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11Apr2016 Market Update: DOW Up Triple Digits, Crude Volatile In The Low 40's, US Dollar Remains Weak

Written by Gary

US markets open higher, made the morning dip and are being driven higher by materials stocks on Monday as a weaker dollar boosted commodities, and investors turned their focus to the earnings season. Alcoa Inc. is scheduled to kick off the first-quarter earnings reporting season on today, after the market closes and is expecting a third straight quarter of declines in both earnings and revenue.

Here is the current market situation from CNN Money

North and South American markets are higher today with shares in U.S. leading the region. The S&P 500 is up 0.42% while Mexico's IPC is up 0.37% and Brazil's Bovespa is up 0.25%.

What Is Moving the Markets

Here are the headlines moving the markets.

Wall Street gains as weak dollar boosts commodities

(Reuters) - Wall Street gains were driven by materials stocks on Monday as a weaker dollar boosted commodities, and investors turned their focus to the earnings season.

Dell's SecureWorks valued at $1.42 billion in year's first tech IPO

(Reuters) - Dell Inc's [DI.Ul] cyber security unit, SecureWorks Corp, could be valued at up to $1.42 billion in its initial public offering, the first major U.S. listing of a technology company this year.

Volkswagen aiming to return to debt market as early as May: sources

FRANKFURT (Reuters) - Volkswagen is hoping to return to the bond market as early as May, people familiar with the matter said, aiming to raise billions of euros to replace the costly bank loan it has been relying on in the wake of its emissions test cheating scandal.

Tesla to voluntarily recall 2,700 Model X SUVs over seat issue

SAN FRANCISCO (Reuters) - Tesla Motors Inc said on Monday it was issuing a voluntary recall of 2,700 Model X sport utility vehicles in the United States due to a faulty locking hinge in the third-row seats that increases the risk the seats could fall forward in a crash.

Microsoft offers first major endorsement of new EU-U.S. data pact

BRUSSELS (Reuters) - Microsoft became on Monday the first major U.S. tech company to say it would transfer users' information to the United States using a new transatlantic commercial data pact and would resolve any disputes with European privacy watchdogs.

Chesapeake Energy's borrowing limit maintained at $4 billion

(Reuters) - Chesapeake Energy Corp said its borrowing limit was reaffirmed at $4 billion, at a time when most oil and gas producers are bracing for steep cuts to their credit lines.

France seeks G20 tax haven blacklist, EU sanctions on evaders

PARIS (Reuters) - France will seek tougher EU sanctions on people who help to facilitate tax evasion and a G20 blacklist of uncooperative tax havens, the Finance Ministry said on Monday following the Panama Papers leaks.

Britain finds a buyer for one Tata steel plant, saving a third of jobs at risk

LONDON (Reuters) - Tata Steel agreed to sell one of its main British steelworks to investment firm Greybull Capital for 1 pound on Monday, saving a third of the 15,000 jobs placed in jeopardy by the Indian conglomerate's decision to sell up in Britain.

Mystery deepens over $3.5 billion Malaysia's 1MDB sent to BVI entity

ABU DHABI/KUALA LUMPUR (Reuters) - The mystery over who controlled a British Virgin Islands-registered company that received $3.5 billion from Malaysia's scandal-tainted state fund 1MDB deepened on Monday when a company in the Middle East with an almost identical name said the BVI firm did not belong to it.

Chesapeake Forced To Pledge Entire Company As Collateral To Preserve Existing Credit Facility

As we enter the critical spring borrowing base redetermination season, which as we previewed previously is the biggest threat to near-insolvent energy companies whose banks may, and in many cases will, decide their assets are worth far less and as a result dramtically cut their revolver availability, one of the biggest question marks was how generous would the banks of troubled gas giant Chesapeake be, whose $4 billion credit facility is one of the few things keeping the company still afloat.

We got the answer earlier today when the company announced it had succeeded in maintaining its entire $4 billion borrowing base and as a result would not suffer an imminent liquidity crunch. From the release:

Chesapeake Energy Corporation today announced it has amended its $4.0 billion secured revolving credit facility agreement maturing in 2019 with its bank syndicate group. Key attributes include:

Borrowing base reaffirmed at $4.0 billion, consistent with current availability

Next scheduled redetermination of borrowing base postponed until June 2017

Senior secured leverage ratio covenant relief granted until September 2017

Interest coverage ratio covenant reduced to 0.65x through March 2017

Following the recent redetermination review by its bank syndicate group, Chesapeake's senior secured revolving credit facility borrowing base was reaffirmed at $4.0 billion, consistent with current availability.

The stock promptly took off and was some 13% higher at last check.

Silver Surges Most In 6 Months As Hedgers Cover

The last 3 days have seen silver prices surge over 6%, testing back towards the psychologically important $16 level.

Having been pressured lower after the ECB bounce, the precious metal jumped perfectly off its critical 200-day moving-average, nearing the highs of the year once again.

It appears some of the recent driver is the largest unwind of commercial hedges since November...

Earnings Implosion Looms Amid The Illusion Of "Permanent Liquidity"

Submitted by Lance Roberts via,


If you like volatility, you had to love this past week. After sliding 22 points on Tuesday, the market rebounded sharply on Wednesday, gave up those plus more on Thursday, and as of Friday is struggling to stay positive.


The spike on Wednesday followed the release of the FOMC minutes which confirmed "bad news is still good news" for the markets as global weakness is keeping the Fed from hiking rates. The surge out of the gate on Friday was again "Fed Speak" as Fed President William Dudley continued "dovish" comments suggesting no rush to hiking rates anytime soon. To wit:

"Caution is needed because of our limited ability to reduce the policy rate to respond to adverse developments, recognizing that we could also use forward guidance and balance sheet policies to provide additional accommodation if that proved warranted.

Although the downside risks have diminished since earlier in the year, I still judge the balance of risks to my inflation and growth outlooks to be tilted slightly to the downside."

And with those "silk ...

ZIRP, NIRP, QE, Bank Collapse and Helicopters Coming Too Late - The Lehman Effect Hits Europe - Hard!

It's official, I'm calling a banking crisis in Europe. Things didn't go well the last time I did this. Of course, many will say, "But the rating agencies have learned their collective lessons. They would most assuredely warn us if the European banks are close to going bust, right?!!!". Yeah, right! Reference our past research note on so-called trusted parties in private blockchains for banks. Those interested in purchasing the 22 page report on what is likely the first major bank to fall victim to the coming Pan-European Banking Crisis can do so here. All others, feel free to read on...

Yahoo: Verizon Is Still the Bidder to Beat

Yahoo may be attracting attention from a number of potential buyers, but Verizon has the heft to guarantee itself a win.

Nvidia Won't Run Out of Road

Shares of chip maker Nvidia have gotten expensive, but a focus on games, cars and the cloud can still pay off.

Putting M&A Hopes on Hold in Europe

The U.K. antitrust watchdog has come out publicly against the merger of CK Hutchison's Three network and Telefónica's O2. Deal makers will need new approaches.

Market Snapshot: Stocks follow oil futures higher ahead of Alcoa earnings

U.S. stocks were trading higher, but off their best levels of the session, as oil futures rallied and the dollar trading lower against most of its rivals.

Earnings Outlook: What to expect from Wells Fargo's earnings

San Francisco-based mortgage giant is expected to report before the bell on Thursday.

The Fed: Bernanke says so-called helicopter money could work

Helicopter Ben himself weighs in on the economic topic du jour.

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