Top Headlines

Pound Tumbles to 31-Year Low as Selloff Resumes Before Carney – Bloomberg

The pound fell to its lowest level in three decades against the dollar, exceeding levels reached in the aftermath of Britain’s vote to leave the European Union.

Conservative politicians are due to hold the first round of voting on Tuesday to elect a new leader for the party – and for the country – following Prime Minister David Cameron’s resignation after the vote to leave the European Union (EU).

Bad Debt Piled in Italian Banks Looms as Next Crisis – WSJ (subscription)

Britain’s vote to leave the EU has produced dire predictions for the U.K. economy. The damage to the rest of Europe could be more immediate and potentially more serious. Nowhere is the risk concentrated more heavily than in the Italian banking sector.

Western Retreat Makes Room for Chinese Advance- WSJ (subscription)

As the West retreats from globalization—the Brexit vote was just the latest, though the most startling, manifestation of a populist trend—expect a new force to fill the gap.

Australian PM Turnbull defies critics, cliffhanger vote count resumes – Reuters

Embattled Australian Prime Minister Malcolm Turnbull defended his performance after widespread calls for his resignation and said on Tuesday he was confident of retaining office after vote counting resumed in a cliffhanger election.

Juno probe: Nasa’s spacecraft makes history by entering Jupiter’s orbit after five-year journey – Daily Telegraph

Nasa celebrated a key triumph on Tuesday as its $1.1 billion (£830 million) Juno spacecraft successfully slipped into orbit around Jupiter on a mission to probe the origin of the solar system.

Regulatory News

Three Former Barclays Traders Found Guilty Over Libor – Profit & Loss (subscription)

Three former Barclays traders have been found guilty by a London court of conspiring to manipulate the London Interbank Offered Rate (Libor) benchmark interest rate.

The Hat-Trick? Third Citi Trader Wins Unfair Dismissal Case – Profit & Loss (subscription)

Citi is on the wrong end of a third unfair dismissal trail according to sources familiar with the matter who say that Rob Hoodless has won his claim against the bank.

Company News

China service sector activity jumps to 11-month high: Caixin PMI – Reuters

Activity in China’s services sector rose to an 11-month high in June, a private survey showed on Tuesday, diverging from struggling manufacturing in a trend that if sustainable would indicate Beijing is making progress in rebalancing the economy.

As 2-and-20 Fees Under Fire, Asia Hedge Funds Seek Cost Cuts – Bloomberg

When Ruhong Huang’s Hong Kong-based hedge fund crossed a key milestone after gathering $100 million in assets, he made an unusual choice. Rather than continuing to go it alone, he decided to join a “platform” to help his firm with everything from hiring administrative staff to handling compliance.

London Banker Bonuses Set to Shrivel as Brexit Hits Dealmaking – Bloomberg

Just be glad you have a job.

That’s the message London’s investment banks will be giving their staff this year, with bonus pools set to be cut by at least a quarter, as the U.K.’s decision to leave the European Union stymies dealmaking and threatens higher costs from moving staff, executives and recruiters said.

Hunter Burton Launches New FX Fund – Profit & Loss (subscription)

Sydney-based Hunter Burton Capital has launched a second FX fund to compliment its existing HBC Alpha fund.

Market Savvy

UPDATE 3-Russian central bank started buying Chinese yuan assets last year – Reuters

Russia’s central bank started buying Chinese yuan-denominated assets in the fourth quarter of last year as part of its drive to diversify its foreign-currency reserves and make it less vulnerable to Western sanctions.

Yen surges, sterling falls as UK nerves grow – Reuters

The Japanese yen rose almost one percent against the euro and dollar and sterling fell to its lowest levels since the immediate aftermath of last month’s EU referendum as currency markets worried about a handful of major British events on Tuesday.

WSJ Survey: Economists Shift Rate-Rise Expectations From June to July – WSJ (subscription)

Most economists in a Wall Street Journal survey believed the Federal Reserve would raise short-term interest rates this summer, despite a bleak May employment report that rattled policy makers and raised questions about the underlying strength of the economy.

Oil prices dip on economic concerns, demand worries – Reuters

Oil prices fell on Tuesday, with Brent dropping back below $50 per barrel as economic concerns took center stage with many analysts saying crude demand will stall later this year.