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** FT News **

* Argentina defaults after last-minute talks fail | Economy minister says ‘vulture’ funds reject renewed offer and S&P takes action after interest payment deadline passes

* Alibaba talks could price Snapchat at $10bn | Pioneer of self-destructing instant messages has held discussions about selling a stake to the Chinese internet group as part of a funding round Continue reading »

They may have left their country for vacation, but a number of Argentine tourists in midtown Manhattan nonetheless found themselves at the centre of the most significant news event facing their country on Wednesday: last-minute negotiations to try to avert a default, Luc Cohen reports.

For the second straight day, Economy Minister Axel Kicillof and his delegation met in New York with court-appointed mediator Daniel Pollack to try to strike a deal with a group of hedge funds led by NML Capital who refused to accept bond restructuring after Argentina’s last default. Continue reading »

** FT News **

* Total suspends Russian share purchases | Total froze its programme of buying stock to raise 18% stake in Russia’s Novatek on the day Flight MH17 was shot down over Ukraine Continue reading »

** FT News **

* EU and US toughen sanctions on Russia | Sweeping measures intended to cripple economy and convince the Kremlin to abandon its support for pro-Russian separatists in Ukraine

* Israeli military pushes deeper into Gaza | The IDF is racing to destroy a network of Hamas tunnels more extensive than it previously thought, even as condemnation of the war outside Israel grows Continue reading »

It is not hard to find evidence of Egypt’s extensive informal economy. It is present everywhere from the rickety microbuses that are poor Egyptians’ main means of transport, to the myriad small businesses which repair, build, supply and otherwise serve the needs of this population of some 85m people.

A World Bank report on the Egyptian labour market released on Wednesday, finds that informality in employment has been deepening, meaning that the proportion of Egyptians in poor-quality jobs without written contracts or social security has been rising, even during years of higher economic growth in the past decade. Continue reading »

Argentina's President Cristina FernandezIt may be difficult to argue convincingly that a default could be anything but bad for Argentina’s economy – the real question is just how bad – but it is less clear what it means for politics.

You might think that little could be of greater importance for leaders of a country in very serious danger of falling into default in a matter of hours than to be doing their utmost to prevent this from happening. Continue reading »

** FT News **

* Former Yukos shareholders awarded $50bn | An arbitration panel in The Hague has ruled against Russia in one of the biggest awards ever made against a sovereign state

* Gaza conflict resumes as truce hopes fade | Diplomatic efforts to agree a cessation of hostilities continue after a brief pause in the fighting breaks down and casualties start to mount once more Continue reading »

Israel and Brazil are locked in a diplomatic spat after Latin America’s biggest country issued a statement condemning Benjamin Netanyahu’s government for using “disproportional” force in Gaza but failed to mention the role of Hamas in the conflict.

An Israeli spokesperson called Brazil a diplomatic dwarf and described it as irrelevant in terms of international diplomacy. Continue reading »

** FT News **

* Russia’s central bank lifts key rate to 8% | Russia’s central bank unexpectedly lifted its key benchmark interest rate to 8 per cent, citing the impact of heightened geopolitical tensions on inflation risk.

* West Bank erupts in anti-Israel protests | Israel’s military had no immediate comment on the shelling attack on the school, which brought the total death toll in Gaza to nearly 750 Continue reading »

We’ve written recently about the scarcity of liquidity on EM secondary markets caused by regulatory changes and loose monetary policies in developed economies since the crisis of 2008-09. We’ve noted that those developments have also delivered abundant liquidity on primary markets, where bonds and equities are first issued (unlike secondary markets, where they are subsequently traded).

Flush with cash and hungry for yield, many investors have snapped up emerging market bonds and other assets they might well have sniffed at in more ‘normal’ times. Some analysts worry that this is driving a bubble. It may also be causing a related phenomenon: a breakdown in the correlation between risk and reward. If that is confirmed, a lot of EM investors face a nasty surprise. Continue reading »

** FT News **

* Israel shells UN school used as a shelter | Israel’s military had no immediate comment on the shelling attack on the school, which brought the total death toll in Gaza to nearly 750

* US says Russia fired artillery at Ukraine | Yatseniuk rebukes parliament for betraying revolution, while EU ambassadors reach no conclusion on widening sanctions against Russia Continue reading »

More glum news for Mexico’s economy, which has been growing at turtle speed this year. Growth in May came in below expectations – again.

According to the state statistics office, growth in May was a disappointing 1.4 per cent, below market forecasts for nearer 2 per cent. Continue reading »

** FT News **

* EU to weigh extensive sanctions on Russia | Proposal includes ban on buying new debt or stock of Russia’s largest banks and from listing new shares on European exchanges

* Emerging markets slowdown hurts Unilever | Maker of Lipton tea and Dove soap reports bigger than expected drop in first-half sales as weakening currencies wipe €413m off operating profits Continue reading »

** FT News **

* Fears rise of Russia-fuelled arms race | Downing of Kiev fighter jets adds to suspicions among western intelligence officials who point to an extensive weapons-smuggling operation

* Why Slim’s three-day week is a great idea | A shorter week would work for many others if their companies have the imagination to agree to it Continue reading »

After a false start this year, it’s time to rev those engines: Mexico’s dreams to return to Formula One are finally back on track.

The government has announced a five-year 2015-19 deal to host the race, marking Mexico’s return to the circuit after an absence of 23 years. Continue reading »