Random Market News, 13 September 2017
"Jean-Claude Juncker outlines vision to win back 'hearts and minds' of EU citizens.
In his State of the Union speech, European Commission President Juncker has praised the bloc for "bouncing back" after 10 years of crises. He has outlined bold proposals for the eurozone, trade and migration."
"In Surprise Vote, House Passes Amendment to Restrict Asset Forfeiture.
Civil asset forfeiture is a practice in which law enforcement can take assets from a person who is suspected of a crime, even without a charge or conviction. Sessions revived the Justice Department’s Equitable Sharing Program, which allowed state and local police agencies to take assets and then give them to the federal government — which would in turn give a chunk back to local police. This served as a way for these local agencies to skirt past state laws designed to limit asset forfeiture.
The amendment passed with a voice vote, meaning it had overwhelming support."
"Trump bars Chinese-backed firm from buying U.S. chipmaker Lattice.
U.S. President Donald Trump blocked a Chinese-backed private equity firm from buying a U.S.-based chipmaker on Wednesday, sending a clear signal to Beijing that Washington will oppose takeover deals that involve technologies with potential military applications."
"China to blacklist firms violating overseas investment rules: China Daily.
China issued rules last month on acquisitions abroad, following a fierce campaign since the end of last year against what Beijing calls “irrational” investments that has targeted sectors including property, entertainment and sport.
“Blacklisted enterprises will not be banned from making overseas investments, but will be punished as they become ‘discreditable’ to regulators,” the paper said, citing Zhang."
"China Shows Capital Controls Might Be a Good Idea After All.
A crackdown on capital outflows played a key role in halting the yuan’s slump last year, with measures ranging from a reserve requirement for currency derivatives to strengthened scrutiny of foreign acquisitions and demands valid business explanations be provided on requests for foreign exchange.
It’s been two decades since Malaysia was criticized for imposing its own capital controls during the Asian crisis, and China’s recent success may strengthen the G-20’s updated view that they have a legitimate role in avoiding damaging overshoots in financial markets."
"Saudis Prepare for Possible Aramco IPO Delay to 2019.
Saudi Arabia is preparing contingency plans for a possible delay to the initial public offering of its state-owned oil company by a few months into 2019, according to people familiar with the matter.
Several important decisions on the IPO have yet to be taken, stretching the ability of the company and its advisers to sell shares before the end of next year.
For example, Saudi Arabia has yet to announce where it will sell shares in Aramco other than the domestic stock exchange in Riyadh. The country may not to make an announcement until late October, when it’s holding a big investment conference in Riyadh."
Government budget deficit lower at current oil prices at ~8% of GDP.
"Saudi Arabia’s Economic Overhaul Claims a Victim.
The crown prince is shaking up business to wean the kingdom off oil. The first casualty is Saudi Oger, one of the country’s biggest builders."
"Ex-Citi CEO Pandit: 30% of bank jobs at risk from tech.
Vikram Pandit, who ran Citigroup during the financial crisis, said developments in technology could see some 30% of banking jobs disappearing in the next five years.
Artificial intelligence and robotics reduce the need for staff in roles such as back-office functions...
While Pandit's forecast for job losses is in step with one made by Citigroup last year, his timeline is more aggressive. In a March 2016 report, the lender estimated a 30 percent reduction between 2015 and 2025, mainly due to automation in retail banking. That would see full-time jobs drop by 770,000 in the U.S. and by about 1 million in Europe, Citigroup said."
"Hedge Fund Alpha Is on the Wane.
Excess hedge fund returns have plummeted since the mid-nineties, and some clients have cut their exposure, according to the latest five-year outlook from Northern Trust.
The return generated from hedge fund strategies in excess of their benchmark has deteriorated from an annualized 8.2 percent in the 1990s to just 0.6 percent over the past decade, according to new data.
Earlier this year, a JPMorgan survey concluded that three quarters of large investors were disappointed by the performance of their hedge fund portfolios in 2016."
"Alternatives standards body rebrands to capture industry, investor evolution.
The Hedge Fund Standards Board (HFSB) has taken on a new name to reflect the evolution of the alternative investment industry and changes in terminology and approaches applied by investors.
The standards-setting body has changed its name to the Standards Board for Alternative Investments (SBAI)."
VIX ~10.50. 10-yr treasury volatility (TYVIX) ~4.17.
Implied Fed rate hike/cut probability for September 20th is ~0.0%/1.4%, November 1st is ~2.0%/1.3%.
"WiseTech buys CargoSphere, Cargoguide.
The logistics enterprise software provider's acquisition spree continues with deals for ocean and air freight rate management solutions providers in United States and Europe.
The deals include the purchase of North Carolina-based CargoSphere, one of the top providers of ocean freight rate management solutions, for a reported $9.2 million and Netherlands-based Cargoguide, a provider of airfreight rate management tools, for $5.5 million.
The acquisitions signal deep interest in tools that empower freight forwarders and 3PLs to better manage the tricky process of quoting quickly and accurately to their customers. CargoSphere specializes in providing its users a closed network of sharable rates. More recently, CargoSphere has been working to directly link ocean carriers and forwarders through its technology to give forwarders access to dynamic rate changes."
"SNCF-Geodis ‘closing in on CEVA acquisition’.
French media reports suggest state group is persuading French authorities to increase its debt allocation in order to finance the purchase.
SNCF Logistics and its main subsidiary Geodis are closing in on the acquisition of global freight forwarding and logistics group CEVA Logistics according to reports in the French media, including the business review Lettre de l’Expansion and the online news service TransportInfo.fr."
"IFLN launches global project freight network.
Organisation of freight forwarders and logistics companies adds worldwide specialist capability as alternative to multinational players.
The nascent network already has more than 40 members and is expanding quickly, said IFLN president Michel Vanlerberghe. “We are very happy with the response from our own IFLN members, and we are now growing the IFLN Global Projects membership with other cargo agents who are dedicated to project forwarding.”"
"XPO Logistics unveils big expansion of last-mile network.
Home-delivery footprint will nearly double by late 2018 to reach 90% of US population, in response to rapid growth of e-commerce.
XPO Logistics yesterday announced plans to nearly double its current last-mile footprint to 85 service hubs by late 2018 in response to the rapid growth of e-commerce."
"Freighter operators at Amsterdam Schiphol are set to lose up to 20% of their slots at the airport next month.
Under IATA and EU rules, when slots are constrained, airports must implement the IATA 80:20 policy – any airline which has not flown 80% of its slots as scheduled, loses its right to them.
On average, according to the Dutch shippers’ council, freighter operators managed to fly 70-80% of their slots as scheduled – not enough reliability to maintain slots under the new policy."
"Comparing Bitcoin, Ethereum, and Other Cryptos."
"Blockchain startup CrowdWiz puts a decentralized spin on fund management.
The Estonia based project wants to use the public Ethereum blockchain to create a transparent suite of investment products based on the wisdom of the crowd.
CrowdWiz’s first product will be WizFund, a self-governed crypto fund. Users can create their own funds and, through voting, members will decide how and where the fund should invest. With no central power of authority, there is no fund manager to make decisions on behalf of investors. The wisdom of the crowd determines what the fund’s next investment is going to be. Less experienced investors will be able to join smart investments without having to do the research!"
"IBM simulates chemical reactions on a quantum computer.
IBM scientists developed an algorithm that uses a seven-qubit quantum processor, and they actually used six qubits of that processor to measure Beryllium hydride (BeH2)’s lowest energy state, a key measurement for understanding chemical reactions. So far, that is the largest molecule simulated on a quantum computer. While this model of BeH2 can be simulated on a classical computer, IBM said its approach has the potential to scale to investigate larger molecules that classical computing methods can’t handle."
"Flip-Flop Qubit Could Make Silicon the King of Quantum Computing.
Headline-grabbing quantum computing efforts by Google and IBM have mostly focused on building quantum bits, called qubits, out of loops of superconducting materials.
But the researchers based at the University of New South Wales and Purdue University in the United States soon realized that the advantage of the flip-flop qubit comes from inducing an electric dipole—separation of positive and negative charges—by pulling the electron a little bit away from the nucleus of the phosphorus atoms (which are themselves embedded in silicon). That electric dipole enables the spin-based silicon qubits to remain entangled together over longer distances and able to influence one another through quantum physics. The wider separations between individual qubits make it easier to squeeze in the classical computing circuitry necessary for controlling qubits.
The researchers also discovered that the new flip-flop qubits can be controlled with electric fields rather than magnetic fields. That’s a big deal because the electron and nuclear spins of phosphorus atoms respond only very weakly to magnetic fields."
"Paper: The Key to Chemical Analysis.
The Paper Analytical Device, or PAD, is a small card that gives users the ability to test the content of dozens of pharmaceuticals to determine whether a drug contains the correct medicine. The device is described as a “complete lab on a piece of paper.”
The PAD allows chemicals analysis to take place outside of a laboratory setting without any additional equipment or instruments. Only water and a drug sample are needed to conduct a chemical test, eliminating the cost and access barriers that many countries have faced for effectively screening pharmaceuticals."
"Fish Food for Marine Farms Harbor Antibiotic Resistance Genes.
From isolated caves to ancient permafrost, antibiotic-resistant bacteria and genes for resistance have been showing up in unexpected places. As scientists puzzle over how genes for antibiotic resistance arise in various environments and what risks to human health they might pose, one team has identified a surprising way some of these genes are getting into ocean sediments: through food for marine fisheries.
Many disease-causing bacteria, such as those that cause tuberculosis, have developed resistance to common antibiotics and drugs of last resort. "
"New supernova analysis reframes dark energy debate.
The accelerating expansion of the Universe may not be real, but could just be an apparent effect, according to new research published in the journal Monthly Notices of the Royal Astronomical Society. The new study—by a group at the University of Canterbury in Christchurch, New Zealand—finds the fit of Type Ia supernovae to a model universe with no dark energy to be very slightly better than the fit to the standard dark energy model.
Dark energy is usually assumed to form roughly 70% of the present material content of the Universe. However, this mysterious quantity is essentially a place-holder for unknown physics."
Type Ia supernovae are a 'standard candle' used to measure astronomical distances due to their consistent luminosity."
"Mysterious lights in the sky seen after Mexico’s huge earthquake.
After an 8.1-magnitude earthquake struck off the southern coast of Mexico on 7 September, videos of fuzzy green smears in the night sky went viral online.
Earthquake lights are a phenomenon so unusual that they border on myth. The first known reports of them are from 89 BC, with spotty descriptions over the centuries.
Earthquake lights are electric discharges that come out of the ground and can rise up to 200 metres in the air, says Freund. Lights are sometimes observed in the days and hours leading up to an earthquake, and at other times during or after it. But how they work is still mysterious."
Startup/SME of the Day.
StellarStation is a cloud-based software platform that connects satellite operators with antenna owners, solving both the problem of insufficient satellite access time and unused antenna idle time."
‘Airbnb for satellite antenna’
"Woomera Range Complex.
Bomb tests and sheep ranchers share the world's largest military land base.
The world’s largest military land base is in South Australia, where it was established in 1947 not at the behest of the Australian military, but of the British. Atomic bombs, ballistic missiles and boosters for satellites have all been tested at the range since it opened in 1947.
About the size of Louisiana at 49,000 square miles, the range is still active today..."
"Bad news keeps piling up at the "leaning tower" of San Francisco.
Millennium Tower is a luxury residential high-rise that has sunk 17 inches and tilted 14 inches since it was completed in 2008.
Millennium Tower sits on land prone to liquefaction, the process by which loose sand and silt behave like a liquid in the event of an earthquake."
IN: WPI, 2:30 AM ET
FR: CPI, 2:45 AM ET
CH: SNB Monetary Policy Assessment, 3:30 AM ET
IT: CPI, 4:00 AM ET
GB: BOE Announcement & Minutes, 7:00 AM ET
US: Consumer Price Index, 8:30 AM ET
US: Jobless Claims, 8:30 AM ET
US: Bloomberg Consumer Comfort Index, 9:45 AM ET
US: EIA Natural Gas Report, 10:30 AM ET
US: Fed Balance Sheet, 4:30 PM ET
US: Money Supply, 4:30 PM ET
https://tradingeconomics.com/calendar (More complete listing, including consensus)