ASIA: China soared over 2%, while the rest of Asia lagged. China’s Xi Jinping has been appointed the head of a key military commission, putting him on track to likely be the successor for Hu Jintao. The Globe and Mail refers to him as a ‘princeling and future king‘.The country is also concluding its latest five-year plan, and has emphasised political restructuring as a focus.
Yet on the rare earths front, China allegedly will slash its export quotas by up to 30% next year, according to a government official via China Daily. The government has come out to deny the report however.
For Japan, the yen’s rally seems to have lost steam. The currency has stabilised above 81 and is weakening today, and it could be due to the fact that traders are now net-short the currency according to Morgan Stanley. Japan’s finance minister is nevertheless continuing to make threatening noises about the strong currency.
Ominously, Japan’s government has said that its economy is grinding to a halt and recession ‘is possible’.
EUROPE: Is mixed. France continues to be rocked by violent protests, with now high schoolers doing their part to fight against a proposed change in the retirement age to 62 from 60. It makes us think a debt crisis is inevitable for France, since it’s the only way people will take the problem seriously.
MACRO: The dollar continues to rebound. Note Timothy Geithner came out yesterday and said that the U.S. supposedly won’t devalue the dollar for export competitiveness.
U.S. FUTURES: Are dropping, with the Nasdaq down hard. In case you missed it yesterday, Apple appears to have disappointed market expectations yesterday evening and as we highlighted, the direction of Apple can determine the direction of the entire market these days.
Watch for Housing Starts data at 8:30 AM ET. Also look out for earnings from Johnson & Johnson (JNJ), Coca-Cola (KO), Bank of America (BAC), and Goldman Sachs (GS).