Financial Markets and Economy
Little reaction on stock market as Fed leaves rates low (AP)
The U.S. stock market didn't react much to the Federal Reserve's decision to hold off on raising interest rates. Bond prices moved higher.
The Fed's decision, which was announced Thursday afternoon at the end of a two-day policy meeting, was widely expected among investors.
The Dow Jones industrial average was up 56 points, or 0.3 percent, to 16,795 at 2:14 p.m. Eastern time, shortly after the Fed released its policy statement.
Breaking News: Fed announcement on interest rates (Yahoo Finance)
Following the conclusion of a closely watched meeting, the Federal Reserve is keeping interest rates at record lows, citing a weak global economy, low inflation and instability in financial markets.
"Recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term," the FOMC said in a statement released at the conclusion of its two-day meeting.
Still, the Fed noted that the U.S. economy continues to expand at a moderate pace and that inflation expectations have been muted. It said the housing sector has shown further improvement. It also noted improvedments in the labor market saying "On balance, labor market indicators show that underutilization of labor resources has diminished since early this year."
UBS: Long Bonds Will Sell Off Today Whether the Fed is Very Dovish or Hawkish (Bloomberg)
Traders will tell you that there's nothing worse than making the right call but not being able to make any money off of it.
So as the 'will they or won't they' debate stretches into the eleventh hour, it's a good time to examine how Wall Street expects the market to react to an array of potential Federal Reserve outcomes.
The Fed can't ignore China this time (Business Insider)
The biggest interest rate policy announcement in years is almost here.
At 2:00 p.m. ET on Thursday, the Federal Reserve will announce the outcome of its two-day monetary policy meeting, and they will reveal whether or not they chose to raise interest rates for the first time in nearly a decade.
The World Awaits the Fed (Bloomberg)
After much anticipation, today the world will learn if the Fed is going to raise rates or not, as most traders and economists think. It’s day two of the Federal Reserve’s two-day meeting on interest rates and at 2 p.m. Washington we’ll get the word. Fed chair Janet Yellen will speak 30 minutes later.
Puerto Rico’s Debt Rescue Plan Called Into Question (NY Times)
A week after the governor of Puerto Rico laid out a plan for attacking the island’s heavy debt, analysts are beginning to publicly question the proposals and even the financial assumptions on which they are based.
The doubts suggest that Gov. Alejandro García Padilla’s strategy to persuade bondholders and other investors to voluntarily help the island restructure the debt — and take losses on their investments as a result — is a long shot.
Futures are going nowhere ahead of the Fed (Business Insider)
The day is finally here, and ahead of the Federal Reserve's policy announcement Thursday afternoon, stocks are going nowhere.
Near 6:40 a.m. ET, Dow futures were down 20 points, S&P 500 futures were down 3 points, and Nasdaq futures were down 4 points.
It's a busy day for the US economy. Economic data on housing starts, building permits, and initial jobless claims are due.
How has the shift to defined contribution plans affected saving? (Market Watch)
Many commentators – ourselves included – assert that people are saving less for retirement as a result of the shift from defined benefit to defined contribution plans. To support such an assertion, it would be nice to have counterfactual data showing what the world would look like today in terms of retirement saving if workers were still covered by defined benefit plans and compare that saving with actual contributions to defined contribution plans. But these data do not exist. Furthermore, even if these data did exist, today’s more mobile workforce would make defined benefit plans a less effective way to save for retirement than they were in the past. So such an exercise simply is not feasible.
European Stocks Increasingly Seen as Safe Haven as Fed Decision Looms (Bloomberg)
European equities, shunned by foreign investors during most of the region's debt crisis, are now increasingly seen as a "safe haven" for investors seeking a shelter from the slowdown in emerging markets and ahead of Federal Reserve's interest rate decision.
Oil gives back some gains ahead of Fed decision (Market Watch)
Oil prices fell Thursday, on the heels of big gains, as market participants grew wary ahead of the U.S. Federal Reserve’s decision on interest rates.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in October CLV5, -1.02% moved under $47 a barrel, dropping 62 cents, or 1.3%, to $46.54 a barrel. November Brent crude LCOX5, -1.43% on London’s ICE Futures exchange fell 66 cents, or 1.3%, to $49.07 a barrel.
China lost the entire GDP of the UK in 22 days (Business Insider)
The Bank of England has a great post on its Bank Underground blog which helps explain just how big the Chinese stock market rout is.
The post, by Fergus Cumming in the Bank’s Monetary Assessment and Strategy Division, breaks down the £1.7 trillion ($2.6 trillion) wiped off the Shanghai and Shenzhen Composite indexes in the initial 22-day summer market rout this year.
U.S. Index Futures Decline as Investors Await Fed Decision (Bloomberg)
U.S. stock-index futures declined as investors prepared for todays Federal Reserve decision on interest rates.
Dollar holds to tight ranges ahead of Fed policy decision (Market Watch)
The dollar was almost flat against the yen and the euro in quiet Asia trade Thursday, as investors anxiously waited to see if the Federal Reserve would raise interest rates for the first time since 2006.
The greenback USDJPY, +0.27% was at ¥120.63, compared with ¥120.58 late Wednesday in New York. The U.S. currency was unchanged against the euroEURUSD, +0.3365% , which was changing hands at $1.1297 midday from $1.1294 late Wednesday.
U.K. Stocks Retreat as Caution Sets in Before Fed Rate Decision (Bloomberg)
The FTSE 100 Index fell before a landmark decision later today from the Federal Reserve.
China’s holdings of U.S. Treasurys drop $30 billion in a month (Market Watch)
China is still the leading holder of U.S. Treasurys with $1.24 trillion in holdings in July but the country is estimated to have sold at least $30.4 billion in a span of one month as it aggressively intervened in the foreign exchange market to prop up the yuan, according to data released on Wednesday.
“The headlines regarding Chinese selling of Treasurys were most prolific in August, especially following the devaluation of the yuan in mid-August. This data suggests that they were ramping up liquidations before making the announcement,” Ward McCarthy, chief financial economist at Jefferies, said in a report.
Economic Takeaways of Singapore's Falling Exports and Home Sales (Bloomberg)
The Takeaway: Exports weakened across most major products and destinations, possibly as a result of the reduced number of working days in August as the country took a four-day weekend to celebrate its 50th anniversary. Non-oil domestic shipments fell for a second straight month, suggesting manufacturing remained lackluster in the third quarter and a potential warning for those watching for a technical recession and monetary easing. Singapore’s economy contracted in the three months through June.
Shale Oil's Retreat Threatens to Leave U.S. Short on Natural Gas (Bloomberg)
The retrenchment in drilling for U.S. oil is threatening to leave a different market short: natural gas.
Another big U.S. company gets hit by global slowdown (CNN)
FedEx is starting to feel the pain from the global slowdown.
The massive package shipping company lowered its performance outlook for the year right before the crucial holiday shipping season. The problem: the weak global economy and strong U.S. dollar.
China's Stocks Resume Losses Amid Uncertainty Over State Support (Bloomberg)
Chinas stocks fell for the third time in four days, led by material companies, as volatility jumped amid uncertainty over state support for equities.
Intervention amplified losses for ETFs tracking China mainland (Business Insider)
Just as China shows that its domestic stock market can be something of a one-way street — investors can put money in, but not take money out – the biggest mutual fund company, Vanguard Group, is moving ahead with plans to expose more mom-and-pop investors to the country's heavily restricted exchanges.
With the Shanghai stock exchange down by 37 percent and the Shenzhen exchange off by 43 percent during the past three months, compared with just an 18 percent drop on Hong Kong's Hang Seng Index, Vanguard is adding China mainland stocks to its $60 billion emerging markets fund in the coming year.
Politics
Trump vs. Carly: Battle of the Republican CEOs (CNN)
From the start, the CNN Republican debate was a battle of the CEOs. Donald Trump and Carly Fiorina came out firing, especially at each other.
Trump called Fiorina one of the worst CEOs of all time. "She can't run any of my companies," he said.
Obama Hints at Sanctions Against China Over Cyberattacks (NY Times)
President Obama warned on Wednesday that his administration was ready to take action against China over online attacks carried out by Beijing or its proxies, publicly raising the specter of sanctions a week before President Xi Jinping arrives in the United States for a state visit.
“We are preparing a number of measures that will indicate to the Chinese that this is not just a matter of us being mildly upset, but is something that will put significant strains on the bilateral relationship if not resolved,” Mr. Obama said in a question-and-answer session with business leaders on economic issues. “We are prepared to take some countervailing actions in order to get their attention.”
Technology
iRobot's New Roomba Is A Cartographer And Has Its Own App (Fast Company)
Move over, Lewis and Clark. iRobot's new Roomba vacuum cleaner is a cartographer.
At first glance, it might seem a little underwhelming to the vacuumers of the world that the latest product from iRobot, the Roomba 980, boasts internal mapping as a key new feature. But it's such a leap forward that CEO and cofounder Colin Angle evokes Lewis and Clark when discussing the achievement.
Timex's Next Smartwatch Focuses on Just Fitness Tracking (Gizmodo)
About a year ago Timex revealed its One GPS+ smartwatch that squeezed GPS, messaging, 4GB of storage, and its own independent 3G connection into a fairly chunky timepiece. But with its Metropolitan+, Timex’s next smartwatch instead focuses on fitness tracking and style.
Pricing and availability hasn’t been revealed just yet, just a 2015 timeline, but the Metropolitan+ is bound to be cheaper than the feature-packed One GPS+ which sold for $400. And thanks to its analog, and dare we say stylish, facade, you won’t have to swap out your timepiece when you need to look more corporate, and less extreme athlete.
Amazon announces new 7-inch Fire tablet that only costs $50 (The Verge)
Amazon tablets are going the way of the e-reader.
One of the new tablets from the e-commerce giant is a 7-inch tablet — simply called the Fire tablet — that costs $50. That's right: for a cool Ulysses, a new Amazon Fire tablet can be yours.
In fact, Amazon is so convinced of this inexpensive Fire tablet's role as a utility that it's offering it in a six-pack. Buy five, and you'll get the sixth tablet free. Who's the cool dude rolling up to the party with a six-pack of tablets, or the person playing Santa Claus at the next holiday gathering? You with the $50 tablet, that's who.
Health and Life Sciences
Surprising cause of early deaths: Air pollution (CNN)
The air we breathe outdoors could be harming more people than ever, a new study suggests.
Globally, more than 3 million people die prematurely each year from prolonged exposure to air pollution, according to the World Health Organization. By 2050, it could be 6.6 million premature deaths every year worldwide, a new study predicts.
Diabetes in toddler raises concern (BBC)
The case of a three-year-old girl in the US who developed type 2 diabetes has driven doctors to raise fresh concerns about diet in childhood.
The child had a version of the illness more commonly seen in older people.
She weighed 35 kg (5.5 stone) when she saw specialists. And experts believe an unhealthy diet and lack of exercise played a large role in her condition.
Life on the Home Planet
Blood and Human Trafficking in the Dustbowl of Libya (Time)
In the southwestern corner of Libya, deep in the arid hinterland of the Sahara desert, there is a city where the state’s slow motion collapse has precipitated a deadly tribal conflict. The city is named Ubari, in the southern district known as the Fezzan, and the battle between the Touareg and Tubu tribes encompasses not just the failure of Libya, but also the challenges facing North Africa as unrest in Nigeria, Mali and Niger drive streams of migrants north towards Europe.
Melting Arctic sea ice accelerates methane emissions (Phys)
Methane emissions from Arctic tundra increase when sea ice melts, according to a new study from Lund University in Sweden. This connection has been suspected before, but has lacked strong evidence until now.
"Changes in the Arctic Ocean can affect ecosystems located far away on land, " says Dr. Frans-Jan Parmentier, the study's lead author and researcher at the Department of Physical Geography and Ecosystem Science, Lund University.
