Monday Morning Cheat Sheet: 3 Stories Moving Markets

Markets were mixed in Asia overnight. Japan’s Nikkei index climbed 1.20 percent, once again setting a new 52-week high after the yen briefly broke below 102 to the dollar. In Hong Kong, the Hang Seng fell 1.42 percent, while Australia’s S&P/ASX 200 edged up 0.08 percent.

Stocks declined in mid-day trading in Europe. Traders and investors seemed worried that the recent climb to five-year highs was not built on solid earnings performance or economic data. Germany’s DAX was off 0.37 percent, London’s FTSE 100 was off 0.19 percent, and the STOXX 50 index was off 0.44 percent.

U.S. futures at 8:50 a.m.: DJIA: -0.10%, S&P 500: -0.12%, NASDAQ: -0.12%.

Here are three stories to keep an eye on:

1) Japan’s Monetary Policy Has a Tepid Green Light: The Bank of Japan announced at the beginning of April that it would throw 7.5 trillion yen ($80 billion at the time) at the yield curve every month, or nearly 1.4 percent of GDP, and would double its monetary base in the coming years. All this was expected to weaken the yen, but G7 economic leaders voiced support for the program as long as the focus remained on domestic growth.

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However, a new storm of skepticism over the program is brewing now that the yen has weakened below 100 to the dollar. G7 leaders, meeting informally over the weekend in England, jointly reaffirmed their commitment not to use monetary policy to competitively weaken currencies. While they once again voiced support for Japan’s program, reports indicate that concerns were voiced as well, packaged into comments about the dangers of “the relatively high levels of liquidity” flowing through the global economy.

2) Chinese Industrial Production Remains Relatively Soft: Chinese industrial production climbed 9.3 percent on the year in April, missing expectations for 9.6 percent growth but still an improvement over March’s 7-month low growth rate of 8.9 percent. On the month, industrial production edged up 0.87 percent.

Gains were led by motor-vehicle production, which was up 18.3 percent, which follows a 12.4 percent gain in March. These gains are in-line with strong car sales in the nation and expectations by major automobile manufacturers that China will continue to be one of the strongest markets in the coming years.

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3) Government Data Shows Mind-Boggling Healthcare Costs: Data compiled from 3,300 hospitals nationwide by the Department of Health and Human Services in 2011 showed a great disparity in the actual cost of health services compared to the prices listed on hospitals’ chargemasters.

The Department’s Centers for Medicare and Medicaid Services released a file Wednesday that contained the list — known as the chargemaster — of prices charged by all hospitals across the United states for the 100 most common inpatient treatment services, and what Medicare paid for those same treatments. Medicare typically paid a fraction of the chargemaster prices… (Read more.)

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