RTTNews Morning Market Briefing October 1, 2013.

Commentary October 1, 2013.

Stocks May Move Higher Despite Government Shutdown - U.S. Commentary

After ending the previous session firmly in the red, stocks may move back to the upside in early trading on Tuesday. The major index futures are currently pointing to a higher open for the markets, with the Dow futures up by 28 points. (Oct 1, 2013) Full Article

Economic News

South Korea Inflation Falls To 14-Year Low

Consumer prices in South Korea gained just 0.8 percent on year in September, Statistics Korea said on Tuesday - slowing to a 14-year low. (Oct 1, 2013) Full Article 

BoJ Tankan: Large Manufacturers Index +12 In Q3

An index measuring business sentiment in Japan gained broadly in the third quarter of 2013, the Bank of Japan revealed on Monday in its quarterly Tankan business survey. (Oct 1, 2013) Full Article 

Australia August Retail Sales Up 0.4%

The total value of retail sales in Australia added a seasonally adjusted 0.4 percent in August compared to the previous month, the Australian Bureau of Statistics said on Tuesday, standing at A$21.923 billion. (Oct 1, 2013) Full Article 

China Official PMI Signals Modest Acceleration In Factory Activity

Chinese manufacturing activity expanded at a slightly faster rate in September, with business activity across the sector seeing a modest pick up, a survey by the China Federation of Logistics and Purchasing, or CFLP, and the National Bureau of Statistics showed Tuesday. (Oct 1, 2013) Full Article

RBA Keeps Cash Rate At Record-Low

Policymakers at the Reserve Bank of Australia on Tuesday decided to hold the the benchmark cash rate unchanged at a record-low of 2.5 percent for a second consecutive time and said a weaker exchange rate would help to rebalance economic growth. The RBA has reduced the cash rate by a cumulative 225 basis points since November 2011. (Oct 1, 2013) Full Article

Abe Opts For Sales Tax-Hike; Stimulus Planned To Soften Impact On Economy

Japan's Prime Minister Shinzo Abe said Tuesday that he will hike the sales tax as planned from April next year to reduce the country's huge debt load. The government is also set to announce a stimulus package to cushion the potential negative impact that the tax hike could have on the nascent recovery of the economy. The government will increase the consumption tax to 8 percent from April 2014. (Oct 1, 2013) Full Article 

Eurozone Jobless Rate Unchanged At 12%

The Eurozone unemployment rate held steady below a record high in August in a sign that the labor market is improving slightly as firms plan recruiting to meet a recovery in demand. The unemployment rate was 12 percent of the labor force for the second consecutive month in August, figures published by Eurostat showed Tuesday. The rate for July was revised down from a record 12.1 percent. (Oct 1, 2013) Full Article

Broker Ratings Changes

Nomura Lowers AU Optronics Corp (AUO) To Reduce From Buy

(Oct 1, 2013)  

Todays WS Events

Ford Motor September 2013 U.S. Sales Conference Call At 10:00 AM ET

Ford Motor Company (F) September 2013 U.S. Sales Conference at 10:00 AM ET October 1, 2013 . To access the live webcast, log on at www.shareholder.ford.com A call can be accessed by dialing 866-783-2138 (US) or 857-350-1597 (International). For replay a call, dial 888-286-8010 (US) or 617-801-6888 (International); passcode:36993696 (Oct 1, 2013)  

Noble Energy To Present At Johnson Rice Energy Conference;Webcast At 10:00 AM ET

Noble Energy Inc (NBL) will present at the Johnson Rice Energy Conference. The event is scheduled to begin at 10:00 AM ET October 1, 2013. To access the live webcast, log on at http://investors.nobleenergyinc.com/ (Oct 1, 2013)

Paychex Q1 14 Earnings Conference Call At 10:30 AM ET

Paychex Inc. (PAYX) will host a conference call at 10:30 AM ET on October 1, 2013, to discuss its Q1 14 earnings results. To access the live webcast, log on at http://investor.paychex.com/webcasts (Oct 1, 2013)

Pioneer Natural Resources To Present At Johnson Energy Conference; At 12:00PM

Pioneer Natural Resources Co. (PXD) will present at the Johnson Rice Energy Conference. The event is scheduled to begin at 12:00 PM ET on October 1, 2013. The presentation will be available at www.pxd.com (Oct 1, 2013)  

Plum Creek Timber Will Host Its Investor And Analyst Meeting At 8:00 AM ET

Plum Creek Timber Co. (PCL) Will host its investor and analyst meeting in New York. The event is scheduled to begin at 8:00 AM ET on October 1,2013. To access the live webcast, log on at http://www.plumcreek.com/Investors/nbspNewsandEvents/EventCalendar/tabid/106/Default.aspx (Oct 1, 2013)

Walgreen Q4 13 Earnings Conference Call At 8:30 AM ET

Walgreen Co. (WAG) will host a conference call at 8:30 AM ET on October 1, 2013, to discuss its Q4 13 earnings results. To access the live webcast log on to http://investor.walgreens.com For a replay call, dial 855-859-2056 (US) or 404-537-3406 (International) with code 69675446. (Oct 1, 2013)  

Reuters | Deals Today October 1, 2013: Perry Corp Cuts Stake in J.C. Penny by More than Half.

Perry Corp cuts stake in J.C. Penney by more than half NEW YORK (Reuters) - J.C. Penney Co Inc shareholder Perry Corp has cut its stake in the retailer by more than half to 3.28 percent, a regulatory filing showed Monday.

 Apollo moves closer to $2.5 billion Cooper deal; hurdles remain (Reuters) - Cooper Tire and Rubber Co shareholders have approved the U.S. company's $2.5 billion sale to India's Apollo Tyres Ltd , clearing a major step for the creation of the world's seventh biggest tyre maker.

 EDF in talks to buy lighting firm Citelum PARIS (Reuters) - Power group EDF said on Tuesday it was in exclusive talks with energy services group Dalkia France to buy public lighting and traffic management company.

 SoftBank's Son buys Tokyo Tiffany building for $326 million: sources TOKYO (Reuters) - The billionaire founder of tech and telecoms group SoftBank Corp bought Tokyo's landmark Tiffany Building for 32 billion yen ($326 million) in one of the priciest property deals in recent years in Japan, underscoring the recovery in the real estate market.

Chevron signs long-term deal with Japan's Tohoku for Wheatstone LNG supply PERTH (Reuters) - U.S. oil company Chevron Corp said on Tuesday it has signed a liquefied natural gas supply deal with Japan's Tohoku Electric Power for supplies from its $29 billion Australian Wheatstone LNG project for up to 20 years.

JG Summit to pay $1.65 billion for San Miguel's stake in Manila Electric MANILA (Reuters) - Philippine conglomerate JG Summit Holdings Inc will pay 72 billion pesos ($1.65 billion) for San Miguel Corp's stake in Manila Electric Co (Meralco) in what would be the country's biggest M&A deal in nearly two years.

Experian buys U.S. fraud detection firm for $324 million LONDON (Reuters) - Experian , the information services group, has agreed to buy United States fraud detection group The 41st Parameter for $324 million, the firm said on Tuesday.

Romania Adeplast launches IPO, hopes to raise up to 15 million euros BUCHAREST (Reuters) - Romanian construction materials producer Adeplast will launch an initial public offering for a minority stake during October 2-15 on the Bucharest bourse, hoping to raise between 13 and 15 million euros ($20.30 million), it said on Tuesday 

SE Asia IPOs regain some lustre with strong Westports pricing KUALA LUMPUR/SINGAPORE (Reuters) - Westports Holdings Bhd, the operator of Malaysia's busiest port, priced its IPO at the top of its projected range to raise $680 million, signalling a boost for Southeast Asia's capital markets on pent-up demand for emerging market stocks.

Newmont joins race for Glencore's Las Bambas mine: FT (Reuters) - Newmont Mining Corp the biggest gold miner in the United States, has joined the race for Glencore Xstrata's copper mining project in Peru, the Financial Times reported in its Tuesday edition.

DealBook Today's Top Stories October 1, 2013: Wall Street Wary as Government Shuts Down | Financial Watchdog to Depart Agency | Doubts Raised on the Value of Consultants to Pensions | An Occupy Debit Card

Tuesday, October 1, 2013

TODAY'S TOP HEADLINES

BY WILLIAM ALDEN

WALL STREET WARY AS GOVERNMENT SHUTS DOWN Investors cautiously pulled back from the markets as a flurry of political moves in Washington on Monday evening failed to end a budget standoff, setting up the first government shutdown in nearly two decades, The New York Times reports. Stock markets around the world fell on Monday, though the declines were relatively modest in the United States while negotiations in Congress remained stalled, Nathaniel Popper writes in DealBook. Markets in Europe were higher on Tuesday, while stock index futures in the United States pointed to a higher opening this morning in New York.

Many on Wall Street think the direct effect of a shutdown would be relatively minimal from the stock market's perspective. About 800,000 federal workers are to be furloughed and more than a million others will be asked to work without pay, as roughly two-thirds of the government - the so-called essential functions - will continue operating. But some economists have said the shutdown would most likely have a broader impact on market psychology if it lasted for more than a few days, Mr. Popper writes.

"You have an economy that has already shown some hesitation," said Diane Swonk, the chief economist at Mesirow Financial. "That's the last thing we need right now."

President Obama is scheduled to meet on Wednesday with members of the Financial Services Forum, including the chiefs of banks like JPMorgan Chase and Goldman Sachs, who are in Washington for an annual meeting. The group is expected to discuss a range of financial issues.

FINANCIAL WATCHDOG TO DEPART AGENCY David Meister, who is waging legal battles against some of the biggest names in finance, is poised to step down from his role as head of the Commodity Futures Trading Commission's enforcement unit, a move that may put the future of those cases in question, DealBook's Ben Protess reports. The commission announced his departure early Tuesday, capping Mr. Meister's effort to embolden an agency once dismissed as "the watchdog that didn't bark."

"Over a nearly three-year stretch, Mr. Meister helped write new rules to expand the enforcement unit's authority, overhauled the unit's management ranks and filed a record number of actions against the financial industry. An investigation into the banking industry's manipulation of benchmark interest rates - a crackdown on banks like UBS and Barclays - defined his tenure," Mr. Protess writes. Still, his exit - and the exit of Gary Gensler, the agency's chairman, whose term expires in December - comes at an awkward time.

One of the most prominent cases is an investigation into whether JPMorgan Chase traders in London built a position so big that they manipulated the market for financial contracts known as derivatives. That comes as the Justice Department and other regulators are trying to negotiate a settlement with JPMorgan over allegations of mortgage abuses - a case that, to many on Wall Street, seems unfair, DealBook's Peter Eavis writes. "But JPMorgan may not be the martyr some think it is."

In the Justice Department's effort over mortgages, a person inside the bank is providing valuable assistance to the government, according to The Wall Street Journal, citing unidentified people familiar with the matter. "The cooperating person has provided information - including emails - suggesting the bank vastly overstated the quality of mortgages that were being bundled into securities and sold to investors before the financial crisis, the people said."

DOUBTS RAISED ON THE VALUE OF CONSULTANTS TO PENSIONS "At a time when individual investors are increasingly demanding transparency in performance track records, the biggest slice of the investment world - pension funds - has conspicuously turned a blind eye to demanding track records from their most influential advisers, investment consultants," Andrew Ross Sorkin writes in the DealBook column. "A new study by professors at the University of Oxford is causing a stir in the staid pension investment industry, highlighting the subpar performance of most consultants and, more important, the lack of disclosure that would allow the public to even know about it."

ON THE AGENDA It is the first day of a government shutdown. Walgreen is scheduled to report earnings before the market opens. Empire State Realty Trust, owner of the Empire State Building, is expected to price its I.P.O. this evening. Pierre Cailleteau, managing director for sovereign ratings at Moody's, is on Bloomberg TV at 11:15 a.m.

AN OCCUPY WALL STREET DEBIT CARD To mark the second anniversary of the Occupy Wall Street movement in September, a surprising undertaking began with little fanfare: creating a prepaid Occupy debit card, Colin Moynihan reports in The New York Times. "The idea, led by a group that includes a Cornell law professor, a former director of Deutsche Bank and a former British diplomat, is meant to serve people who do not have bank accounts, but it also aims to make Occupy a recognized financial services brand."

Contact: @williamalden | E-mail

MERGERS & ACQUISITIONS »

Mergers Holding Steady For the first nine months of the year, Goldman Sachs claimed the top spot among financial advisers, having worked on 285 deals worldwide worth nearly $517 billion.

• DEALBOOK »

Cooper Tire Shareholders Approve Sale to Indian Tire Maker The shareholder approval was a big step forward for the $2.5 billion sale of Cooper Tire and Rubber to Apollo Tyres of India, but the deal still faces hurdles.

• REUTERS

How the Deal for Rue21 Could Fall Apart A report of weak sales by the retailer rue21 has spooked potential investors in a private equity deal to buy the company. The question now is whether the three banks on the deal want to risk their reputations by trying to kill it, Steven M. Davidoff writes in the Deal Professor column.

• DEALBOOK »

Frontier Airlines to Be Acquired by Investment Firm "The man who turned Spirit Airlines Inc. into one of the industry's stingiest but most profitable carriers agreed in principle to buy Denver-based Frontier Airlines, a transaction that likely signals the expansion of the ultralow-cost sector of the U.S. airline industry, according to a person familiar with the deal," The Wall Street Journal reports.

• WALL STREET JOURNAL

Nielsen Completes Acquisition of Arbitron Nielsen Holdings said on Monday that its $1.26 billion acquisition of the radio ratings company Arbitron would allow it to monitor eight hours a day of the public's media consumption across television, radio and a range of electronic devices.

• NEW YORK TIMES

INVESTMENT BANKING »

An Ex-Trader Looks at the Changes in Goldman "What Happened to Goldman Sachs" examines the bank's evolution from an elite private partnership to a vast public corporation – and the effects of that transformation on its culture.

• DEALBOOK »

Berkshire Hathaway to Receive $2 Billion of Goldman Stock Berkshire is getting Goldman Sachs stock worth nearly $2.15 billion through warrants it acquired as part of a deal in 2008, Reuters reports.

• REUTERS

Barclays Names Top Aerospace Banker Barclays has announced that Jay Caldwell will join the bank as global head of its aerospace and defense team.

• DEALBOOK »

Freddie Mac Names Ally Executive as Finance Chief Freddie Mac said on Monday it had chosen James Mackey, a top executive at Ally Financial, to be its chief financial officer, succeeding Ross Kari.

• REUTERS

Mutual Fund Billionaire Gives $250 Million to Yale Charles B. Johnson, the retired chairman of the money management company Franklin Resources, has pledged $250 million to Yale.

• DEALBOOK »

Bank Fees Rise Again, for 15th Straight Year

• USA TODAY

 

PRIVATE EQUITY »

Apollo's Energy I.P.O. Gives New Life to Quick Flips Apollo Global Management is showing that private equity can still dig into its old bag of tricks, Christopher Swann of Reuters Breakingviews writes.

• REUTERS BREAKINGVIEWS

Active Network in $1.05 Billion Buyout Active Network, which provides online tools and data management for events, has agreed to be acquired by the private equity firm Vista Equity Partners in a deal valued at $1.05 billion.

• DEALBOOK »

HEDGE FUNDS »

Perry Capital Cuts Stake in J.C. Penney The hedge fund began to cut its stake on Friday, coinciding with J.C. Penney's disclosure of a planned sale of as much as 96.6 million new common shares.

• DEALBOOK »

I.P.O./OFFERINGS »

Container Store Aims to Raise $200 Million in I.P.O. The Container Store Group, a 35-year-old retail chain based in Texas, filed for an initial public offering, saying it planned to use the proceeds to pay a dividend to holders of its senior preferred stock and to repay debt.

• REUTERS

VENTURE CAPITAL »

Cybersecurity Firm Cigital Raises $50 Million Cigital, which helps enterprise customers maintain software applications to protect against cyber threats, announced on Tuesday that it raised $50 million from LLR Partners, to support its expansion and growth.

• CIGITAL

Payments Start-Up Leaf Raises $20 Million Leaf, a competitor to Square and other payments companies, attracted $20 million from Heartland Payment Systems, a big payments processing company, AllThingsD reports.

• ALLTHINGSD

LEGAL/REGULATORY »

Despite Cries of Unfair Treatment, JPMorgan Is No Victim Some banking experts say they believe that the government is picking on JPMorgan Chase, but the bank may not be the martyr some think it is.

• DEALBOOK »

No Limit on Strikes for JPMorgan Chase Simply paying money to get rid of investigations raises questions about whether JPMorgan Chase should be viewed as a recidivist, and if so how the law should treat the bank, Peter J. Henning writes in the White Collar Watch column.

• DEALBOOK »

Wells Fargo Settles With Freddie Mac Over Loans Wells Fargo agreed to pay $780 million in cash to Freddie Mac to resolve repurchase liabilities on home loans sold to the mortgage finance giant before 2009, Reuters reports.

• REUTERS

For Sweden's Banks, Fast Growth Isn't Seen as the Goal "The dream scenario would be that the economy grows a little bit faster than the bank sector," Peter Norman, Sweden's financial markets minister, told Bloomberg News.

• BLOOMBERG NEWS

Former Morgan Stanley Broker Pleads Guilty in Insider Case A former financial adviser with Morgan Stanley admitted to tipping off a childhood friend to Gilead Sciences' plan in 2011 to buy Pharmasset, before the takeover was announced.

• REUTERS

U.S. Stock Market Future Indications by MarketWatch October 1, 2013: Stock futures shrug off shutdown; Cars in focus.

By Barbara Kollmeyer, MarketWatch 

 

MADRID (MarketWatch) — U.S. stock futures pointed to gains at the open for Wall Street on Tuesday as investors, at least for the moment, chose to shrug off a partial government shutdown that kicked in as a deadline passed without a deal. 

Data on tap includes a fresh look at the U.S. manufacturing industry and sales figures from car makers. 

In a marked difference to sharp losses seen in Monday’s premarket session, futures for the Dow industrials DJZ3 +0.26%   rose 50 points, or 0.3%, to 15,096. Futures for the Standard & Poor’s 500 index SPZ3 +0.33%  gained 6.4 points, or 0.4%, to 1,680.70. Futures for the Nasdaq 100 index NDZ3 +0.34%   rose 12.25 points, or 0.4%, to 3,221.25. 

 

The Next 24: Overseas Markets Track Shutdown
It's unlikely anything will grab the attention of investors as much as the looming U.S. government shutdown, but there also will be other important economic news: Japan sales tax, U.S. auto sales and more. 

U.S. politicians failed at the 11th hour to agree on funding for the fiscal year that began just after midnight, owing to moves by lawmakers over the budget and President Barack Obama’s health-care law. A shutdown — the first in 17 years — has begun, furloughing thousands of government workers in the process. 

Given the increased uncertainty created by the budget impasse, and with the government needing to raise the debt ceiling by Oct. 17,, there are higher risks of a further correction in stock markets, said Allen von Mehren, chief analyst at Dankse Bank in a note. 

“The reaction so far has been fairly muted. But given that markets have been technically overbought, we think it’s likely we will see further declines in coming weeks,” said von Mehren. “This should also add to downside pressure on bond yields. In the short term, the risk is also that the U.S. dollar could weaken further.” 

The shutdown means the week’s biggest piece of economic data, September’s monthly jobs report, won’t be released on Friday. However, markets are bracing for the possibility that the data could be released as early as Tuesday. Economists polled by MarketWatch expect payrolls to rise to 185,000 in September from 169,000 in August.

Reuters

Statues of female figures representing Grief and History stand before the U.S. Capitol Dome.

On the regular schedule, the Institute for Supply Management’s business survey is projected to drop to 55% in September from a more than two-year high of 55.7% in August. A number above 50% signals growth. The report will be released at 10 a.m. Eastern Time.

Ahead of that, the Markit PMI, will come out shortly before 9 a.m. Eastern. The preliminary Markit PMI totaled 52.8 in for September.

A report on construction spending for August will be postponed due to the shutdown. 

On the corporate front General Motors Co. GM +0.03%   and Ford Motor Co. F +0.12%  could be active as major car makers are scheduled to release monthly auto sales data. Analysts are predicting car sales could fall in September versus the year-ago period. Read GM, Ford are Tuesday’s stocks to watch

 

Across other markets, the dollar was under pressure, while oil prices also fell and gold moved higher.

Asia stocks showed little reaction to the looming shutdown, with Japanese shares eking out a small gain after Prime Minister Shinzo Abe said he would raise the country’s sales tax next year. Europe stocks logged gains, with data showing the euro-zone manufacturing sector expanded for a third month in September. The final reading came in unchanged from a preliminary reading.

Wall Street stocks dropped on Monday, with the Dow industrials DJIA -0.84%  logging a triple-digit decline as the deadline for a budget deal neared. 

Barbara Kollmeyer is an editor for MarketWatch in Madrid. Follow her on Twitter @MWBarbaraKollmeyer.

Financial and Forex Info | Kitco Latest Gold News.

Latest Gold News

NY Time

P.M. Kitco Roundup: Comex Gold Weaker as U.S. Government Partial Shutdown Imminent - Kitco News, Sep 30 2013 1:57PM

LBMA Coverage: Is Europe Wasting A Good Crisis? - Keynote Speaker - Kitco News, Sep 30 2013 4:45PM

LBMA Coverage: Market At A Pivotal Point: CME Metals Managing Director - Kitco News, Sep 30 2013 5:01PM

Guarded Optomism Is Sentiment: Bart Melek - Kitco News, Sep 30 2013 3:25PM

Analysts Mixed Over Whether Gold Will Rally In Looming U.S. Government Shutdown - Kitco News, Sep 30 2013 12:18PM

Market At A Pivotal Point: CME Metals Managing Director - Kitco News, Sep 30 2013 1:53PM

Speculators Return To Gold, But Activity Mixed Elsewhere in Precious Metals - CFTC - Kitco News, Sep 30 2013 11:50AM

Is Europe Wasting A Good Crisis? LBMA Keynote Speaker - Kitco News, Sep 30 2013 9:01AM

SPDR Gold Shares Fell 4.2 Metric Tons Last Week - Kitco News, Sep 30 2013 8:57AM

Govt steadfast on MPRDA as CoM pulls levers - Miningmx (South Africa), Oct 1 2013 5:59AM

Vedanta looking to expand into gold mining - Economic Times, The (India), Oct 1 2013 5:59AM

Japan hikes sales tax as economy recovers - CNNMoney.com, Oct 1 2013 5:46AM

Abe Opts For Sales Tax-Hike; Stimulus Planned To Soften Impact On Economy - RTT News, Oct 1 2013 5:46AM

Euro-Area Jobless Rate Unexpectedly Falls Amid Recovery - Bloomberg Business News, Oct 1 2013 5:15AM

RTTNews Forex Top Story October 1, 2013: Abe Opts For Sales tax-Hike; Stimulus Planned to Soften Impact on Economy.

Forex Top Story

Abe Opts For Sales Tax-Hike; Stimulus Planned To Soften Impact On Economy

Japan's Prime Minister Shinzo Abe said Tuesday that he will hike the sales tax as planned from April next year to reduce the country's huge debt load. The government is also set to announce a stimulus package to cushion the potential negative impact that the tax hike could have on the nascent recovery of the economy. The government will increase the consumption tax to 8 percent from April 2014.

Australian Dollar Spikes Higher As RBA Maintains Cash Rate

The Australian dollar rallied on Tuesday after the Reserve Bank of Australia kept its benchmark cash rate at a record-low of 2.5 percent. The RBA noted that the effects of monetary policy easing since late 2011 are still having an impact on the economy. The decision was in line with economists' expectations....

China Official PMI Signals Modest Acceleration In Factory Activity

Chinese manufacturing activity expanded at a slightly faster rate in September, with business activity across the sector seeing a modest pick up, a survey by the China Federation of Logistics and Purchasing, or CFLP, and the National Bureau of Statistics showed Tuesday. The headline purchasing managers' index, or PMI, rose to 51.1 in September from 51 in August.

Australia August Retail Sales Up 0.4%

The total value of retail sales in Australia added a seasonally adjusted 0.4 percent in August compared to the previous month, the Australian Bureau of Statistics said on Tuesday, standing at A$21.923 billion. That beat forecasts for an increase of 0.3 percent following the 0.1 percent gain in July. By...

BoJ Tankan: Large Manufacturers Index +12 In Q3

An index measuring business sentiment in Japan gained broadly in the third quarter of 2013, the Bank of Japan revealed on Monday in its quarterly Tankan business survey. The survey is closely watched by the Bank of Japan for formulating policies. The large manufacturers index came in with a score...

South Korea Inflation Falls To 14-Year Low

Consumer prices in South Korea gained just 0.8 percent on year in September, Statistics Korea said on Tuesday - slowing to a 14-year low. The headline figure was well below forecasts for an increase of 1.2 percent and down sharply from 1.3 percent in August. The CPI now moves even further below...

Dollar Mixed Monday As Government Shutdown Nears

The dollar is retreating from early gains against both the Euro and pound sterling on Monday, but is rising from early losses against the Japanese Yen. The deadline for a government shutdown is drawing near and there currently seems to be no sign that a compromise will be reached in time to avert it....

Eurozone Inflation Slows On Energy Prices

Eurozone inflation slowed more-than-expected to the lowest since early 2010 in September due to a notable fall in energy prices, giving ample room for the central bank to undertake growth-oriented measures to fortify nascent recovery. Inflation in the euro area slowed to 1.1 percent, the lowest since February 2010, from 1.3 percent in August, preliminary data from Eurostat showed Monday.

European Economics Preview: Eurozone Inflation Data Due

Consumer price inflation from euro area and retail sales from Germany are due on Monday, headlining a busy day for the European economic news.

China's Final Factory PMI Shows Activity Rose Less Than Estimated

An indicator of manufacturing activity in China increased less than previously estimated in September, final outcome of a survey by HSBC and Markit Economics revealed Monday. The latest result signaled only a modest improvement in operating conditions from August. The headline purchasing managers' index edged up to 50.2 in September from 50.1 in August, according to the newest estimate.

Japan Industrial Output Falls 0.7% In August

Industrial production in Japan was down a seasonally adjusted 0.7 percent in August compared to the previous month, the Ministry of Economy, Trade and Industry said on Monday - reversing the previous month's gains. The headline figure missed forecasts for a decline of 0.3 percent following the 3.4...

South Korea Industrial Production Adds 1.8% In August

Industrial production in South Korea climbed a seasonally adjusted 1.8 percent in August compared to the previous three months, Statistics Korea said on Monday. That beat expectations for an increase of 1.1 percent following the downwardly revised 0.3 percent contraction in July (originally called...

Dollar Sinking On Concerns Over Possible Government Shutdown

The dollar is losing ground against all of its major competitors at the end of the trading week, as concerns over a possible government shutdown continue to weigh on investors. Lawmakers continue to wrangle over legislation to keep the government running past next Monday. The Senate is scheduled to...

U.S. Consumer Sentiment Deteriorates Less Than Previously Estimated

Thomson Reuters and the University of Michigan released a report on Friday showing an upward revision to their reading on U.S. consumer sentiment in the month of September, although the index still pointed to a deterioration in sentiment compared the previous month.

U.S. Personal Income And Spending Growth Matches Economist Estimates

Personal income and spending in the U.S. both rose in line with economist estimates in the month of August, according to a report released by the Commerce Department on Friday. The report said personal income rose by 0.4 percent in August following an upwardly revised 0.2 percent increase in July.

Asian Markets at Close Report by MarketWatch October 1, 2013: Asia stocks yawn as Washington shuts down

 

By Mia Lamar and Jake Maxwell Watts 

Currencies dominated major moves in Asian trading Tuesday as the U.S. government entered a partial shutdown, while reactions in the region’s biggest stock markets were muted. 

Asian stock markets pulled back after a deadline passed for the U.S. government to avert a partial shutdown. Japanese shares eked out a small gain as Prime Minister Shinzo Abe decided to raise the country’s sales tax next year. 

Japan’s Nikkei Stock Average JP:NIK +0.20% ended up 0.2%, pulling back from a gain of more than 1% earlier Tuesday. The U.S. government shutdown, which officially took effect during afternoon trading hours in Tokyo, weighed on stock prices as the dollar saw sell pressure. 

Investors were initially cheered by the fact that Mr. Abe “is doing the fiscally prudent thing,” said Gavin Parry, managing director of Parry International Trading in Hong Kong. 

In currency markets, the U.S. dollar USDJPY -0.39% enjoyed a brief intraday spike to a high of around 98.72 yen on the news of the sales tax hike but it fell to ¥97.98 in late Asian trade, compared with ¥98.23 late Monday in New York. 

The Australian dollar rallied against the greenback despite growing uncertainty over the U.S. budget impasse, as a raft of strong economic reports and a decision by the Reserve Bank of Australia not to cut interest rates boosted the risk-sensitive currency. It traded at US$0.9412 compared with US$0.9305 late Monday in Asia. 

In the metals markets, prices for nickel-often tied to global growth expectations--showed the biggest reaction, falling 0.9% to $2,098 per metric ton. 

Price action was muted elsewhere in Asia. Stocks in Australia AU:XJO -0.23% closed slightly lower after seesawing in a narrow range between positive and negative territory. South Korea’s Kospi KR:SEU +0.10%  pared gains as the deadline approached and ended down 0.1%. 

Stock market benchmarks in Thailand and Indonesia came off highs but stayed in positive territory.

“We haven’t really seen any progress [on budget negotiations in the U.S.] since day one,” said Desmond Chua, a Singapore-based analyst at CMC Markets. 

Traders said investors had largely positioned for the shutdown Monday as it became increasingly certain lawmakers would fail to agree on a budget before a Tuesday deadline. Stocks sold off across the region Monday.

“Markets knew it since yesterday, so more or less this is the outcome that people expected,” Mr. Chua said. 

Markets in Hong Kong and mainland China were closed for holidays Tuesday. 

Asian markets also appear to be growing increasingly immune to U.S. budget battles. They barely reacted 10 months ago as Congress fought over the so-called fiscal cliff. 

Instead, markets in the region are focused more heavily when the U.S. Federal Reserve plans to slow the pace of its bond buying effort. Earlier in the summer when investors became convinced the Fed would move soon, they fled the region’s developing economies, knocking down markets. When Fed action appeared less imminent, the markets posted a strong rebound, ending the quarter up nearly 7%

Asian Markets at Close Report by CNBC October 1, 2013: Asian stocks mostly higher after US government shuts down

Asian stocks held onto modest gains on Tuesday after the U.S. Congress failed to reach a compromise on a government spending bill, leading to the first partial federal shutdown since 1996.
Japan's Nikkei, South Korea's Kospi and Indian stocks were modestly higher but Australia's S&P ASX 200 closed down 0.2 percent. Among emerging markets, Thailand's SET index and the Jakarta Composite rallied over 1 percent each.

U.S. stock futures were resilient with Dow futures up 28 points but the U.S dollar index held near a seven-and-a-half month low against a basket of currencies.

	Name	Price		Change	%Change
NIKKEI	Nikkei 225 Index	14484.72		28.92	0.20%
HSI	Hang Seng Index	22859.86		-347.18	-1.50%
ASX 200	S&P/ASX 200	5206.80		-12.08	-0.23%
SHANGHAI	Shanghai Composite Index	2174.67		14.64	0.68%
KOSPI	KOSPI Index	1998.87		1.91	0.10%
CNBC 100	CNBC 100 ASIA IDX	7194.02		28.73	0.40%

US government shuts down
The White House ordered federal departments to execute shutdown plans after Democrats and Republicans failed to agree on a spending bill before Monday's midnight deadline (noon Singapore/Hong Kong time).

Earlier in the session, the Democratic Senate twice rejected the Republican-led House of Representatives demands to delay portions of the Obamacare health insurance initiative. Now, the two parties must strike a deal on raising the federal borrowing limit to avoid a debt default by October 17.
(Read more: The final hours before the government shutdown)

Chinese markets are shut until October 7th for the week-long Golden Week holiday, but the government still released the official purchasing manager's index (PMI). The index edged up to 51.1 in September, missing expectations for a 51.5 figure. Still, the data was better than August's reading of 51.


Nikkei up 0.2%
Japan's benchmark index pared gains following an earlier 1 percent spike after Prime Minister Shinzo Abe decided to raise the national sales tax to 8 percent from 5 percent next April. Investors are now expecting a hefty stimulus package worth $50 billion to help mitigate the tax hike impact.
"What we need in Japan more than anything is clarity and trustworthiness of the government. That's exactly what Prime Minister Abe is delivering and that's good news for anybody who has a long-term investment horizon," said Jesper Koll, head of Japanese equity research at JP Morgan Securities Japan.


A weaker currency also lent support as the yen bounced off the previous day's one-month high. Index heavyweight Softbank rose 2.5 percent, chemical producer UBE Industries jumped 5 percent and battery maker GS Yuasa climbed 3 percent.

Stock market gains were also underpinned after sentiment among Japanese big manufacturers improved in the three months to September for a third straight quarter, according to the Bank of Japan's closely-watched Tankan survey.

Sydney down 0.2%
Australian shares ended near session lows in a relatively quiet session after the Reserve Bank of Australia's (RBA) left its main cash rate steady at a record low of 2.5 percent in a widely-expected move.The RBA said it expected below-trend growth to continue in the near term while stressing that a lower currency would help with economic re-balancing.

The Australian dollar rose nearly 1 percent to a session high of $0.9394 after the news.
Energy producers weighed on the index for a second straight session after Brent crude slipped below $108 a barrel. Karoon Gas fell over 5 percent while Woodside Petroleum eased 1.4 percent.

But retailers rallied after a better-than-expected 0.4 percent rise in August retail sales. David Jones closed up 1.4 percent and Harvey Norman climbed over 2 percent .

Kospi adds 0.1%
South Korea's benchmark index inched higher thanks to strong foreign inflows. Foreigners were net buyers of local stocks for 25 consecutive sessions on Tuesday.

Large-cap stocks led gains with Hyundai Motor and Samsung Electronics higher by over 1 percent despite the weaker Japanese currency.

But stock market gains were limited on the back of lackluster economic reports. Central bank data showed September exports falling 1.5 percent from a year ago.

Emerging markets rally
Developing markets posted the biggest gains in the Asian session. India's benchmark added half a percent on the back of positive comments from Economic Affairs Secretary Arvind Mayaram. He said the nation would fully finance the current account deficit and grow 5 percent in the 2013 financial year.

— By CNBC.com's Nyshka Chandran. Follow her on Twitter

@NyshkaCNBC