Financial Markets and Economy
Today Was a Wild Day for the Oil Market (Bloomberg)
Crude prices are tumbling.
Global currency markets are now dancing to China's tune (Business Insider)
It has been a brutal start to the year for markets around the world – for several the worst start in their history.
Stocks, currencies and commodities have taken a hammering.
Asian Futures Signal Rebound as U.S. Gains Crowd Out Oil's Slump (Bloomberg)
Most Asian equities looked set to follow U.S. stocks higher, as the start of the American earnings season takes some of the focus away from concern over China and an oil-driven slump in commodity prices.
Russian Shares and Ruble Fall as Oil Prices Continue to Tumble (NY Times)
Russia’s main stock indexes plummeted on Monday, the first day of trading after a lengthy winter holiday here, as the drop in oil prices cast a pall over the country’s energy-dependent economy.
The retreat for Russian shares was in line with declines on other exchanges around the world in the first week of the year, when financial markets in Moscow were closed for the Eastern Orthodox Christmas holiday.
Why The Smart Money Chases Performance (A Wealth of Common Sense)
The fund I used to work for was invested in an investment manager that performed very well in 2008 when the majority of asset classes and portfolio managers were getting destroyed by the financial crisis and stock market collapse.
2 things could seriously hurt Wall Street banks in 2016 (Business Insider)
Bank stocks are on a tough run.
In a recent note to clients, Deutsche Bank's Matt O'Connor pointed out that the KBW Nasdaq bank index is down 17% from its highs in July last year. It's down 15% since early December, and 9% so far this year.
There are a lot of questions circling, including what to expect going forward in 2016.
The yen rally won’t last, and that could be good news for stocks (Market Watch)
Over the last month and a half, the yen has been one of the best-performing currencies in the world as worries about slowing growth and China and the uncertainty surrounding the likely pace of rising interest rates have weighed on the U.S. dollar.
The yen has risen 4.6% against the dollar since the end of November—and it has risen even further against its rivals on a trade-weighted basis, thanks to the declining Chinese yuan.
The Nasdaq Is on its Worst Losing Streak Since January 2008: Chart (Bloomberg)
Here's another measure of how painful its been to own stocks in 2016.
Are stocks and housing off on another bubble? (EconBrowser)
One of Professor Shiller’s academic contributions was construction of a monthly time series analogous to the current S&P 500 stock price index along with dividends and earnings going all the way back to 1871. One summary he has used for how expensive stocks are at any point in time is the ratio of the inflation-adjusted value of stocks in month to the average real earnings on those stocks over the previous decade, with the averaging helping to standardize the measured P/E with respect to business-cycle fluctuations. The current value of that backward-looking P/E (even with last week’s stock market losses) is 24.4, well above the historical average of 16.6.
The stock market hasn't made sense in 14 of the last 20 quarters (Business Insider)
Earnings are what investors ultimately want out of the companies they invest in. Earnings, and the expectations for earnings growth, are therefore what give stock prices their value.
Alcoa Earnings Top Estimates on Demand for Aircraft Parts (Bloomberg)
Alcoa Inc., the U.S. aluminum producer splitting itself in two amid a commodities rout, reported better-than-expected fourth-quarter earnings as demand grows for components made from the metal.
Under Armour shares slide 8% on concerns company is losing market share (Market Watch)
Under Armour Inc. shares were down 8.4% in Monday trading after the company was downgraded to underweight from equal-weight at Morgan Stanley, with analysts saying they prefer Nike Inc. stock instead.
Train stocks are getting crunched by a one-two commodities punch (Quartz)
Falling oil prices have taken their toll on many things, including inflation, junk bonds,petrocurrencies, and the budgets of entire nations. Another victim? Train traffic. As theFinancial Times notes (paywall), oil shipments by rail have been decreasing as the commodity’s glut keeps building.
But it’s not just oil. Coal usage has been declining for years, and sinking demand for both has shrunk train traffic by the most since 2009.
Keep an Eye on 'Billions' as a Market Indicator (Bloomberg View)
I have a peculiar love for contrary indicators — the weirder, the better. I find magazine-cover indicators, page-view numbers, $100 million food trucks and other oddities strangely compelling. (Here are 169 various discussions on the subject.)
But this is more than mere fetish: Back in 2003, we took a deep-dive look at 20 contrary indicators that suggested markets were reaching a bottom after the dot-com collapse. That turned out to be a timely analysis. Active traders should have more than a passing familiarity with this, since these indicators can at times be clues as to an imminent market reversal.
China Rout Infects Aussie Resource Giants as Bond Risk Surges (Bloomberg)
Australias credit market is having its shakiest start to a year since at least 2008 as the prospects for resource and gaming companies are clouded by China's market turmoil.
Bank of America: Rail Traffic Is Saying Something Worrying About the U.S. Economy (Bloomberg)
Rail carloads are looking recessionary.
Gold Daily and Silver Weekly Charts – Commodities Spanked (Jesse's Cafe Americain)
Gold and silver were sliding lower today, down a bit along with most other commodities which were getting hammered.
Politics
What If Bernie Sanders Is the Democrats' Best Bet? (The Atlantic)
If you’d told most Americans a year ago that Bernie Sanders would be a serious threat to Hillary Clinton in January 2016, they probably would have laughed. (Or asked who Sanders was.) If you’d told them that Sanders would be arguing that he was a better candidate than Clinton because he was more electable, the reaction would have been even more incredulous. She was cautious, sure, and a bit more conservative than some Democrats, but surely she was more palatable to voters than an acerbic democratic socialist from Vermont.
Donald Trump widens lead over Ted Cruz in Iowa poll (Market Watch)
Donald Trump took a slightly expanded lead over Republican rival Ted Cruz in a new poll of Iowa voters, with the first voting contest of the 2016 presidential primary season just three weeks away.
Trump edged up to 31% support from likely Iowa Republican caucus-goers in the latest Quinnipiac University poll, after pulling in 28% in the same survey in December. His new standing puts him two points ahead of Cruz, a Texas senator, versus one.
Italy's Berlusconi calls for elections, vows to oust Renzi – paper (Reuters)
Former Italian prime minister Silvio Berlusconi pledged to relaunch his Forza Italia party this year and force out the centre-left government of Matteo Renzi, according to an interview with daily Il Giornale on Saturday.
Berlusconi, 79, has kept a low profile since he was convicted of tax evasion and banned from public office in 2013, but promised to return to the front lines of Italian politics and strengthen his party, which he said was weakened by his absence.
Technology
R.I.P., BlackBerry OS (VentureBeat)
It’s too early to know if BlackBerry’s Priv Android smartphone will save the company’s hardware division, but the few crumbs of evidence we’ve seen so far are encouraging. And the first victim of this potential success will be the company’s own homegrown platform, BlackBerry 10.
This Self-Driving Car Comes With Its Own Drone (Popular Science)
Rinspeed Auto's founder has been innovating for awhile. But with the self-driving car revolution just starting, we got a look at a concept car called the Rinspeed Auto Etos at CES 2016. Not only does it self-drive, it syncs with a bunch of applications, has a retractable steering wheel, 8 on-board cameras, and the big kicker — a built-in DRONE!
Health and Life Sciences
When Good Medicine Mixes With Bad (NY Times)
We like to think that bad and good medicine are easy to distinguish. A huge construct of education, licensure and regulation depends on that single, simple premise. And yet, perhaps more often than not, the good and the bad swirl together like cream poured into coffee, almost impossible to separate.
Some years ago, a patient of mine was admitted to the hospital for an exacerbation of her longstanding asthma. She was in her 50s, but unlike most of us who accumulate illnesses as we age, she was shedding them. She had been a sick young woman, with late-stage AIDS and the recurrent infections that go with that diagnosis.
Illumina Launches Firm to Pursue Gene-Based Cancer Blood Test (Wall Street Journal)
Illumina Inc., seeking to build on its strength in DNA sequencing, is launching a new company that will develop and market a test to detect genetic evidence of cancer in the blood.
The San Diego maker of gene-sequencing machines said Sunday it is forming the company, called Grail, with a group of other investors, marking the latest bet that so-called liquid biopsies will become a major tool for detecting, diagnosing and managing treatment of cancer.
Life on the Home Planet
Giant icebergs store high levels of carbon (Futurity)
Melting water from the icebergs, which contains iron and other nutrients, supports unexpectedly high levels of phytoplankton growth. This activity, known as carbon sequestration, contributes to the long-term storage of atmospheric carbon dioxide—helping to slow global warming.
Satellites dissect Nepal quake (BBC)
The deep anatomy of last year's devastating quake in Nepal is revealed in a new analysis by scientists.
Satellite data is used to show where and how the rocks ruptured under the country, leading to the loss of more 8,800 lives.
