U.S. Budget, Fed, Tankan, BlackBerry: Week Dec. 16-21

The U.S. Senate will vote this week on a bipartisan committee’s $1.01 trillion budget agreement following its approval by the House. The proposal doesn’t touch Democrat-favored entitlement programs or corporate-tax breaks that Republicans want to protect.

German Chancellor Angela Merkel will be sworn in for a third term after the country’s Social Democratic Party agreed to a coalition with her Christian Democratic bloc over the weekend.

The Federal Open Market Committee will release its policy statement.

The Bank of Japan quarterly Tankan index will probably show a growing economy and weaker yen improved business sentiment.

A third round of trade talks between the U.S. and European Union will be held in Washington.

BlackBerry Ltd. plans to update analysts on its strategy and structure after reporting earnings.


-U.S. budget vote. The Senate plans to vote this week on a bipartisan committee’s budget agreement reached Dec. 10 that would set U.S. spending at about $1.01 trillion for this fiscal year, reduce the budget deficit by $23 billion, and ease automatic spending cuts by $63 billion over two years. The House passed the bill 332-94 on Dec. 12 after Speaker John Boehner and House Majority Leader Eric Cantor voiced their support. Day and time to be determined. In Washington.

-U.S. industrial production probably rose in November as manufacturing bolstered the economy, according to a Bloomberg survey of economists. The Federal Reserve releases the data at 09:15 in Washington.

-U.S.-EU trade negotiations. The third round of talks with the 28-nation European Union will be held in Washington as both sides aim to harmonize rules on autos, chemicals and other products. Agriculture and Internet privacy may be the biggest areas of contention. Negotiators seek to complete a deal, covering an area with $32 trillion in annual output, by the end of 2014. Companies, unions and other groups with a stake in the outcome will brief negotiators and reporters on Dec. 18. Assistant U.S. Trade Representative Dan Mullaney and his EU counterpart, Ignacio Garcia Bercero, will hold a press conference on Dec. 20. Times to be determined.

-European Banking Authority to release data on bank capital levels and assets. The EU regulator, which isn’t conducting stress tests this year, will disclose more than 2,500 data points on each financial institution on subjects including sovereign-debt holdings and risk-weighted asset calculation. 17:00 in London (12:00 EST)

-European Central Bank President Mario Draghi speaks to the Economic and Monetary Affairs Committee of the European Parliament. Brussels 15:00 (09:00 EST)

-German coalition agreement to be signed by Chancellor Angela Merkel, Social Democratic Party Chairman Sigmar Gabriel and Horst Seehofer of Bavaria’s Christian Social Union. Ceremony at 13:15 in Berlin (07:15 EST).

-Austrian President Heinz Fischer swears in Chancellor Werner Faymann’s new government in Vienna. 11:00 CET (05:00 EST)

-Swiss National Bank board member Fritz Zurbruegg gives speech in Zurich on “Asset management at the SNB: What makes the difference?” 18:00 CET (12:00 EST)

-The Bank of Japan’s quarterly Tankan index is forecast to show the growing economy and weaker yen improved sentiment across Japan’s business community. Large manufacturers’ sentiment will rise for a fourth quarter, and the index for small non-manufacturers will turn positive for the first time since 1992, according to a survey by Bloomberg News. 08:50 in Tokyo (12/15 18:50 EST)

-HSBC and Markit announce a preliminary reading of their China manufacturing purchasing managers’ index for December. November’s final reading was 50.8, indicating the nation’s economic recovery is sustaining momentum amid government efforts to rein in credit growth. 09:45 in Beijing (12/15 20:45 EST).

-General Motors Co. Chairman and Chief Executive Officer Dan Akerson speaks about the automaker’s U.S. investment plans a week after the Treasury announced it fully divested its GM shares, ending the government’s bailout. Mary Barra, head of product development, will succeed Akerson as CEO in January. 13:00, National Press Club, in Washington.

-Hussain al-Shahristani, Iraq’s deputy prime minister for energy affairs, and Youcef Yousfi, Algeria’s energy minister, are among officials scheduled to attend the Japan-Arab Economic Forum. 09:00 in Tokyo (19:00 EST on Dec. 15) through Dec. 17

-EU crop development may have improved in November after planting was helped by good weather in October. 12:00 in London (07:00 EST)

-U.S. Supreme Court is in session for 2013-14 period. Click this line for weekly schedule.

-The draw for soccer’s Champions League round of 16 takes place in Nyon, Switzerland. Clubs that have advanced from the group stage include defending champion Bayern Munich and record nine-time European champion Real Madrid. 12:00 local time (06:00 EST).

-Day 4 of the third Ashes cricket Test between Australia and England at Perth. From 10:30 local time (12/15 21:30 EST).

-ECONOMY: Empire manufacturing (Dec.), U.S. capital flows (Oct.), euro-area PMIs (December), euro-area trade balance (Oct.), U.K. Rightmove house prices (Dec.), Italy trade balance (Oct.), Spain house-price index (3Q), Turkey unemployment rate (Sept.)


-Australia is expected to forecast a wider budget deficit for the first six months and slower economic growth due to the sustained strength of the nation’s currency. The Liberal-National coalition government has pledged to return the budget to surplus within a decade and this month struck a deal to remove the A$300 billion ($271 billion) debt ceiling. 12:30 in Sydney (12/16 20:30 EST).

-AMC Entertainment Holdings Inc., the U.S. movie chain controlled by China’s richest man, plans to raise as much as $368 million in an initial public offering. At the high end, AMC would have an enterprise value of $3.64 billion including debt. Dalian Wanda Group, China’s largest entertainment company led by Wang Jianlin, acquired AMC last year for $2.6 billion, including debt. Dalian Wanda will retain an 80 percent stake. The stock is expected to start trading Dec. 18, listed on the New York Stock Exchange.

-U.S. consumer prices probably increased 0.1 percent in November, according to a Bloomberg survey of economists, showing inflation remains tame. The Labor Department reports at 08:30 in Washington.

-Euro-area finance ministers will convene to discuss a single resolution mechanism for the currency bloc’s banks. In Brussels, 19:30 (13:30 EST).

-U.S. Patent lawsuits. The Senate Judiciary Committee, lead by Democratic Chairman Patrick Leahy, holds a hearing on legislation to rein in patent lawsuits. Leahy’s bill would have to be merged with a similar measure passed Dec. 5 by the House that would limit some patent lawsuits and possibly reduce the time companies spend fighting them in court. 10:00 in Washington.

-German Chancellor Angela Merkel will be sworn in, along with 16-member cabinet, under governing coalition with SPD. 09:00 CET (03:00 EST)

-Bank of England Governor Mark Carney testifies to the Economic Affairs Committee of the House of Lords. 15:30 in London (10:30 EST).

-The Reserve Bank of Australia will release minutes of this month’s policy meeting, at which it kept the benchmark interest rate unchanged at a record low of 2.5 percent. 11:30 in Sydney (12/16 19:30 EST).

-Day 5 of the third Ashes cricket Test between Australia and England at Perth. From 10:30 local time (12/16 21:30 EST).

-ECONOMY: Hong Kong unemployment (Nov.), euro-area inflation (Nov.), euro-area labor costs (3Q), euro-area car registrations (Nov.), German ZEW investor confidence (Dec.), U.K. inflation (Nov.), Spain labor costs (3Q), Nigeria consumer price inflation (Nov.)

-CENTRAL BANKS: Turkey rate decision, Sweden rate decision, Hungary rate decision

-EARNINGS: Jefferies Group LLC.


-The Federal Open Market Committee meets for a second day and releases its policy statement after U.S. payrolls rose more than projected in November, pushing down the unemployment rate to 7 percent from 7.3 percent. The central bank has pledged to continue buying bonds until the labor market has “improved substantially,” and will probably begin tapering its $85 billion in monthly bond purchases, according to 34 percent of economists surveyed this month by Bloomberg, an increase from 17 percent last month. The FOMC releases its policy statement and forecasts for economic growth, inflation and unemployment at 14:00. Fed Chairman Ben S. Bernanke will give a press conference in Washington at 14:30.

-U.S. housing starts, the pace of ground-breaking on new homes, probably exceeded the average for 2013 in November as construction continued to contribute to economic growth. The Commerce Department will release numbers for November, and also for the months of October and September, which were delayed by the 16-day partial federal government shutdown. 08:30 in Washington.

-The Bank of England publishes the minutes of the Monetary Policy Committee’s Dec. 4-5 meeting, when it left the benchmark interest rate at a record low of 0.5 percent and held its asset purchase plan at 375 billion ($612 billion). Governor Mark Carney reinforced his message in New York on Dec. 9, saying that while recent U.K. news has been positive, he won’t tighten policy prematurely. London 09:30 (04:30 EST)

-European Union finance ministers hold an emergency meeting to strike an agreement on a planned single resolution mechanism for euro-area banks. Time TBA in Brussels.

-Ifo index: German business confidence rose to 109.3 in November, the highest level in more than 1 1/2 years, and the reading for December will give an indication as to whether Europe’s largest economy will continue to drive growth in the euro area. The Bundesbank this month lifted its growth forecasts for this year and next. Munich 10:00 (04:00 EST)

-Japan’s Ministry of Finance will report data on imports of oil and liquefied natural gas during November. 08:50 in Tokyo (18:50 EST on Dec. 17)

-China will announce November property prices after new home prices in October in its four major cities rose the most since January 2011, raising concerns of a bubble as buyers were emboldened by a lack of new nationwide property curbs. 09:30 in Beijing (12/17 20:30 EST).

-The Australian Bureau of Resources and Energy Economics publishes forecasts for mining and energy export earnings and the outlook for global metals markets. 09:30 in Melbourne (17:30 EST on Dec. 17)

-ECONOMY: U.S. building permits (Nov.), Japan Trade Balance (Nov.), Euro-area construction output (Oct.), U.K. ILO unemployment (Aug.-Sept), Italy current-account balance (Oct.), Swiss Credit Suisse ZEW survey (Dec.), Israel current account balance (third quarter)

-CENTRAL BANKS: India rate decision

-EARNINGS: Oracle Corp., FedEx Corp., General Mills Inc.


-U.S. existing home sales, or sales of previously owned homes, probably declined for a third month in November, according to a Bloomberg survey of economists, as limited supply and higher mortgage rates affected the housing market. The National Association of Realtors reports at 10:00 in Washington.

-European Union leaders meet to discuss defense and economic policy. Agreement on a bank-failure plan for the euro area is a top priority for the summit “because we would like to see whole banking union before the European Parliament recess” ahead of elections in May, Maros Sefcovic, the EU’s inter-institutional relations commissioner, said Nov. 19. 15:00 in Brussels (09:00 EST)

-ECONOMY: U.S. initial jobless claims (weekly), Philadelphia Fed survey (Dec.), U.S. leading indicators (Nov.), Brazil mid-month inflation (Dec.), Brazil unemployment rate (Nov.), Mexico retail sales (Oct.), Colombia GDP (third quarter), New Zealand GDP (3Q), Japan Industrial Activity (Oct.), Euro-area current account (Oct.), U.K. retail sales (Nov.), Swiss SECO 2013 economic forecasts (Dec.), Netherlands consumer confidence (Dec.), Netherlands unemployment (Nov.), Swiss trade balance (Nov.), Greek unemployment (third quarter)

-EARNINGS: Nike Inc.


-BlackBerry Ltd. earnings. The smartphone maker will probably report a fiscal third-quarter loss as sales plunged. John Chen, executive chairman and chief executive officer since November, will provide an update on BlackBerry’s strategy and organizational structure after the company’s marketing and operations chiefs left last month. About 7:00 EST in Waterloo, Ontario, followed by conference call at 08:00 EST.

-Default risk at Eike Batista’s OSX. Shipbuilder OSX Brasil SA has said it plans to miss the payment due today on $500 million of secured bonds. Unless creditors agree to a standstill, the shipbuilder may follow sister company OGX Petroleo & Gas Participacoes SA into default, prompting bondholders to take steps to assume control of an OSX-owned $1.1 billion offshore oil-production ship. The default would be the latest setback for Batista, whose wealth has plummeted after peaking at more than $34 billion last year.

-EU leaders begin the second day of a summit at 09:30 in Brussels (03:30 EST)

-Madagascar holds presidential runoff election. Jean Louis Robinson will compete in a runoff against former Finance Minister Hery Rajaonarimampianina after no candidate won sufficient votes for an outright majority in October’s first round. Time TBA.

-ECONOMY: U.S. GDP (third quarter-final), Canada consumer prices (Nov.), Brazil bank lending (Nov.), Mexico unemployment rate (Nov.), Argentina GDP (third quarter), Taiwan export orders (Nov.), German GfK consumer confidence (Jan.); France business confidence (Dec.), Italy industrial orders (Oct.), Spain mortgage lending (Oct.), U.K. GfK consumer confidence (Dec.), U.K. budget balance (Nov.), U.K. GDP (third quarter - final)

-CENTRAL BANKS: Mexico meeting minutes, Colombia rate decision, Japan Policy Statement

-EARNINGS: Walgreen Co.


-The final of soccer’s Club World Cup takes place in Marrakech, Morocco. Competitors come from governing body FIFA’s six international confederations, and include European champion Bayern Munich. The two finalists have yet to be determined. 19:30 local time (14.30 EST).

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