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06Jul2017 Pre-Market Commentary: Wall Street To Open Lower After Not So Good Trade And Employment Numbers, Crude Prices Improve, The US Dollar Slides Again, Investors Looking For Safe Havens As Gold Rises Fractionally

Written by Gary

US stock index futures were lower this morning (SPY -0.4%) ahead of data on trade (down 46.5B, expecting 46.20B) and private sector hiring . . .


Here is the current market situation from CNN Money

. . . (down 158K, expecting 185K), a day after the Federal Reserve's policy minutes failed to provide a clear picture of future interest rate increases.

Crude recovered from a heavy fall (+1.7%) while European stocks and bonds were in the red on Thursday, as markets waited to see if ECB meeting minutes would give clues on the bank's next moves.

Tuesday's Key Earnings

In Asia, Japan -0.4%. Hong Kong -0.2%. China +0.2%. India +0.4%.
In Europe, at midday, London-0.6 %. Paris -1%. Frankfurt -0.7%.
Futures at 6:20, Dow -0.3%. S&P -0.4%. Nasdaq -0.7%. Crude +1.6% to $45.84. Gold +0.2% to $1223.60.
Ten-year Treasury Yield +3 bps to 2.36%

Today's Economic Calendar

Chain Store Sales
7:00 MBA Mortgage Applications
7:30 Challenger Job-Cut Report
8:15 ADP Jobs Report
8:30 International Trade
8:30 Initial Jobless Claims
8:30 Gallup Good Jobs Rate
9:45 PMI Services Index
10:00 ISM Non-Manufacturing Index
9:45 Bloomberg Consumer Comfort Index
11:00 EIA Petroleum Inventories
4:30 Money Supply
4:30 Fed Balance Sheet

Companies reporting earnings today »

What Is Moving the Markets

Here are the headlines moving the markets.

Futures lower ahead of trade, ADP jobs data

(Reuters) - U.S. stock index futures were lower on Thursday ahead of data on trade and private sector hiring, a day after the Federal Reserve's policy minutes failed to provide a clear picture of future interest rate increases.

Oil recovers from fall, bond yields regain traction

LONDON (Reuters) - Oil recovered from a heavy fall while European stocks and bonds were in the red on Thursday, as markets waited to see if ECB meeting minutes would give clues on the bank's next moves.

Qatar Airways aims to start buying American Airlines shares 'soon'

DUBLIN (Reuters) - Qatar Airways Chief Executive Akbar al-Baker said on Thursday the Doha-based carrier would soon start buying shares in American Airlines "depending on the share price."

EU charges Merck KGaA, GE, Canon over merger rules

BRUSSELS (Reuters) - General Electric , German drugmaker Merck KGaA , and Japan's Canon risk hefty fines after EU antitrust regulators accused them of providing misleading information during separate merger deals.

Volkswagen recalls 766,000 VW cars worldwide for brake system update

BERLIN (Reuters) - Volkswagen is recalling 766,000 vehicles of its core passenger car brand worldwide for a software update to their braking control systems, a spokesman said.

Tesla's Model S fails to ace some tests in IIHS evaluation

(Reuters) - Tesla Inc's Model S did not get the top score in certain tests by the Insurance Institute for Highway Safety (IIHS), the agency said on Thursday.

Konica Minolta to buy Ambry Genetics, deal worth up to $1 billion

TOKYO (Reuters) - Konica Minolta Inc said it was purchasing U.S. diagnostics company Ambry Genetics in a deal valued at up to $1 billion - an acquisition that marks a strategic shift for the Japanese firm's healthcare business as it seeks a leading position in precision medicine.

U.S. cars a tough sell in South Korea even as Trump targets trade deal

SEOUL (Reuters) - U.S. auto imports from the likes of General Motors and Ford Motor must become more chic, affordable or fuel-efficient to reap the rewards of President Donald Trump's attempts to renegotiate a trade deal with key ally South Korea, officials and industry experts in Seoul say.

China's Baidu being probed after CEO tests driverless car on public roads

BEIJING/SHANGHAI (Reuters) - Baidu Inc, China's biggest search engine provider, is under investigation to determine whether it had broken any laws after its chief executive tested a driverless car on public roads, Beijing's traffic police said on Thursday.

Precious Metals Are "Best Defence" Against Bail-ins In Economic Crisis

Precious Metals Are "Best Defence" Against Bail-ins In Economic Crisis

Precious metals are "real assets" and "best defence" against bail-ins and cashless society in the economic crisis which is "on its way"

The risks posed to investors and savers from the coming economic crisis and the threat of bank bail-ins, negative interest rates, 'helicopter money,' capital controls and the "cashless society" has been looked at in an excellent and timely article by economist John ...

Albert Edwards: "Something Smells Different This Time"

In his latest note, SocGen's permaskeptic Albert Edwards looks back 20 years in time to the Asian Crisis, and makes an interesting observations: nothing has really changed. In fact, as he explains, the events over the past 2 decades have been a "linear progression of the monetary madness that followed the 1997 Asian", and all thanks to central bankers who used the crisis as a springboard for ever more drastic monetary interventions, resulting in one bubble after another, culminating with the current state of the world, to wit:

On the 20th anniversary of the start of the Asian crisis it is certainly clear to me that the mess we are now in is a linear progression of the monetary madness that followed the 1997 Asian bust. Each and every subsequent economic and financial hiatus has been a direct result of excessively loose monetary policy to clear up the previous mess. The current perilous state of the global financial system is evident to anyone who scrapes at the cheap veneer of normality. I was cheered last week when the BIS called out the current conjuncture. They were one of the few institutions in the mid-2000s to accurately predict the impending financial crisis - and they fear another crisis is close.

Following his 20-year look back, Edwards then recounts the dramatic events of the past week, saying that "It took only a few days after my last weekly, which focused on the likely loss of independence for central banks in the next recession, for them to come out swinging. It only took a subtle change of rhetoric to prompt a mini-taper tantrum. It seems increasingly clear the Fed, the ECB and even the Bank of England (BoE) wish to get on with their tightening cycles, however far behind the curve they might now be."

...

Frontrunning: July 6



EU, Japan Strike New Trade Deal (WSJ)

EU-Japan deal sends anti-protectionist signal before G20: German minister (Reuters)

Republican lawmaker Steve Scalise's condition worsens after June shooting (Reuters)

The Flashpoints for World Leaders at G-20 Summit (BBG)

Leftist protesters vow to disrupt G20 summit in Hamburg (Reuters)

Trump Weighs 'Pretty Severe Things' for North Korea Over Launch (BBG)

China's Xi urges peaceful resolution to North Korea issue (Reuters)

How the June Jobs Report Matters for the Fed (El-Erian)

At least 123 Venezuelan soldiers detained since protests - documents (Reuters)

Can U.S. defend against North Korea? Not all agree (Reuters)

How Long Before the U.S. Is in Range? (WSJ)

South Korea's Moon says it is time for North Korea to decide: dialogue or not (Reuters ...

Live: Trump Delivers Speech To People Of Poland

As part of his trip to Poland, Donald Trump is delivering a speech in Krasinski Square, scene of a Polish uprising against the Nazis in 1944. In the speech the president will reprise his message that nations need to safeguard their borders or risk terrorist attack.

"While we will always welcome new citizens who share our values and love our people, our borders will always be closed to terrorism and extremism," Trump plans to say, according to a speech excerpt provided by the White House.

After concluding his speech, Trump will then fly to Hamburg for the two-day G-20 summit. After touching down in Germany he will hold a bilateral meeting with the nation's chancellor, Angela Merkel.

Watch the speech below.

Trump Is Right: China Could Press North Korea More on Trade

In addition to banning coal imports from North Korea, China could tighten the trade screws on its neighbor a lot more if it wanted to.

CEO-Worker Pay Ratio Generates Outrage---And Some Insight

A controversial new metric on executive pay is on Congress's chopping block. Shareholders should want it to survive, even if it only provides a sliver of insight into the companies they own.

Fed's Words Seem to Spell Worry

Is the drop in inflation starting to rattle Federal Reserve policy makers? Their words suggest as much.

June 2017 ADP Job Growth Is 158,000 - Below Expectations

Written by Steven Hansen

ADP reported non-farm private jobs growth at 158,000. This was a significantly weaker report than last month, and below expectations.

Bond Report: Global bond yields turn higher as sovereign debt selloff resumes

U.S. Treasury yields rose on Thursday, joining a global selloff in government paper, as investors took a cautious stance amid fears that central banks were on the verge of halting easy-money policies.

Economic Report: Private-sector job growth throttles back in June, ADP says

A private-sector job report said 158,000 jobs were created in June.

Key Words: Trump on foreign interference in U.S. election: 'Nobody really knows for sure'

Amid reports that he may not broach the topic in his face-to-face meeting Friday with Russian President Vladimir Putin, U.S. President Donald Trump conceded that Russia's widely suspected meddling in the November election probably had actually occurred, according to an Associated Press report, but he was quick to add that "other [countries]," "a lot of other people" and President Obama could be cited as sharing blame.

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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