Morgan Stanley to Cut a Quarter of Bond, Currency Trading Jobs – Wall Street Journal

Updated Nov. 30, 2015 7:26 p.m. ET

Morgan Stanley MS 1.54 % plans to slash hundreds of jobs from its debt and currencies division, people familiar with the matter said, revealing that the Wall Street firm believes that a monthslong slump in trading revenue may persist.

Morgan Stanley company could eliminate as much as a quarter of the business's workforce, the people said Monday. The cuts will occur across all of the division's offices, and on each of the firm's trading desks, though London is expected to bear a slightly bigger brunt than New York, the people said.

The potential cuts reflect Morgan Stanley's acceptance that a slowdown in client activity that took root during the summer months may not reverse any time soon. The New York firm also faces pressure from investors to lift its returns on equity that have often languished below a 10% target set by James Gorman, Morgan Stanley's chairman and chief executive.

New capital rules have penalized big banks for holding vast inventories of bonds and other debt securities, forcing them into difficult decisions on how big their trading businesses can remain in the postcrisis era.

"Many investors have been waiting for them to take more drastic action," Steven Chubak, an analyst with Nomura Holdings, said of Morgan Stanley. "It doesn't suggest they expect a continued decline in the 2015, but it does suggest they don't expect to see a meaningful recovery in the near or intermediate future."

Mr. Chubak estimates that Morgan Stanley's fixed-income arm will post a 5% return on equity this year. Overall, the firm's return on equity is expected to be around 9%.

Colm Kelleher, president of Morgan Stanley's investment-banking and securities businesses, said earlier this month the firm has wrestled with how to size its fixed-income arm as the pool of trading business up for grabs continues to shrink.

"The available fee pool in fixed income historically was assumed to be about $ 150 billion to $ 160 billion," Mr. Kelleher said. "The last three years it's been $ 100 billion or less."

All of the banks, from Goldman Sachs Group Inc. GS 0.11 % to Deutsche Bank AG DB 1.26 % , have shrunk their fixed-income business since the financial crisis. But the market has continued to contract, leaving those firms and executives with a difficult decision to cut further or try to ride out what could be a temporary slowdown.

Trimming costs, either from smaller bonuses or fewer employees, could help boost returns. The potential job cuts, which were reported initially by Bloomberg News, helped lift Morgan Stanley's shares 1.6% on Monday.

Investors, corporate executives, central bankers and others have watched closely as big banks ease their commitment to fixed-income trading. Some fear that a reduction in overall bank trading will make it harder to buy and sell bonds at a reasonable price and exacerbate market volatility when interest rates move.

The year started well for debt traders at Morgan Stanley, and across Wall Street. The firm's executives believed they would gain a bigger share of clients' business over time, thanks to a credit-rating upgrade that made Morgan Stanley a more attractive trading partner and the gradual retreat from trading by some of its main European rivals. A strong first half, during which the firm's fixed-income unit posted its best results in four years, bolstered that outlook.

Then, Morgan Stanley posted a 42% drop in fixed-income trading revenue in the third quarter, more than some rivals.

On Oct. 1, the firm said Edward Pick, head of equities trading, would also oversee fixed income.

The last quarter "was clearly very weak, and I don't think Q4 is going to be much better," Mr. Kelleher said during a Nov. 17 conference with investors.

"What I don't know yet is: What is the steady run rate of what we think fixed income should be? What is that number, and how do you size? But clearly, you have to adjust in accordance with market conditions for the foreseeable future."

Wall Street's bond, currencies and commodities trading desks already have been a frequent target for job cuts. Coalition Ltd., a research firm, estimated in February that fixed-income headcount dropped 9% last year across 10 of the world's largest banks.

It is unclear, though, whether Morgan Stanley will make corresponding cuts to its balance sheet—a step that would free up capital. The firm has already sharply cut the capital it allocates to the fixed-income business.

Write to Justin Baer at justin.baer@wsj.com

Asian shares firm as focus turns to China PMI surveys – Reuters

Passersby are reflected on a stock quotation board at a brokerage in Tokyo, Japan, September 29, 2015.

Reuters/Issei Kato

Asian shares were solidly higher on Tuesday, shrugging off one Chinese factory survey that did little to ease persistent concerns about cooling growth in the economy, while a private survey showed a hint of stabilization.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS extended early gains and was up 1.1 percent, while Japan’s Nikkei .N225 added 0.9 percent.

Wall Street lost ground overnight, though major U.S. indexes still gained for the second straight month and U.S. stock futures ESc1 were up 0.5 percent in Asian trade.

China’s official Purchasing Managers’ Index (PMI) stood at a three-year low of 49.6 in November, compared with the previous month’s reading of 49.8 and below both forecasts for a reading of 49.8 as well as the 50-point mark that separates growth from contraction.

But the private Caixin/Markit China Manufacturing PMI showed factory activity contracted at a slower pace than in October, fuelling hopes the economy may be slowly leveling out in response to a series of government support measures.

“This indicates that pressure on economic growth has eased and fiscal policy has had a strong effect,” said He Fan, chief economist at Caixin Insight Group.

“Overall, the economy is still on track to become more stable.”

China’s major stock indexes opened down, with the CSI300 index .CSI300 and the Shanghai Composite Index .SSEC both 0.1 percent lower in early trading.

China’s yuan was flat at its open in onshore trading CNY=CFXS, after the International Monetary Fund on Monday admitted the yuan into its Special Drawing Rights (SDR) basket alongside the dollar, euro, pound sterling and yen. The widely expected move was a milestone in China’s integration into global finances and a nod of approval to the country’s reforms.

“What is interesting about the new weightings is that the biggest change is for the euro, which now accounts for 30.9 percent of the basket instead of 37.4 percent. While EUR/USD did not have much of a reaction to the news, it is certainly not positive for the currency,” Kathy Lien, managing director of FX strategy for BK Asset Management, said in a note to clients.

The euro was already under pressure on expectations that the European Central Bank will announce further easing measures at its policy meeting on Thursday.

“Everyone is watching the euro this week and we believe that it will test and break $ 1.05. While investors have completely discounted easing by the ECB, there’s a great deal of uncertainty surrounding what actions the central bank will take,” Lien said.

The euro inched up to $ 1.0575 EUR=, nursing losses just above a 7 1/2-month low of $ 1.0557 marked on Monday.

Against the yen, the dollar edged up slightly to 123.14 JPY=.

The dollar index .DXY, which tracks the greenback against a basket of six major rival currencies, edged down to 100.14, but remained within sight of its more than 12-year high of 100.39 hit in March.

The dollar gained despite disappointing U.S. economic data. The Chicago Purchasing Management Index fell in November, indicating a contraction in the Midwest factory sector.

Investors looked past the PMI, and ahead to the key nonfarm payrolls report which will be released on Friday. Economists expect it to show that employers added 200,000 jobs in November, according to a Reuters poll. A solid report would cement expectations that the U.S. Federal Reserve is on track to increase interest rates this month for the first time in nearly a decade.

By contrast, the Reserve Bank of Australia (RBA) is expected to hold rates steady at 2 percent at its policy meeting on Tuesday, with an announcement expected to come at 0330 GMT.

Ahead of the decision, the Australian dollar added about 0.4 percent to $ 0.7259 AUD=D4 and Australian shares .AJXO rallied 2.2 percent, extending gains after trade data showed that Australia’s economy enjoyed a huge lift last quarter from a rebound in resource exports.

U.S. crude oil prices steadied after volatile trading overnight in which they first rallied and then erased gains after a survey estimated higher OPEC output. U.S. crude CLc1 added 0.4 percent to $ 41.81 a barrel.

Brent crude futures LCOc1 edged up 0.1 percent to $ 44.66.

Spot gold XAU= was up about 0.3 percent at $ 1,067.81 an ounce, though it remained close to a nearly six-year low of $ 1,052.46 plumbed last week, pressured by the recently robust dollar and growing expectations of higher U.S. interest rates.

(Additional reporting by Xiaoyi Shao and Nick Heath in Beijing; Editing by Shri Navaratnam and Eric Meijer)

Cyber Monday Sales Still on Top, but Losing Some Luster – ABC News

Retailers are rolling out online deals on so-called “Cyber Monday.” But now that shoppers are online all the time anyway, the 10-year-old shopping holiday is losing some of its luster.

Still, Monday is expected to be the biggest online shopping day ever, with estimates that it will rack up over $ 3 billion in sales.

“It’s no longer about one day, but a season of digital deals,” said Matthew Shay, president of retail trade group The National Retail Federation.

Online shopping is taking its toll on brick-and-mortar shopping. Frenzied crowds seemed to be a thing of the past on Black Friday — the busy shopping day after Thanksgiving — and sales fell to $ 10.4 billion this year, down from $ 11.6 billion in 2014, according to preliminary figures from research firm ShopperTrak.

But as online shopping grows more popular on Thanksgiving and Black Friday, that’s causing less of a frenzy on Cyber Monday, too.

“Consumers are recognizing the Internet is the place to go for a deal any time, any day,” said Gene Alvarez, managing vice president of research firm Gartner.

Retailers have been touting online deals since the beginning of November. And they no longer wait for Monday to roll out Cyber Monday deals, either. Amazon started “Lighting Deals” on Saturday and Wal-Mart beginning all of its Cyber offers on 8 p.m. on Sunday.

Amazon was offering 65 percent off sweaters, Target was touting 15 percent off its whole site for the first time and Wal-Mart offered $ 500 off a $ 1200 LG 65-inch 4K Ultra HDTV.

“I personally skip Black Friday just to shop Cyber Monday,” said Mark Flores, a parks and recreation director from Lynwood, California. He was looking online Monday for tablets for his nephews, nieces and grandparents, leather goods and gift certificates, plus shoes for himself on Amazon, department store sites and the Groupon App. He said he was looking for deals “that are greater than normal sale prices and coupons.”

Research firm Comscore expects online sales to rise 14 percent to $ 70.06 billion During the November and December shopping period, slowing slightly from last year’s 15 percent rise. Online sales make up 10 percent of overall retail sales, but that increases to 15 percent during the holidays as online shoppers snap up Black Friday and Cyber Monday deals, according to research firm Forrester.

Cyber Monday itself is expected to be the biggest online sales day of the season and ever, surpassing $ 3 billion in sales. If so, it will be the sixth year in a row that Cyber Monday is the biggest online shopping day ever.

But Thanksgiving and Black Friday are gaining fast. About $ 4.47 billion were spent online on Thanksgiving Day and Black Friday combined, 18 percent more than last year, according to Adobe, which tracks 200 million visitors to 4,500 retail websites. And 33.2 percent came from mobile devices, up from 27 percent last year.

Amazon is offering new deals every 5 minutes starting Friday, Nov. 20, and extending through Dec. 5 double the cadence of last year. It also is offering more than 150 app-only lightning deals to encourage mobile shopping.

Wal-Mart started offering all of its 2,000 Cyber Monday deals — quadruple the 500 online deals it offered last year — starting 8 p.m. on Sunday the evening before. A year ago, the nation’s largest retailer only offered a sneak peak of about 20 deals on the evening before Cyber Monday.

And Target is offering 15 percent off its entire site on Cyber Monday, its first ever site-wide discount on the shopping day.

Forrester Research analyst Sucharita Mulpuru said even though more people are shopping online and on their phones throughout the season, Cyber Monday will still drive sales from its name alone.

“A lot of people waiting to see if deals are better on Cyber Monday,” she said.

The name “Cyber Monday” was coined in 2005 by the National Retail Federation’s online arm, called Shop.org, to encourage people to shop online. The name was also a nod to online shopping being done at work where faster connections made it easier to browse. Now, even with broadband access, Cyber Monday continues to be a day when retailers pull out big promotions.

“I plan on scoping out the deals,” said Diane Boral, 33, from Oxnard, California, who planned to shop online at Walmart, Target and other stores on Monday. She said she hoped to get most of her Christmas shopping done on Cyber Monday. She was looking for deals ranging from 20 percent to 75 percent off on items like a camera, air conditioner, tires and Christmas gifts.

Most of her shopping is done online via her iPhone and laptop, she said.

“I have more time to browse for items,” online, she said.

UPDATE 4-IMF gives China’s currency prized reserve asset status – Reuters

* China’s yuan to join Special Drawing Rights basket

* Yuan to enter in Oct. 2016 with 10.92 pct share

* Review cuts euro share, adds weight to financial flows

* IMF’s Lagarde, China central bank say reforms to continue (Adds source comment on decision unanimous)

By Krista Hughes

WASHINGTON, Nov 30 The International Monetary Fund admitted China’s yuan into its benchmark currency basket on Monday, as expected, in a victory for Beijing’s campaign for recognition as a global economic power.

The decision to add the yuan, also known as the renminbi, to the Special Drawing Rights (SDR) basket alongside the dollar, euro, pound sterling and yen, is an important milestone in China’s integration into global finances and a nod to the progress it has made with reforms.

To meet the IMF’s criteria, Beijing has undertaken a flurry of reforms in recent months, including better access for foreigners to Chinese currency markets, more frequent debt issuance and expanded yuan trading hours.

IMF chief Christine Lagarde, who along with in-house experts has previously backed the inclusion, made it clear she did not expect Beijing to stop there.

“The renminbi’s inclusion in the SDR is a clear indication of the reforms that have been implemented and will continue to be implemented,” she told reporters.

The People’s Bank of China said the move, which was backed by countries including the United States and Britain, showed the international community expected China to play a bigger role in the world economy.

“Going forward, China will continue to deepen and accelerate economic reforms and financial opening up, and contribute to promoting world economic growth, safeguarding financial stability and improving global economic governance,” it said in a statement.

A person familiar with the IMF deliberations said approval was unanimous. An IMF official said it was not IMF policy to disclose board voting records.

The yuan will have a 10.92 percent share, in line with expectations, after a review of the weightings formula for the SDR which also cut the euro’s share by more than 6 percentage points.

To be included in the SDR basket, the yuan had to meet the criteria to be “freely usable,” or widely used to make international payments and widely traded in foreign exchange markets — a yardstick it missed at the last review in 2010.

The yuan’s inclusion in the basket from October 2016 is a largely symbolic move with few immediate implications for financial markets. But it is the first time an additional currency has been added to the SDR basket, which determines which currencies countries can receive as part of IMF loans.

“Ultimately China would like to see, as a number of countries would, the dollar end its reign as the global reserve currency,” said Malcolm Polley, chief investment officer at Stewart Capital Advisors.

“That won’t happen until there is another currency that from a geopolitical standpoint is as secure as the dollar.”

EURO MAKES ROOM

The new SDR formula gives more weight to financial variables and less to exports, reflecting long-standing criticism of the methodology but also cutting the euro’s share to 30.93 percent, from 37.4 percent.

The yuan will come in with a higher weight than sterling and yen, which will drop to 8.09 percent and 8.33 percent respectively, while the dollar remains broadly unchanged at 41.73 percent.

The addition is likely to fuel demand for China’s currency and for renminbi-denominated assets as central banks and foreign fund managers adjust their portfolios to reflect the yuan’s new status.

But analysts said investors would likely remain cautious as long as China did not fully liberalize capital controls or allow the currency to float freely.

“‘Freely usable’ meant freely usable to reserve managers and available to official institutions,” said Steven Englander, head of G10 foreign exchange strategy at Citi in New York.

“But if you look at the normal definition of liquidity, the point is not that just you and your mates can use it but that the whole world can use it.”

The IMF said China’s comparatively higher interest rates would likely increase the SDR interest rate – potentially pushing up the cost of IMF loans for some borrowers. (Reporting by Krista Hughes; Additional reporting by Jason Lange and Howard Schneider in Washington and Dion Rabouin, Daniel Bases and Sam Forgione in New York; Editing by Meredith Mazzilli and Alan Crosby)

Target website couldn’t keep up with record traffic on Cyber Monday – USA TODAY

A screenshot of the Target website Monday morning, Nov 30. The site went down during the Cyber Monday sale due to high traffic.(Photo: www.target.com)

Target’s website couldn’t keep up with an overload of Cyber Monday shoppers as the retailer deals with record online traffic.

The site was down intermittently starting around 10 a.m. Monday, according to Catchpoint Systems, which monitors web performance of retail sites. Customers received a message asking them to “hold tight.”

Target has set up a virtual line for customers, giving people access to the site gradually in order to control traffic, says Katie Boylan, a spokeswoman for Target. Some customers are still getting an apology message from the retailer, asking them to try again shortly.

“We are seeing an absolutely extraordinary response to our Cyber Monday offer,” Boylan said. Target is offering 15% off site-wide, plus free shipping on every order. “The traffic, the demand, the orders are just absolutely through the roof.”

Target says volume is already twice as high as its busiest day ever, which was Thanksgiving.

Online sales have been driving the holiday season so far, as more people chose to shop online over stores during Thanksgiving weekend, according to figures from the National Retail Federation. Many retailers made Black Friday deals available online before they were available in stores last week and have invested in optimized mobile and Web experiences that make browsing and shopping easier.

Customers flood into a Target in Jersey City, N.J. on Thanksgiving, Nov. 26, 2015. The retailer is experiencing record traffic to its site on Cyber Monday, which continues to lead to delays for some customers. (Photo: AP Images for Target)

Target isn’t the first to experience site glitches during the busiest shopping period of the year. On Monday morning, PayPal “experienced a brief, intermittent interruption in our service,” the company said in a statement, as some customers experienced issues. The problem has been resolved. And Neiman Marcus’ site went down on Black Friday, leading the department store to extend its Black Friday sale.

Fewer people are expected to shop online Monday compared with last year, according to NRF data.

Hadley Malcolm on Twitter: @hadleypdxdc.

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China’s Renminbi Is Approved as a Main World Currency – New York Times

Photo

Inclusion of the renminbi in the I.M.F.'s elite reserve currency group was so important to China's leaders that they named it in October as one of their highest economic policy priorities in the coming years. Credit Agence France-Presse — Getty Images

HONG KONG — The International Monetary Fund on Monday approved the Chinese renminbi as one of the world's main central bank reserve currencies, a major acknowledgment of the country's rising financial and economic heft.

The I.M.F. decision will help pave the way for broader use of the renminbi in trade and finance, securing China's standing as a global economic power. But it also introduces new uncertainty into China's economy and financial system, as the country was forced to relax many currency controls to meet the I.M.F. requirements.

The changes could inject volatility into the Chinese economy, since large flows of money surge into the country and recede based on its prospects. This could make it difficult for China to maintain its record of strong, steady growth, especially at a time when its economy is already slowing.

The I.M.F. will start including the renminbi in the fund's unit of accounting, the so-called special drawing rights, at the end of September. The renminbi will take its place alongside the dollar, the euro, the yen and the pound.

Continue reading the main story

Many central banks follow this benchmark in building their reserves, so countries could start holding more renminbi as a result. China will also gain more influence in international bailouts denominated in the fund's accounting unit, like Greece's debt deal.

The decision to include the renminbi "is an important milestone in the integration of the Chinese economy into the global financial system," Christine Lagarde, the managing director of the I.M.F., said in a statement. "It is also a recognition of the progress that the Chinese authorities have made in the past years in reforming China's monetary and financial systems. The continuation and deepening of these efforts will bring about a more robust international monetary and financial system, which in turn will support the growth and stability of China and the global economy."

China's leadership has made it a priority to join this group of currencies, naming it in October as one of its highest economic policy priorities in the coming years. The renminbi's new status "will improve the international monetary system and safeguard global financial stability," President Xi Jinping of China said in mid-November.

In the months before the I.M.F. decision, China took several actions to make sure that the renminbi was more widely embraced. China did so partly to meet the I.M.F.'s rule that a currency must be "freely usable" before it can be included in this benchmark.

China and Britain have sold renminbi-denominated sovereign bonds for the first time in London, which has emerged as Europe's hub for the currency. Even Hungary has announced plans to issue its own renminbi-denominated bonds as well, while the Ceinex exchange in Frankfurt has begun trading funds this month based on renminbi bonds. Preparations began to trade renminbi-denominated oil contracts in Shanghai, where copper and aluminum contracts are already sold.

Most important, China began changing the way it sets the value of the renminbi each morning. In doing so, it abruptly devalued the currency.

The entry itself into the special drawing right is mainly symbolic. But such broader moves toward greater financial transparency and easier trading — part of the process to meet the I.M.F. requirements — will have long-term effects on the renminbi's use.

"There's this obsession with the S.D.R., and it's completely out of proportion to its economic impact, which is likely to be trivial," said Randall Kroszner, a former Federal Reserve Board governor who is now an economics professor at the University of Chicago. "It may be that in the drive to get into the S.D.R., they may make changes that make the renminbi more attractive for international market participants."

Cyber Monday Steals: 5 Bargains Worth Logging On For – NBCNews.com

We hope you didn’t spend all your dough on Black Friday deals, because Cyber Monday has some mighty fine offerings too.

As with Black Friday sales, consumers are being inundated with options, so NBC News has cobbled together a list of five of the best Cyber Monday sales.

Before we begin, though, one thing to keep in mind if you’re busy today: Many sales will last beyond Monday. Keith Anderson, vice president of strategy and insight at Profitero, an e-commerce analytics firm, said the biggest trend in the retail industry this holiday season is extended promotions.

“Retailers including Amazon, Walmart, and Target are starting the promotions earlier and ending later — some running a full week or more of promotions,” Anderson said.

Amazon

What would Cyber Monday be without Amazon.com, which helped pioneer the shopping holiday? The online retail giant sold more than 43 million products last year on Cyber Monday — a record-breaking 500 items per second.

Related: Everything You Need to Know Before Buying a New TV

This year it’s looking to break that mark by offering savings across a number of categories, including electronics, toys, gifts for babies and pets, home and kitchen, sports and travel and fashion and beauty.

Among the standout deals are:

• 60 percent off MEE audio Sport-Fi M6 noise-isolating, in-ear headphones.
• Up to 50 percent off select toys, including favorite brands like Nerf, My Little Pony, “Star Wars,” and more.
• 60 percent off a SINGER 4411 heavy-duty sewing machine.
• 40 percent off select bikes for the entire family.
• 50 percent off select Kenneth Cole Reaction shoes for men and 50 percent off select Frye boots for women.

eBay

Fellow e-commerce giant eBay.com is also offering substantial savings, most notably in the form of gift cards.

After selling a gift card every two seconds from Black Friday through Cyber Monday last year, the online auction and retail site started rolling out coupon offers on Nov. 23 this year. It will continue to do so through Cyber Monday, including these discounted offers:

• Lowes coupon: $ 200 for $ 175.
• Exxon: $ 100 for $ 92.
• JC Penny: $ 50 for $ 42.59.
• Wine.com: $ 50 for $ 40.

Suzy Deering, chief marketing officer of eBay North America, said consumers looking for bigger and better deals can find them on the site’s “Wish Bigger” holiday hub and on eBay’s mobile app, where “shoppers can snag great merchandise at a discounted price, whenever and wherever. Additionally, almost all our deals throughout the holidays will ship for free.”

Kohl’s

The department store retail chain has fashioned Cyber Monday deals spanning its entire range of merchandise, including clothing, jewelry, TV’s, electronics, toys, bed and bath products and kitchenware.

Some of the hottest deals here lie in the niche category of tech toys, including a World Tech Toys Spy Drone for $ 199.99, marked down from $ 349.99, and a Discovery Kids Digital Photo Camera at $ 29.99, down from $ 69.99.

In addition to mark-downs of up to 50 percent off, shoppers can knock off an extra 15 percent by using coupon codes (search using the store name and the word “coupon” or “promo code” and check couponing sites such as retailmenot.com or slickdeals.net) or by signing up for Kohl’s email alerts.

Nick Porfilio, the CEO of Saveful.com points to one Kohl’s sale as a particular standout: the Keurig K45 Elite Coffee Maker.

“It’s originally $ 149.99 but is on sale for $ 89.99. Then you can use promo code TURKEYTIME for an additional 15 percent off. This brings the final price to $ 76.49,” Porfilio said. “You’ll also get free shipping and $ 15 in Kohl’s Cash, which is a $ 15 coupon on a future purchase.”

The Children’s Place

Shoppers looking for gifts for little ones should check out The Children’s Place, which is offering is offering between 50 percent to 75 percent off plus free shipping, Kendal Perez, savings expert at CouponSherpa.com, told NBC News.

Related: Cyber Monday Shopping Could Top $ 3 Billion This Year

The savings apply to every product on the site — offering outstanding value on everything from like winter boots and fleece jackets, to basics like jeans and socks, and NHL, NFL, NBA, and MLB apparel.

Target

Target is calling this Cyber Monday its “biggest and boldest yet,” and for the first time is marking down everything on its website in order to offer a boundary-free shopping experience.

“Target.com’s site-wide15 percent discount is pretty aggressive and likely the best offer we’ve seen,” said Profitero’s Anderson.

In additon to the site-wide savings, use of the promo code CYBER15 gives consumers access to nearly 75 “e-door-buster” deals, including 50 percent off Sennheiser in-ear headphones; a Swagway x1 Hands-Free Smart Hoverboard for $ 399, down from a list price of 499; an Xbox One 500GB Gears of War: Ultimate Edition Bundle for $ 299.99, $ 50 less than its regular $ 349.99 price tag. The deal also comes with a free EA sports game, and a 3-month Xbox Live subscription.

Amazon has a new drone delivery video. Here are 8 details worth noting. – Washington Post

Almost exactly two years after first announcing its plans to deliver packages with a drone, Amazon revealed a new prototype of one of its delivery drones. Here are some interesting revelations:

1. Amazon built a "hybrid" drone

Amazon's prototype is an octocopter — meaning it has eight propellers and can take off and land vertically, like a helicopter. But the design also includes wings and a "pusher motor" so that it can transition from helicopter takeoffs to the energy-efficient flight of a plane at altitude. A pure octocopter wouldn't be capable of a range of 15 miles, like this prototype.

At altitude, only the pusher motor — the large propeller in the back of the drone — is in motion. The eight other propellers reactivate once the drone is about to land and needs to make a vertical descent into a yard.

2. Backyards will be key for Amazon Prime Air

The video shows the drone switching into "landing mode" and descending onto a "delivery zone" in the customer's backyard. The drone releases the package onto what looks like a sheet of plastic with an Amazon logo. The larger the yard and the less tree cover, the easier the landing will be.

3. Amazon sticks with a different approach than Google

Just like its first drone video, the Amazon drone lands to drop off a package. This is a different tactic than what rival Google has demonstrated, in which its hovering drone releases a package that floats to the ground.

Amazon will need to be certain its drone can land in a backyard without any mishaps involving a family pet, kids, stray sports equipment, a new birdbath or whatever else might be in a yard.

4. What about safety?

Amazon says its drone has "sophisticated 'sense and avoid' technology," which will be essential for those backyard landings. Everyone from big tech companies such as Amazon to start-ups is developing this technology, so that drones can identify obstacles and automatically avoid them. For example, with sense and avoid, a drone would realize a dog had strayed into its landing zone, and not land until the coast was clear.

Because this prototype has nine propellers it will still function even if multiple motors fail.

5. It'll likely be a lot faster than your local delivery truck

One section of the video, which Amazon notes is actual flight footage, shows the drone flying between 55-58 mph. That speed will come in handy if Amazon is going to deliver on its promise of getting packages to customers in 30 minutes.

6. It's a big drone

Amazon isn't saying how much this prototype weighs, only that its drones weigh less than 55 pounds. And it's not sharing the prototype's wingspan. If you look at the photo below and remember that blue box is actually a shoe box, it's obvious the drone is far larger than the consumer drones we see most frequently, such as the DJI Phantom and Parrot Bebop.

A larger drone means Amazon can carry larger packages. Larger drones are generally heavier, which increases risk in the event of the crash. At the same time, all that size creates space for the nine propellers — and a drone with nine motors has more back-up propellers that a drone with four propellers, which improves safety.

7. Remember, it's just a prototype.

Don't expect an exact replica of this drone to eventually land in your backyard. Amazon says it has more than a dozen prototypes in its research and development labs, and that the look of characteristics will continue to evolve. Amazon's prototype has changed quite a bit in two years, who knows what it'll look like in 2017.

8. Amazon chose a British broadcaster for voiceover purposes

Former Top Gear host Jeremy Clarkson — who is developing a show for Amazon — does the honors. Amazon has taken its testing overseas given its frustration with the slog toward commercial drone regulation in the United States. Amazon says it will launch Prime Air once it has regulatory support. Don't be surprised if it launches first outside the United States.

Amazon says the prototype can operate safely "beyond line of sight" to distances of 10 miles or more. That means outside the view of the person responsible for controlling it. However the FAA's proposed commercial drone rules, released in February, require drones to fly where the drone's pilot can see it. While U.S. drones may eventually be able to fly out of sight, the process isn't moving as fast as Amazon would like.

Related: Amazon's plans for how drones can fly safely over U.S. skies

New Amazon drone video, brought to you by Jeremy Clarkson – CNNMoney

Watch Amazon’s latest drone demo

Amazon is stoking interest in its drone delivery plan with a new video starring TV host Jeremy Clarkson and a “naughty, naughty” bulldog.

The video, published Sunday, imagines a family in the “not too distant future” receiving a replacement soccer shoe via drone after their bulldog chews up the original.

It is the first such video from Amazon in two years, showcasing new flight footage and revealing a new design for the company’s drone fleet.

Amazon is seeking to win public support for its project and overcome regulatory hurdles in the United States, United Kingdom and elsewhere.

“In time there will be a whole family of Amazon drones, different designs for different environments,” Clarkson says, narrating footage of a drone flying over a suburban area.

“This one can fly for 15 miles,” he says. “And it knows what’s happening around it. It uses ‘sense and avoid’ technology to, well, sense and then avoid obstacles on the ground and in the air.”

Amazon first spoke publicly about its plans for the Prime Air delivery service in December 2013. “I know this looks like science fiction. It’s not,” Amazon CEO Jeff Bezos said on “60 Minutes.”

Back then, Amazon shared footage of a delivery drone taking a package to a customer, but the company’s engineers have clearly made many enhancements since then. In Sunday’s new video, the drone flies much higher and seems to be more stable.

Clarkson, the narrator, is known around the world as the host of the BBC’s “Top Gear.”

When the BBC sacked him earlier this year, Clarkson and his producing partners struck a deal with Amazon. Their new show will debut on Amazon sometime next year.

In the promotional video for Prime Air, Clarkson describes Amazon’s drone design in a way that is meant to assuage safety concerns.

“After rising vertically like a helicopter to nearly 400 feet, this amazing hybrid design assumes a horizontal orientation and becomes a streamlined — and fast! — airplane,” he says.

As the drone approaches its destination, the customer receives a message on a tablet “to say that your Prime Air delivery is arriving,” he continues.

Once approved for a landing (via a tap on the tablet) the drone “goes back to vertical mode and scans the landing area for potential hazards. This amazing innovation then lowers itself slowly to the ground, drops off the package, and flies straight back up to altitude.”

An Amazon spokesperson did not immediately respond to a request for further comment. But the company’s website was updated on Sunday with new information about its plans.

“Amazon Prime Air is a future service that will deliver packages up to five pounds in 30 minutes or less using small drones,” the site says.

“Flying under 400 feet and weighing less than 55 pounds, Prime Air vehicles will take advantage of sophisticated ‘sense and avoid’ technology, as well as a high degree of automation, to safely operate beyond the line of sight to distances of 10 miles or more,” it adds.

Amazon’s specifications are partly a response to FAA regulations. The government is working on rules for drones that weigh less than 55 pounds.

An early draft of the rules only allowed drones to fly within a user’s line of sight. Amazon expressed its disagreement with this restriction over the summer, and the new drone video asserts that the vehicles can safely go further distances.

Amazon’s website was also updated on Sunday to say that “we are testing many different vehicle designs and delivery mechanisms to discover how best to deliver packages in a variety of environments.”

Amazon says it has “more than a dozen prototypes.” The FAA approved tests in the U.S. earlier this year.

As for when the drones could start flying over your head, Amazon remains noncommittal about any specific date.

“Putting Prime Air into service will take some time,” Amazon said. “We will deploy when we have the regulatory support needed to realize our vision.”

CNNMoney (New York) November 29, 2015: 3:42 PM ET

Yellen will check her list twice before Fed raises rates – Honolulu Star-Advertiser

Janet Yellen will never be confused for Santa Claus. But the chairwoman of the Federal Reserve shares the habit of double-checking her work before coming to a conclusion.

Federal Reserve bankers get their last major economic statistic this week before their interest rate meeting in mid-December. November employment data will be released Friday. A strong month of both job growth and wage growth likely will seal the fate for the Fed to raise interest rates in December. Login for more…

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121 million consumers are expected to shop online on Cyber Monday – InternetRetailer.com

November 29, 2015, 4:42 PM

By Matt Lindner Associate Editor

Because retailers have been offering deals for weeks, many shoppers feel less pressure to shop online on the Monday after Thanksgiving, according to the National Retail Federation.

Fewer consumers are expected to shop online on Cyber Monday than did last year—but that's likely due to retailers spreading out holiday savings over a longer period of time.

That's according to a just-released study from the National Retail Federation and Prosper Insights & Analytics, which projects that 121.3 million consumers will shop online tomorrow, down 4.4% from 126.9 million last year. That 121.3 million number represents 49.5% of all consumers, the first time less than half of all shoppers surveyed said they planned to shop on Cyber Monday since 2010. Last year, 52.3% of all shoppers said they were planning to shop online on Cyber Monday.

While fewer people are expected to shop online on Cyber Monday, that's not necessarily an indication that consumers are expected to shop less this holiday season in general.

"Tomorrow's gonna be a huge day, there's gonna be no question about it," says National Retail Federation CEO Matthew Shay. "We look at this weekend as the season continues to evolve, it's almost the second quarter now going on halftime whereas once upon a time this is when the game started. We know that's not the case anymore. The game starts a lot earlier than Thanksgiving weekend."

Cyber Monday culminates a 5-day holiday shopping period that this year has been marked by an accelerating shift toward shopping on the web. Adobe Inc.'s Digital Index, based on data from its e-retailer clients, suggests consumers spent $ 4.47 billion online on Thanksgiving Day and the following day, which is widely known as Black Friday. But store sales—excluding e-commerce—fell about 10% on Thursday and Friday to $ 12.1 billion, according to ShopperTrak, which monitors traffic to stores and malls.

ComScore Inc. reports that consumers spent $ 1.096 billion on desktop devices on Thanksgiving Day, up 8.6% from $ 1.009 billion last year. On Black Friday, shoppers spent $ 1.656 billion on desktop devices, up 10% from $ 1.505 billion last year. ComScore, which tracks the online activity data of some 1 million U.S. consumers did not include purchases on mobile devices in this report, which likely accounts for the percentage increase being less than that reported by Adobe, which does include the growing purchases consumers make on smartphones and tablets.

"Looking ahead to Cyber Monday, we expect to see upwards of $ 2.5 billion in desktop spending as people return to their work computers after Thanksgiving weekend and use some of their down time to continue their holiday gift buying, but without other family members looking over their shoulders,” said comScore chairman emeritus Gian Fulgoni.

Retailers say they've noticed a change in consumers' shopping habits.

"Sales are up this holiday compared to the past few years," says James Wu, chief operating officer of online electronics retailer Newegg Inc. "People are shopping earlier than ever, and they're responding very well to our early holiday deals, which launched (last) Monday."

Wu says Newegg.com will be prepared to offer more deals tomorrow. "We're getting ready to release several hundred new deals to ensure shoppers will have plenty of fresh deals to choose from on Monday," he says.

Those Cyber Monday shoppers are going to be increasingly mobile this year. 29.6 million said they plan on shopping on a smartphone or a tablet, up 21.2% from 24.5 million shoppers last year, according to the Prosper Insights survey for NRF.

"Looking at the smartphone trend and the mobile device usage for Cyber Monday, that's the highest level we've ever seen," says Pam Goodfellow, principal analyst at Prosper.

The NRF reports that 103 million consumers shopped online this weekend, with 151 million people shopping either online or offline. The latter is more than the 135.8 million that the NRF originally projected. Goodfellow says the continued growth of online deals and discounts has many shoppers feeling empowered these days.

"Consumers really feel like they have that upper hand with retailers," she says.

"One-third of consumers indicated that 100% of what they purchased was purchased at a discount," Shay adds.

And while the trend is towards lowering the free shipping threshold or even eliminating it altogether, Goodfellow says having one in place could help online retailers drive additional and unplanned for revenue.

"When you buy online and you're trying to meet a $ 50 or $ 75 threshold and you have to throw a couple of extra items in your cart to get free shipping, I think there is some impulse buying going on online," she says. "What our information shows over the past couple of months is if consumers find a great deal, they'll take advantage of it. That moves into the impulse buying."

It wasn't just U.S. shoppers buying from U.S. e-retail sites over the weekend. Pitney Bowes Inc. reports a 38% increase in purchases by Chinese shoppers on Black Friday over last year, based on data from 130 U.S. online retailer clients. Canada was in second place, as purchases from that country increased 3% over last year on Friday, and was followed by the United Kingdom, South Korea and Australia.

Black Friday store sales drop as Americans opt to buy more online – New York Daily News

WASHINGTON — Black Friday shopping is shifting from hours spent in line to more time online.

Sales at retail stores on Black Friday fell to $ 10.4 billion this year, down from $ 11.6 billion in 2014, according to preliminary figures from research firm ShopperTrak.

And sales on Thanksgiving dropped to $ 1.8 billion from just over $ 2 billion. The firm compiled data from 1,200 retail chains. The figures don’t include e-commerce.

CYBER MONDAY TECH GUIDE: THE BEST DEALS ANNOUNCED SO FAR

A big reason for the declines is increased online shopping, as Americans hunt down deals on their smartphones, tablets and computers. Another key factor: Many retailers are offering bargains long before Thanksgiving, limiting the impact of Black Friday specials.

Still, most analysts expect this year’s holiday sales to show stronger growth than last year’s. Americans are starting to see early signs of pay increases, hiring has been solid in the past year, and low gas prices are leaving more money in shoppers’ pockets.

“There’s a lot of strength in the consumer,” said Bill Martin, co-founder of ShopperTrak. Even with the slip in sales, “Black Friday will end up being the number one sales day in retail this year.”

Gerri Spencer and her daughter Jasmine Hansen were enthusiastic participants in Black Friday shopping this year. They left Spencer’s home at 4 a.m. Friday and were at Cabela’s, a hunting and outdoor equipment store, in Kansas City, Kansas, an hour later.

“There was a very long line, a few tents and a lot of lawn chairs,” Spencer said. “They posted signs saying you can’t have a fire.”

Spencer said she spent a little more than normal this year. “I feel the economy has picked up in a few areas, and I felt the pull of the holiday spirit,” she said.

Online retailers have been bombarding customers with email discounts for weeks. Online sales jumped 14.3 percent on Friday compared with last year, according to Adobe, which tracked activity on 4,500 retail websites. Email promotions drove 25 percent more sales compared with 2014, the company said.

Chris Christopher, director of consumer economics at consulting firm IHS, predicts that holiday season e-commerce sales will jump 11.7 percent this year to about $ 95 billion, up from last year’s 10.9 percent gain. IHS considers the holiday shopping season to include both November and December.

That’s a much larger increase than the 3.5 percent gain Christopher forecasts for total holiday retail sales, including both online and in traditional retail stores. Overall, about $ 1 in every $ 7 in holiday shopping sales will occur online this year, IHS predicts.

Retailers have also started offering deep discounts as early as Halloween, even advertising them as “Black Friday” deals, Martin said. Auto dealers have gotten in on the game and are offering “Black Friday” discounts.

“Consumers have shifted and started earlier,” Martin added. Americans are doing more of their holiday shopping in November, he said, a decade-long trend, even though December remains the month in which consumers spend the most.

The move toward earlier discounts was intensified this year because many retailers struggled with overstocked warehouses and store shelves heading into the fall, Christopher said. That prompted many to offer deep discounts as early as the beginning of this month.

“The price discounting has been creeping toward Halloween,” he said.

Shoppers are even starting to postpone some of their back-to-school purchases until later in the fall, in anticipation of such deals, Christopher said.

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China brokerages investigated over margin trading contracts – Reuters

The signboard of CITIC Securities is seen at its head office in Beijing March 27, 2013.

Reuters/Kim Kyung-Hoon

Chinese brokerages currently under scrutiny from the country’s securities regulator are being investigated for suspected rule breaches related to the signing of margin trading contracts, they said in separate filings on Sunday.

Shares in Shanghai sank more than 5 percent on Friday, the biggest drop since the summer rout, after brokerages announced that they were under investigation by the China Securities Regulatory Commission.

China’s biggest brokerage, CITIC Securities (600030.SS)(6030.HK), said on Sunday that the investigation was looking into possible violations of rules on margin trading contracts with clients, adding that the company is operating normally during the probe.

Smaller rivals China Haitong Securities (600837.SS)(6837.HK) and Guosen Securities (002736.SZ) issued similar statements.

China Haitong Securities’ (600837.SS)(6837.HK) statement on the Hong Kong Stock Exchange said it would continue to comply fully with its disclosure obligations.

After the stock market slump began in mid-June, Beijing launched a massive and unprecedented rescue effort and began cracking down on insider trading and short-selling, which it said were partly to blame for market volatility.

Haitong, along with Guotai Junan Securities (601211.SS), is also being probed by anti-corruption investigators, the official Xinhua news agency reported on Tuesday.

(Reporting by David Stanway and Zeng Xiangjin; Additional reporting by Michelle Chen; Editing by David Goodman)

Holiday shopping unlikely to cheer many investors – Reuters

The holiday shopping rush that kicked off on Friday is unlikely to bring much cheer to investors looking for a revival in retail stocks.

After months of uninspiring sales growth and recent disappointments from Macy’s (M.N) and Nordstrom (JWN.N), shareholders of apparel sellers have had little to be thankful for and face a challenging holiday season.

Those stocks have reflected a shift by consumers away from discretionary items like designer-label clothes and cosmetics toward smartphones, televisions, home goods and travel, as well as an ongoing migration to online spending.

Early indications suggested this year’s holiday season was off to a slow start. Crowds were thin at U.S. stores and shopping malls in the early hours of Black Friday and on Thanksgiving evening, as shoppers responded to early holiday discounts with caution.

Macy’s stock has plummeted 39 percent this year while Nordstrom is down 22 percent and Tiffany & Co (TIF.N) is 23 percent lower – all far worse than the benchmark S&P 500 index’s 1-percent gain.

On the other hand, Home Depot (HD.N) has surged 29 percent in 2015 and discount store Dollar Tree (DLTR.O) is up 6 percent.

The S&P 500 retail index .SPXRT has risen 27 percent this year, with much of that gain driven by its largest component, Amazon.com (AMZN.O), which continues to undercut brick-and-mortar rivals and has seen its stock more than double this year.

Earnings expectations vary for the holiday shopping quarter; Lowe’s (LOW.N) on average is expected to grow its earnings by 29 percent from a year ago while videogame store GameStop (GME.N) is seen growing earnings by 9 percent, according to Thomson Reuters data.

Gap Inc (GPS.N), which warned this month about weak sales and a strong dollar, is seen posting a 24 percent drop in fourth-quarter earnings.

“You really have to bifurcate between the largely apparel retailers and hard-goods retailers,” said Anthony Chukumba, an analyst at BB&T Capital Markets.

His top picks include discount retailer Big Lots (BIG.N) as well as Best Buy (BBY.N), which specializes in the electronic goods consumers are buying these days and also has a compelling valuation at 12 times expected earnings. By comparison, Nordstrom trades around 17 times earnings and Target (TGT.N) has a price-earnings ratio of 15.

Polls going into holiday season have been mixed: A Reuters/Ipsos survey found more people planned to cut holiday spending than to boost it, while Gallup reported Americans plan to spend an average of $ 830 each on gifts this season, up from $ 720 a year ago at this time.

U.S. retail sales edged up a meager 0.1 percent last month after staying unchanged in both September and August, according to the Commerce Department.

FBR technology analyst Daniel Ives and his team planned to visit at least 25 Best Buys and other big-box stores over the weekend in New York and other major cities to gauge consumer appetite for Microsoft’s (MSFT.O) Xbox One game console and Apple’s (AAPL.O) smartwatch, launched in April.

“It’s not quantitative, but it gives you anecdotal data points that become part of the mosaic of your thesis about whether to be bullish or bearish on trends, names and products,” Ives said.

Since 2008, early sales estimates following Black Friday and Cyber Monday have had little or no bearing on retail stock performance for the holiday quarter, according to a report by LPL financial.

The short-term performance of stocks in the week after Thanksgiving has also been similarly inconsistent.

For the past three years, Wal-Mart Stores (WMT.N) has lost as much as 3.9 percent or gained as much as 2.6 percent in the week following Black Friday, according to Thomson Reuters data.

By comparison, the S&P 500 has been flat to up 0.5 percent in the week following Black Friday for the past three years.

Amazon.com’s (AMZN.O) stock performance in the week following Thanksgiving has been even more erratic. It lost 8 percent last year, lost 2 percent in 2013 and jumped 5 percent in 2012.

(Editing by Bernadette Baum)

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