Top Headlines

Italy’s Monte Paschi Flunks Stress Test, Plans to Raise Capital – Bloomberg

The world’s oldest bank is also Europe’s riskiest. Italy’s Banca Monte dei Paschi di Siena SpA was the only one of 51 lenders tested by European regulators to have its capital wiped out in the exam’s toughest scenario. The bank, which has been bailed out twice by the government since 2009, said it plans to sell as much as 5 billion euros ($5.6 billion) of stock if it can offload a bad-loan portfolio.

Brexit Hit U.K. Manufacturing Harder Than Initially Estimated – Bloomberg

U.K. manufacturing shrank more than initially forecast in July, suffering its biggest drop in more than three years.

SNB Chief Says Swiss Franc Overvalued, More Room to Intervene in FX Market – Reuters

The Swiss National Bank has room to intervene in the foreign exchange market, with the Swiss franc considered overvalued to the euro, the bank’s chairman said on Monday.

Ex-Citi FX Chief Seeking Investors for Fund? – Profit & Loss

Citi’s former global head of FX trading, Jeff Feig, is reportedly seeking to establish a macro hedge fund and is talking to investors.

Steady Euro-Area Factory Output Masks Worries in Periphery – Bloomberg

Activity in euro-area manufacturing slowed in July as uncertainty following the U.K.’s vote to leave the European Union damped new orders.

Europe in Crisis: The Elections to Watch for Political Risk – Bloomberg

Brexit. The largest influx of refugees since World War II. A spate of terrorist attacks. A populist insurgency. Another banking meltdown.

Regulatory News

FCA Cites “Real Improvements” in Banks’ FX Controls – Profit & Loss

Alongside last week’s publication of an update on the Fair and Effective Markets Review (FEMR), the UK’s Financial Conduct Authority (FCA) has separately published a progress report on its own FX remediation programme.

UBS trader jailed for UK’s biggest fraud warns it could happen again – CNBC

Kweku Adoboli, the ex-UBS trader jailed four years ago for the biggest fraud in British history, has said his crimes could be repeated as those working in the banking industry still faced the same pressure to make profits “no matter what”.

Company News

Apple’s Embrace by Bond Market Prompts Calls for Sanity Check – Bloomberg

Debt investors’ irrepressible appetite for Apple Inc. turned the company into the biggest corporate-bond issuer in the world as it raised more than $80 billion in just four years. Now, some analysts are asking whether that’s too much, too fast.

Platform Volumes Fall Back in July – Profit & Loss

The first batch of trading venues to provide turnover data indicates that trading volumes in July, perhaps inevitably, retreated from the Brexit-inspired heights of June.

Uber to Sell China Business to Rival Didi After Losing Billions – Bloomberg

Uber Technologies Inc. will sell its China business to Didi Chuxing, the dominant ride-hailing service in the country, according to people familiar with the matter, ending a costly battle between the two companies for customers and drivers.

Currency Impact to Take Froth off Heineken Earnings – Reuters

Heineken, the world’s third-largest brewer, forecast a bigger blow from declining currencies this year after a first half when strength in Asia and Europe helped to offset declining sales in Africa.

Market Savvy

UK Welcome First London Sale of Rupee Bond From Indian Private Company – Reuters

British finance minister Philip Hammond welcomed the issuance on Monday of the first offshore rupee-denominated bond from a private company, saying it highlighted London’s status as a leading global finance centre.

Global Stocks Inch Higher – WSJ

Global stocks mostly inched higher Monday after closing out July with solid gains.

Bond World Sees ‘Live’ September for Fed, But It’s September ’17 – Bloomberg

Forget September, or even December. Bond traders are betting the Federal Reserve won’t be able to pull off another interest-rate increase until September next year.

Iran’s Oil Contract Due Wednesday to Lure Billions of Investment – Bloomberg

Iran is expected to approve a new model for oil contracts on Wednesday, paving the way for billions of dollars of foreign investment to help rebuild its energy industry.