08Mar2016 Pre-Market Commentary: US Futures Down Fractionally, China’s Trade Data Pushes Global Markets Into The Red And WTI Crude Climbs To $38

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 0.57% while Germany’s DAX is off 0.43% and London’s FTSE 100 is lower by 0.38%.

Odebrecht, OAS ex-CEOs mull collaborating in Brazil probe: paper

BRASILIA (Reuters) – The former chief executives of major Brazilian builders Odebrecht SA [ODBES.UL] and OAS Empreendimentos SA [OAS.UL] could strike plea bargain deals with prosecutors in the Petrobras probe, newspaper O Globo reported on Tuesday.

United Airlines to buy 25 single-aisle Boeing aircraft

(Reuters) – United Airlines said it would buy 25 single-aisle aircraft from Boeing Co in addition to the 40 it had ordered earlier.

Vivint Solar terminates $2.2 billion merger with SunEdison

(Reuters) – Rooftop solar panel installer Vivint Solar Inc said on Tuesday it had terminated an agreement under which it would have been taken over by solar energy company SunEdison Inc after SunEdison failed to “consummate” the deal.

Chevron plans to slash budget in next two years to save cash

NEW YORK (Reuters) – Oil and natural gas producer Chevron Corp said on Tuesday it will slash its budget by at least 17 percent for the next two years as it finishes construction on major expansion projects and works to save cash as oil prices sit near 10-year lows.

Brent hits three-month high on hopes for producer price support

LONDON (Reuters) – Oil prices rose one percent on Tuesday, with benchmark Brent prices hitting a three-month high on hopes for a coordinated approach by major producers to support prices.

United Continental shareholders to nominate six board members: WSJ

(Reuters) – Two shareholders of United Continental Holdings Inc are nominating six directors to the airline’s board, the Wall Street Journal reported.

Jailed Libor trader Hayes denied UK Supreme Court appeal

LONDON (Reuters) – Tom Hayes, a former UBS and Citigroup trader serving an 11-year jail sentence for conspiring to rig Libor global interest rates, was on Tuesday blocked from appealing to the UK’s Supreme Court against his conviction.

VW’s labor chief says big U.S. fines will hit workers’ jobs

WOLFSBURG, Germany (Reuters) – Volkswagen may have to cut jobs in the United States as well as Europe and other countries depending on how big a fine has to be paid for its manipulation of diesel emissions tests, the carmaker’s top labor official told a meeting of 20,000 workers at its German headquarters on Tuesday.

Futures slip as China data fans global growth fears

(Reuters) – U.S. stock index futures were lower on Tuesday, after weak Chinese data rekindled fears of a global economic slowdown led by the world’s second-biggest economy.

“I’ll Go Full Power If There’s No Agreement” – Kuwait Breaks OPEC Production Freeze

Back in late February, when crude prices had just hit a 13 year low, one catalyst unleashed a furious short-covering rally: a WSJ report which cited a delayed SkyNews interview with the UAE energy minister, according to which OPEC would freeze, if not cut production. Since then we learned, courtesy of the Saudi oil minister Al-Naimi himself, that the Saudis will never reduce output, however, in a utterly meaningless gesture, Saudi Arabia and Russia agreed to “freeze” production at levels which are already at maximum capacity and under one condition: that all other OPEC members join the freeze, with the possible exception of Iran which may be allowed to produce until it hits its pre-embargo export levels.

Of course, even said “freeze” is nothing but a stalling tactic employed by an OPEC member (Saudi Arabia), to give the impression that OPEC still exists as a production-throttling cartel when OPEC ceased to exist in that capacity in November 2014. Everything since then has been one surreal redux of “Weekend at Bernies” where everyone pretends not to notice the corpse in the room.

However, while many had pretended to at least play along with the charade, today a core OPEC member effectively broke ranks when Kuwait said it would only agree to an output freeze if all major producers take part including Iran.

According to Reuters, Kuwait’s oil minister said on Tuesday that his country’s participation in an output freeze would require all major oil producers, including Iran, to be on board.

“I’ll go full power if there’s no agreement. Every barrel I produce I’ll sell,” Anas al-Saleh told reporters in Kuwait City. And since Iran has made it very, very clear it will not join the production freeze at its current mothballed output, and will need at least 9-12 months before it regains its pre-embargo capacity levels, one can forget about a production freeze well into 2017 if not for ever since by then at least one if not more OPE …

Frontrunning: March 8

Global Stocks Drop on Renewed Concerns About China (WSJ)

Iron Ore’s Rally Stalls as Goldman to Citigroup Forecast Retreat (BBG)

EU and Turkey close to groundbreaking migrant deal (FT)

Carney’s `Brexit’ Stance Under Fire as BOE Accused of Bias (BBG)

Oil edges lower after Kuwait dents hopes for output freeze (Reuters)

OECD Leading Indicators Point to Slowing Global Growth (WSJ)

Treasuries Rally as Japan Yields Extend Record Low on Safety Bid (BBG)

Germany’s Schäuble Sees No Need For Immediate Decision on Greece Payments (WSJ)

Justin Trudeau: The Canadian Coming for Dinner (BBG)

The Problem With the World’s Most Obvious Trade (WSJ)

Millennials Spending Power Has Hilton Weighing a ‘Hostel-Like’ Brand (

Bears Exit Hibernation As Rally Fizzles On Dismal Chinese Trade Data; Commodities Slide; Gold Higher

Those algos who scrambled to paint yesterday’s closing tape with that last second VIX slam sending the S&P back over 2,000, forgot one thing – the same thing that China also ignored – central bankers can not print trade, something we have repeated since 2011. The world got a harsh reminder of this last night when China reported the third largest drop in exports in history, which crashed by over 25%, the third biggest drop on record, and no, it was not just the base effect from last February’s spike, as otherwise the combined January-February data would offset each other, instead it was a joint disaster, meaning one can’t blame the Lunar New Year either. In short, one can’t really blame anything aside from the real culprit: despite all the lipstick that has been put on it, global trade is grinding to a halt.

This, together with fresh record low (and mostly negative) yields along Japan’s JGB curve, brought the risk off sentiment out of hibernation, and have sent the USDJPY sliding in overnight trading, and dragging European stocks and U.S. equity futures down with it.

Furthermore, after Goldman doubled-down on its bearish call on commodities, the sector has taken a deep breather after yesterday’s surge, and while crude oil has dipped by about 1%,iIron-ore futures on the Singapore Exchange fell 8.8% after yesterday’s record 19% jump on Monday. Citigroup Inc. said it’s still bearish as supply and demand fundamentals remain weak, while Axiom Capital Management Inc. said the price surge was probably just a œblip.

Promptly bearish commentators came out of the woodwork, first in Asia…

“If they can’t get stocks right, how are they going to get the tricki …

Global Stocks Drop on Renewed Concerns About China

Global stocks retreated after disappointing Chinese trade data sent commodities prices lower and heightened concerns about the world’s second-largest economy.

Goldman Adviser to 1MDB Quit After Alleged Violations of Bank Policy

Tim Leissner, the Goldman Sachs partner who handled deals for a controversial Malaysian government investment fund, was suspended and later quit after bank investigators found he allegedly violated company policies.

The Problem With the World’s Most Obvious Trade

This week should provide the perfect opportunity for betting on a stronger dollar, but not so fast.

February 2016 CBO Monthly Budget Review: Receipts Are Up 5%

from the Congressional Budget Office

The federal budget deficit was $352 billion for the first five months of fiscal year 2016, CBO estimates – $34 billion less than the shortfall recorded in the same span last year. Receipts were 5 percent higher than they were at this time a year ago, and outlays were 2 percent higher.

Metals Stocks: Gold buoyed as stocks weaken; Goldman, others doubt the rally

Gold futures are higher Tuesday, drawing at least short-term, safe-haven demand as stock futures point to a rough start.

The Wall Street Journal: Bettors give John Kasich better odds than Marco Rubio to win nomination

John Kasich is still a longshot to win the Republican presidential nomination, but prediction markets now see him as less of a longshot than Marco Rubio.