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08May2017 Pre-Market Commentary: Wall Street Expected To Open Flat But Show Green Later In The Day, Crude Prices Slipping Again, US Dollar Showing Strength, Investors Are Split In Which Way Markets Will Go

Written by Gary

US stock market futures flat (SPY -0.04%) ahead of the opening bell. The markets reaction of newly elected French President Macron pledged to reform France's labor market, unify the country's pension plans and reduce the budget deficit has been positive.


Here is the current market situation from CNN Money

European markets are mixed. The FTSE 100 is higher by 0.17%, while the CAC 40 is leading the DAX lower. They are down 0.97% and 0.25% respectively.

French election, earnings set to cause a stir on Wall Street

What Is Moving the Markets

Here are the headlines moving the markets.

Tyson Foods profit falls as plant fires hurt production

(Reuters) - Tyson Foods Inc , the No. 1 U.S. meat processor, reported a 21.3 percent slump in quarterly profit as a fire at two of its plants in the period disrupted chicken production, hurting sales volumes at the company's second-biggest business.

With eye on millennials, Coach buys Kate Spade for $2.4 billion

(Reuters) - Handbag maker Coach Inc said it would buy Kate Spade & Co for $2.4 billion as it looks to tap the popularity of its smaller rival's quirky satchels and totes among millennials.

Buffett says deal partner 3G follows 'standard capitalist formula': CNBC

(Reuters) - Warren Buffett said on Monday 3G Capital, its controversial partner on multiple transactions, follows a "standard capitalist formula" when it sweeps away thousands of jobs and imposes deep expense cuts to make the companies it buys more efficient.

Akzo Nobel rejects third takeover proposal from PPG

AMSTERDAM (Reuters) - Dutch paint maker Akzo Nobel on Monday rejected a third takeover proposal from PPG Industries , leaving its larger U.S. rival to decide whether to make a formal bid without the support of Akzo's board, or throw in the towel.

Global stocks, euro dip as Macron win shifts focus to economy

LONDON (Reuters) - European stocks and the euro pulled back on Monday from highs touched after Emmanuel Macron's emphatic but well-flagged victory in France's presidential election as investors' focus shifted from politics to monetary policy.

Banks planning to move 9,000 jobs from Britain because of Brexit

LONDON (Reuters) - The largest global banks in London plan to move about 9,000 jobs to the continent in the next two years, public statements and information from sources shows, as the exodus of finance jobs starts to take shape.

Exclusive: Barrick faces sanctions for Argentina cyanide spills, judge says

SAN JUAN, Argentina(Reuters) - Barrick Gold Corp failed to complete improvements to the Veladero mine in Argentina that could have prevented the third spill of cyanide solution in 18 months, leading to eventual sanctions for the world's biggest gold miner, a judge told Reuters.

French vote calls time on 'populist meltdown' trade

LONDON (Reuters) - In December, one of the trades of 2017 for investors who play on global political and economic risk was the spread of populism in Europe and the threat that might pose to the future of the euro.

Brimming U.S. oil storage tanks to feel OPEC cuts last

NEW YORK (Reuters) - The energy industry scrutinizes U.S. oil stockpile data every week for evidence that OPEC supply cuts are ending a global crude glut, but growing domestic output means the world's largest oil consumer may be the last place to feel the cuts.

Home Capital's Bank Run Accelerates As Company Scrambles To Find Additional Liquidity

Just two work days after we reported that Home Capital had already used up half of its C$2 billion emergency "lifeline" credit facility (yielding 22.5%) and was seeking additional emergency funding, on Monday Canada's most troubled alt-mortgage lender provided a liquidity update in which it said that it had drawn an addition C$400 million on its loan, leaving just C$600 million available. At the same time, the company confirmed that the bank run at subsidiary Home Trust has failed to slowdown, and as of May 8 "deposit balances are expected to be approximately $192 million." According to the latest data, another 50% of deposits have been pulled in the past week, and are now down over 90% since March 28.

Additionally, the company announced that its all important Total Guaranteed Investment Certificate (GIC) deposits, including Oaken and broker GICs, stood at $12.64 billion as at May 5, 2017 compared with $12.86 billion as at April 28, 2017. Oaken savings accounts stood at $167 million as at May 5, 2017 compared $222 million as at April 28, 2017.

Home Capital said that its total liquid assets stood at $1.160 billion as of end of day May 5, 2017, a number which is shrinking rapidly with each passing day.

In an amusing addition, the company said that "its advisers continue to work towards seeking lower cost sustainable funding solutions and to evaluate strategic alternatives to solidify and strengthen its successful mortgage origination platform. "

Good luck with that.

Full < ...

Gold Coins, Bars In Demand - +9% In Q1, 2017

Gold Coins and Bars Demand Rises 9% In Q1, 2017

- Global gold demand in Q1 2017 was 1,034.5t
- Total demand -18% from record high levels in Q1, 2016
- Demand for coins and bars up 9% yoy to 290 t
- UK demand for coins, bars at highest since Q2 2013
- ETF inflows fell by 2/3, account for overall -18% fall in demand
- European uncertainty brings gold investors to market
- Innovation continues to drive gold demand in China
- Peak Gold: Mine production likely to drop

Global gold demand driven by climb in bar and coin investment

Uncertainty in Europe increased demand for g ...

Frontrunning: May 8



Macron victory reshapes European politics (Reuters)

Macron Vows to Heal France's Divisions After Victory Over Le Pen (BBG)

Macron's Style Choices - CEO or Chairman? (BBG)

Euro gives up gains as investors look to post-election France (Guardian)

China's April trade growth slows as commodities, electronics demand cools (Reuters)

Saudi Arabia and Russia Signal Oil-Cuts Extension Into 2018 (BBG)

Germany's SPD goes back to drawing board after state poll drubbing (Reuters)

Merkel Gains Momentum in German State Vote (BBG)

Ex-Obama administration officials to testify in Trump-Russia probe (Reuters)

What We Know About Congress's Russia Investigations (BBG)

Obama Urges Congress to Show 'Courage' on Health Care (BBG< ...

Market Mocks OPEC Crude Jawboning; Morgan Stanley Warns Of Risks To 2018 Oil Price

In the clearest indication yet that OPEC jawboning no longer has an effect on markets, and especially headline scanning algos, following numerous headlines from Saudi energy minister Khlaid Al-Falih overnight warning that the oil rebalancing is imminent, and in case it isn't, it will come in 2018 when OPEC and Non-OPEC producers may extend their production cuts, this morning oil is firmly hugging the flatline after a failed attempt to push higher earlier in the session.

As Bloomberg reports, Saudi Arabia and Russia signaled they may extend production cuts into 2018, doubling down on an effort to eliminate a supply surplus as oil prices continue to drop.

In separate statements just hours apart on Monday, the world's largest crude producers said publicly for the first time they would consider prolonging their output reductions for longer than the six-month extension widely expected to be agreed at the OPEC meeting on May 25. "We are discussing a number of scenarios and believe extension for a longer period will help speed up market rebalancing" the Russian Energy Minister Alexander Novak said in a statement.

Speaking in Kuala Lumpur earlier Monday, Saudi energy minister Khalid Al-Falih said he was "rather confident the agreement will be extended into the second half of the year and possibly beyond" after talks with other nations participating in the accord.

"The producer coalition is determined to do whatever it takes to achieve our target of bringing stock levels back to the five-year average," Al-Falih said. While U.S. shale output growth and the shutdown of refineries for maintenance have slowed the impact of cuts by OPEC and its partners, the Saudi minister ...

Macron Wins: Now Can Europe Do What Investors Want?

Following Emmanuel Macron's victory in the French presidential race, the next test will be whether the renewed sense of solidarity in European politics leads to progress on issues that have long dogged the economic bloc.

TPG's Offer for Fairfax Not Yet Fit to Print

TPG Group-led consortium's $1.6 billion bid for one of Australia's leading media companies could fall short.

Cutting Through Chinese Tech Giants' Profit Distortion

Now that Facebook has stopped issuing non-GAAP results, the spotlight is on China's big tech companies, for whom share-based compensation is a highly distorting force.

The Tell: Goldman enamored with stocks in these tech juggernauts

The Nasdaq's run and run has Goldman clients questioning its staying power. But as the bank ponders whether that stretch will continue, it declares big love for the five biggest tech names around.

Push your kids to play these sports to boost their chance at a college scholarship

Find out if your child should be wielding a tennis racket or a fencing epee — or both.

The Wall Street Journal: Coach to buy Kate Spade in $2.4 billion deal

Coach to buy Kate Spade in a deal valued at $2.4 billion.

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To contact me with questions, comments or constructive criticism is always encouraged and appreciated:

gary@econintersect.com

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