Written by Gary
Wall Street is pointing to a flat open today (SPY +0.1%) as traders looked ahead to minutes of the Fed’s July policy meeting, while keeping an eye on crude prices. Texas Tea reached $46.73 earlier today and may top the 50 handle if this mornings inventory reports are lower than expected. Indicators are moderately bullish.
Here is the current market situation from CNN Money | |
 | European markets are lower today with shares in Germany off the most. The DAX is down 0.97% while France’s CAC 40 is off 0.63% and London’s FTSE 100 is lower by 0.27%. |
Fed funds futures are currently pricing in a 15% chance of a rate hike by September. December odds were at around 53%, up from 42% a day earlier.
What Is Moving the Markets
| Here are the headlines moving the markets. | |
 | Futures flat ahead of Fed minutes(Reuters) – U.S. stock index futures were little changed on Wednesday as investors held off from making big bets ahead of the release of the minutes of the Federal Reserve’s July policy meeting. |
| Special Report: Not so SWIFT – Bank messaging system slow to address weak pointsLA HULPE, Belgium (Reuters) – More than a dozen current and former board directors and senior managers of SWIFT, the bank messaging system that helps transmit billions of dollars around the world every day, have told Reuters the organization for years suspected there were weaknesses in the way smaller banks used its messaging terminals – but did not address such vulnerabilities. |
| Target cuts full-year profit forecast as sales decline(Reuters) – Retail chain Target Corp cut its fiscal-year profit outlook on Wednesday after quarterly sales fell more than expected, sending its shares down nearly 5 percent. |
| Russian court turns down appeal from Google in anti-monopoly caseMOSCOW (Reuters) – A Russian court on Wednesday turned down an appeal from Google in an anti-monopoly case over pre-installed applications on mobile devices running the Android operating system, Interfax news agency reported. |
| Gaining confidence, Fed officials eye interest rate hike this yearNEW YORK/KNOXVILLE, Tenn. (Reuters) – The Federal Reserve is raising expectations for an interest rate rise this year, even as early as next month, after two policymakers on Tuesday said the economic stars now appear to be aligning despite weak U.S. economic growth in the first half of 2016. |
| Lowe’s profit and sales fall short of estimates(Reuters) – Home improvement retailer Lowe’s Cos Inc reported lower-than-expected quarterly sales and profit and cut its full-year earnings forecast, sending its shares down in premarket trading on Wednesday. |
| Staples quarterly sales fall 3.7 percent(Reuters) – Staples Inc , the No. 1 U.S. office supplies retailer, reported a 3.7 percent fall in quarterly sales, reflecting a lower store count and a strong dollar. |
| Investors cool on Hong Kong stock market link with ‘Wild West’ ShenzhenHONG KONG (Reuters) – A plan to connect the giant stock markets of Shenzhen and Hong Kong offers global investors tempting access to China’s fast-growing tech sector, but high valuations and a reputation for wild speculation are likely to keep many buyers at bay, money managers said on Wednesday. |
| De Beers stakes its reputation on spotting the differenceMAIDENHEAD, England (Reuters) – In nature it takes billions of years to produce a diamond, or a laboratory can grow one in days and to the untrained eye, it looks the same. |
| 45th Anniversary Of Nixon Ending The Gold StandardThis week 45 years ago, August 15th 1971 to be exact, President Nixon suddenly declared the end of the Gold Standard. He ushered in the modern monetary system based on fiat paper and digital currency that works so poorly for us today and led to the global financial crisis. The dramatic announcement by ‘Tricky Dicky’ is a must watch and you can see it here: “Your dollar will be worth just as much tomorrow as it is today… ” |
| Frontrunning: August 17Futures flat ahead of Fed minutes (Reuters) Trump shakes up campaign staff (Reuters) Univision Wins Bankruptcy Auction for Gawker Media for $135 Million (WSJ) Congress receives FBI material on Hillary Clinton emails (CBS) Traders Brace for More Turmoil in World’s Worst Stock Market (BBG) Withdrawals Plague Once-Mighty Hedge-Fund Firms Brevan Howard and Tudor (WSJ) New York man in court charged with murdering Muslim cleric, assistant (Reuters) NSA website recovers from outage amid intrigue (Politico) The Soft Pinch of Austerity in Saudi Arabia Could Backfire (BBG) Walmart’s Out-of-Control Crime Problem Is Driving Police Crazy (BBG) Iran official: No permanent Russia base for Syria strikes (AP) Deutsche Bank Must Weigh Scrapping Bonus for 2016, Sewing Says ( |
| Trump Hires Breitbart Chairman As Campaign CEO In Latest Shake Up To “Boost Sagging Polls”In the latest surprise move involving his key political advisors, overnight Donald Trump revealed the latest shake up to his presidential campaign, the second in two months, hiring a top executive from Breitbart News and promoting a senior adviser in an effort to “right his faltering campaign” according to the NYT.
Stephen Bannon, the executive chairman of Breitbart News will become the Republican campaign’s chief executive, and Kellyanne Conway, a senior adviser and pollster for Trump and his running mate, Gov. Mike Pence of Indiana, will become the campaign manager. Paul Manafort, the campaign chairman, will retain his title. But the staffing change, hammered out on Sunday and set to be formally announced Wednesday morning, was seen by some as a demotion for Mr. Manafort. The Washington Post cited campaign aides as saying that while Trump respected Manafort, he felt “‘boxed in’ and ‘controlled’ by people “who barely knew him”. Why Bannon? Robert Costa provides one clue:
The news, first reported by The Wall Street Journal, was confirmed early Wednesday by Ms. Conway in a brief interview, but she rejected the idea that the changes amounted to a shake-up and said that Mr. Manafort was not being diminished. Manafort was forced to d … |
| European Stocks Drop, Futures Flat As Rising Dollar Pressures Oil, EMs: All Eyes On The Fed MinutesEuropean stocks are down led by tech, chemicals, alongside EM stocks which retreated from near a one-year high and oil fell for the first time in a week after hawkish comments from Federal Reserve officials revived bets on U.S. interest rate rises this year, and pushed the dollar higher from 7 week lows ahead of today’s Fed Minutes. S&P 500 futures were little changed following yesterday’s drop from record highs. The Stoxx Europe 600 Index fell for a fourth day, while MSCI’s gauge of developing-nation shares also declined, having halted an eight-day winning streak on Tuesday.
Crude pulled back from a five-week high as the Bloomberg Dollar Spot Index rebounded from near a three-month low after two regional Fed chiefs indicated interest rates could be increased at least once this year. South Korea’s won tumbled by the most since Britain voted to leave the European Union and gold declined. After sliding as low as 99.50 yesterday, a rebound in the USDJPY to 101 overnight pushed the Nikkei higher by 0.9%, closing at 16,746. The rebound in the dollar was catalyzed by comments from Fed President William Dudley and Dennis Lockhart who jolted markets yesterday by indicating a rate hike in 2016 remained possible despite uneven growth in the world’s largest economy. Their comments helped push the probability of a Fed move above 50 percent in the futures market for the first time since the June 23 Brexit vote. Before their comments, global equities had climbed to a one-year high and the dollar index sank to levels last seen in May amid conflicting signals over the U.S. labor market and growth. “A pull-back is following through in European stocks today after the Fed raised the p … |
| Why Some Banks Are Thankful for Money-Market StrainsIn 2008, higher Libor was a thing to fear, now it looks set to bring benefits. |
| How Junk Bonds Can Look Attractive and Scary at the Same TimeHow can high-yield corporate bonds simultaneously look historically expensive, yet also attractive? In the world of ultralow rates, investors are being forced to wrestle with some conundrums. |
| ValueAct Says ‘More Please’ at Morgan StanleyAn activist’s praise for Morgan Stanley signals a possible turnaround in investor attitudes toward major U.S. banks. |
| Are Key Investment Indicators Signaling A Recession?from the St Louis Fed — this post is authored by Kevin Kliesen A few key economic indicators may give some forecasters reason to think a recession is on the horizon. But when put into historical context, it seems that the economy is still expanding heading into the last half of the year.
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| Get away from utility stocks before they toppleDividends look appealing — but demand for electricity is falling and so are prices. And that’s before the industry feels the full impact of some new technologies that are disrupting the market. |
| Market Snapshot: U.S. stock futures waver as investors await Fed minutesWall Street set for choppy trade on Wednesday as investors opt for caution ahead of Federal Reserve minutes that could reveal if a rate increase in 2016 is in the cards. |
| Need to Know: Buy your insurance now against the boogeymen lurking in this marketInvestors just aren’t worried enough says our call of the day. And here’s what you need to do about it. |
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