Good morning. Here's what you need to know.
- Markets in Asia were mixed in overnight trading. The Japanese Nikkei 225 jumped 2.0%, the Hong Kong Hang Seng rose 0.3%, and the Shanghai Composite fell 0.1%. European markets are rallying, led by Germany and Italy, both up 1.0%. In the United States, futures point to a positive open.
- The big event today is the FOMC decision, due out at 2 PM ET, followed by Ben Bernanke's last press conference as chairman of the Federal Reserve at 2:30. The consensus prediction is that the FOMC will refrain from tapering its quantitative easing program until 2014, but a growing number believe it could be announced today following a recent string of solid economic data. The FOMC could also announce a modification to its forward guidance on the likely path of short-term interest rates, such as a reduction of the unemployment rate threshold that must be met before the first rate hike to 6.0% from the current 6.5% figure.
- Japanese exports rose 18.4% from a year earlier in November, faster than expected, while imports rose 21.1% from a year earlier, slower than expected. The trade deficit widened to ¥1.2929 trillion from ¥1.0927 trillion.
- The German IFO Business Climate indicator of sentiment ticked up to 109.5 in December from 109.3 in November, as expected by economists. The current assessment gauge unexpectedly fell to 111.6 from 112.2, but the outlook gauge advanced to 107.4 from 106.4.
- The U.K. unemployment rate unexpectedly fell to 7.4% in October from 7.6% the month before, while the three-month employment change through October was 250,000, well above the 165,000 consensus forecast. The numbers have sparked a rally in sterling this morning.
- Eurozone construction output fell 1.2% in October after dropping 0.5% in September. On a work day-adjusted basis, construction output fell 2.4% from a year earlier after falling 0.7% year over year in September.
- November housing starts and building permits data are due out at 8:30 AM ET. Economists predict permits fell to 990,000 at an annualized rate in November from 1.034 million in October, while starts are expected to clock in at 950,000. Follow the data LIVE on Business Insider »
- Bitcoin lost another 30% of its value overnight after Chinese Bitcoin startup BTC China announced that it could no longer accept deposits in the local currency. The digital currency has been on a wild ride in 2013 — in January, it traded below $15, and recently, it traded over $1000. Now, it trades just below $500.
- BP said Wednesday it would write off just over $1 billion in costs related to an unsuccessful Brazilian oil well, which ended up finding no commercial quantities of oil or gas. However, it also said it made a significant oil discovery in the Gulf of Mexico, which it will continue to explore.
- Bloomberg News reports that the Fed will delay imposing regulatory requirements related to leverage ratios on large U.S. banks until the Basel Committee on Banking Supervision completes its global standards. "The Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency had favored finishing a U.S. rule by year’s end, said one of the people," writes Bloomberg's Jesse Hamilton. "The Fed’s wait-and-see position is aligned with groups representing the banking industry, who have argued for a delay on grounds that the regulations should be consistent."