Recap 11-15-13




  • US Empire Mfg declined to -2.2 vs 5 exp and 1.5 prev
  • Leaked plenary documents helped spark an equity rally in China. The leak was later confirmed by official headlines. The document said China will implement reforms on the pricing of water, oil, nat gas, electricity, telecoms, and transportation. In addition, Beijing will push forward w/exchange rate and interest rate reforms while SOEs will be reigned in. Finally, farmers will be given more property rights. Upcoming events are 2014 growth targets and the debt audit.
  • A number of new Chinese policy initiatives were reported earlier. h/t FTA:
  1. China will abolish the “reeducation through labor” system. Laws relating to correction and punishment will be improved. Community-based correction which helps convicts return to society will also be improved. The country will work to ban extorting confessions through torture and physical abuse, the document said. Courts will be told to tighten the practice of ruling out illegally obtained evidence, while law enforcement agencies will regulate procedures of sealing up, seizing, freezing and handling properties involved in judicial investigations.
  2. China will open up the banking sector wider, on condition of strengthened regulation, by allowing qualified private capital to set up small- and medium-sized banks
  3. Thirty percent of the gains of China’s state-owned capital will have to be handed back to the government by 2020. At present, the proportion ranges from zero to 15 percent.
  4. transfer a portion of SOE shares to social pension funds, raise dividend paid to public finance to 30pct by 2020
  5. Farmers will be given more protection of their property rights and enjoy bigger freedom to sell their land.
  6. The Chinese are also looking at setting up a separate court for intellectual property rights.
  7. Accelerate legislation of property tax and proceed at appropriate time

Upcoming Data:

  • Mon: NAHB Housing Market Index, RBA Minutes
  • Tue: German ZEW, Bernanke Speaks
  • Wed: BoE Minutes, US Retail Sales, Dudley Speaks, US Existing Home Sales, FOMC minutes, China Flash Mfg PMI, BoJ
  • Thu: EU PMI, RBA Governor Stevens speaks, US Jobless Claims, US Markit Preliminary PMI, US Philly Fed, EU Consumer Confidence