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22Jun2017 Pre-Market Commentary: Wall Street To Open Lower And Flat, Crude Prices Remain Low, But Off Session Lows, Data And Oil Prices Worry Investors

Written by Gary

US stock market index futures are pointing towards a flat, but negative opening (SPY -0.1%). The tech-heavy Nasdaq 100 futures is pointing to a drop of 8 points, or roughly 0.1%, and crude prices have recovered slightly.


Here is the current market situation from CNN Money

European markets are lower today with shares in France off the most. The CAC 40 is down 0.41% while London's FTSE 100 is off 0.38% and Germany's DAX is lower by 0.02%.

Oil, data in the spotlight on Wall Street

Today's Markets

In Asia, Japan -0.1%. Hong Kong -0.1%. China -0.3%. India flat.
In Europe, at midday, London -0.4%. Paris -0.3%. Frankfurt flat.
Futures at 6:20, Dow flat. S&P flat. Nasdaq flat. Crude +0.7% to $42.83. Gold +0.5% to $1251.70.
Ten-year Treasury Yield flat at 2.15%

Today's Economic Calendar

8:30 Initial Jobless Claims
9:00 FHFA House Price Index
9:45 Bloomberg Consumer Comfort Index
10:00 Leading Indicators
10:30 EIA Natural Gas Inventory
11:00 Kansas City Fed Mfg Survey
4:30 PM Money Supply
4:30 PM Fed Balance Sheet

Companies reporting earnings today »

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 flat as oil prices remain under pressure

(Reuters) - U.S. stock index futures were little changed on Thursday as oil edged up from multi-month lows but prices remained under pressure.

Exclusive: China Unicom counts Alibaba, Tencent among investors in drive to raise $10 billion - sources

HONG KONG (Reuters) - Chinese tech giants Alibaba Group Holdings and Tencent Holdings will be among new investors pouring a total of around $10 billion into mobile carrier China Unicom, sources said, part of efforts by Beijing to rejuvenate state behemoths with private cash.

Sales chief says Boeing won 571 orders and commitments

PARIS (Reuters) - Boeing said it had won 571 orders and commitments for jetliners at the Paris Airshow, upstaging European rival Airbus after the launch of a new model of its 737 MAX passenger jet.

Airbus concedes defeat to Boeing in Paris order race

PARIS (Reuters) - Airbus conceded defeat to rival Boeing in the race for new business at the Paris Airshow on Thursday, as a late haul of almost 100 aircraft failed to close a gap opened up by the launch of the American firm's new 737 model.

Tesla reaches agreement with Shanghai to explore production: Bloomberg

Tesla's revenue from China more than tripled to over $1 billion last year, according to its annual report.

Takata to file for bankruptcy Monday, SMFG to provide bridge loan: sources

TOKYO (Reuters) - Takata Corp will seek bankruptcy protection from creditors on Monday, two sources said, as the Japanese company faces billions of dollars in liabilities stemming from the biggest recall in automotive history.

Home Capital to get C$2 billion loan from Berkshire Hathaway

(Reuters) - Home Capital Group Inc said billionaire Warren Buffett's Berkshire Hathaway Inc will provide a new C$2 billion ($1.50 billion) line of credit to its unit Home Trust Co, ending the Canadian lender's strategic review process.

Oil prices slip as physical excess overpowers OPEC

LONDON (Reuters) - Oil slid back toward multi-month lows on Thursday, after a brief recovery early in the session, as traders warily eyed a glut of physical supply that has persisted despite OPEC-led efforts to balance the market.

UK competition watchdog clears Standard Life-Aberdeen deal

(Reuters) - Britain's competition watchdog said it had cleared Standard Life's 11 billion pound ($14 billion) deal to buy Aberdeen Asset Management , paving the way for the tie-up which will create the country's biggest listed asset manager.

Frontrunning: June 22



European stock markets stumble as oil languishes near lows (Reuters)

Some Trump Aides Want a New Leader at the Fed (BBG)

Goal of Saudi Shake-Up: Drag Country Into the Modern Era (WSJ)

Under fire in Washington, Trump back in campaign mode in Iowa (Reuters)

Revenue Slides at Some Trump Businesses, but Vegas Tower Brings Windfall (WSJ)

Trump, new Saudi crown prince share hardline views on Iran but risks abound (Reuters)

Canada's Plan for Managing Trump: Go Around Him (NYT)

Democrats Take Stock: 'Our Brand Is Worse Than Trump' (NYT)

Apple Scraps Like an Underdog in India's Huge Mobile Market (WSJ)

Norway's central bank keeps rates on hold, removes easing bias (Reuters)

Tesla Reaches Pact With Shanghai for China Production (BBG)

South Kore ...

Democrats Raise Paltry $4.3 Million In Worst May Total Since 2003

Embattled Democrats couldn't catch a break on Wednesday: not only did the party go 0-5 in a series of special elections for the House of Representatives, but the Democratic National Committee disclosed that it raised just $4.3 million last month - its worst tally for the month of May since 2003, when the DNC raised just $2.7 million.

Meanwhile, the party's bundlers plowed money into the special election campaign of Jon Ossoff, who lost his bid for Health and Human Services Secretary Tom Price's old seat in Georgia's 6th Congressional district.

Ossoff's defeat echoed the failure of the Clinton campaign: Ahead of the vote, pollsters and party leaders assured the public that Ossoff's strong polling in a staunchly red district was emblematic of the public's dissatisfaction with President Donald Trump.

Instead, Republican Karen Handel carried the day, defeating Ossoff by a comfortable margin of more than 10,000 votes. The loss was especially demoralizing for Democrats, who'd hoped that a victory in a staunchly red district would cement the party's chances of winning a majority in the House during next year's midterm election.

Ossoff's defeat appears to have ended the 31-year-old's burgeoning political career before it could truly begin. Ossoff, a documentary filmmaker and former political aide, garnered national attention with his aggressively anti-Trump rhetoric, epitomized by his slogan, "Make Trump Furious."

Unfort ...

Europe Slides For Third Day As Oil Attempts A Rebound; US Futures Flat

US equity futures were marginally in the red, while Asian markets rose and European stocks dropped. WTI oil rose 0.6% to $42.79 as some suggest the time to go long has arrived; oil tumbled 2.3% in the previous session. The Bloomberg Dollar Spot Index fell 0.1 percent.

Here are the main market developments while you were sleeping.

In Asia, the MSCI's index of Asia-Pacific shares ex-Japan climbed 0.6% but Japan's Nikkei ended a touch lower as a stronger yen and a plunge in the shares of auto air bag-maker Takata Corp took a toll on sentiment. The kiwi jumped after RBNZ kept rates on hold and focused on the positive growth outlook. The yen gained for the third day, its longest winning streak since May, after dovish comments from the Fed's Harker supported Treasury futures. Australian 10-year sovereign yield declines a basis point; ASX 200 stabilizes after two days of losses. the PBOC drained a net 80 billion yuan via open market operations; CNY drops for sixth straight day; the Shanghai Composite dropped 0.3% in a late day selloff after advancing 0.8% earlier, as the MSCI index inclusion is now just a memory. Still, the blue-chip CSI300 index rose to the highest level in 1-1/2 years. Dalian iron ore futures unchanged. Also in China, the onshore yuan falls for a sixth day, the longest stretch of losses in eight months, as China's Yield curve steepened following longest-ever period of inversion. CNY edges 0.03% lower to 6.8319 per dollar, poised for sixth straight day of declines, the longest since Oct. 18;

In Europe, stock markets fell for a third straight day on Thursday, as a selloff in energy shares continued and miners resumed declines. Energy companies led the Stoxx Europe 600 Index lower by 0.2% as of 6:45am EDT, after crude Wednesday dropped further into a bear market.2 out of 19 Stoxx 600 sectors rise; insurance is the most active -0.7% on 120% 30-day average volume followed by retail -0.1% on 112% average vol ...

If BlackRock And Pimco Are Right, "Another Fed Shock Looms"

Discussing the market's ongoing reaction to the schizophrenic split between the hawkish Fed and a market which now sees a 50% lower terminal Fed Funds rate than the FOMC, yesterday Jeff Gundlach said that the flattening yield curve could become a concern for US economic growth when two and three-year notes yield about the same.

"Lower CPI in the next couple of months will be a cold bucket of water for the Fed tightening dreams," Gundlach said. "Commodities are super weak, with the dollar down year-to-date, no less."

In not so many words, an error is forming: either "policy error" by the Fed, or one by the market, which will be forced to reconcile its dovish stance, potentially in violent fashion, with the Fed's relentless "data independence."

It was this issue that was the topic of a note by Bloomberg's macro commentator Garfield Reynolds, who noted in his overnight Macro View note, that in addition to the Gundlach "quandary", if recent commentary by BlackRock and Pimco is right, then "another Fed shock looms."

His full note below:

Another Fed Shock Looms If BlackRock, Pimco Right: Macro View

Once bitten, twice eager sounds like a contradiction but it can often seem like standard operating procedure in global markets - just look at the money piling into bets th ...

What Could Go Wrong in the Fed's Stress Tests

The Federal Reserve will reveal on Thursday which of the 34 banks it tests have passed hypothetical negative scenarios while maintaining required capital levels.

A Sweetheart Deal to Bailout Italy's Banks

Intesa Sanpaolo has proposed a takeover of two small banks' good assets, but the deal is almost too good to be true

Rampaging Oil Bears Are Missing Half the Picture

Oil has a U.S. supply problem, but unlike in previous downturns, demand still looks firm—for now.

Key Words: N.J.'s Chris Christie on his abysmal approval rating: 'The fact is, who cares?'

When it comes to polls, some politicians cherry pick. New Jersey Gov. Chris Christie has a novel approach.

Project Syndicate: El-Erian: Greece has been robbed by IMF and eurozone's failure to agree

Greek citizens have waited, and suffered, long enough, says Mohamed A. El-Erian, chief economic adviser at Allianz and a former deputy director at the International Monetary Fund.

Market Snapshot: Stock futures struggle to shake oil-market gloom

U.S. stocks were headed for another day in the red Thursday, with futures struggling to shake off gloom over the oil market as crude futures sank deeper into a bear market.

Earnings Summary for Today

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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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