US stock future indexes are flat again this morning (SPY +0.04%), as investors focused on the highly-anticipated meeting of major oil producers scheduled later in the day. Crude prices rebounded to the low 45 handle after plunging 3% earlier. Indicators are neutral with a bearish slant.
Here is the current market situation from CNN Money
European markets are broadly higher today with shares in France leading the region. The CAC 40 is up 1.16% while Germany's DAX is up 1.01% and London's FTSE 100 is up 0.85%.
(Reuters) - Wells Fargo & Co said on Tuesday that Chief Executive Officer John Stumpf will forfeit unvested equity awards worth about $41 million and will not get a salary while the company's board investigates the bank's sales practices.
LONDON (Reuters) - A recovery in Deutsche Bank shares helped push European stocks higher on Wednesday, easing concerns over Germany's financial sector that had hit equities in Asia and drove investors into safe-haven government bonds and the dollar.
FRANKFURT (Reuters) - The German government denied it was working on a rescue of Deutsche Bank as Germany's biggest lender boosted its balance sheet by selling its British insurance business on Wednesday.
BEIJING (Reuters) - China's COSCO Shipping Co Ltd may consider buying the port assets of troubled South Korean firm Hanjin Shipping Co Ltd, Chinese online finance magazine Caixin reported on Wednesday.
LONDON (Reuters) - SABMiller shareholders backed the brewer's $100-billion-plus takeover by rival Anheuser-Busch InBev by a large majority on Wednesday, paving the way for one of the biggest corporate mergers in history.
(Reuters) - Japan's Takata Corp is in talks with the U.S. Department of Justice to resolve allegations of criminal wrongdoing related to its faulty air bags, the Wall Street Journal reported on Wednesday.
SINGAPORE (Reuters) - Oil prices rose in mixed trading on Wednesday, after sharp losses in the previous session, as industry data showed a surprise draw in U.S. crude stocks, although worries over a lack of agreement among producers to curb output kept a lid on gains.
MANILA (Reuters) - The FBI is negotiating with a former branch manager of a Philippines bank for information relating to $81 million that she handled after it was stolen from the Bangladesh central bank's account at the New York Federal Reserve, her lawyer said.
Having been bullish for nearly half a year, yesterday Goldman's flipped again, when it cut its Q4 oil price target from $50 to $43, admitting the previously anticipated rebalancing will take longer to achieve, and now expects "a global surplus of 400 kb/d in 4Q16 vs. a 300 kb/d draw previously." Moments ago, the same Goldman analyst released a follow up note, confirming what we have been saying for the past year, namely that OPEC is increasingly irrelevant as a marginal supply-setter in a world in which it is the lack of demand that is a far bigger threat.
In "OPEC won't stop oil going", Damien Courvalin writes that "an OPEC deal to curb oil production, either today or at the November meeting, is thought more likely than at any point in the past two years." That said, he notes, "we remain sceptical of its impact. For one, our production forecast continues to reflect a seasonal Saudi production decline into year-end, with no growth elsewhere. Second, even with this OPEC help, our updated oil supply-demand forecast now points to a renewed build in inventories in 4Q 2016 vs. a forecast for a draw only last month. This weaker oil outlook into year-end led us yesterday to lower our year-end WTI oil price forecast to $43/bbl, from $51/bbl previously. Given a well-supplied market and a crude curve in contango (with limited spot upside)."
Here are the details behind Goldman's pessimism:
Intraday oil price volatility has picked up over the past week and ahead of today's OPEC advisory meeting in Algiers. Statements by participants suggest a deal to curb production today or at the next meeting in November is more likely than at any point over the past two years. We remain sceptical of its impact, for two reasons: (1) independent of today's outcome, our production forecast continues to reflect a seasonal Saudi p ...
Perhaps the most memorable aspect of Monday's presidential debate from a policy standpoint, was Donald Trump's latest attack on the Fed, and its chair, Janet Yellen. As a reminder, Trump repeated a claim he has made before, saying the economy was in a "big, fat, ugly bubble" and went straight for Yellen when he said: "And we have a Fed that's doing political things. This Janet Yellen of the Fed." He also gave his version about what might happen next at the Fed.
"On the day Obama goes off, and he leaves, and goes out to the golf course for the rest of his life to play golf, when they raise interest rates, you're going to see some very bad things happen, because the Fed is not doing their job. The Fed is being more political than Secretary Clinton."
This puts Yellen in a bind. As AFR's Philip Baker writes, "Trump's attack on the Fed chairwoman during this week's presidential debate was so vicious that Paul Ashworth, chief US economist at Capital Economics, now thinks it's possible Yellen will have to resign if Trump ends up becoming president."
While Trump has criticised Yellen in the past on numerous occasions, on Monday night be upped the ante "big league" - Ashworth argues that the "veracity" of the claims are "irrelevant" and it doesn't even matter if Trump himself doesn't really believe what he said.
"It's all to do with how voters react to his comments", Ashworth notes, adding that "if those claims are made publicly to a viewing audience of up to 100 million Americans, and a majority of those Americans then go on to vote for Trump in November's election, then what choice does Yellen have? It's true that Yellen might still have the support of Congress, but she could not argue that she enjoys the confidence of the American people" he wrote in a n ...
After yesterday's broad "Hillary rally" gains in the US, overnight's session has seen more risk-on sentiment as European stocks advanced, ignoring some weakness in Asia and especially Japan (Nikkei was down 1.3%) as investors followed every twist of shares of beleaguered lender Deutsche Bank, whose CEO last night assured Bill readers that the bank is not seeking a bailout, which however was contradicted by a Zeit article this morning reporting that Germany may seek as much as s 25% "bailout" stake in a worst case scenario. This report, too, was promptly denied by the German finance ministry, however not before push US equity futures back into the red.
Beyond banking sector worries, investors were looking ahead to U.S. Federal Reserve Chair Janet Yellen's appearance before a Congressional committee, a speech by European Central Bank President Mario Draghi and a meeting of oil producers in Algiers.
Crude oil climbed before a meeting of major producers in Algiers, even thought Saudi Arabia and Iran have said there's little chance of an immediate agreement. Nonetheless, Saudi Arabia gave the strongest indication yet it's ready to compromise with regional rival Iran, potentially paving the way for the first limit on oil production in two years, although a deal is unlikely until OPEC's next meeting in November. In other words, algos will now be focusing only on OPEC headlines about the November meeting. Khalid Al-Falih, who inherited a chronically oversupplied oil market when he was appointed Saudi energy minister in April, appeared to show more flexibility toward Tehran, saying that Iran, Libya and Nigeria s hould be allowed to "produce at the maximum levels that makes sense". "The gap between OPEC countries is narrowing in terms of what are the levels at which we will freeze," Al-Falih said after a long day of ...
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