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24May2017 Pre-Market Commentary: World Stocks Slip On China Downgrade, Ahead Of Fed Minutes Later This Afternoon

Written by Gary

US stock future indexes are flat (SPY +0.06%), but are poised to post another green session. Moody's has lowered China's credit rating to A1 from Aa3, WTI crude is lower, but remains in the 51 handle.

Here is the current market situation from CNN Money

European markets are mixed. The FTSE 100 is higher by 0.25%, while Germany's DAX is off 0.15%. Shares in France are unchanged with the CAC 40 at 5,347.69.

What Is Moving the Markets

Here are the headlines moving the markets.

Moody's downgrades China, warns of fading financial strength as debt mounts

SHANGHAI/BEIJING (Reuters) - Moody's Investors Service downgraded China's credit ratings on Wednesday for the first time in nearly 30 years, saying it expects the financial strength of the economy will erode in coming years as growth slows and debt continues to rise.

Kuwait says OPEC, non-OPEC could deepen oil cuts

VIENNA (Reuters) - OPEC and non-member oil producers could deepen output cuts or extend them for a year at a meeting in Vienna this week, Kuwait said on Wednesday, as they seek to clear a global stocks overhang and prop up the price of crude.

World stocks slip on China downgrade, ahead of Fed minutes

LONDON (Reuters) - World stocks inched lower on Wednesday after China's sovereign credit rating was downgraded and as investors eyed a pause in Wall Street's four-day winning streak, the longest in over three months.

U.S. financial council reimagined as boon, not bane, for Wall Street

WASHINGTON (Reuters) - The Financial Stability Oversight Council (FSOC), which brings together all U.S. financial watchdogs, used to be the scourge of Wall Street but under Treasury Secretary Steven Mnuchin it can serve to ease its regulatory burdens.

Uber inadvertently underpaid New York City drivers for over two years

(Reuters) - Uber Technologies Inc [UBER.UL] said on Tuesday it underpaid its New York City drivers for the past two-and-a-half years, an error that could cost the ride-hailing company tens of millions of dollars.

German prosecutor says is in touch with U.S. authorities on Daimler

FRANKFURT (Reuters) - German prosecutors, who searched Daimler's offices this week as part of an investigation into diesel pollution, are talking to U.S. authorities, the Stuttgart public prosecutor's office said on Wednesday.

Tiffany's sales miss estimates; shares slump

(Reuters) - Tiffany & Co reported lower-than-expected quarterly sales and a surprise drop in comparable sales due to lower spending by tourists and domestic customers in the Americas, its largest market.

Judge gives RBS week to end investor suit or face trial

LONDON (Reuters) - A British judge has given Royal Bank of Scotland a week to avoid a trial by reaching a deal with investors who allege the bank misled them over its 2008 fundraising.

'Food revolution': megabrands turn to small start-ups for big ideas

LONDON (Reuters) - Food and drink megabrands are seeing their sales chewed away by smaller, nimbler, cooler rivals. They can't beat them - so now they're joining them.

Bitcoin Explodes Above $2400 After China Downgrade, Scaling Agreement Reached

Following comments from DoubleLine's Jeff Gundlach tieing the surge in virtual currencies to the demise of China (right before that nation is downgraded), Bitcoin surged overnight, breaking above $2400 for the first time. It is now up over 150% year-to-date.

Bitcoin is up fopr the 26th day in the last 29 sessions, doubling in price in that period...

Wednesday's gain comes after a bitcoin scaling agreement was reached by the Digital Currency Group, representing 56 companies in 21 countries, at the Consensus 2017 conference in New York, which reduced some of the fears surrounding the so-called 'hard fork' in Bitcoin's code. The agreement states:

"We agree to immediately support the following parallel upgrades to the bitcoin protocol, which will be deployed simultaneously and based on the original Segwit2Mb proposal:

  • "Activate Segregated Witness at an 80% threshold, signaling at bit 4

  • "Activate a 2 MB hard fork within six months"

The announc ...

Gold and Silver Bullion Now Treated As Money In Arizona

Gold and Silver Bullion Now Treated As Money In Arizona

by Ron Paul Liberty Report staff

Undermining the Federal Reserve received a major boost yesterday.

Arizona Governor Doug Ducey signed into law a bill that eliminates capital gains taxes on gold and silver, thus allowing Arizona residents to use precious metals as currency instead of Federal Reserve notes.

Currency competition against the monopolist Fed is starting to unfold. Let's hope that other states follow in Arizona's heroic footsteps. There's no reason to wait for another severe financial crisis to act.

?Read Ron Paul's statement via

Frontrunning: May 24

Trump Meets With Pope Francis After Policy Clashes (WSJ)

Fed Minutes to Offer Clues on Debate Over Path of Rate Increases (WSJ)

Manchester bomber had 'proven' links to Islamic State (Reuters)

U.K. Chides U.S. for Leaking Manchester Bombing Probe Details (BBG)

Manchester Bomber, Salman Abedi, Is Thought to Have Traveled to Syria (NYT)

'No defeat, no pity': Manchester unites (Reuters)

China Handed First Moody's Downgrade Since 1989 on Debt Risk (BBG)

Defiant Duterte threatens harsh measures as thousands flee Philippines unrest (Reuters)

OPEC Boss Embraces Shift to Top Diplomat (WSJ)

Trump's Budgets Will Suffer a Double Whammy Thanks to Fed Policy (BBG)

Icahn Guides Trump's Policy and Scores $60 Million (

Britain Slams US For Leaking Details About Suicide Bomber Who "Did Not Act Alone", Had "Proven Links To ISIS"

Just hours after the UK raised its terror alert to Critical, or the highest possible, for the first time in ten years, Britain's Interior minister Amber Rudd said that Salman Abedi, the Manchester suicide bomber who killed 22 people at a concert venue, and had recently returned from Libya had likely not acted alone and troops were being deployed to key sites across Britain to help prevent further attacks according to the FT.

Salman Abedi, the suspect in the Manchester attack

Rudd said on BBC radio that the bombing was "more sophisticated than some of the attacks we've seen before, and it seems likely, possible, that he wasn't doing this on his own." She said Abedi had been known to security services before the bombing. Asked about reports that Abedi had recently returned from Libya, Rudd said she believed that had now been confirmed.

Rudd said up to 3,800 soldiers could be deployed on Britain's streets, taking on guard duties at places like Buckingham Palace and Downing Street to free up police to focus on patrols and investigation. An initial deployment of 984 had been ordered, initially in London, then elsewhere. The minister also scolded U.S. officials for leaking details about the investigation into the Manchester attack before British authorities were prepared to go public.

Separately Rudd's French counterpart said Abedi had links with Islamic State and had probably visited Syria too. According to Reuters, French Interior Minister Gerard Collomb said British investigators had told French authorities Abedi had probably travelled to S ...

China's Downgrade: It's Not Just About the Government

Moody's decision to cut China's credit rating could make it more costly for Chinese companies and banks to issue bonds.

Fannie and Freddie Endgame Takes Shape

A consensus is starting to emerge between lawmakers and the Trump administration on how to reform the U.S. housing finance market.

Investors' Faith in Michelin Looks Over-Inflated

The tire maker's stock is trading at peak multiples even as higher rubber prices and a weakening car market threaten its margins.

Obama, Buffett or Trump: who's right about the cost of retirement investing advice?

Much of the fiduciary rule debate centered on how much money investors lose to fees from conflicted advice.

Capitol Report: What to watch in the CBO's score of the Republican health-care bill

Depending on what congressional budget-crunchers say later this week, a key part of Republicans' agenda could get a green light to proceed, or run into a big obstacle. Here is what to watch when the nonpartisan Congressional Budget Office releases its score of the American Health Care Act, which is expected Wednesday afternoon.

Caroline Baum: Trumponomics relies on fuzzy math, rosy scenarios

Defining Trumponomics isn't easy with a president who frequently changes his mind, writes Caroline Baum.

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