The (early) Lunch Wrap | FT Alphaville

The (early) Lunch Wrap

Good morning New York,

FT ALPHAVILLE

Paralysis in Cairo: Joseph notes the website of the Egyptian stock exchange is down as the death toll in Egypt keeps rising and the economic damage mounts.

NEWS

Japan’s government upgraded its economic outlook, saying an end to deflation is approaching. The latest monthly economic statement had the most upbeat view of prices for nearly four years. The government also revised up its assessment on the job market to say it is “improving,” as falls in the yen falls. (Reuters)

State of emergency declared in Egypt; scores dead: “Egypt’s security services on Wednesday stormed two Cairo protest camps housing thousands of Islamists, killing scores and igniting a wave of violence across the Arab world’s most populous country that raised the spectre of further chaos.” At least 235 people were killed in Wednesday’s violence and 1,403 injured, according to the Egyptian Health Ministry. The decision to storm the camps appeared to eliminate what limited hope there might have been for political reconciliation in Egypt following the military taking power last month.”(Financial Times)

India curbs outward investment to help rupee: In its latest move to bolster the rupee the Reserve Bank of India cut the maximum outward direct investment allowed for future deals to a quarter of the old level, reducing it to 100 per cent of the net worth of the Indian investor from 400 per cent unless special permission is granted. State oil companies are excluded from the new restrictions. (Financial Times)

“US prosecutors filed criminal charges against two former JPMorgan Chase traders alleging that they falsified the bank’s books to hide its multibillion-dollar “London whale” trading losses.” (Financial Times)

Cisco cuts jobs, sees poor Asia demand continuing: The company’s shares fell almost 10% in after-hours trade after it announced it was cutting 5% of its workforce, or 4,000 jobs. the company revealed lower than expected sales expectations for the next quarter, particularly in Asia. Sales in China and Japan fell 3% last quarter and orders for the next quarter were down by the same amount. (Financial Times)

Michigan muni fund lost 5% of assets as Detroit went bust: “The biggest Michigan-focused municipal-bond fund lost 5 percent of its assets to net withdrawals last month as Detroit sank into bankruptcy, according to Morningstar Inc. Investors took $66 million from the $1.3 billion Franklin Resources Inc. (BEN) portfolio, Morningstar said yesterday in a report. It said muni-bond funds shrank by $10.2 billion in July, half by those holding intermediate- and long-term bonds.” (Bloomberg)

Chinese regulator may target more sectors for price probes: “The National Development and Reform Commission (NDRC) would look at industries that have an impact on the lives of ordinary Chinese, China Central Television (CCTV) quoted Xu Kunlin, head of the anti-monopoly bureau at the NDRC, as saying… Companies in the petroleum, telecommunications, banking and auto sectors were on the NDRC’s radar for future investigations, CCTV’s official blog quoted Xu as saying.” (Reuters) Meanwhile an investigation of drug pricing and corruption in the pharmaceuticals sector has intensified. (Financial Times)

Exxon wants to sell part of Iraqi oil field stake to PetroChina: “The request, which is subject to review by Iraq’s cabinet before a sale process can begin, comes amid Baghdad’s displeasure over Exxon’s decision to strike separate exploration deals with the semiautonomous Kurdistan region in the country’s north.” (Financial Times)

RWE to close plants as profit drops: “German utility RWE said it would shut down around 6% of its total power-generation capacity as a drop in electricity demand due to the recession and competition from renewable energy hit profit.” (WSJ)

Cisco warned that global demand for IT equipment and services continued to be unstable and the computer networking company would cut 5 per cent of its workforce in response. (Financial Times)

IAG places $5.4bn order with Airbus for Vueling expansion: IAG, parent of British Airways and Iberia, also outlined options to buy up to 58 more narrow-body aircraft for Vueling, as it seeks to provide strong competition for low-cost carriers led by Ryanair and easyJet. (Financial Times)

Markets: The FTSE Eurofirst 300 is seeing a 0.5 per cent loss after another slide in Tokyo hit sentiment in Asia. US index futures suggest Wall Street’s S&P 500 will shed four points to 1,681, not helped by a poorly-received earnings report by IT services and equipment group Cisco. The euro is up 28 pips to $1.3283, supported by news this week that the single currency bloc has emerged from an 18-month recession. Such news had helped global stocks flirt with fresh five-year highs and pushed the S&P 500 to a record level at the start of August. Industrial commodities had bounced, too writes the FT’s Global Markets Muad’Dib Jamie Chisholm.