New York morning espresso

** FT News **

* US warns on China air force spending | A Pentagon report claims that Beijing’s annual defence spending is 20% higher than officially claimed and closer to $145bn

* Execution video shows brutality in Ukraine | In the video, a man resembling Igor Bezler, a pro-Russia separatist leader, demands that Kiev free a prisoner, or he will execute more hostages

* China set to expel Tiananmen artist | Guo Jian, an Australian citizen, was detained by Chinese authorities this week after giving an FT interview on the Tiananmen Square massacre

* D-Day ceremony provides diplomatic stage | Putin and Poroshenko, Ukraine’s newly elected president, set to join Obama and more than a dozen other government heads to mark the D-Day landings

* World Bank backs Crédit Agricole loans | International Finance Corporation wing will provide $90m worth of credit risk protection on a wide variety of emerging market loans

* Mexico’s buzz driven by brand-crazy customers | Appetite growing in region’s second-biggest economy

* BHP Billiton pins hopes on China demand | Anglo-Australian mining group, which just cut jobs in its iron ore arm, hopes demand for energy and fertiliser will take up the slack as steel sector softens

* West warns Russia of Ukraine sanctions | New threshold will be Putin’s recognition of Poroshenko and prevention of the flow of arms and militants across the Ukrainian border

* Baghdad and Kurds in battle of wills | Tanker entangled in a diplomatic dispute between Turkey and Iraq as Kurdish regional capital Irbil makes a bid for greater independence

** FT Opinion **

- What Xi and Putin think about the west | The stable relationships of the future require understanding the other side’s mindset and a willingness, when necessary, to be tough

- Strongmen return to dash Arab spring hopes | The newly entrenched rulers would be wrong to assume nothing has changed, with people likely to be far more impatient and demanding of accountability

- Iran: Rogue trader | Secret sanctions-evading oil deals were only the start of the corruption that thrived under Ahmadi-Nejad. Can the country clean up?

- Angola: Gulfs apart | Vast oil reserves and the prospect of more to come have created rapid growth but the wealth remains stubbornly concentrated among the elite

** BB recent & required reading **

- Guest post: Indonesia is missing a Modi | By Wellian Wiranto of OCBC Bank The past year has not been easy for India and Indonesia. Faced with slowing growth, festering fiscal deficits, ballooning current account gaps and political uncertainties, the two had the common misfortune of being counted into the Fragile Five group of challenged economies. With Indonesia’s presidential election taking place a month from now, there are hopes that the country can find a Modi-like savior in Joko Widodo, the frontrunner in the race.

- Brazil: missing out in Africa | Remember the days when Brazil’s former president Luiz Inácio Lula da Silva sought to make Latin America’s largest country the foremost foreign diplomatic and business presence in Africa? Not only was he a frequent flyer there but Brazil’s corporate giants such as miner Vale and construction company Odebrecht invested, posing a challenge to other foreign powers such as China in the great game for the continent. Today, however, Brazil is failing to take this push to the next level, if you believe a report from Safmarine, a South Africa-based international container shipping line.

- UK “twiplomat” dramatises African twitter surge | When a self-styled “twiplomat” – a.k.a the UK’s High Commissioner to Kenya – throws a tweet-while-you-eat dinner party for the twitterati of Nairobi, then a milestone of sorts may have been passed in Africa’s social networking journey. Christian Turner, who has just shy of 30,000 Twitter followers, hosted the evening – called #EatTweet2 – to emphasise the growing importance of social media in Kenya’s political and social life.

** From elsewhere **

Thaci set to hold onto power in Kosovan vote despite new challenges (Business New Europe)

The other victims of the Ukraine crisis: Indian medical students (Quartz)

Latin America’s Great Economic Divide (Bloomberg Business Week)

** Markets: mixed **

Emerging Markets
MSCI Emerging Market Index up +0.23% at 1,037

Europe
FTSE up +0.33% at 6,836
RTS down -0.57% at 1,326
Warsaw Wig up +0.12% at 52,963
FTSE 300 Eurotop up +0.22% at 1,383

Americas
DJIA up +0.59% at 16,836
S&P 500 up +0.65% at 1,940
Bovespa down -0.53% at 51,559

Asia
Nikkei 225 down -0.01% at 15,077
Topix up +0.15% at 1,235
Hang Seng down -0.69% at 22,951
Shanghai Composite down -0.54% at 2,030
MSCI Asia ex-Japan up +0.04% at 488.84
CNX Nifty up +1.46% at 7,583

Currencies
€/$ 1.36 (1.37)
$/¥ 102.35 (102.38)

Commodities
Brent Crude (ICE) up +0.31 at 109.10
Light Crude (Nymex) up +0.20 at 102.68
100 Oz Gold (Comex) unchanged 0.00 at 1,253