Photo: flickr / alex 1560
Good morning. Here’s what you need to know.
- Asian markets were mixed in overnight trading, with the Japanese Nikkei up 1.4 per cent and the Shanghai Composite falling 1.8 per cent. European stock markets are also mixed, with France and Italy trading lower. In the United States, futures point to a negative open.
- Newly-elected Japanese Prime Minister Shinzō Abe introduced a new fiscal stimulus package totaling ¥10.3 trillion – roughly $117 billion – with the stated objective of boosting real GDP by 2 percentage points and creating 600,000 jobs. Earlier in the day, Abe suggested that the Bank of Japan should consider targeting unemployment, causing the yen to plunge.
- Japan’s current account swung to a massive deficit of -¥222.4 billion in November after recording a big surplus of ¥376.9 billion only one month before. Economists expected a much smaller deficit of -¥17.1 billion.
- China’s consumer price index rose 2.5 per cent in December from the previous year, accelerating from 2.0 per cent year-over-year growth the previous month and marking higher inflation than the 2.3 per cent expected by economists. Higher food prices and cold weather are partly to blame, and could cause China to reconsider any potential interest rate cuts in the coming months.
- The rate of contraction in Spanish industrial production unexpectedly accelerated to a staggering 7.2 per cent in November, well below the 3.1 per cent decline in the previous month. Economists had expected the rate of contraction to ease to 1.5 per cent. The data highlight the futility of high hopes for a quick turnaround in the eurozone economy.
- U.K. industrial production also contracted more than expected in November, falling 2.4 per cent from the previous year after recording a 3 per cent year-over-year decline the previous month. Economists expected the contraction to narrow to 1.8 per cent. Manufacturing production fell 2.1 per cent year-over-year versus forecasts of a 1.3 per cent decline.
- Angela Merkel and other EU leaders travel to Cyprus to discuss next year’s EU budget amid tense negotiations with the tiny island nation over a bailout of its banking system. Merkel declared earlier in the week that Cyprus would not receive “special treatment” for its bailout and would have to comply with tough austerity measures undertaken in other “program” countries.
- Investors staged one of the biggest moves into stocks of all time this week. Total equity inflows were the second-largest ever, while inflows into emerging market equities were the biggest in history. Inflows into long-only equity funds were the largest since March 2000.
- Wells Fargo – the second big name of this earnings season – is set to report financial results for Q4 2012 this morning before the opening bell. Analysts expect the bank to announce earnings of $0.89 per share and $21.29 billion in revenues.
- U.S. trade balance balance data for the month of November is due out at 8:30 AM ET. Economists expect the trade deficit to narrow slightly to $41.3 billion from $42.2 billion the month before. Follow the releases LIVE on Business Insider >
- BONUS: TMZ reports that Demi Lovato has been residing in a sober living facility for more than a year.
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