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08Jun2016 Pre-Market Commentary: US Markets Fractionally Higher, No Rate Hike Rumor Sending Stocks Higher Along With Crude Prices

Written by Gary

US stock future indexes are fractionally higher (SPY +0.1%) and the SP 500 is trading trading at noteworthy resistance levels (Nov '15, Apr '16 peaks). Yellen called the recent U.S. jobs numbers "concerning" but warned against attaching too much significance to the payrolls data in isolation. Bye-bye summer rate hike? The US Dollar, looking for a dead cat bounce then analysts are expecting it to go lower pushing crude price higher.

Here is the current market situation from CNN Money

European markets are mixed. The FTSE 100 is higher by 0.07%, while the DAX is leading the CAC 40 lower. They are down 0.45% and 0.26% respectively.


The June S&P 500 was higher overnight as it extends this year's rally. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term.

If June extends this year's rally, weekly resistance crossing at 2133.40 is the next upside target. Closes below the 20-day moving average crossing at 2075.91 are needed to confirm that a short-term top has been posted.

First resistance is Tuesday's high crossing at 2117.80. Second resistance is weekly resistance crossing at 2133.40. First support is the 10-day moving average crossing at 2100.08. Second support is the 20-day moving average crossing at 2075.91.

On the oil major's capital markets day, Shell (RDS.A, RDS.B) declared it was still on track to sell assets worth $30B by 2018 and pledged to save up to $4.5B thanks to synergies from its takeover of BG.

Shell further anticipates the potential for $20-25B of organic free cash flow - based on a $60 oil price environment - and 10% ROACE around the end of the decade. It also said its priorities were to reduce debt, pay dividends and achieve a "balance between capital investment and share buy backs."

What Is Moving the Markets

Here are the headlines moving the markets.

Frustrated in China, U.S. industry hopes for post-election reset to annual talks

BEIJING (Reuters) - As the United States and China wrapped up talks this week touting bilateral cooperation on strategic and economic issues, many in the U.S. business community say the annual dialogue is delivering diminishing returns in resolving commercial disputes.

World stocks struggle to build on highs as Europe weighs

MILAN (Reuters) - World stocks struggled to build on six-week highs on Wednesday after mixed Chinese data, weighed down by a weaker session in Europe and political concerns that sent Germany's 10-year government bond yield to a record low.

OECD lead indicator flags first signs of growth stabilization

PARIS (Reuters) - Signs are emerging that a downturn in the United States and China, the world's two biggest economies, may have bottomed out, the OECD's monthly leading indicator showed on Wednesday.

Stock futures little changed after S&P closes at 11-month high

(Reuters) - U.S. stock index futures were little changed on Wednesday, a day after the S&P closed at a near 11-month high, as oil prices rose for the third straight day and investor worries of an immediate interest rate hike eased.

Pharaohs' shadow an omen in Egypt gold search

EASTERN DESERT, Egypt (Reuters) - Careering around Egypt's rocky Eastern Desert, Alexander Nubia CEO Mark Campbell peers from his jeep and sees hills so rich with gold they could lure billions in investments and jumpstart the ailing economy. His company just has to find it.

China central bank holds line on growth forecast but sees more pain to come

SHANGHAI (Reuters) - China's central bank slashed its forecast for exports on Wednesday, predicting a second straight annual fall in shipments, but said the economy will still grow 6.8 percent this year.

Exclusive: Commerzbank considers hoarding billions to avoid ECB charges - sources

FRANKFURT (Reuters) - Commerzbank, one of Germany's biggest lenders, is examining the possibility of hoarding billions of euros in vaults rather than paying a penalty charge for parking it with the European Central Bank, according to sources familiar with the matter.

Lululemon Athletica's profit narrowly misses as costs rise

(Reuters) - Lululemon Athletica Inc's quarterly profit narrowly missed analysts' estimate due to higher costs, a week after its founder Chip Wilson criticized the Canadian yoga-wear retailer's leadership for failing to keep up with market trends.

China commerce ministry removes curbs on Wal-Mart's Yihaodian deal

HONG KONG (Reuters) - China's Ministry of Commerce has removed restrictions on Wal-Mart Stores Inc's deal in 2012 to raise its stake in online supermarket Yihaodian, and said the move would not impact the already competitive market.

Oil Doubles From February Lows

Betweeen Doha hopes (and nopes), Nigerian supply 'disruptions' which apparently cannot be stopped (conveniently for many oil producers, equity bulls, and central bank inflation watchers), and non-transitory Chinese 'demand', WTI crude has topped $51 this morning - almost doubling off the February lows. While still down YoY, oil prices have recovered to 11-month highs, soothing credit-driven anxiety in markets (even though bankruptcies continue) and enabling hedgers to pile in (crushing the crude curve). With rig counts rising once more (and global GDP being slashed), one questions how sustainable this frothy bounce will be...

A larger than expected inventory draw from API last night sparked the latest impulse...

Along with China trade data, sending WTI to 11-month highs...

"The market sentiment is positive; the trend and the momentum points to further gains," said Carsten Fritsch, commodities analyst at Commerzbank. As Reuters reports,

Supply disruptions caused by a string of attacks by the Niger Delta Avengers militant group in Nigeria have brought the oil exporter's production to its lowest level in 20 years.

The group said on Wednesday it had attacked another oil well o ...

Dennis Gartman Mocks Bill Ackman's "Demise"; Tries To Understand Bitcoin, Fails

In an unexpected development, in his latest note the best market inflection point indicator alive, Dennis Gartman, has decided to pick on none other than billionaire Bill Ackman. This is the result:

We wish to talk once again about the incredible collapse of Valeant's shares and the damage being wrought upon the reputation of those hedge fund managers still caught long of this company's shares, with the leading example remaining the demise of the once sterling reputation of Mr. Bill Ackman of Pershing Square Capital. Here we have one of the true giants of the hedge fund industry; a gentleman once worth billions who ran billions more; a leader in the performance race for many years and now rather obviously a gentleman, who like Icarus of Greek mythology fame, flew too close to the sun and is now falling into oblivion.

Pershing Square's assets are down 18.6% for the year as of the end of May we are told. We see no sense in being vindictive for there is nothing to be gained in being so; rather we wish simply to point out that the Rules of Trade are meant to be adhered to and that thefirst among equal of our rules of trading is the first: that one is never, ever, under any circumstance to average down into a trade. As our old friend, Paul Tudor Jones, says in this regard,Losers average losers.

When one averages down into a long position ¦ or averages up into a short position ¦ only one thing can be happening to the equity in one's account: it must, by definition, be falling. If you buy a company's stock at $25/share and it goes to $20/share, you are worth less than you were before. It cannot be otherwise. It is simple arithmetic. On the other hand, if you buy a company's shares at $25/share and they go to $30/share your equity can only be larger. Why, we ask, woul ...

Frontrunning: June 8

World stocks struggle to build on highs as Europe weighs (Reuters)

Oil hits eight-month high on disruptions, Chinese demand (Reuters)

Hillary Clinton Set for Democratic Nomination After Primary Wins (WSJ)

DNC avoids calling Clinton presumptive nominee (The Hill)

Trump, Rattled by Critics, Treads Carefully in Victory Speech (BBG)

Ruling against ex-AIG boss Greenberg raises stakes in Trump University case (Reuters)

China May exports fall 4.1 percent, but imports beat expectations (Reuters)

China Oil Imports Decline as Busy Port Curbs Crude Access (BBG)

The Epicenter of America's Oil Bust Is Drawing Buyers (WSJ)

ECB Keeps Buying and Buying, Sending Assets to New Peak (BBG)

Police Probe Finds Nothing to Suggest Aubrey McClendon Committed Suicide (

The Tesla Effect: Elon Musk's Tweet Saps Samsung's Battery

Elon Musk's tweet about Tesla's Model 3 batteries essentially shifted more than half a billion dollars of value from Samsung to Panasonic.

Time to Cut Power to This Hong Kong Lighting Play

Tech Pro Technology's rebuttal to criticism doesn't address the uncomfortable suggestion that its stock is its currency, and its high share price is integral to the business.

Valeant: Still the Sick Man of Pharmaceuticals

The clouds hanging over Valeant's prospects just won't go away. The drugmaker's quarterly results have dashed any immediate hopes that its business is turning around.

How Much Is Left To Refinance?

from CoreLogic

-- this post authored by Molly Boesel

With Mortgage rates expected to rise this year [1] what will happen with refinancing? How much is left to refinance?

Capitol Report: Trump says Republicans should 'get over' judge attack | Senators say Sanders should stand down | Trump-backed candidate loses primary

Donald Trump says Republicans should 'get over' his attack on a Mexican-American judge; Senators say Bernie Sanders should stand down; a Trump-backed candidate loses House primary; and more.

Warren Buffett's words of wisdom for small businesses

What's the key to small business success? These are the tips from Buffett, Jack Dorsey, Michael Bloomberg and other business leaders at a Goldman Sachs event in New York.

Two Twitter trends could drive company to sell

Continuing executive turnover and a lack of growth at Twitter Inc. are pushing the company closer to a possible sale, according to analysts, but they see that as a big positive for the company.

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