Bloomberg Business
-Stocks tumble: Stocks in Europe have tumbled to their lowest since 2014 this morning with the Stoxx 600 down 2.2 percent at 10:55 a.m. London time, heading for its sixth day of declines. The MSCI Emerging Markets Index fell 0.5 percent overnight in Asia amid light trading as the Chinese Lunar Holiday begins, with South Korea and Taiwan among the markets that are closed. U.S. futures point to a lower open.
-Oil falls: West Texas Intermediate for March delivery was down 74 cents at $30.15 a barrel as of 11:05 a.m. London time, having been as high as $31.34 in earlier trading. The drop in oil comes as the CEO of the world’s largest independent oil-trading house, Vitol Group BV, says he expects prices to remain low for a decade.
-Safe haven: German sovereign debt is climbing again this morning as investors seek safety, with the 2-year note yield falling to minus .517 percent, a record low. Spreads between German and peripheral euro area debt widened, with the yield on Portuguese 10-year bonds jumping 13 basis points to 3.23 percent, the highest since June. U.S. Treasuries climbed, as that debt continues to outperform other major asset classes this year, despite some of the biggest U.S. bond market bears standing their ground. Data from the Japanese Ministry of Finance showed investors in that country bought a net 13.85 trillion yen ($118.2 billion) in U.S. debt in 2015, a record amount.
-Fed negative rates?: If the U.S. economy weakens enough, the Fed may consider pushing rates below zero, according to Bank of America Corp. and JPMorgan Chase & Co. Options on Dec. 2017 eurodollar futures contracts are implying a 13 percent chance of negative rates by the end of next year. With central banks in Japan, the euro area, Sweden, Switzerland, and Denmark showing that negative rates are not hugely disruptive, the Fed will have less to worry about, according to Michael Feroli, JPMorgan’s chief U.S. economist in New York. Federal Reserve Chair Janet Yellen is due to start her semiannual testimony to Congress on Wednesday, with investors looking for any hint as to the Fed’s rate path.
-Ruble hack: Investigators are blaming hackers for a sudden 15 percent move in the ruble-dollar rate in February 2015. The volatility, which lasted 14 minutes and caused the exchange rate to swing between 55 and 66 rubles per dollar, was triggered by hackers deploying a virus known as the Corkow Trojan to infect Kazan-based Energobank and place more than $500 million in orders at non-market rates, said the Moscow-based cyber-security firm hired to investigate the attack.
CNN Money
-Stock market movers — Sharp, Arm, Randgold, Credit Suisse, Chipotle: Sharp (SHCAY)shares had a quiet trading day in Tokyo Monday, despite huge jumps last week on an expected bid by Foxconn, the manufacturer of the iPhone. Sharp is up 51% in 2016. Chip designer Arm (ARMH, Tech30) is the biggest faller in London ahead of results out Thursday. Arm’s fortunes seems tied to Apple as it designs chips for the iPhone. Randgold (GOLD) is up nearly 3% in London on the back of the gold miner reporting «one of the best years in the company’s history,» despite the dire market for commodities. Credit Suisse (CCRSX) shares are down more than 2%. Its new CEO Tidjane Thiam has asked the board to slash his bonus after terrible results released last week. Chipotle (CMG) is closing every store for four hours today for a food safety meeting following an E. coli outbreak that now appears to be over.
-Earnings: Hasbro (HAS) is among the companies posting earnings updates ahead of the market open. Its shares have suffered in recent months while rival Mattel (MAT) enjoyed a Barbie-fueled Christmas rally. Rumors of the two merging have been in the market for weeks. Companies including 21st Century Fox (FOXA), Yelp (YELP) and Leapfrog (LF) will report after the closing bell.
-International markets overview: European markets are down more than 2% in early trading, while the few Asian markets trading today shrugged off North Korea’s rocket launch on Sunday. The Nikkei ended 1% higher on the back of a weakening yen. Investors will also have to wait to respond to news that Chinese foreign exchange reserves dropped $99.5 billion in January to $3.23 trillion, the lowest level since 2012.
– Friday market recap: The Dow Jones industrial average shed 1.3%, while the S&P 500 dropped 1.9% and the Nasdaq was down by 3.3%.
-Global currency collapse: Winners and losers; Russia’s ruble and Mexico’s peso recently hit all-time lows against the dollar. The currencies of Colombia, Argentina and Brazil are all down 28% or more in the past 12 months. Turkey and South Africa have also fallen by double digits over that time. Weak currencies are often a sign of an economic slowdown. China posted its worst growth last year in a quarter century, and Brazil is in its longest recession since the 1930s. These huge currency shifts have also created opportunities and challenges. When a currency falls, it makes a country’s exports cheaper and more attractive to foreign buyers. At the same time imports get more expensive, which can entice locals to buy products made in their own country. Some countries and companies benefit, others lose. At the same time, international travel from countries with higher valued currencies rise, while those from devalued currencies fall.