Global News August 07, 2017

  1. BBC
  2. Global News August 07, 2017

“U.S. Stocks Drift Higher, Energy Weighs on Indexes: Markets Wrap”

U.S. stocks were slightly higher Monday, continuing their record run, despite a decline in energy stocks. Crude dropped as major oil producers gathered to discuss participation in output cuts. The dollar continued to climb, while the euro also rose.
The greenback initially struggled to maintain its positive momentum against G-10 peers, before gradually strengthening. European equities slipped after a report showed German industrial data unexpectedly fell in June, with declines in travel and leisure shares offsetting advances for ArcelorMittal and Anglo American Plc after iron ore and steel prices climbed. West Texas Crude futures dipped below $49 a barrel as producers gathered in Abu Dhabi. The euro’s continued resilience is a testament to growing investor confidence in the growth story of the European Union amid disappointment over U.S. President Donald Trump’s failure get tax reform and infrastructure spending plans off the ground. Monday’s report from Germany is unlikely to mark a turning point for either the nation’s economy or the wider bloc, which has successfully navigated a series of political challenges while expansion accelerates.


“North Korea vows to retaliate against US over sanctions”

North Korea has vowed to retaliate and make «the US pay a price» for drafting fresh UN sanctions over its banned nuclear weapons programme.
The sanctions, which were unanimously passed by the UN on Saturday, were a «violent violation of our sovereignty,» the official KCNA news agency said. Separately, South Korea says the North has rejected an offer to restart talks, dismissing it as insincere. The sanctions will aim to reduce North Korea’s export revenues by a third. The UN Security Council decision followed repeated missile tests by the North which have escalated tensions on the peninsula. In its first major response on Monday, North Korea insisted that it continue to develop its controversial nuclear weapons programme.
The state-run KCNA news agency said Pyongyang would «not put our self-defensive nuclear deterrent on the negotiating table» while it faces threats from the US. It threatened to make the US «pay the price for its crime… thousands of times,» referring to America’s role in drafting the UN sanctions resolution. Speaking to reporters at a regional forum in the Philippine capital, Manila, North Korean spokesman Bang Kwang Hyuk said: «The worsening situation on the Korean peninsula, as well as the nuclear issues, were caused by the United States.


“Samsung chief on trial: Prosecutors want 12-year jail sentence”

The de facto leader of the Samsung business empire could face up to a dozen years behind bars if prosecutors get their way. They presented their closing argument in South Korea’s «trial of the century» on Monday, portraying Samsung’s Lee Jae-yong as a savvy tycoon who knew exactly what he was doing when the conglomerate paid tens of millions of dollars to entities linked to a confidante of the country’s former president.
Lee, the 49-year-old son of Samsung’s ailing chairman, has pleaded not guilty to charges of bribery, perjury, concealing criminal profits, embezzlement and hiding assets overseas. He’s accused of playing a key role in an influence-peddling scandal that led to the ouster of former President Park Geun-hye. The prosecution says Lee – who also goes by the name Jay Y. Lee – bribed Park and her friend, Choi Soon-sil, in order to win government support for an important merger that would cement his leadership of the conglomerate.
In his final statement to the court on Monday, Lee said he had been falsely accused of wrongdoing.
«I have never asked the president for a favor for my private interest or for my own personal gain,» he said, fighting back tears. The court said it will announce its verdict on the case on August 25.


Zero Hedge
“China’s Reserves Continue to Decline as Capital Outflows Accelerate, «Outbound Travel Spending» Surges”

The confusion over the direction of Chinese capital flows continues to grow. On one hand, overnight the PBOC reported that China’s foreign-exchange reserves «posted a sixth straight monthly increase» as the yuan strengthened and economic growth remained robust, Bloomberg reported. Specifically, Beijing said that China’s foreign currency stockpile rose $23.9 billion to $3.081 trillion in July, higher than the $3.075 trillion estimate. The narrative was ready to go: as Bloomberg stated, «solid economic data and the presence of curbs on moving money abroad have helped restore confidence in the currency and ease outflow pressure. The foundation for steadier cross-border capital flows has become more solid, the State Administration of Foreign Exchange said last month.»
On the other hand, there was just one problem with the above assessments of China’s inflows: they are all completely incorrect. While those, such as the «experts» listed above may be left with the impression that China has managed to put a lid on its relentless capital outflow pressure, using a separate gauge compiled by China’s SAFE which tracks onshore FX settlement as well as cross-border RMB flows, shows something vastly different: as calculated by Goldman, China has not had a single month of FX inflows since its mid-2015 Yuan devaluation.


The Guardian
“Kenyan police to flood streets as country braces for election violence”

An estimated 180,000 police officers and members of the security forces are being deployed across Kenya as the country prepares to vote on Tuesday in a fiercely contested presidential election.
Voters will either return the incumbent, Uhuru Kenyatta, who has been in power since 2013, or elect the veteran opposition politician Raila Odinga. Recent opinion polls have not indicated any clear leader in the campaign and turnout will be a key factor.
The country is braced for widespread unrest whoever wins, after a campaign marred by hundreds of violent incidents – including the murder of a high-profile election official – issues with new voting technology and widespread concerns about fraud.
A contested poll in 2007 led to more than 1,000 deaths, and violence could sweep the country again if the losing party refuses to accept the result. Local elections for appointments as governors, members of the lower house, senators, county officials and women’s representatives involve 16,000 candidates and are seen as potential flashpoints.