Morning Memo: Wednesday, August 21, 2013

"Morning Memo" begins below this "NOTE for  NEWCOMERS" to "Morning Memo"...... Each morning, we post a short bullet-point list of noteworthy events, data, etc that find their way into the assessment of global markets.  It's far from complete and is not meant to be an exhaustive reconciliation of all things that could possibly impact stocks, bonds, currencies and commodities!  Rather, it's best viewed as a cryptic memo of "highlights", noteworthy items that took place in Asia, European and US hours.....and color-coded 'Red' for seemingly negative impact on equity markets, 'Green' for positive.
This will also serve as a useful review mechanism, as scrolling through the series of "Morning Memo" posts over time ought to summarily highlight what generally drove price action.  
We hope you find this useful and informative....and as always, that you'll share feedback!!
5:30am, ET....

• Asia markets mixed ahead of this afternoon's (2pm ET) release of minutes from the last Fed meeting.  Nervousness over imminent tapering has hammered many currencies in the region along with their stock markets in recent days.  Indonesia's equities, after massive loses in the past few days, rebounded 1.6% on stronger than expected consumer confidence data.  Nikkei and Shanghai up slightly, others lower.  Action overall muted ahead of the Fed.
• Japan's nuclear regulatory agency is reported to be considering raising the Fukushima plant leak status to 'serious' level 3, from level 1 (8 point scale).  (Editorial comment:  Notable clearly for Tepco shares, but also for the ongoing concern this creates over nuclear power in Japan and elsewhere).
• India's markets rebounded on a move by the Reserve Bank of India to inject liquidity into the system w/open market operations.  Recent moves to tighten rates in defense of the falling Rupee have hit holders of long bonds with big mark-to-market losses (especially banks).  To relieve some pressure on banks, the RBI will buy some securities in the open market and has made some other bank related relief moves.  Markets responded positively.
• Thailand..kept rates unched @ 2.5% despite data earlier this week showing the economy formally in recession.  The Bank of Thailand said they're concerned about rising levels of household debt (editorial note: private credit growth throughout Asia is something to keep an eye on). They've also experienced weakness in the Bhat and strong loan growth.
• Europe markets opened mixed but mostly lower in muted mode ahead of the Fed.
• Mexico...yesterday reported Q2 growth contracted, first time in four years, largely due to slowing exports to the US and lower government spending.
• US Existing Home Sales better than expected but lower than prev month.
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• Fed Minutes released:  minutes show broad agreement with the Bernanke plan of contingent tapering, likely to begin with improving economic growth as we approach yearend, but no new wording on imminent moves.  Equities initial response was to sell off.  Summary of minutes on MarketWatch and on CalculatedRiskBlog.
• more later...

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