61 level, pros say, could signal even lower prices with the next support around 1800 to 1820, stock chart watchers say.

The S&P 500 is trading at levels not seen since October 2014, and was also flirting with a close below the intraday low of 1820.66 back on Oct. 15, 2014, which occurred at the height of the panic selling during the Ebola virus scare.

"Stocks are stress testing the August lows," Robert Sluymer, a technical stock analyst at RBC Capital Markets told clients in a report.

Sluymer pointed out to clients that even though the market is oversold and beaten down, the S&P 500 "has yet to show any meaningful evidence of bottoming."

Key levels to watch on the S&P 500, Sluymer says, is the 1867 level (or the low in August). If that doesn't hold, the next key support for the broad U.S. stock gauge is the low of around 1820 in the fourth quarter of 2014.

The Nasdaq composite pared it losses and was down 1.1%.

Investors were shedding risk and heading to the safety of perceived havens, such as the 10-year U.S. Treasury note, where prices were rising and yields were falling. The yield on the 10-year note dipped to 1.96%. The last time the yield closed at that low level was back in mid-October.

"Risky assets (are) retreating as oil prices hit new lows and growth concerns remain elevated," Guillermo Felices of Barclays told clients in a note. "The pick-up in risk aversion has spread ... ."

Heading into Wednesday's trading session, the Dow was down 8.1% for the year and 12.5% from its May record close. The S&P 500 was down 8% for 2016 and off 11.7% from its May peak. The Nasdaq composite kicks off the day off 10.6% in the new year and down 14.2% from its July all-time closing high.

In a sign of the market's recent pain, a wide swatch of stock indexes around the world are now in bear market territory, or more than 20% below recent highs. Japan's Nikke 225 is now in a bear market. In Europe the Stoxx Europe 600 dipped into bear territory last week. Here at home, the small-cap Russell 2000 stock index kicks off the day 23.2% below its June high, and the Dow Transportation average, another key index, is also down more than 20%.

In another rough market session overseas, Japan's Nikkei 225 index fell 3.7%, leaving it down more than 20% from its recent high. Hong Kong's Hang Seng index fell 3.8%, while mainland China's Shanghai composite fell 15.

The selling was intense in Europe. The broad Stoxx Europe 600 index was down 3.3%. Germany's DAX index was off 2.8% and the CAC 40 in Paris was down 3.5%.

How should the average investor react as global stocks experience volatility? Charisse Jones with five tips for the every day investor.

Read or Share this story: http://usat.ly/1V8kwJv

[ad_2]

Source link

Wall St. Slips in a Volatile Day as Investors’ Fears Grow – New York Times

Red
-
1
Wall St. Slips in a Volatile Day as Investors’ Fears Grow – New York Times

[ad_1]

Stocks in the United States had a wild day of trading as worries about economic growth and the continued slump in oil prices weighed on investors.

Markets had been steadily falling all day on Wednesday but staged a turnaround in the last hour of the trading day. At the close of trading, the benchmark Standard & Poor’s 500-stock index was down about 1 percent, after being off as much as 3.7 percent.

The Dow Jones industrial average, which had been down more than 500 points earlier in the day, fell about 250 points, or 1.5 percent. The tech-heavy Nasdaq was nearly unchanged.

The Dow had been hit hard earlier in the day after IBM, one of the 30 blue-chip stocks in the gauge, reported a drop in its fourth-quarter profit after the markets closed on Tuesday.

It has been a month of heavy selling and globally, more than $3.6 trillion has been lost in January, said Howard Silverblatt, a senior index analyst at S.&P. Dow Jones Indices.

Related Coverage

“That’s money taken out, even if it’s on paper,” Mr. Silverblatt said.

A trader on the floor of the New York Stock Exchange on Wednesday.


Brendan McDermid/Reuters

Traders will be closely scrutinizing earnings of the S.&P. stocks next week to see how 2016 will go, he added.

“If they don’t come through well, there’s not a lot of support there,” he said.

Oil prices continued their monthslong sell-off, with the price of a barrel of crude oil at the lowest level since May 2003. Crude oil futures were down 6.7 percent on Wednesday to settle at $26.55 a barrel in trading on the New York Mercantile Exchange.

On Wednesday, Royal Dutch Shell warned that it expected its profit for the fourth quarter of 2015 to be about half of what it was in the comparable period a year earlier.

In addition, traders see no signs of the oil glut easing as Iran now has permission to sell into the world markets now that sanctions have been lifted as part of a nuclear deal.

6 Tips for Investors When the Stock Market Tumbles

The impulse when the stock market falls hard for a few days in a row is to do something but it probably doesn’t make much sense to overhaul an investment strategy based on a blip of market activity.

The worldwide drop in stocks signaled nervousness among global investors despite a sanguine reaction earlier in the week to data showing that China’s economic growth continued to slow. Concerns about China’s prospects, as well as the drop in oil prices and signs of weakness elsewhere, have affected global markets in recent months.

The sell-off earlier in the day hit a broad range of investments. European stocks ended sharply lower, with the Euro Stoxx 50 index down 3.3 percent. The FTSE 100 in London closed the day down 3.46 percent.

Stocks in Japan closed 3.7 percent lower, bringing the Nikkei 225’s total decline since its near-term high in June to more than 20 percent — a level that analysts generally regard as a bear market. In addition to worries about China, investors have also grown concerned that economic overhauls championed by Prime Minister Shinzo Abe, called Abenomics, are faltering. Despite Mr. Abe’s pledges to increase economic growth, which were accompanied by a huge program of monetary easing carried out by the central bank, the Japanese economy continues to dip in and out of recession.

The latest round of market turmoil started at the beginning of the year in China, where Beijing’s continued intervention sent stocks down sharply and led to an unexpected weakening of the country’s currency, the renminbi. That added to concerns about the underlying state of the Chinese economy. On Tuesday, China reported its slowest quarterly growth since 2009.

Concerns have broadened in recent weeks, as oil prices have continued to tumble and as volatility spread across global markets.

Japan’s drop followed a broader slump in Asia. In Hong Kong, the Hang Seng closed 3.8 percent lower, while stocks in Shanghai closed down 1 percent.


[ad_2]

Source link

Goldman Sachs’s Profit and Revenue Fell in Quarter – New York Times

Red
-
1
Goldman Sachs’s Profit and Revenue Fell in Quarter – New York Times

[ad_1]

The headquarters of Goldman Sachs in New York. The bank’s business opportunities were diminished in the fourth quarter by new regulations and volatility in the global markets.


Mark Lennihan/Associated Press

Goldman Sachs made a strong commitment to its Wall Street business model on Wednesday after announcing lower revenue and profit for the fourth quarter.

Earnings were dragged down, in part, by a recent government settlement over mortgage securities the bank produced before the financial crisis.

But the firm’s revenue also fell 5 percent in the fourth quarter from the same quarter a year ago, bringing revenue down 2 percent for all of 2015.

New regulations and volatility in the global markets have diminished business opportunities for the bank, considered by many to be the most elite firm in the industry.

“Clearly, it has been a challenging environment for the entire industry,” the firm’s chief financial officer, Harvey M. Schwartz, said in a call with analysts on Wednesday.

But Mr. Schwartz said that the recent difficulties had not led the company’s executives to question their mix of businesses.

“We run the firm for multiple years,” he said. “We see opportunities.”

Many other firms on Wall Street have recently announced big cuts to businesses on which Goldman is heavily reliant — most of all the fixed-income trading businesses that has been hit hard by new regulations.

Wall Street’s 4th Quarter Earnings

Investors are eagerly awaiting guidance from management about when higher short-term interest rates will impact the banks’ bottom lines.

On Tuesday, one of Goldman’s closest competitor, Morgan Stanley, detailed significant cutbacks in fixed income and elsewhere. The firm’s chief executive, James P. Gorman, argued that regulation had changed the firm’s long-term business outlook in ways that it had not anticipated a year ago.

Goldman Sachs has also been struggling in fixed income, a business that comes with much higher regulatory costs than it has in the past. In the fourth quarter, the business reported 8 percent lower revenue than it did a year ago. For the year, fixed-income revenue was down 13 percent.

But Mr. Schwartz reiterated the bank’s belief that with so many competitors leaving the field, Goldman will benefit when there is any sort of turnaround in the global markets.

That did not quiet all the questions from analysts, some of whom asked when the continuing slide in revenue would convince Goldman that it, like other banks, needed to take more drastic action.

Mr. Schwartz defended Goldman’s more cautious approach and said that it had been making cuts slowly over time, often ahead of competitors, but did not want to overreact to recent events.

“We’re certainly not sitting still here,” he said.

The lower revenue helped push the bank’s fourth-quarter profit down to $765 million, or $1.27 a share, compared with $2.17 billion, or $4.38 a share, in the final quarter of 2014.

Goldman said that $1.8 billion in provisions for the mortgage settlement reduced fourth-quarter earnings by $3.41 a share. Analysts polled by Thomson Reuters had expected a profit of $3.53 a share.

Shares of Goldman fell more than 2 percent on a day when financial stocks and the overall market were sharply lower.

The firm’s profit for the year as a whole declined 31 percent, to $5.6 billion.

Goldman Sachs has kept investors satisfied largely because it has kept profits high, particularly relative to competitors like Morgan Stanley.

Goldman’s business of advising companies continued to perform well, growing 27 percent from a year earlier. But nearly every other major business line produced smaller revenue, including the stock trading division that has been doing so well in recent quarters.


[ad_2]

Source link

Glassdoor ranks the 25 best jobs in America – Washington Post

Red
-
0
Glassdoor ranks the 25 best jobs in America – Washington Post

[ad_1]


The Big Bang Data exhibition at Somerset House in London. According to the careers web site Glassdoor, data scientists, who can make sense of the exponentially growing amount of data today's companies receive, have the most career and earnings potential of any job in America. (Peter Macdiarmid/Getty Images for Somerset House)

What's the best job in America right now? Being a test driver for Tesla? A visual effects designer for Lucasfilm? A taster in the quality control department of New Belgium Brewing Co.?

At least according to the folks at Glassdoor, it's something far less flashy. A new ranking by the careers web site put data scientists -- people with a background in computer science, statistics and math who can help companies analyze the mountains of data available now -- at the top of its second annual list of the "25 Best Jobs in America."

The top five also included tax manager, solutions architect, engagement manager and mobile developer. (Sorry kids, but astronaut, rock star and baseball player don't make a showing.)

The ranking analyzes median salaries, total openings per job category and career growth opportunities -- which are based on employee ratings about room for advancement -- combining those factors to create an overall "job score" for each career type. The list isn't based on job satisfaction, in other words, but on the potential for career and earnings growth. "This report looks at three of the prime reasons job seekers indicate they consider most when making a job decision -- earning potential, career opportunities and hiring opportunity," said Scott Dobroski, Glassdoor's career trends analyst. "Job satisfaction can really play a role depending on the company you work at."

Cross-reference it with Glassdoor's list of the best jobs for work-life balance, however, and a few jobs seem like they could be winners. User experience designers, quality assurance managers and those who do software development are on both lists; data scientists, meanwhile, took the top spot on each ranking.

The list, unsurprisingly, is heavy on job categories in the technology field -- nearly half of the 25 stem from the engineering or software industries, or require a technical foundation of some kind. Health care also makes a good showing (physician assistant and nurse practitioner are both ranked) as does finance (audit manager and finance manager both appear).

Meanwhile, Bloomberg reports that Glassdoor revealed four jobs that are among the worst in America, at least according to the "job score" it calculated. They were guest services managers, accounts payable specialists, insurance agents and -- uh oh -- reporters.

Read also:

The best CEOs, according to employees

These are the 25 jobs employees say have the best work-life balance

Like On Leadership? Follow us on Facebook and Twitter, and subscribe to our podcast on iTunes.

Jena McGregor writes a daily column analyzing leadership in the news for the Washington Post’s On Leadership section.

[ad_2]

Source link

Investors unimpressed by strong US bank earnings – Euromoney magazine

Red
-
40
Investors unimpressed by strong US bank earnings – Euromoney magazine

[ad_1]

Jamie Dimon serious-R-600
JPMorgan chief executive Jamie Dimon

US banks reported last month stronger-than-expected revenues
and much better profits for the fourth quarter of 2015, showing
that pro-longed cost-cutting efforts have left them resilient
earners.

As they now hope finally to emerge from an era of large
regulatory fines and legal bills, banks could become once again
a useful payer of dividends to investors.

For the full year 2015, JPMorgan delivered its record net income
of $24.4 billion. Bank of America produced its best profit
since before the financial crisis, at $15.9 billion. Citigroup brought in $17.1 billion of
profit for 2015, its best result since 2006.

Shareholders – and the analysts who had failed to
predict these strong results – reacted in quite
predictable fashion. They dumped the banks’
stocks.

Citigroup’s share price fared worse, falling 7%
after results and dragging the bank’s market
valuation down to just 0.7 of tangible book value per share.
JPMorgan’s stock fell a more measured 2.5% and
Bank of America’s fell just 2%.

However, even stock-market darling Wells Fargo saw its share
price fall by 5.5% in the days after it announced $23 billion
in net income for 2015, a year in which, after 13 consecutive
quarters of declines in non-performing assets, it generated so
much capital that regulators allowed it to return around $3
billion in dividends and stock buy-backs each quarter.

In part, the banks simply got caught up in the general stock
market sell off at the start of the year, amid fears over
slowing Chinese and global growth and further possible declines
in the oil price.

The International Energy Agency
(IEA) estimates that weakening growth will subdue
demand for oil, even as Iran returns to an already
over-supplied market as a big producer. It sees supply
exceeding demand by 1.5 million barrels per day in the first
half of this year, with global inventories rising to a notional
1.285 billion barrels and straining storage infrastructure.

As the oil price fell below $30 per barrel in January,
analyst began to predict further declines to $25 or $20.

"Unless something changes, the oil market could drown in
over-supply," says the IEA. "So the answer to our question [can
the price fall even lower] is an emphatic yes."

Investors are focusing on banks’ exposure to
the
oil and gas sector, as well as to second-order effects on
other types of credit. JPMorgan reserved $550 million against
exposure to the oil and gas sector in 2015 and expects to add
more in 2016.

New credit crisis

Analysts are starting to worry that, as companies have
leveraged up once more to reward shareholders with the benefit
of cheap debt, a new credit crisis is upon us and that banks
might not be building reserves fast enough.

JPMorgan chief executive Jamie Dimon told analysts: "You
know me, I’d put up more if I could but accounting
rules dictate what you can do."

Dimon seemed to suggest that banks would almost be compelled
to keep lending to oil companies to prevent a crisis as other
market sources of funding disappear.

"The oil folks have been surprisingly resilient," says
Dimon. "Remember, these are asset-backed loans. A bankruptcy
doesn’t necessarily mean your loan is bad."

He admits: "If banks just completely pull out of markets
every time something gets volatile and scary,
you’ll be sinking companies left and right."

If the stresses now hitting the oil and gas and metals and
mining sectors are the canary in the coal mine, JPMorgan
isn’t sucking gas just yet, according to chief
financial officer Marianne Lake.

"We’re watching very closely industries that
could have knock-on effects like industrials and
transportation, but we’re not seeing anything
broadly in our portfolio right now," she says.

Citigroup might be, though. More exposed than its peers to

emerging markets – which the World Bank suggests suffered their weakest
growth since 2001 last year, and where it fears spillover
risks in 2016 from
weak growth or recession in Brazil, Russia, South Africa and
China – Citigroup built $300 million in
reserves related to oil and gas in the last quarter of
2015.

Mindful of second-order effects, it built another $300
million across the rest of its portfolio and predicts credit
costs in its wholesale business of $600 million for the first
half of this year. And that is based on oil at $30 per
barrel.

John Gerspach, Citigroup’s chief financial
officer, admits: "If oil were to drop to say $25 a barrel and
then stay there for a sustained period of time, then that
first-half cost of credit number that I gave you [$600 million]
might double."

Citigroup’s overall exposure to the oil sector,
including funded loans and unfunded commitments, is $58
billion, with 80% of that to companies for now-rated investment
grade.

Bank of America chief financial officer Paul Donofrio says
that while the bank has $21 billion of utilized exposure to the
energy sector, that represents just 2% of total loans, and of
that $21 billion just $8.3 billion is to borrowers in the two
high-risk sectors of exploration and production and oil field
services.

The bank has reserves on those exposures of $500 million and
believes that if oil stayed around $30 per barrel for nine
quarters, losses would be about $700 million.

"Outside of energy, we are not seeing asset-quality change
nor are we seeing a reduction in appetite for our credit," says
Donofrio.

The banks are desperately trying to make the case that if
the oil price falls simply because of over-supply –
and not because of more worrying collapse in demand –
then contagion will not spread form the oil sector and that
other sectors might well benefit.

Their problem is that the market just doesn’t
buy it.

"We estimate that US high-yield market is pricing a 6.1%
default rate in 2016 versus a current default rate of 3.2%,"
says Alberto Gallo, head of global macro credit research at
RBS.

"However, defaults could spread beyond the energy sector,
into retail and manufacturing – each 5% of the US
high-yield market. We estimate that 10% of high-yield
manufacturing firms have exposure to the energy sector."

[ad_2]

Source link

Stocks plunge: Dow down almost 300, oil tumbles below $28 – USA TODAY

Red
-
76
Stocks plunge: Dow down almost 300, oil tumbles below $28 – USA TODAY

[ad_1]

Oil is THE story in the early days of 2016. A barrel of U.S. crude briefly dipped below 30 bucks a barrel for the first time since 2003. That matters to both Wall Street and Main Street.

The sell-off that has engulfed global stock markets early in 2016 intensified Wednesday, with oil breaking below $28 a barrel for the first time since 2003, the Dow plunging almost 300 points at the open, Japanese stocks skidding into bear market territory and European shares shedding 3%.

Sparking Wednesday's stock sell-off around the world were many of the same worries that have dragged down shares all year: fears of slowing growth around the globe and the continued plunge in oil at a time when markets are craving stabilization in the oil patch. U.S.-produced crude was down 92 cents barrel, or 3.2%, to $27.54, its lowest level since September 2003.

For now, as many Wall Street pros have been saying, "As oil goes, so goes the stock market." Unfortunately, signs of stabilization in the oil patch have not appeared amid a supply gut, slowing global growth and Iran brining on more supply after economic sanctions were lifted.

At the open, the Dow Jones industrial average, which eked out a 28 point gain Tuesday, was down 275 points, or 1.7%. The broader Standard & Poor's 500 stock index was off 1.6%, and if that drop sticks it will put the closely followed U.S. stock benchmark of closing below its low in August at the bottom of the market's last correction. A drop below that key 1867.61 level, pros say, could signal even lower prices with the next support around 1800 to 1820, stock chart watchers say.

"Stocks are stress testng the August lows," Robert Sluymer, a technical stock analyst at RBC Capital Markets told clients in a report.

Sluymer pointed out to clients that even though the market is oversold and beaten down, the S&P 500 "has yet to show any meaningful evidence of bottoming."

Key levels to watch on the S&P 500, Sluymer says, is the 1867 level (or the low in August). If that doesn't hold, the next key support for the broad U.S. stock gauge is the low of around 1820 in the fourth quarter of 2014.

The Nasdaq composite was down 1.5%.

Investors were shedding risk and heading to the safety of perceived havens, such as the 10-year U.S. Treasury note, where prices were rising and yields were falling. The yield on the 10-year note dipped to 1.98%. the last time the yield closed at that low level was back in mid-October.

"Risky assets (are) retreating as oil prices hit new lows and growth concerns remain elevated," Guillermo Felices of Barclays told clients in a note. "The pick-up in risk aversion has spread ... ."

Heading into Wednesday's trading session, the Dow was down 8.1% for the year and 12.5% from its May record close. The S&P 500 was down 8% for 2016 and off 11.7% from its May peak. The Nasdaq composite kicks off the day off 10.6% in the new year and down 14.2% from its July all-time closing high.

In a sign of the market's recent pain, a wide swatch of stock indexes around the world are now in bear market territory, or more than 20% below recent highs. Japan's Nikke 225 is now in a bear market. In Europe the Stoxx Europe 600 dipped into bear territory last week. Here at home, the small-cap Russell 2000 stock index kicks off the day 23.2% below its June high, and the Dow Transportation average, another key index, is also down more than 20%.

In another rough market session overseas, Japan's Nikkei 225 index fell 3.7%, leaving it down more than 20% from its recent high. Hong Kong's Hang Seng index fell 3.8%, while mainland China's Shanghai composite fell 15.

The selling was intense in Europe. The broad Stoxx Europe 600 index was down 2.5% but off its earlier lows. Germany's DAX index was off 2.2% and the CAC 40 in Paris was down 2.9%.

How should the average investor react as global stocks experience volatility? Charisse Jones with five tips for the every day investor.

Read or Share this story: http://usat.ly/1V8kwJv

[ad_2]

Source link

IMF downgrades global growth forecast amid China slowdown – Irish Independent

Red
-
1
IMF downgrades global growth forecast amid China slowdown – Irish Independent

[ad_1]

Published 20/01/2016 | 02:30

Maurice Obstfeld, chief economist at the International Monetary Fund (IMF), speaks during a news conference at the Bank of England (BOE) in the City of London. Photo: Chris Ratcliffe/Bloomberg

Maurice Obstfeld, chief economist at the International Monetary Fund (IMF), speaks during a news conference at the Bank of England (BOE) in the City of London. Photo: Chris Ratcliffe/Bloomberg

The International Monetary Fund has downgraded its forecasts for global growth, made just three months ago, on the back of slowing growth in China and tumbling oil prices.

In an update to its 'World Economic Outlook', published yesterday, the Washington-based fund said the pick-up in global growth was weak and uneven across economies, with emerging markets and developing economies set for slower growth.

This comes amid a turbulent start to 2016 on markets, concern about the world economy on the back of slowing growth in China and oil plunging to 13-year low at under $28 per barrel. The Standard & Poor's 500 Index of stocks is off to its worst start to a year on record.

Separate data released yesterday showed that China, the world's second-biggest economy, grew by 6.9pc last year, capping a tumultuous year that witnessed a huge outflow of capital, a slide in the currency and a summer stocks crash.

That is the slowest growth rate that China has seen in a quarter of a century.

The IMF said advanced economies would see a modest recovery this year, while emerging markets and developing economies "face the new reality of slower growth".

The Fund projects global growth of 3.4pc this year (down from 3.6pc in October) and 3.6pc in 2017 (down from 3.8pc).

The IMF estimates that the global economy grew 3.1pc last year, the weakest pace since the 2009 recession.

"This year is going to be a year of great challenges and policymakers should be thinking about short-term resilience and the ways they can bolster it, but also about the longer-term growth prospects," said Maurice Obstfeld, inset, IMF Economic Counsellor and Director of Research.

He added: "Those long-term actions will actually have positive effects in the short run by increasing confidence and increasing people's faith in the future."

Growth in advanced economies is projected to rise to 2.1pc and hold steady in 2017 - a slightly weaker pick-up than that forecast in October. The IMF said overall activity remained robust in the United States.

"But there are also challenges stemming from the strength of the dollar, which is causing the US manufacturing sector to shrink marginally," it said.

The Fund said growth prospects in parts of Asia had diminished as a result of the "unexpectedly big external spillovers from China's growth transition". The IMF maintained its previous China growth forecasts of 6.3pc this year and 6pc next year, representing sharp slowdowns from 2015.

The IMF said a steeper slowing of demand in China remained a risk to global growth and that weaker-than-expected Chinese imports and exports were weighing heavily on other emerging markets and commodity exporters.

India, however, will continue to grow at the fastest pace among emerging economies.

In Europe, lower oil prices will help support personal spending, so the IMF said it added a 0.1 percentage point to its 2016 eurozone growth forecast, bringing it to 1.7pc, where it will remain for 2017.

The update came as Bank of England Governor Mark Carney signalled that a rise in UK interest rates is still a considerable way off. "Now is not yet the time to raise interest rates," he said in a speech in London yesterday.

"The world is weaker and UK growth has slowed. Due to the oil-price collapse, inflation has fallen further and will likely remain very low for longer.

Mr Carney said the decision to keep rates low had been "straightforward". Sterling fell slightly against the euro in the wake of the announcement, before edging back up to 76 pence.

"Given the scale of foreign disinflationary pressures, current domestic cost growth is not yet consistent with a firming in underlying inflation," Mr Carney said.

"The Monetary Policy Committee must remain vigilant for signs that low inflation is having second-round effects in the wage bargain, possibly via inflation expectations."

Irish Independent



[ad_2]

Source link

ES Morning Update January 20th, 2016

Red
-
0
ES Morning Update January 20th, 2016

e89afde9-bf98-4414-beb2-0143dbf7408fThe Futures did a flip this time around and sold off afterhours instead of rallying up and becoming overbought like they have done the past several trading days.  This suggests the market will flip during regular hours as well and go up instead of down.

This 60 minute chart supports a rally today and the 2 hour is hooking up as well.  The 4 hour and 6 hour are lagging behind.

Trying to pick a spot to take a trade overnight has been tough lately as there just haven't been any clear trades.  Everytime it looks like the market might go up the next day it does the whole move overnight/premarket and then goes down at the open.  It's been a steady series of steps walking the market down.

The moves down are so controlled right now that it seems hard to find a bottom.  We've yet to see a "capitulation" day where every bull gives up and sells everything.  Then the market reverses and puts in a long bottoming tail candle on the daily chart.  So for now it's just a day traders market.

My thought are that we'll go up some today as the 60 minute and 2 hour charts push up on the futures.  But I wouldn't be a player of it as it can rollover again at anytime.  After the 60 and 2hr MACD's get up even close to the zero level (which could be midday or the close?) we could see them roll back over again and drop again.

Financial stocks lead an early gain on Wall Street – Atlanta Journal Constitution

Red
-
0
Financial stocks lead an early gain on Wall Street – Atlanta Journal Constitution

[ad_1]

U.S. stocks are opening higher, led by gains in banks and technology companies.

Morgan Stanley gained 1 percent early Tuesday after the investment bank reported better earnings and revenue than analysts were expecting. Bank of America also edged up.

Not all the earnings news was good. Tiffany sank 6 percent after reporting a decline in jewelry sales during the holiday season.

Global shares buoyed by China growth report photo

Investors check stock prices at a brokerage house in Beijing, Tuesday, Jan. 19, 2016. Chinese shares were buoyed but the rest of Asian stock markets were largely flat Tuesday after China's quarterly economic growth met expectations, calming some of the investor jitters in the region. (AP Photo/Andy Wong)

The Dow Jones industrial average was up 165 points, or 1 percent, to 16,151 as of 9:35 a.m. Eastern.

The Standard & Poor's 500 index rose 17 points, or 0.9 percent, to 1,898. The Nasdaq composite gained 39 points, or 0.9 percent, to 4,527.

U.S. markets were closed Monday for the Martin Luther King, Jr. Day holiday.

Global shares buoyed by China growth report photo

A man chats with other investors near an electronic board displaying stock prices at a brokerage house in Beijing, Tuesday, Jan. 19, 2016. Chinese shares were buoyed but the rest of Asian stock markets were largely flat Tuesday after China's quarterly economic growth met expectations, calming some of the investor jitters in the region. (AP Photo/Andy Wong)

Global shares buoyed by China growth report photo

A woman checks stock index through her smartphone at a brokerage house in Beijing, Tuesday, Jan. 19, 2016. Chinese shares were buoyed but the rest of Asian stock markets were largely flat Tuesday after China's quarterly economic growth met expectations, calming some of the investor jitters in the region. (AP Photo/Andy Wong)

Global shares buoyed by China growth report photo

Investors check stock prices at booths at a brokerage house in Beijing, Tuesday, Jan. 19, 2016. Chinese shares were buoyed but the rest of Asian stock markets were largely flat Tuesday after China's quarterly economic growth met expectations, calming some of the investor jitters in the region. (AP Photo/Andy Wong)

[ad_2]

Source link

Chinese economic growth in 2015 was weakest in 25 years – USA TODAY

Red
-
1
Chinese economic growth in 2015 was weakest in 25 years – USA TODAY

[ad_1]


Hannah Gardner, USA TODAY
9:13 a.m. EST January 19, 2016

China's economy grew 6.8 percent in the fourth quarter from a year earlier, matching expectations and the slowest since the global financial crisis.
Wochit

China’s economy grew at its slowest rate in 25 years last year, according to official statistics released today.

The Communist-led country saw its economy expand 6.9% overall in 2015 and 6.8% the last quarter, the National Bureau of Statistics said.

The annual figure was largely in line with analysts' expectations, but the fourth quarter figure was one percentage point lower that analysts had predicted.

Chinese markets, which have been volatile of late, reacted calmly to the news, trading mostly flat in the morning and closing 3.2% up in the afternoon.

Economists warned that the figure — though probably inflated — hinted at a difficult road ahead.

“2016 will be a tough year. The economy faces a lot of structural problems and no changes to policy or regulations can produce a sharp ‘V’ rebound,” former head of the National Bureau of Statistics Yao Jinyuan told state broadcaster CCTV.

China's economic woes first began to attract attention three years ago when GDP dropped from 9.5% to 7.7% in 2012 . Since then it has trended downwards, causing the Communist-led government to draw up plans to shift from an investment and manufacturing-led economic model, to one driven by services and consumption.

The question now is whether the Party can effect that transition — which has been likened from jumping from one high speed train to another — without a crash in between.

Today's figures suggest there is still hope, even if some of the data is overstated, say economists.

“The upshot is that while the official GDP figures shouldn’t be taken at face value, growth does appear to have been broadly stable last quarter,” Juilan Evans-Pritchard of Capital Economic said in a research note.

Of particular interest to many observers were retail sales, which were up 11.1% in December compared to the same period a year earlier. Optimists pointed out that this was higher than the average for the year, suggesting a pick up toward the year’s close. Pessimists pointed it was lower than the expected 11.3% rise and was down from November, which recorded a rise of 11.2%.

“Consumer spending likely remained the only bright spot in today's data release, despite also coming in slightly below market expectations," Julia Wang greater China economist at HSBC, said in research note.

Other indicators were also the subject of debate.

Industrial output grew 5.9% in December, compared to the same period the year before, but it missed a prediction of 6%, and was lower than November’s year-on-year figure of 6.2%.

Analysts said the low growth figure could be explained by higher-than-normal factory activity last December, because a lot of industries in northern china were closed during November 2014 to make sure the air was clean for the APEC summit.

Fixed asset investment growth, a crucial driver of the economy, also missed predictions, coming in at 10% rather than 10.2%.

“Whether and how this funding situation evolves will be key aspect to watch in 2016,” Ms Wang said in her note.

“We currently see [official] growth easing to 6.5% in 2016 and further thereafter, “ The Economist intelligence unit said.

Capital Economics said they believed the Chinese economy was actually growing at 4.5%, but added that was up from the beginning of the year when it was growing at 4%.

Read or Share this story: http://usat.ly/1V3x3xU

[ad_2]

Source link

Oil market could ‘drown’ in oversupply, IEA warns

Red
-
1
Oil market could ‘drown’ in oversupply, IEA warns

[ad_1]

Reuters

Iranian oil is seen as adding more pressure on an already oversupplied oil market.

The selloff in oil could get even worse in 2016, as the energy market grapples with excessive oversupply, a strong dollar and a weak global economy, the International Energy Agency has warned.

In its monthly oil report released Tuesday, the energy watchdog warned that the market is poised for a third straight year of supply exceeding demand, due to those factors. That will lead to “enormous strain” on the system’s ability to absorb the pressure, it said.

“While the pace of stock building eases in the second half of the year, as supply from non-OPEC producers falls, unless something changes, the oil market could drown in oversupply,” the IEA said in the report. “It could go lower.”

Read: Could this turn out to be oil’s surprising savior?

On Monday, oil prices hovered around the $28 a barrel mark on news sanctions on Iran were being lifted. That put oil futures down more than 20% since the beginning of the year.

The end of sanctions allows Iran to once again start selling its oil on the international energy markets. The IEA said Iran is expected to add around 300,000 barrels a day of additional crude by the end of the first quarter and about 600,000 barrels by mid-year. This would offset the expected 600,000 drop in supply from producers outside of OPEC.

This means global oil supply could exceed demand by 1.5 million barrels a day in the first half of 2016, the IEA said.

Read: How long until Iran gets its oil out? This chart holds a clue

“Some analysts argue that the easing of sanctions on Iran is already ‘priced in’ to the market,” the energy body said. “However, if Iran can move quickly to offer its oil under attractive terms, there may be more ‘pricing in’ to come. Time will tell.”

Both crude CLG6, +1.26%  and Brent LCOH6, +3.85%  shook off the downbeat assessment from the IEA and rose on Tuesday. Crude tacked on 0.7% to $29.63 a barrel, while Brent jumped 2.6% to $29.29 a barrel.
[ad_2]

Source link

Market Extra: One reason this selloff may not mean a crisis is coming

Red
-
0
Market Extra: One reason this selloff may not mean a crisis is coming

[ad_1]

While a stock market selloff and a recession have gone hand in hand in the past, investors would be wise to not automatically assume the two are joined at the hip.

That’s the latest wisdom from A Wealth of Common Sense blogger Ben Carlson, who tackled the “recession watch” that has started to grip many investors on the heels of the worst start for U.S. stocks in history. For 2015 so far, the Dow industrials DJIA, -2.39% and S&P 500 index SPX, -2.16%  are down at least 8%, and the Nasdaq Composite Index COMP, -2.74% has shed more than 10%.

Four of the last eight economic downturns have come alongside big market crashes — 1929-32, 1937-38, 1973-74, 2000-2002 and 2007-2009 — he noted in a blog post Sunday. For that reason, some investors have started watching for signs of an economic downturn.

He himself doesn’t see a recession on the cards, noting that “we don’t generally go into a recession until excesses have built up in the system. It’s the old adage that you can’t kill yourself jumping off of a 2-foot ledge.”

As for the solidity of that relationship, he says pullbacks for stocks have also occurred without an accompanying recession. “Double-digit losses and even bear markets can certainly occur without a big economic downturn,” said Carlson, who notes that that’s been the case around one out of every five years since the late 1930s.

His chart shows the number of double-digit declines the S&P 500 has seen that haven’t come with a recession:

Wealth of Common Sense


Now, just to keep you from weeping in your beers too copiously, Carlson has also charted what the markets have done five and 10 years after those no-recession double-digit drops for stocks — such as a 103% bounce for the S&P 500, five years after melting down in 2010:

Wealth of Common Sense

Read his full blog here.

[ad_2]

Source link

Apple, Lenovo and Microsoft failing on child labor checks says Amnesty – ZDNet

Red
-
0
Apple, Lenovo and Microsoft failing on child labor checks says Amnesty – ZDNet

[ad_1]

cobalt-mining.jpg
Inside a cobalt mine in the Democratic Republic of Congo.


Image: Amnesty International

Major electronics firms - including Apple, HP, Samsung, Microsoft and Lenovo - are failing to check that cobalt mined by child labourers has not been used in their products, says Amnesty International in a report published today.

The report traces the sale of cobalt, used in lithium-ion batteries in phones, laptops and tablets, from mines in central Africa where it says children as young as seven and adults work in dangerous conditions.

"The glamourous shop displays and marketing of state of the art technologies are a stark contrast to the children carrying bags of rocks, and miners in narrow man-made tunnels risking permanent lung damage," said Mark Dummett, business and human rights researcher at Amnesty International upon the publication of the report, This is what we die for: Human rights abuses in the Democratic Republic of the Congo power the global trade in cobalt.

"Millions of people enjoy the benefits of new technologies but rarely ask how they are made. It is high time the big brands took some responsibility for the mining of the raw materials that make their lucrative products."

The report, prepared by Amnesty in conjunction with Afrewatch, documents how traders buy cobalt from the former province of Katanga in the Democratic Republic of Congo, where child labour has been shown to be rife. The report charts how this cobalt is then sold to Congo Dongfang Mining (CDM), a wholly-owned subsidiary of Chinese mineral giant Zhejiang Huayou Cobalt Ltd (Huayou Cobalt).

Amnesty International's investigation used investor documents to show how Huayou Cobalt and its subsidiary CDM process the cobalt before selling it to three battery component manufacturers in China and South Korea. In turn, they sell to battery makers who claim to supply technology companies, including Apple, HP, Lenovo, Microsoft, Samsung and Sony.

Amnesty International contacted the 16 multinationals who were listed as direct or indirect customers of the battery manufacturers that are documented as sourcing processed ore from Huayou Cobalt.

While some of the multinationals denied sourcing from Huayou Cobalt and others from the DRC, Amnesty says that none provided enough details to independently verify where the cobalt in their products came from.

"It is a major paradox of the digital era that some of the world's richest, most innovative companies are able to market incredibly sophisticated devices without being required to show where they source raw materials for their components," said Emmanuel Umpula, Afrewatch (Africa Resources Watch) executive director.

"The abuses in mines remain out of sight and out of mind because in today's global marketplace consumers have no idea about the conditions at the mine, factory, and assembly line. We found that traders are buying cobalt without asking questions about how and where it was mined."

Child labor and deadly mines

Amnesty International researchers found that the vast majority of miners work long hours every day without basic protective equipment, such as gloves, work clothes or facemasks to protect them from lung or skin damage.

Children told Amnesty International they worked for up to 12 hours a day in the mines, carrying heavy loads to earn between one and two dollars. In 2014, about 40,000 children worked in mines across southern DRC, many of them mining cobalt, according to UNICEF.

Paul, a 14-year-old orphan, started mining at the age of 12. He told researchers he had been made ill by spending so much time underground.

"I would spend 24 hours down in the tunnels. I arrived in the morning and would leave the following morning ... I had to relieve myself down in the tunnels ... My foster mother planned to send me to school, but my foster father was against it, he exploited me by making me work in the mine."

Today there is no regulation of the global cobalt market, unlike other metals and ores used in electronic and other consumer goods. Cobalt does not fall under existing "conflict minerals" rules in the US, which cover gold, coltan/tantalum, tin and tungsten mined in DRC.

What the tech giants say

Amnesty International says that none of the companies named had been in touch with Huayou Cobalt or traced where the cobalt in their products had come from prior to being contacted.

All of the named companies say they have "zero tolerance policies" on child labor but Amnestry International's Dummett said: "this promise is not worth the paper it is written [on] when the companies are not investigating their suppliers".

Apple does not deny the link between its products and Huayou, saying that it is "evaluating dozens of different materials, including cobalt, in order to identify labor and environmental risks as well as opportunities for Apple to bring about effective, scalable and sustainable change".

"As we gain a better understanding of the challenges associated with cobalt we believe our work in the African Great Lakes region and Indonesia will serve as important guides for creating lasting solutions".

Both Samsung and its supplier Samsung SDI say they do not source cobalt-derived battery parts from CDM or Huayou Cobalt - directly or indirectly. Samsung SDI does say, however, that "it is impossible for us to determine whether the cobalt supplied to Samsung SDI comes from DRC Katanga's mine".

Microsoft said it couldn't guarantee that none of the cobalt used in its products could be sourced back to the former Katanga province of DRC "due to our supply chain complexity".

It said that it did source batteries from a supplier that Amnesty says buys cobalt from CDM and Huayou but that this was a "very limited number of batteries for a product development project". It adds that "to our knowledge", these batteries are "not used in any product currently sold by Microsoft".

HP says it had started an investigation with its suppliers but "as of now we have not found any linkage between our products and the DRC mine". Similarly Sony says it has launched an investigation, which also "so far" has not yielded any "obvious" signs that Sony products contain cobalt originating from Katanga in the DRC".

Lenovo said it had identified two "third-party trademark licensees" that make products sold under the Motorola brand that source batteries from a supplier Amnesty has linked to CDM and Huayou. Lenovo says if an internal investigation verifies Amnesty's concerns then it will order the licensee to stop using the supplier until it can "demonstrate compliance to Lenovo's requirements".

Amnesty International and Afrewatch conclude the report by calling on multinational companies who use lithium-ion batteries in their products to conduct human rights due diligence, investigate whether the cobalt is extracted under hazardous conditions or with child labour, and be more transparent about their suppliers.

[ad_2]

Source link

Global fears cast gloom on the Fed’s rate hike plans – CNNMoney

Red
-
0
Global fears cast gloom on the Fed’s rate hike plans – CNNMoney

[ad_1]

Global volatility could force the Federal Reserve to pump the brakes this year.

The Fed raised its key interest rate in December and projected there would be four more rate hikes in 2016.

Not so fast. American stocks are getting nauseous from the global economic slowdown and falling oil prices.

The Dow has fallen 250 or more points five times in the first 10 trading days this year. The S&P 500 is down 8% in two weeks and the Nasdaq has lost 10% in that time. All three indexes are in a correction -- down 10% from their most recent highs.

Many on Wall Street believe there will only be two rate increases this year.

"We doubt that the Fed will be hiking the federal funds rate four times this year," Ed Yardeni, chief investment strategist at Yardeni Research. Yardeni is calling for only one rate hike this year.

The Fed meets next week but no one expects it to raise rates again at that meeting. But it could raise rates at its meeting in March.

Rate increases are the Fed's way of saying that the U.S. economy is looking healthy. When it hikes less or changes its forecast, that's a sign that the Fed is feeling less confident about the economy's health.

The Fed cares about how U.S. markets perform -- at least to the degree that stocks impact the U.S. economy. And its committee members have seen this before: In August stocks were on a roller coaster ride, which partially caused the Fed to not raise rates in September.

Related: Oil prices dive on Iran sanctions fallout

Fed Chair Janet Yellen and her colleagues try to look beyond short-term volatility, but sometimes they can't ignore it. Oil prices have fallen to their lowest point in 12 years at $28 a barrel.

Falling oil prices are keeping inflation -- one of the Fed's key metrics -- below where Yellen wants it to be. The Fed wants inflation to be moving towards 2%, but inflation in November only hit 0.5% -- its highest mark all year.

Oil prices don't need to go up for the Fed to raise rates, Yellen said in December.

"All they need to do is stabilize," she said.

That's not happening so far. What's worse is that when oil prices fall, energy firms cut back on spending. Those spending cuts hurt U.S. economic growth.

Related: World stock markets start week with drop

The U.S. economy probably didn't finish 2015 strong. The Atlanta Fed is projecting the economy grew 0.6% in the fourth quarter. Barclays' economists forecast a meager 0.3% growth between October and December.

If it's anywhere near those guesses, economic growth will be well behind last year's fourth quarter figure of 2.1%.

And that's just the beginning of the list of things that could hold back the Fed. The U.S. dollar could strengthen more as currencies like China's continue to lose value. The broader global slowdown is another major factor possibly making the Fed hit pause on its rate hike plans.

CNNMoney (New York) First published January 19, 2016: 2:27 AM ET

[ad_2]

Source link

Market Extra: This chart shows how long it could take Iran to get its oil production up to speed

Red
-
0
Market Extra: This chart shows how long it could take Iran to get its oil production up to speed

[ad_1]

Oil prices sputtered along on Monday, as the beaten-down commodity market began adjusting to the harsh new reality of Iran’s inclusion in the global oil production fold.

As expected, economic and financial sanctions on Iran came to an end on Saturday evening for that country’s work on curbing its nuclear-related infrastructure. It’s a moment that oil traders and investors have been dreading for months and comes as U.S. oil is down 20% year to date, on the heels of a 31% plunge in 2015. Brent oil is down 22% year-to-date and sank 35% last year.

When the Iran news finally reached the market in Asia on Monday, oil prices plunged, driving Brent crude LCOH6, -0.31%  to $27.67 a barrel. That’s the lowest level for Brent since November 2003, according to analysts at Commerzbank. Prices moved off that level to hover around $29 a barrel in European trading hours. U.S. WTI crude CLG6, -0.85%  also traded cautiously, last off around 11 cents to $28.83 a barrel.

While the Iran news was zero surprise for this market, that doesn’t mean it won’t be an excuse for bears to push oil prices even lower, said analysts. The U.S. Energy Information Administration has forecast OPEC crude production to rise by 500,000 barrels a day in 2016, with Iran expected to make up for the bulk of that rise.

Read: Could this surprising factor save oil from Iran-fueled slide?

With the Iran cat now out of the bag, investors will naturally start questioning how quickly the country will get its oil production back to normal. Naturally, more supply for an already overflowing market couldn’t come at a worse time, Eugen Weinberg, head of commodity research at Commerzbank and a team of analysts, said in a note on Monday.

Weinberg said the prospect of additional oil from Iran will put the brakes on a recovery for oil in the foreseeable future. However, it shouldn’t be such a weight on oil given that the market should have already priced in the prospect of a “realistic” 500,000 barrel per day increase in Iranian oil shipments, he said.

Weinberg said it’s unlikely Iran’s production volume will see a significant, sharp increase this year. “After all, Iraq and Libya took roughly twelve months to regain their original production levels following the wars in 2003 and 2011 respectively,” and Libya was only able to restore its production levels for a short time.

Here’s the chart from Commerzbank laying out the process of production normalization for those countries:

Commerzbank

Iraq, Libya may offer clues to Iran’s production ramp-up

Something else that may keep Iran from putting its foot to the floor on production: its inability to invest in its oil infrastructure for several years now. Therefore it will take “more, rather than less time for oil production to normalize,” said Commerzbank’s Weinberg.

In observance of the Martin Luther King Jr. holiday, U.S. stock and bond markets are closed on Monday. Oil futures will trade via Globex through the New York morning, but then all trading will be halted from 1 to 6 p.m. Eastern Time.

[ad_2]

Source link

In One Chart: Tesla has a big lead over its rivals, in one chart

Red
-
0
In One Chart: Tesla has a big lead over its rivals, in one chart

[ad_1]

Tesla Motors Inc. sold more electric cars in the U.S. then anyone else in 2015, a feat made a little bit easier because competitor Nissan Motor Co. is working on a complete do-over for its best-selling EV, the Leaf.

Cost-estimating website HowMuch.net did a chart that visually illustrates Tesla’s dominance in the electric-car arena, ranking the Model S’s 24 competitors from the second-place Leaf all the way down to the 25th-place Volvo XC90, which sold only 86 units in 2015:


In 2014, the Leaf, which starts at $29,000, handily beat the Tesla TSLA, -0.58%  Model S, which starts around $70,000. A little over 30,000 Leafs were sold that year, compared with almost 19,000 Model S cars, according to Insideevs.com.

Nissan 7201, -0.59%  has said it is working on a new battery system that could double the Leaf’s driving range. The 2016 Leaf can go up to 107 miles on a single charge, which was an improvement over the 2015 model and made some buyers think twice about buying a Leaf in 2015.

A basic Model S goes 240 miles on a single charge.
[ad_2]

Source link

Apple, Microsoft, Samsung And Other Tech Firms Implicated In Child Labor Report – TechCrunch

Red
-
0
Apple, Microsoft, Samsung And Other Tech Firms Implicated In Child Labor Report – TechCrunch

[ad_1]


Apple, Samsung and Microsoft are among a host of tech companies and carmakers implicated in a new report that sheds light on apparent child labor practices in the sourcing of minerals used to create batteries.

An Amnesty International report — created in partnership with Africa-focused NGO Afrewatch — delves into the world of cobalt mining in the Democratic Republic of the Congo (DC), which accounts for half of the world’s cobalt sourcing, finding that children as young as seven are working in dangerous conditions for a mere dollar or two of income each day.

Beyond allegations of children laboring in between or instead of school, the report claimed that working conditions are extremely hazardous. Aside from the issue of working in cramped conditions daily with little to no protection, Amnesty claimed that some 80 miners died in southern DRC during the final four months of 2015. Many more deaths may have gone unreported since, in the event of an accident, bodies can be buried in the rubble, the organization added.

The report focused on Congo Dongfang Mining (CDM) and Huayou Cobalt, DC-based subsidiaries of companies from China and Korea respectively, which “buy cobalt from [traders in] areas where child labour is rife.” The cobalt is then sold to battery component makers, who use it to develop batteries which are sold on to carmakers and tech companies, the report claimed.

cobalt

Movement of cobalt from DRC mines to the global market — via Amnesty International

Amnesty said it traced 16 multinational companies who are listed as customers of Huayou Cobalt.

Samsung SDI, the division of the Korean tech giant that deals with batteries, told TechCrunch that has no dealings with either Huayou Cobalt or CDM. It added that it “conducts written evaluations and on-site inspections in areas such as human rights, labor, ethics, environment, and health and safety on a two-year basis and awards them with certification.” Emails to Apple and Microsoft did not elicit responses at the time of writing.

Amnesty itself said it received a mixture of responses from the 16 companies it contacted:

One company admitted the connection, while four were unable to say for certain whether they were buying cobalt from the DRC or Huayou Cobalt. Six said they were investigating the claims. Five denied sourcing cobalt from via Huayou Cobalt, though they are listed as customers in the company documents of battery manufacturers. Two multinationals denied sourcing cobalt from DRC.

“It is a major paradox of the digital era that some of the world’s richest, most innovative companies are able to market incredibly sophisticated devices without being required to show where they source raw materials for their components,” Afrewatch Executive Director Emmanuel Umpula said in a statement.

“The abuses in mines remain out of sight and out of mind because in today’s global marketplace consumers have no idea about the conditions at the mine, factory, and assembly line. We found that traders are buying cobalt without asking questions about how and where it was mined,” Umpala added.

“Amnesty International and Afrewatch are calling on multinational companies who use lithium-ion batteries in their products to conduct human rights due diligence, investigate whether the cobalt is extracted under hazardous conditions or with child labour, and be more transparent about their suppliers,” the two organizations said in a joint statement.

Update: Apple provided TechCrunch with the full text of its statement to Amnesty International — a portion of which appeared in the Amnesty posting. It is reproduced in its entirety below.

We appreciate the concerns Amnesty International raised. As discussed in our recent conversation, we share your interest in and dedication to improving the lives of workers around the world. Apple believes every worker in our supply chain has a right to safe, ethical working conditions.

Underage labor is never tolerated in our supply chain and we are proud to have led the industry in pioneering new safeguards. We not only have strict standards, rigorous audits and industry-leading preventative measures, but we also actively look for any violations. Any supplier found hiring underage workers must 1) fund the worker’s safe return home, 2) fully finance the worker’s education at a school chosen by the worker and his or her family, 3) continue to pay the worker’s wages, and 4) offer the worker a job when he or she reaches the legal age.

We have been reporting on our supply chain for 10 years because we believe transparency and the feedback that comes with it makes us better. Of more than 1.6 million workers covered in 633 audits in 2014, our auditors uncovered 16 cases of underage labor and all were successfully addressed. We take any concerns seriously and investigate every allegation. We engage with our suppliers all over the world, including directly with smelters and refiners. We’re also working on site to support programs that educate workers on local laws and protect the rights of miners.

Our efforts around conflict minerals are illustrative of our commitment to forging sustainable solutions to complex challenges deep within our supply chain. In the last 5 years, Apple worked with peers and stakeholders to implement and improve an industry wide standard, drove compliance with the Conflict Free Sourcing Program or equivalent third party audit programs, and expanded traceability to the mine site. As of November 2015, over 95% of our reported smelters are compliant or participating in a third party audit verifying their conflict-free sourcing practices. And we will not stop until we reach our goal of 100%.

Apple goes beyond what is legally required to drive further change in the DRC and neighboring countries. We provide significant funding and strategic guidance to several programs that are increasing the number of registered miners operating in, and selling their materials through, conflict-free channels, providing educational and health care support to mining communities, developing best practices for small scale miners to improve their productivity and health & safety, and improving methods for tracking and trading materials from the mine to the smelter.

Though it would be a simpler solution to stop our suppliers from sourcing from countries where challenges exist such as the DRC, doing so goes against our core value of leaving the world better than we found it.

We are currently evaluating dozens of different materials, including cobalt, in order to identify labor and environmental risks as well as opportunities for Apple to bring about effective, scalable and sustainable change. As we gain a better understanding of the challenges associated with cobalt we believe our work in the African Great Lakes region and Indonesia will serve as important guides for creating lasting solutions.

We know from experience that we can’t do this alone, and there are no quick fixes to the complex challenges in a global supply chain. But we are committed to being a force for change by advocating for and supporting positive government action and partnering with companies and other stakeholders such as Amnesty International working to make a difference. We have made significant progress, though we know our work is never done and will not stop until every person in our supply chain is treated with the respect and dignity they deserve.

Featured Image: Amnesty International

[ad_2]

Source link

The Margin: Just 62 people own as much wealth as half the world’s population: Oxfam

Red
-
0
The Margin: Just 62 people own as much wealth as half the world’s population: Oxfam

[ad_1]

World Economic Forum


Oxfam’s report on inequality is aimed at swaying the political and financial elites meeting in Davos this week.

The wealth divide between the world’s richest and poorest is turning into a Grand Canyon.

Last year, just 62 individuals held wealth equivalent to the amount owned by 3.6 billion people, about half the world’s population. That’s according to a new report by Oxfam published Monday, ahead of the World Economic Forum in Davos, which aims to show just how deep the gulf of inequality has become.

“Oxfam’s prediction — made ahead of last year’s Davos — that the 1% would soon own more than the rest of us by 2016, actually came true in 2015, a year early,” the nonprofit said in a statement.

Read: The 10 wealthiest couples on the planet

The wealth of those 62 one-percenters has risen by more than half-a-trillion dollars in the last five years, the report said. At the same time, the total owned by the poorest half has fallen by a trillion dollars.

In monetary terms, that club of 62 has seen its riches climb by $542 billion, or 44%, to $1.76 trillion since 2010. That’s as the less-fortunate half has seen its wealth slide by 41%.

“Power and privilege are being used to rig the system to increase the gap between the richest and the rest to levels we have not seen before. Far from trickling down, income and wealth are instead being sucked upwards at an alarming rate,” said Raymond C. Offenheiser, president of Oxfam America, in a statement.

Oxfam


Some other factoids in the Oxfam report: the daily income of the poorest 10% worldwide has risen by less than a cent every year, and their annual income has risen by less than $3 each year for the past quarter century.

With the report, Oxfam is urging world’s leaders make a big initiative to tackle tax havens. Its release comes as the financial and political elites gather in Switzerland for the World Economic Forum, which begins in earnest on Wednesday in Davos.

“Globally, it is estimated that a total of $7.6 trillion of individual’s wealth sits offshore — a 12th of the total. If tax would be paid on the income that this wealth generates, an extra $190 billion would be available to governments every year,” Oxfam said in the report.

Read: Meet the richest person in each U.S. state

The nonprofit also highlighted that 9 out of 10 of this year’s World Economic Forum corporate partners have a presence in at least one tax haven. It estimates that tax dodging by multinational corporations comes at a cost to developing countries of least $100 billion every year. Corporate investment in tax havens almost quadrupled between 2000 and 2014, according to Oxfam.

It took a final jab at wage inequality in the U.S., noting that salaries of chief executive officers at top companies have risen by half since 2009, but the minimum wage has been stuck at $7.25. That’s even as the cost of groceries has shot up 25%, Oxfam noted.

“Given that a solid majority of voters across all political backgrounds support an increase, it seems an obvious thing to do, but Congress isn’t budging,” said Offenheiser.
[ad_2]

Source link

Big banks brace for oil loans to implode – CNNMoney

Red
-
0
Big banks brace for oil loans to implode – CNNMoney

[ad_1]

oil stocks hurting banks

Big banks are cringing as crude oil is crumbling.

Firms on Wall Street helped bankroll America's energy boom, financing very expensive drilling projects that ended up flooding the world with oil.

Now that the oil glut has caused prices to crash below $30 a barrel, turmoil is rippling through the energy industry and souring many of those loans. Dozens of oil companies have gone bankrupt and the ones that haven't are feeling enough financial stress to slash spending and cut tens of thousands of jobs.

Three of America's biggest banks warned last week that oil prices will continue to create headaches on Wall Street -- especially if doomsday scenarios of $20 or even $10 oil play out.

For instance, Wells Fargo (WFC) is sitting on more than $17 billion in loans to the oil and gas sector. The bank is setting aside $1.2 billion in reserves to cover losses because of the "continued deterioration within the energy sector."

JPMorgan Chase(JPM) is setting aside an extra $124 million to cover potential losses in its oil and gas loans. It warned that figure could rise to $750 million if oil prices unexpectedly stay at their current $30 level for the next 18 months.

"The biggest area of stress" is the oil and gas space, Marianne Lake, JPMorgan's chief financial officer, told analysts during a call on Thursday. "As the outlook for oil has weakened, we would expect to see some additional reserve build in 2016."

Citigroup(C) built up loan loss reserves in the energy space by $300 million. The bank said the move reflects its view that "oil prices are likely to remain low for a longer period of time."

If oil stays around $30 a barrel, Citi is bracing for about $600 million of energy credit losses in the first half of 2016. Citi said that figure could double to $1.2 billion if oil dropped to $25 a barrel and stayed there.

Related: $10 oil: Crazy or the real floor beneath the oil crash?

More oil companies will die

The oil crash has already caused 42 North American oil companies to file for bankruptcy since the beginning of 2015, according to a list compiled by Houston law firm Haynes and Boone. It's only likely to get worse. Standard & Poor's estimates that 50% of energy junk bonds are "distressed," meaning they are at risk of default.

"There is a lot of distress in the industry. There will be a lot of pain but they'll get through it," said Buddy Clark, a 33-year veteran of the energy finance space and a partner at Haynes and Boone.

The financial pain has gotten so great that now there's murmurs of a bail out for the U.S. oil industry, though it's clear any assistance would run into political opposition.

Related: Is it time to bail out the U.S. oil industry?

Are banks ready?

All of this raises the question: Is Wall Street doing enough to prepare for the oil storm?

"One year from now, are you going to look back and say, 'Whoops, we didn't get ahead of this enough,'" outspoken banking analyst Mike Mayo asked JPMorgan boss Jamie Dimon during Thursday's conference call.

Dimon said if it were up to him, he'd reserve against the potential for even greater losses. However, he said those decisions are limited by accounting rules.

Still, Dimon said the energy portfolio makes up just a small portion of JPMorgan's balance sheet and many of the loans are backed by physical assets. That means banks can sell off assets to recover money if a company defaults on its loans.

"We're not worried about the big oil companies. These are mostly the smaller ones that you're talking," Dimon said.

Paul Miller, a banking analyst at FBR, said oil loans don't represent nearly the same threat to banks that mortgages did last decade. He also pointed out that banks have been forced to stockpile capital to help them absorb losses.

"The big banks might have 1% to 6% of exposure. That's not going to kill them. This is not like 2006 or 2007," Miller said.

Despite the turmoil, JPMorgan isn't planning to run away from the oil patch.

"To the extent we can responsibly support clients, we're going to. And if we lose a little bit more money because of it, so be it," Dimon said.

CNNMoney (New York) First published January 18, 2016: 4:13 AM ET

[ad_2]

Source link

Need to Know: How investors should prepare for that short-term stock breather

Red
-
0
Need to Know: How investors should prepare for that short-term stock breather

[ad_1]

After the worst start in history for U.S. stocks, some would look at the bright green lighting up futures screens this morning and say it’s about time. Not even another cut in the International Monetary Fund’s global growth forecast can spoil the mood this morning.

Gains come after the worst annual growth in 25 years for China has left investors stimulus-hungry, forks pointed at Beijing. That’s not to mention a growing frozen-Fed mentality out there after some recent soft data. The CME Group’s FedWatch tool puts chances of a rate hike in March at 31% (down from 50% a few days ago notes IBankCoin), in April at 35% and 50% for June.

Meanwhile, it’s been hard to move an inch without some forecast about where this market is headed next. From big sell-it-all calls last week to the relaxed bulls over at Goldman Sachs, you might have thought everyone has had their say. But a few calls more have been spilling out, and they’re saying this market is due a bounce.

David Bianco, Deutsche Bank’s chief U.S. equity strategist, told investors Monday that the next 5% move for the S&P 500 will be “up and soon.” (h/t Business Insider) He said he isn’t panicked by the recent slide in stocks because it’s being driven by a “a profit recession centered at certain industries caused by factors that we’ve long flagged as risks.”

Our call of the day is looking for a bounce too, but it comes with a warning: If you’re ready to leap into the next big rally, you’d better be ready for what’s to will follow. Yep, another pullback.

Our chart of the day takes a whack at oil as Brent floors it with some supersize gains. That’s as the IEA warns the oil market could “drown” in oversupply.

Key market gauges

Futures for the Dow industrials YMH6, +1.31% and the S&P 500 ESH6, +1.29% are taking off in a big way after Monday’s Martin Luther King holiday that shuttered U.S. markets, it not Globex. Helping out was a 3.2% Shanghai Composite COMP, -2.74%
surge after that sluggish (for China) growth data. The Nikkei NIK, +0.55%  and other Asia markets rose across the board. After a plunge last week and no surprise on Iran sanctions being lifted, U.S. crude CLH6, +0.92% is back over $31 a barrel and Brent LCOH6, +2.80%   is closing in on $30, up nearly 5%.

Elsewhere, Europe SXXP, +2.04%  has a lock on that rally fever. Gold GCG6, -0.39% is off a little and the dollar DXY, +0.14%  is up against the yen.

The call of the day Jonathan Krinsky, chief market technician for MKM Partners, says brace for a short-term bounce in the S&P 500. That’s after the worst start to the year in history may have winded the bears and sentiment indicators like the American Association of Individual Investors poll shows the fewest bulls since 2002.

He and his team doesn’t think the sellers are finished with this market, and are more interested in “selling a bounce than trying to catch one. In the “best-case” scenario, investors could see that S&P 500 bounce to near 1,900, but don’t expect it to move past 1,950, says Krinsky. On the downside, he says 1,820 and then 1,740 are likely to be tested in the coming months. Here’s his chart:

MKM Partners

“With that said, we understand many clients must remain invested. In that regard, we would fight the urge to bottom-fish beaten-down names, and stick with those exhibiting relative strength,” he says. A similar sell-any-rallies mentality was expressed earlier this month by J.P. Morgan equity strategist Mislav Matejka.

Krinsky offers up 20 names that are above their 200-day moving averages, a chart level that many technical analysts watch closely. They include DreamWorks Animation DWA, -2.30% Popeyes Louisiana Kitchen PLKI, +0.33% Allscripts Healthcare MDRX, -2.53% Dean Foods
DF, -1.09% Luminex LMNX, +0.15%  and Universal Forest Products UFPI, +1.45%

The economy

It’s a light week for U.S. economic data. The only item on tap Tuesday is a home builder’s index due at 10 a.m. There will be no Fed speakers this week ahead of a policy meeting on Jan. 26-27.

Earnings

Health insurer UnitedHealth UNH, -1.35% reported early and shares are up. Morgan Stanley MS, -4.35% is up 4% after the investment bank beat earnings expectations. Bank of America
BAC, -3.54% is still to come.

Delta DAL, -1.85%  is down 1% after the airline’s results.

Netflix NFLX, -2.82%  is after the close.

The stat $1 to $2 a day — That’s roughly the amount children, some as young as seven, are reported to be earning in harsh and dangerous conditions mining cobalt in the Democratic Republic of the Congo, according to a new report from Amnesty International and Afrewatch. They say Apple AAPL, -2.40% Samsung 005930, +4.00% and Sony SNE, -3.86% have failed to do basic checks to ensure that cobalt mined by child laborers hasn’t been used in their products.
The buzz

Netflix’s CEO Reed Hastings says the streaming service may soon get a license to operate in China.

Jan Koum, the CEO of Facebook FB, -3.46% -owned WhatsApp, said the company is dumping the $1 annual fee for subscribers and is now looking at a business-to-consumer strategy for a revenue stream. Koum spoke to Wired Magazine about the move. ”We view this as a logical next step to drive and hopefully accelerate consumer adoption,“ said Credit Suisse analysts in a note.

Twitter TWTR, -5.58%  (the service, not the stock) has been suffering on and off outages across the globe.

Security risk in home routers has been unearthed by The Wall Street Journal.

The World Economic Forum has begun in Davos, Switzerland, and the BBC has done a fun little map showing connections between delegates.

Lots of chatter about the Oxfam wealth inequality report that came out Monday that shows 62 wealthy individuals own as much as the poor half of the world. And they all fit neatly in a bus now:

Oxfam


The chart

Iranian oil is something the market will just have to get used to, even though it could take longer than anyone thinks for production to get up to full speed. Bucking up against that rally for oil this morning is this chart from investment strategist Callum Thomas, which shows how oil prices tend to crater going into February, followed by a nice ride up. But, of course, one could say the rule books on crude are being rewritten these days.

The quote
Getty Images


The problem on Europe’s doorstep

“We have until March, the summer maybe, for a European solution. Then Schengen goes down the drain.” — Unnamed German official tells Reuters that Berlin could shut its borders to immigrants from Syria and other places as that flow of people is expected to swell to huge levels once cold weather has passed. That official and others said that could be the beginning of the end of the European Union.

Random reads
Reuters


Glenn Frey and ‘The Eagles’ in June 30, 2011

Tributes flow as Eagles Founder Glenn Frey dies at 67.

Andy Murray says reports of match-fixing in tennis don’t surprise him.

Jada Pinkett Smith’s plans for an Oscar boycott go down badly with some.

Donald Trump’s bungled “Two Corinthians” Bible reference

Speaking of, the U.K. parliament debated whether to ban Trump from entering the U.K. and called him a wazzock.

[ad_2]

Source link

1...101102103...125Page 102 of 125

© Copyright - Red Dragon Leo

s2Member®