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13Jun2017 Pre-Market Commentary: Wall Street Prepares To Open Moderately Higher, WTI Crude Prices Dive Again Into The 45 Handle, US Dollar Follows Crude Prices

Written by Gary

US stock market index futures are pointing to a moderate higher opening (SPY +0.2%) as investors breathe a sigh of relief as Technology companies recover and are helping drive a bounce for the session.

Here is the current market situation from CNN Money

European markets are higher today with shares in Germany leading the region. The DAX is up 0.58% while France's CAC 40 is up 0.32% and London's FTSE 100 is up 0.01%.

Today's Markets

In Asia, Japan -0.1%. Hong Kong +0.6%. China +0.5%. India flat.
In Europe, at midday, London +0.1%. Paris +0.5%. Frankfurt +0.6%.
Futures at 6:20, Dow +0.1%. S&P +0.2%. Nasdaq +0.2%. Crude +0.4% to $46.28. Gold -0.4% to $1263.70.
Ten-year Treasury Yield flat at 2.22%

Today's Economic Calendar

FOMC meeting begins
6:00 NFIB Small Business Optimism Index
8:30 Producer Price Index
8:55 Redbook Chain Store Sales
1:00 PM Results of $12B, 30-Year Note Auction

Companies reporting earnings today »

Nasdaq futures rise with Amazon, Alphabet higher in premarket

Looking at the last three columns (below), the first one (Actual), is what was reported this morning. The second column (Forecast) is what analysts had forecast and the third column is the previous report. Full calendar HERE.

What Is Moving the Markets

Here are the headlines moving the markets.

Stock futures up as tech stocks recover; Fed meeting in focus

(Reuters) - U.S. stock index futures were slightly higher on Tuesday as technology shares staged a recovery after a two-day rout, while investors awaited the Federal Reserve to kick off its meeting, where its is almost certain to raise interest rates.

Fed set to raise interest rates, give more detail on balance sheet winddown

WASHINGTON (Reuters) - The U.S. Federal Reserve is widely expected to raise its benchmark interest rate this week due to a tightening labor market and may also provide more detail on its plans to shrink the mammoth bond portfolio it amassed to nurse the economic recovery.

Exclusive: Renault-Nissan considers hidden bonus plan - documents

PARIS (Reuters) - Renault-Nissan alliance bankers have drawn up plans designed to channel millions of euros in additional, undisclosed bonuses to Chairman Carlos Ghosn and other managers via a specially created service company, according to documents seen by Reuters.

Bill Gross advises investors to cut risk on U.S. growth woes

NEW YORK (Reuters) - Bond investor Bill Gross warned on Tuesday that investors should reduce their risk appetite, given the U.S. growth rate is stunted by secular forces "which monetary and even future fiscal policies seem unable to reverse."

Oil rises on Saudi pledge to make real supply cuts

LONDON (Reuters) - Oil prices rose slightly on Tuesday after Saudi Arabia said it would make significant export cuts in July amid signs of a drawdown in U.S. crude inventories, though increasing U.S. output continues to weigh on the market.

Exclusive: GE begins testing drones to inspect refineries, factories - executive

SEATTLE (Reuters) - General Electric Co has begun testing autonomous drones and robotic "crawlers" to inspect refineries, factories, railroads and other industrial equipment with an eye on capturing a bigger slice of the $40 billion companies around the globe spend annually on inspections.

Uber CEO Kalanick likely to take leave, SVP Michael out: source

SAN FRANCISCO (Reuters) - Uber Technologies Inc [UBER.UL] Chief Executive Travis Kalanick is likely to take a leave of absence from the troubled ride-hailing company, but no final decision has yet been made, according to a source familiar with the outcome of a Sunday board meeting.

U.S. shale firms more exposed to falling oil prices as hedges expire

(Reuters) - Cash-strapped U.S. shale firms scaled back their hedging programs in the first quarter, leaving them more vulnerable to tumbling spot market prices just after OPEC reached a landmark deal to curb global supply.

Toshiba faces fresh lawsuit, plans provision for year ended March

TOKYO (Reuters) - Toshiba Corp on Tuesday said it was being sued by another group of foreign investors for 43.9 billion yen ($399 million) in damages over a $1.3 billion accounting scandal uncovered two years ago.

Trump Lays Out "Highly Anticipated" Plan To Overhaul Bank Rules

Nearly four months after Donald Trump signed an executive order calling for a review of Wall Street regulations, the administration has laid out part one of its plans for reforming the system in a detailed report released by the Treasury Department late Monday.

Some of the more notable proposals in the highly-anticipated report - the first in a series that will detail the administration's thinking on how it plans to proceed with paring back post-crisis regulations in the financial services industry - include: adjusting the annual stress tests, easing trading rules (i.e., gutting the Volcker Rule), and paring back the power of the watchdogs - like the Consumer Financial Protection Bureau.

The Treasury said its plan was designed to spur lending and job growth by making regulation 'more efficient' and less burdensome, according to Bloomberg although in reality it simply caters to the "requests" of Wall Street, which has been limited in its activities since Dodd-Frank, most notanly prop trading, although in most cases banks, like Goldman, have found simply loopholes around the Volcker Rule. Also of note, "unlike the bill passed last week by House Republicans, the report consistently calls for most Obama-era rules to be dialed back, not scrapped."

In a statement released along with the report, Treasury Secretary Steven Mnuchin said that while the administration backs congressional efforts to roll back Dodd-Frank, the report focuses on actions that can be taken without involving Congress. In fact, between 70 and 80% of its recommended reforms can be made unilaterally through federal agencies' independent rulemaking authorities.

As expected ...

Frontrunning: June 13

The Snowballing Power of the VIX, Wall Street's Fear Index (WSJ)

Beneath the Uneasy Peace Between Donald Trump and Janet Yellen (WSJ)

Senators to Query Sessions on Russia, Comey (BBG)

U.S. lawmakers to probe Tillerson on Russia, diplomacy budget cuts (Reuters)

Under pressure to soften Brexit, PM May to meet Northern Irish 'kingmakers' (Reuters)

Russian Cyber Hacks on U.S. Electoral System Far Wider Than Previously Known (BBG)

North Korea 'most urgent' threat to security: Mattis (Reuters)

North Korean Drone Spied on U.S. Missile-Defense Site (WSJ)

Kremlin says Russia will not heed U.S. calls to free protesters (Reuters)

Saudi Arabia Cuts U.S. Oil Exports to Ease Supply Glut (WSJ)

Inflation fizzle may once again leave Fed rate path in doubt (

Trump: "Fake News Media Has Never Been So Wrong Or So Dirty", Slams 9th Circuit

Trump wasted little time before launching his opening salvos on Twitter on Tuesday morning, when the President first went after the "Fake News Media" just after 6:30am, accusing the press of publishing false stories.

"The Fake News Media has never been so wrong or so dirty. Purposely incorrect stories and phony sources to meet their agenda of hate. Sad!" Trump lashed out in his first tweet on Tuesday.

The Fake News Media has never been so wrong or so dirty. Purposely incorrect stories and phony sources to meet their agenda of hate. Sad!

— Donald J. Trump (@realDonaldTrump) June 13, 2017

It was not immediately clear which particular story (or stories) prompted Trump's ire this morning. The president's latest tweet came hours before Attorney General Jeff Sessions is set to appear before the Senate Intelligence Committee, and shortly after Christopher Ruddy, chief executive of the conservative news site and TV network Newsmax, said during an interview on "PBS NewsHour" that Trump is thinking about firing special counsel Robert Mueller.

As NBC noted last night, it is open to question how reliable Ruddy's comments are. "He is often described as a close friend of Trump's, and reporters spotted him leaving the White House on Monday. But a source familiar with the visit told NBC News that any meeting Ruddy was to have had with the president was postponed. Still, his remarks prompted this reply on Twitter from Rep. Adam Schiff of California, the top Democrat on the Intelligence Committee, who said the committee would simply reappoint Mueller and then advised the president: "Don't waste our time."

OPEC Oil Prodcution Rises Most In 6 Months, Hits Highest Since December

Well, so much for OPEC's production cut.

In OPEC's latest Monthly Oil Market Report, the oil producing cartel reported that in May - the same month OPEC met to extend its production cuts - crude output climbed the most in six month, since November 2016, rising by 336.1kb/d to 31.139 mmb/d, the highest monthly production of 2017, as members exempt from the original Vienna deal restored lost supply.

From the report:

Preliminary data indicates that global oil supply increased by 0.13 mb/d in May to average 95.74 mb/d, m-o-m. It also showed an increase of 1.48 mb/d, y-o-y. A decrease in non-OPEC supply, including OPEC NGLs represents a contraction of 0.21 mb/d m-o-m but an increase of 0.34 mb/d in OPEC crude oil production, not only offset the decline of non-OPEC supply but also increased overall global oil output in May. The share of OPEC crude oil in total global production stood at 33.6% in May, an increase of 0.3% from the month before. Estimates are based on preliminary data for non-OPEC supply, direct communication for OPEC NGLs and non-conventional liquids, and secondary sources for OPEC crude oil production

Specifically, Libya pumped 730k b/d in May, up 178kb/d from 552kb/d in April; Nigeria output jumped to 1.68m b/d vs 1.506m b/d, a 174kb/d increase, while even the biggest producer Saudi Arabia, saw its output grow by 2.3kb/d to 9.94mb/d vs 9.938m b/d in April.

Trump Regulation Plan Makes for Pleasant Reading on Wall Street

The U.S. Treasury Department's report on bank regulation recommends several changes that would greatly benefit top Wall Street institutions

China Tightens Ship in Case of Fed Rate Storm

Chinese markets have calmed after a regulatory "storm" that sparked deep selloffs this spring. But recent moves show that policy makers are still worried about a midyear liquidity crunch as the Fed prepares to raise rates.

GE's Challenge: Bring Good Things Back to Life

A fresh face will be leading General Electric. Next up for the industrial giant: freshening up shareholder returns.

How should parents divide their assets between their children and stepchildren?

This man's father-in-law is wealthy, but he is not married to his wife's mother.

The Fed: Here's what the Fed will signal when it hikes interest rates

The Federal Reserve will raise interest rates this week and signal it is staying on course for more moves this year.

ETF Focus: A new ETF is making a bet that a company's most prized asset isn't in its balance sheet

Before deciding whether they will put their money into a stock, investors can scour the company's financial statements, looking at its various measures of valuation and its past performance. But what if one of the most valuable parts of the company was intangible, something that wouldn't get a line on quarterly balance sheets?

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