Mr. Chandler's is:
Investor Anxiety Continues to Run High Despite Some Stability in the Capital Markets
From Marc to Market:
Overview: News that the AstraZeneca Phase 3 test had to be stopped to study the adverse reaction of one subject added to the uncertainty of investors amid one of the more significant reversals of risk appetites since March. Equities continued to slump in the Asia Pacific region, with many large markets off more than 1%, led by Australia's more than 2% decline. However, European equities are moving higher, and the Dow Jones Stoxx 600 is up about 0.8% in late morning turnover that that seen nearly all the main industry groups advance. Energy, consumer staples, and communication service sectors are the strongest. US shares are firmer, and the early call is for the S&P 500 to open around 0.6% higher. Benchmark 10-year yields are mostly lower, with the US near 68 bp. The greenback is mixed. The dollar-bloc currencies are posting small gains, while sterling is the weakest, holding below $1.30 today. Emerging market currencies are mostly weaker, though the South African rand is recovering from yesterday's disappointing-GDP induced slide and the Russian ruble is also a little stronger. Gold held above $1900 in yesterday's slump but is consolidating today in nearly a $5 range on either side of $1930. Oil prices are also tentatively stabilizing after a four-day slide that took the October WTI contract from almost $43 to near $36.....MUCH MORE
Asia Pacific
China's inflation challenge has been primarily about food prices, and these have begun easing. Headline August CPI eased to 2.4% from 2.7% in July. Pork prices slowed to 53% year-over-year, which is the smallest increase in a year. Overall, food price inflation slowed to 11.2%. Non-food prices rose a mere 0.1%. Core prices, excluding food and energy, rose 0.5% in August year-over-year, the same as in July. Further moderation in headline inflation is likely due to the base effect and the rebuilding of the Chinese pork industry after the swine flu forced a culling of herds. Meanwhile, producer deflation moderated to -2.0% from -2.4%. It does not seem that the high food prices were the main deterrent to more aggressive PBOC policy, so today's CPI is unlikely to change the outlook. Gradual and targeting easing of policy is likely to continue.
No country that has a current account deficit has adopted negative policy rates. The UK curve is negative out through seven years as the BOE continues to keep this card in play. However, New Zealand appears to be readying the market for such a move, and today for the first time, swap rates have gone negative. The RBNZ meets on September 22....
