US stock market daily report (May 15, 2012, Tuesday)

"Collectively, these uncertainties about the future are likely contributing significantly to the tight lending standards in the mortgage market today," Federal Reserve Governor Elizabeth Duke said in a speech Tuesday. "Regardless of what the final contours of the rules are, I think the mortgage market will benefit from having them decided so that business models can be set and investments calibrated." Comments were made by Duke as lenders are being overly conservative when they decide on what loans to make, a situation that is being driven largely by regulatory uncertainty. Contributing to the tightened lending are the uncertainties around litigation risk, mortgage servicing standards, capital requirements and compensation of loan servicers. Duke cited rules being drafted about what mortgages will be exempt from new rules as contributing to the uncertainty of lending practices. A consumer watchdog bureau is in the process of adopting a rule that would identify the criteria and characteristics for 'qualified mortgages' - those deemed by the Dodd-Frank bank reform law that assures a borrower has a reasonable ability to repay the loan.

US stock market daily report (May 14, 2012, Monday)

Ina Drew, the woman who ran JP Morgan Chase & Co.’s chief investment office, which incurred a trading loss of more than $2 billion, has decided to retire, becoming the first high-ranking casualty in a scandal that has dented the bank’s reputation and prompted fresh calls for tighter regulation of large financial institutions. In a statement shortly before the stock market opened on Monday, Morgan Chase said that Drew, who has been at the firm for more than 30 years, will retire as chief investment officer - terms of her retirement were not disclosed in the statement. Her departure was widely anticipated after her office suffered nearly a $2 billion trading loss disclosed last Thursday. It has been reported that she may receive $14.65 million of accelerated equity awards depending on the terms of her departure. As J.P. Morgan holds its annual shareholder meeting on Tuesday, her compensation is likely to be the spotlight. Drew, age 55, is reportedly one of the highest paid women on Wall Street. In 1993, Crain’s New York Business named Drew one of the '40 under 40' executives to watch and at that time, she was working for Chemical Bank, which later bought Chase Manhattan Bank. Matt Zames, co-head of global fixed income in the company’s investment bank and head of capital markets in the mortgage bank, will reportedly replace Drew. Executive Mike Cavanagh will oversee a team task force responsible for responding to the firm’s trading loss, which resulted from a soured hedge on credit derivatives. The final scale of the loss remains unclear, with the bank still in the process of unwinding these trading positions. JP Morgan Chase Chairman and Chief Executive Jamie Dimon issued a statement as he praised Drew for her contributions to the bank, saying: “Despite our recent losses in the [chief investment office], Ina’s vast contributions to our company should not be overshadowed by these events.” Dimon has been a vocal opponent of calls for stricter regulation of the banking industry in the wake of the 2008 credit crisis. Also on Monday Dimon said that his bank is 'very strong and well capitalized'. “We will learn from our mistakes,” he added, with pressure mounting on Dimon, in recent days. Over the weekend, Elizabeth Warren, a candidate for the U.S. Senate from Massachusetts, urged Dimon to resign from the board of directors of the Federal Reserve Bank of New York, a role in which he advises the Fed on oversight and policy for the industry. “We need to stop the cycle of bankers taking on risky activities, getting bailed out by the taxpayers, then using their army of lobbyists to water down regulations,” said Warren, who helped establish the federal government’s Consumer Financial Protection Bureau, in a statement.

US stock market daily report (May 11, 2012, Friday)

By 8:00am ET Friday, J.P. Morgan Chase (JPM:NYSE) shares were sinking, during pre-market trading and were the most active during the session after reporting late Thursday, a $2 billion trading loss that will eat into Q2 results. “Since March 31, 2012, the firm’s Chief Investment Office has had significant mark-to-market losses in its synthetic credit portfolio, and this portfolio has proven to be riskier, more volatile and less effective as an economic hedge than the firm previously believed,” said Chief Executive Jamie Dimon. Dimon said the loss “plays right into the hands of a bunch of pundits out there, but that’s life.” Reportedly, the losses stemmed from trades at the bank’s chief investment office, where a single trader, dubbed the 'London Whale', was reported to have taken large positions for the bank in credit-default swaps. The U.S. Securities and Exchange Commission is investigating whether there were any civil violations around the firms $2 billion trading loss. According to reports, the SEC opened a formal preliminary investigation in recent days into the bank's accounting practices and public disclosures after learning about its trading activities in April.

US stock market, economy and companies update (May 16, 2012)

European indices traded up into positive territory just before the open of US cash trading. Overnight the Greeks officially named an interim prime minister and both Chancellor Merkel and ECB President Draghi reiterated their support for Greece staying in the euro zone. In addition, Merkel may have vaguely hinted on the possibility of more concessions for Greece in an interview with CNBC, and there was also news that outflows of deposits from Greek banks have slowed (yesterday's slide was blamed to a degree on the circulation of news that more than €1B in deposits had left Greek banks in the last week). However the recirculation of news that the ECB might halt overnight lending and other monetary policy operations to certain Greek banks took US and European indices off their highs midmorning.

European stock market, economy and companies update (May 16, 2012)

European equity indices opened the session broadly lower, as indices have been pressured by banks. Additionally, resource-related companies opened lower following cautious comments out of BHP about the outlook for commodity prices. Concerns about Greece have continued to weigh on the markets, following reports from yesterday that the country is expected to hold elections in mid-June. Also, Greek banks have been in focus, amid reports that deposit outflows have accelerated following the recent Greek parliamentary elections. In terms of upcoming event risks, the US Fed is due to release the minutes from its most recent policy meeting later today. Also on Thursday's session, Spain is due to sell 2015 and 2016 bonds.

Russian stock market daily morning report (May 16, 2012, Wednesday)

Trade at the Russian market was inactive yesterday: MICEX added 0.55%, RTS lost 0.07%. After Monday sale on bad news in Greece, market participants decided to wait-and-see. Even the weak data on 1Q 2012 GDP of Italy, which was worse than expected, did not force a new wave of sale. Interest in buying was on the shares of Novatek (+3.1%), Inter RAO (+3%), IRNC. Oil companies shares were for sale: (-2.48% - after the shareholders register closed), preferred shares of Transneft and Tatneft (-10% - after register close).

Asian stock market, economy and companies update (May 16, 2012)

Asian equities continued their slide for the 6th consecutive day as the global economic outlook becomes more clouded. Greece failed again for another day to form a new government and there is chatter that fresh elections will be held on June 17th. Germany and France both reiterated their desire for their Southern neighbor to remain in the EU and Asian leaders voice their concerns about the impact of EU uncertainty on their own countries.

Indian stock market and companies daily report (May 16, 2012, Wednesday)

The domestic markets are expected to open in red tracking negative opening in Asian markets. Asian markets turned in a mixed performance yesterday, as worries prevailed that the European debt crisis could spiral out of control and weigh on global growth if Greece were to exit the euro zone and default on its debt.

Malaysia stock market and companies daily report (May 16, 2012)

Felda Global Ventures Holdings (FGVH) announced that it has signed two agreements with two well-known companies, Netherland-based Louis Dreyfus Commodities and international giant Vitol Group. OSK Research and Hong Leong Investment Bank Research recommended “Buy” call on Kimlun after the company announced its RM148.5 million job to build apartment last week. IOI Corporation announced that it has entered into documentation for the establishment of a euro medium-term note (EMTN) programme with an initial programme size of US$1.5 billion (RM4.62 billion).