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11Jul2016 Pre-Market Commentary: Wall Street Set To Open Higher, Second Quarter Earning Season Starts, Crude Prices Fall, Investors Remain Wary As Main Indexes Climb Higher

Written by Gary

U.S. stock index futures pointed to higher numbers at the open (SPY +0.3%), with the SP 500 poised to reach an all-time high, joining a global equity rally. This week marks the start of second-quarter earnings season with Alcoa reporting after the close Oil prices declined on this morning to a l2-month low (44.55) amid increasing U.S. drilling activity.

Here is the current market situation from CNN Money

European markets are broadly higher today with shares in Germany leading the region. The DAX is up 1.54% while France's CAC 40 is up 1.36% and London's FTSE 100 is up 0.86%.

What Is Moving the Markets

Here are the headlines moving the markets.

Global stocks rise as markets anticipate stimulus

LONDON (Reuters) - Shares rose in Europe and Asia on Monday and the safe-haven yen tumbled against the dollar after upbeat U.S. jobs data, though the prospect of more stimulus to counter a weak global growth outlook kept low-risk sovereign bond yields near record lows.

Pentagon unveils new cost-cutting initiatives for F-35 fighter jet

FARNBOROUGH, England (Reuters) - The U.S. Defense Department on Monday extended by two years a project that has cut the cost of Lockheed Martin Corp's F-35 fighter plane by more than $1 million per jet, and kicked off a similar project to cut operating and maintenance costs.

Thomson Reuters to sell IP & science business for $3.55 billion

(Reuters) - Thomson Reuters Corp said it agreed to sell its intellectual property and science business to private equity firms Onex Corp and Baring Private Equity Asia for $3.55 billion in cash.

Oil falls further under $50 on Asia demand concern

LONDON (Reuters) - Oil fell on Monday over signs that U.S. shale drillers have adapted to lower prices and on renewed indications of economic weakness in Asia where refiners are already trimming crude runs.

Musk hints at top secret Tesla masterplan: tweet

(Reuters) - Tesla Motors Inc CEO Elon Musk on Sunday tweeted his intention to soon publish part two of his "top secret Tesla masterplan" following an embattled several weeks for the Silicon Valley heavyweight.

South Korea to decide soon on whether to suspend VW car sales

SEOUL (Reuters) - South Korea's environment ministry said on Monday it will decide later this month whether to revoke the certification of 32 vehicle models made by Volkswagen after prosecutors accused the German carmaker of fabricating documents on emissions and noise-level tests.

Planemakers shrug off economy worries as travel demand grows

FARNBOROUGH, England (Reuters) - Top planemakers shrugged off worries about a faltering global economy on the opening day of the Farnborough Airshow on Monday, with Airbus announcing a $4.4 billion order and Boeing raising its 20-year forecast for jet demand.

Pokemon game adds $7.5 billion to Nintendo market value in two days

TOKYO (Reuters) - Shares in Japan's Nintendo Co Ltd soared again on Monday, bringing market-value gains to $7.5 billion in just two days as investors cheered the runaway success of Pokemon GO - its first long-awaited venture in mobile gaming.

UK's Osborne to urge U.S. investors to stick with Britain outside EU

LONDON (Reuters) - British finance minister George Osborne will meet some of Wall Street's biggest investors in New York on Monday to urge them to stick with Britain despite last month's vote to leave the European Union, his office said.

Gartman Capitulates On Shorts: "We Have Had Quite Enough; We Want Out Now"

In the last market comment we shared from Dennis Gartman, we observed that the "world-renowned commodity guru" said that "you'd have to hold a gun to my head to be an aggressive buyer. I'm quietly, modestly net short and I feel reasonably comfortable being that way."

"I find it very difficult to be anything other than modestly bearish. I trade only from my own account and I am modestly short of equities generally and I think that's the proper place to be. It's a little scary to be bullish at these prices when it's the Fed and monetary authorities who are sponsoring share prices (going) higher - it can't last for very long."

To this, our response was simple: "Expect another ramp higher with new all time highs to follow."

Sure enough, after tagging all time highs on Friday, the S&P is about to open at never before seen levels.

So does this mean that Gartman has thrown in the towel and is once again bullish? You bet. Here is his latest rant:

SHARE PRICES HAVE SOARED since Friday' morning with all ten of the markets comprising our International Index having risen and with 7 of the 10 rising by more than 1%, as represented by the "green" coloring in the price index below, and as 2 of those 7 have risen by more than 2% and with 1 of those ten... the market in Japan... having risen by more than 4%. It is a spectacle of bullish enthusiasm and the markets are "dancing" to TINA's tune... There Is No Alternative. Money has no place to go these days other than to the equity markets and the global markets are breaking out to the upside. It is really quite stunning.

As one or two off the wittier ...

Good Luck Getting Your Money Out When the Next Crisis Hits

Behind the veneer of "all is well" being promoted by both world Governments and the Mainstream Media, the political elite have begun implementing legislation that will permit them to stop you from getting your money out of the system during the next crisis.

This strategy has already been employed in the UK where over 50% of all funds devoted to commercial property are currently LOCKED... meaning you cannot get your money out.

Three more fund managers have stopped investors from leaving their UK property funds, trapping an additional £5.5bn and bringing to six the funds unable to meet withdrawal requests after the Brexit vote.

More than half of the £25bn of funds committed to commercial property by retail investors is now locked down by managers, who are under pressure to sell buildings to raise cash.

Henderson Global Investors said on Wednesday that it had suspended redemptions from its £3.9bn UK property fund.

Source: Business Day Live

In the US, the SEC has implemented similar regulations designed to stop investors from pulling their funds when a Crisis hits.

The regulation is called Rules Provide Structural and Operational Reform to Address Run Risks in Money Market Funds. It sounds relatively innocuous until you get to the below quote:

Redemption Gates - Under the rules, if a money market fund's level of weekly liquid assets falls below 30 percent, a money market fund's board could in its discretion temporarily suspend redemptions (gate). To impose a gate, the board of directors would find that imposing a gate is in the money market fund's best interests. A money ma ...

Theresa May Confirmed As New Leader Of Tory Party, Most Likely Next UK Prime Minister

Following the surprising withdrawal announcement by Tory leadership challenger Andrea Leadsom, moments ago Theresa May was confirmed as the new leader of the UK Tory Party.


Theresa May has been confirmed as the new leader of the Conservative Party

— Sky News (@SkyNews) July 11, 2016

So does this mean that the next UK prime minister has been decided? More or less yes: as Sky adds, the 1922 Committee can now either name May as Prime Minister or hold a ballot of Tory members on her leadership.

Leadsom pulls out of the Tory leadership race.

1922 Committee can either name May as PM or hold a ballot of Tory members on her leadership

— Sky Data (@SkyData) July 11, 2016

In any case, bypassing this formality, it is now virtually assured that May will be the next UK Prime Minister, one who will be tasked with either triggering the Article 50 process for the UK's departure from the EU, or trying to undo the entire process.

How Panasonic Can Speed Ahead on More Than Tesla

Panasonic's Tesla surge seems overdone, but the Japanese electronics giant is still a reasonable bet on the future of cars.

Software's Sale Window Hasn't Closed Just Yet

M&A interest in software likely to remain high as valuations haven't fully recovered.

In Mobile Payments War, Big Banks Strike Back

Banks have key advantages as they start to compete with popular online payment platforms.

How Have High Reserves And New Policy Tools Reshaped The Fed Funds Market?

from Liberty Street Economics

-- this post authored by Gara Afonso and Sam Stern

Over the last decade, the federal funds market has evolved to accommodate new policy tools such as interest on reserves and the overnight reverse repo facility. Trading motives have also responded to the expansion in aggregate reserves as the result of large-scale asset purchases. These changes have affected market participants differently since, for instance, not all institutions are required to keep reserves at the Fed and some are not eligible to earn interest on reserves.

Futures Movers: Oil prices fall on concerns global glut set to worsen

Crude oil prices are lower Monday as market participants fret over a supply overhang that could worsen as global supply disruptions fade.

Market Snapshot: U.S. stock futures climb, with S&P near record high

Wall Street is set for gains on Monday, with the S&P 500 index within short reach of a record high after a surprisingly strong jobs report last week fueled a stock-buying spree.

Amazon Prime Day should be much bigger this year than it was last year

Analysts at MKM Partners believe sales on this year's Amazon Prime Day could be double last year's.

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