14Apr2016 Pre-Market Commentary: Futures Fractionally Higher, Crude Prices Melting Up, Fireworks Ahead If SP500 Breaks 2085

Here is the current market situation from CNN Money

European markets are mixed today. The DAX is up 0.30% while the CAC 40 gains 0.19%. The FTSE 100 is even.

Bank of America hit by weak trading, provisions for energy loans

(Reuters) – Bank of America Corp, the No. 2 U.S. bank by assets, reported an 18 percent slide in quarterly profit on Thursday as its trading business was hit by concerns about a global economic slowdown and uncertainty about U.S. interest rates.

Shares hit 2016 high, FX hit by Singapore sting

LONDON (Reuters) – World stocks rose to their highest level in more than four months on Thursday and the dollar chalked up a third day of gains as markets took a positive view ahead of top policymaker and oil producer meetings.

How Saudi Arabia plans to shake up its economy

RIYADH/DUBAI (Reuters) – In late February, several hundred Saudi officials, company executives and foreign consultants gathered in a luxury Riyadh hotel to discuss how Saudi Arabia’s economy could survive an era of cheap oil.

Wells Fargo’s quarterly profit falls 7 percent

(Reuters) – Wells Fargo & Co reported a 7 percent fall in quarterly profit as the third-largest U.S. bank by assets set aside more money to cover bad loans, mainly to energy companies.

BlackRock first-quarter profit falls 20 percent

(Reuters) – BlackRock Inc , the world’s largest asset manager, posted a 20 percent drop in first-quarter profit on Thursday amid a dramatic reversal in financial markets. The New York-based company’s net income fell to $657 million, or $3.92 per share, in the quarter, from $822 million, or $4.84 per share, a year earlier.

Delta Air profit tops expectations; smaller unit revenue decline seen

(Reuters) – Delta Air Lines Inc on Thursday reported a first-quarter profit above analysts’ expectations and forecast a smaller decline in passenger unit revenue for the spring, promising to change its fall flight capacity if necessary to improve the measure.

Oil falls as dark clouds appear ahead of producer meeting

LONDON (Reuters) – Oil fell on Thursday as the International Energy Agency trimmed its forecast for demand growth and on signs that a producers’ meeting this weekend will not yield a concrete plan to reduce oversupply.

McDonald’s targeting buyout firms as it seeks to sell North Asia stores

HONG KONG (Reuters) – McDonald’s Corp is targeting private equity firms, including Bain Capital, MBK Partners, TPG Capital Management and Chinese state-backed conglomerate China Resources (Holdings) for its planned sale of 2,800 restaurants in North Asia, people familiar with the matter told Reuters.

Macquarie lays off 15 percent of U.S. investment banking group: sources

(Reuters) – Australia’s Macquarie Group Ltd shed close to 15 percent of its U.S. investment banking workforce this month to replenish its ranks with star performers in North America, according to people familiar with the matter.

Deutsche Bank Confirms Silver Market Manipulation In Legal Settlement, Agrees To Expose Other Banks

Back in July of 2014, we reported that in an attempt to obtain if not compensation, then at least confirmation of bank manipulation in the precious metals industry, a group of silver bullion banks including Deutsche Bank, Bank of Nova Scotia and HSBC (later UBS was also added to the defendants) were accused of manipulating prices in the multi-billion dollar market.

The lawsuit, which was originally filed in a New York district court by veteran litigator J. Scott Nicholson, a resident of Washington DC, alleged that the banks, which oversee the century-old silver fix manipulated the physical and COMEX futures market since January 2007. The lawsuit subsequently received class-action status. It was the first case to target the silver fix.

Many expected that this case would never go anywhere and that the defendant banks would stonewall indefinitely: after all their legal budgets were far greater than the plaintiffs.

Which is why we were surprised to read overnight that not only has this lawsuit against precious metals manipulation not been swept away, but that the lead defendant, troulbed German bank Deutsche Bank agreed to settle the litigation over allegations it illegally conspired with Bank of Nova Scotia and HSBC Holdings Plc to fix silver prices at the expense of investors, Reuters reported citing a court filing by law firm Lowey.

Terms were not disclosed, but the accord will include a monetary payment by the German bank.

It goes without saying, that there would have been neither a settlement nor a payment if the banks had done nothing wrong.

According to Reuters, Deutsche Bank has signe …

Oil Spikes Back To $42 After IEA Comments

Forget Doha, says the International Energy Agency (IEA), bet it all on US production crashing.

First, IEA says Doha Don’t Matter…

A deal to freeze oil production by OPEC and non-OPEC producers will have a limited impact on global supply and markets are unlikely to rebalance before 2017, the International Energy Agency (IEA) said on Thursday.

The IEA, which oversees the energy policies of industrialized nations, said even though the decline in U.S. output was gathering pace and Iran was not adding as many barrels as expected, the world would still produce more oil than it consumes throughout 2016.

Then, as Bloomberg reports, IEA says global oil markets will œmove close to balance in the second half of the year as lower prices take their toll on production outside OPEC…

The world surplus will diminish to 200,000 barrels a day in the last six months of the year from 1.5 million in the first half, the agency said in a report on Thursday. Production outside the Organization of Petroleum Exporting Countries will decline by the most since 1992 as the U.S. shale oil boom falters. The glut is also being tempered as Iran restores exports only gradually with financial barriers to sales persisting even after the lifting of international sanctions.

Here’s The First “Panama Papers” Fallout In The Resources Sector

Submitted by Dave Forest via OilPrice.com,

Readers the world over are still busy crawling through information from the “Panama Papers” leak – which has revealed how high-profile persons around the globe used corporate havens to dodge taxes.

And in Zimbabwe, they’re turning their attention to one particular name leaked in the documents: the country’s largest platinum miner.

That’s Zimplats — the local subsidiary owned 87 percent by major miner Impala Platinum. Which the Panama Papers say used offshore accounts to dodge tax rules in Zimbabwe.

The leaked documents note that Zimplats established a company in the Isle of Man, called HR Consultants. Which was used to pay the salaries of Zimplats’ senior managers.

The offshore firm thus eliminated the need for salaries to be routed through Zimbabwe. Almost certainly simplifying payments, and possibly avoiding local taxes on these monies.

But such a strategy is illegal under Zimbabwe rules. With reports suggesting that the Reserve Bank of Zimbabwe was never notified of the payment scheme, constituting a major breach of tax legislation.

As one local expert interviewed by BDLive noted, “As long as the central bank was not involved in this‚ Zimplats would be committing a serious crime of money laundering‚ externalization and tax evasion.”

For its part, Zimplats has denied that it took part in any such arrangements — with a spokesperson saying the company has “no relations …

Frontrunning: April 14

Global shares reach four-month high, forex hit by Singapore sting (Reuters)

Dollar Rally Hits Commodities as Europe Halts Global Stock Gains (BBG)

Currencies Across Asia Fall Sharply Against U.S. Dollar (WSJ)

IEA expects limited impact from oil output freeze at Doha (Reuters)

IEA Sees Oil Oversupply Almost Gone in Second Half on Shale Drop (BBG)

BofA Profit Declines 13% on Trading Slump, Energy Reserves (BBG)

BlackRock quarterly profit falls 20 percent (Reuters)

Negative Rates: How One Swiss Bank Learned to Live in a Subzero World (WSJ)

With plenty of punch, central bankers wait in vain for the world to drink (Reuters)

Russia’s Putin: Panama papers are ‘provocation’ (Reuters)

Goldman Asset $15 Billion Manager Sees Wild Markets, Tame Gains (BBG)
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J.P. Morgan Earnings: Being Big Isn’t So Bad

J.P. Morgan Chase struck a blow against its critics with earnings that showcased the benefits of being big and diversified.

This Japanese Tech Stock Is a Ripe Target for Activists

Kyocera is a laggard when it comes to return on equity. Pressure from Abenomics and shareholders could change that.

What Citigroup’s ‘Living Will’ Win Means for Big Banks

Five big banks’ living wills were deemed to be not credible by regulators. That Citi passed is significant.

March 2016 CPI: Inflation Moderates

by Doug Short and Steven Hansen

According to the BLS, the Consumer Price Index (CPI-U) year-over-year inflation rate was 0.9 % – a decline from last month’s 1.0 %. The year-over-year core inflation (excludes energy and food) rate declined 0.1% to 2.2 %, and remains slightly above the target set by the Federal Reserve.

Rail Week Ending 09 April 2016: The Data Now Looks Recessionary

Week 14 of 2016 shows same week total rail traffic (from same week one year ago) declined according to the Association of American Railroads (AAR) traffic data. All rolling averages are in decline.

Economic Report: U.S. consumer prices climb 0.1% in March

Consumer prices rose a scant 0.1% in March, as the higher cost of filling up at the gas pump offset lower expenses for groceries and new clothes.

Outside the Box: Why this market rally looks like a classic investor trap

Currency risks and economic weakness creates poor conditions for stocks, writes Med Jones.

Deep Dive: Boring no more, these banks have found ways to make money

And the shares of some of the best industry performers are trading at relatively low valuations, writes Phil van Doorn.