01Aug2016 Pre-Market Commentary: US Futures Mostly Flat, Interest Rate Rise Off The Table, Crude Prices Due To Fall And Short-Term Indicators Are Neutral

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 0.59% while London’s FTSE 100 is off 0.33% and Germany’s DAX is lower by 0.13%.

Stock futures little changed on first day of month

(Reuters) – U.S. stock index futures were little changed on Monday, the first trading day of the month, as the chances of a near-term U.S. interest rate hike faded.

SolarCity agrees to $2.6 billion buyout offer from Tesla

(Reuters) – Tesla Motors Inc said on Monday it had reached a deal with SolarCity Corp to buy the solar panel installer for $2.6 billion, a big step in Chief Executive Elon Musk’s plan to offer consumers a one-stop clean-energy shop.

After bruising China battle, Uber cedes to rival Didi

(Reuters) – After a bruising two-year battle, ride-hailing firm Uber is selling its China operations to bigger local rival Didi Chuxing in a deal that will give Uber a one-fifth stake in Didi.

Verizon to buy Fleetmatics for about $2.4 billion

(Reuters) – Verizon Communications Inc said it will buy GPS vehicle tracking company Fleetmatics Group Plc for about $2.4 billion in cash.

Fed’s Dudley urges caution on rate hikes, cites risks to U.S.

NUSA DUA, Indonesia (Reuters) – The Federal Reserve should be cautious on interest rate increases due to lingering risks to the U.S. economy, one of its most influential policymakers said on Monday, appearing to signal the chance of a hike by the end of the year was fading.

Factories struggle as world demand sputters

LONDON/SYDNEY (Reuters) – British manufacturers slammed on the brakes last month after the Brexit vote and growth eased in the euro zone, surveys indicated, with factories in China, Japan and elsewhere in Asia offering only crumbs of comfort.

Oil falls as oversupply weighs

LONDON (Reuters) – Oil prices fell on Monday, reversing earlier gains, as increases in OPEC production and U.S. oil rig additions continued to weigh on the market.

Rogue trader jailed for UK’s biggest fraud warns it could happen again

LONDON (Reuters) – Kweku Adoboli, the rogue trader jailed in 2012 for the biggest fraud in British history, has said his crimes could be repeated because bankers still faced the same pressure to make profits “no matter what”.

Israel’s taxman investigating 8,000 accounts at HSBC in Switzerland

JERUSALEM (Reuters) – Israel’s tax authority, looking to crack down on unreported capital, said on Monday it has received a list from French authorities of more than 8,000 Israeli customers that held bank accounts at the Swiss arm of HSBC.

Frontrunning: August 1

Global stocks hit highest in a year but banks take shine off Europe (Reuters)

Fed’s Dudley Warns It Is Premature to Rule Out an Interest-Rate Increase This Year (WSJ)

Fed’s Kaplan Says September ‘On the Table’ If Data Support (BBG)

Europe’s stress tests fail to ease investors’ bank sector worries (Reuters)

Trump’s Attacks on Khan Family Roil Race But May Not Alter It (BBG)

Father of Slain Soldier Volleys Back at Donald Trump (WSJ)

Clinton says Russia behind DNC hacking, draws line to Trump (Reuters)

Russia says accusations it was behind DNC email hack are insulting (Reuters)

Islamic State calls on members to carry out jihad in Russia (Reuters)

Celgene Accused of Using Charities in ‘Scheme to Gain Billions’ (BBG)

Hunt for Returns Reaches Pakistan (WSJ)

A $400 Billion Influx Squeezes U.S. Bond Market’s Safest Asset (

Uber Throws In The Towel: Sells Money Losing Chinese Operation To Local Competitor Didi Chuxing

Concluding a vicious, money-losing ridesharing price war in China, overnight Didi Chuxing, the dominant ride-hailing service in China, announced it would acquire Uber’s operations in the country, ending a battle that cost the two companies billions as they competed for customers and drivers.

As reported early in the overnight session, Didi said it would Uber’s brand, business and data in the country. Uber will receive 5.89% of the combined company with preferred equity interest equal to 17.7 percent of the economic benefits. According to the Didi statement, Uber China’s other shareholders, including search giant Baidu Inc., will get 2.3% of the economic interest in Didi Chuxing. Didi founder Cheng Wei and Uber Chief Executive Officer Travis Kalanick will join each other’s boards.

After the merger, Uber will become the largest shareholder in Didi. The Chinese ride-hailing company will also invest $1 billion in Uber as part of the deal, a person familiar with the matter said.

As Bloomberg reports, “the truce brings to an end a bruising battle between the two companies for leadership in China’s fast-growing ride-hailing market. Uber has been spending at least $1 billion a year to gain ground in China, while Didi offered its own subsidies to drivers and riders to build its business.”

“Didi Chuxing and Uber have learned a great deal from each other over the past two years,” said Cheng, who is also CEO, in the statement. “This agreement with Uber will set the mobile transportation industry on a healthier, more sustainable path of growth at a higher level.”

Bloomberg adds that Didi’s valuation after the deal will be $35 billion.

The deal is the latest consolidation in China’s critical ridesharing industry. Last year, China’s ride-hailing leaders Didi and Kuaidi j …

Why It Has Been a Sterling Year for Corporate Bond Markets

The sterling corporate bond market is small, but producing outsize returns.

Nintendo’s Pokémon Hunters Need to Catch Whales

If Nintendo is to make Pokémon Go stick around, it will need to get accustomed to hunting whales—mobile-game parlance for the type of player who buys a lot of in-game items. The problem is such players are a loyal but rare breed.

Which Households Have Negative Wealth?

from Liberty Street Economics

— this post authored by Olivier Armantier, Luis Armona, Giacomo De Giorgi, and Wilbert van der Klaauw

At some point in its life a household’s total debt may exceed its total assets, in which case it has “negative wealth.” Even if this status is temporary, it may affect the household’s ability to save for durable goods, restrict access to further credit, and may require living in a state of limited consumption.

The Wall Street Journal: Transocean to buy rest of Transocean Partners in $514 million deal

Transocean to buy back the rest of Transocean Partners, the company it formed two years ago, that it didn’t already own in a deal that values the master limited partnership at about $514 million.

Need to Know: Earnings signal a bear market: ‘Sell the house, sell the car, sell the kids’

Investors are certainly looking for something to light a fire under this market, considering the S&P 500 over the past 11 days has been stuck in the narrowest range in 45 years.