08Apr2019 Pre-Market Commentary: Wall Street Lower, Treasury Yields Hold Ground, DOW Down Double Digits, WTI Crude Rises To 63.35, Oil Climbs To Five-month High

Here is the current market situation from CNN Money

European markets are mixed today. The CAC 40 is up 0.04% while the FTSE 100 gains 0.04%. The DAX is off 0.24%.

Aramco’s international bond attracts strong interest as demand tops $30 billion

Demand for Saudi Aramco’s inaugural international bond, seen as a gauge of potential investor interest in the oil company’s eventual initial public offering, is higher than $30 billion, Saudi Energy Minister Khalid al-Falih said on Monday.

Investors hit pause as ECB and Brexit risks loom

World stocks faltered at six-month highs and U.S. markets were set to dip on Monday as flashpoints including a crucial Brexit summit and a European Central Bank meeting loomed and investors looked ahead to an earnings season that may be disappointing.

Pinterest seeks $15-$17 per share in IPO, below last private valuation

Pinterest Inc on Monday set a price range of $15 to $17 per share for its initial public offering of 75 million shares, valuing it below the $12 billion at which the online image-search company sourced its last fundraising in 2017.

Wall Street analysts cut 737 MAX delivery forecast

Boeing Co is now unlikely to deliver more than 500 of its 737 MAX planes to customers this year, and even that will depend on a swift removal of an effective halt in deliveries after June, Wall Street analysts said on Monday.

Boeing’s 737 production cut hits its shares and those of suppliers

Boeing’s decision to cut production of its 737 aircraft hit the shares of its suppliers on Monday, while its own shares were lower in U.S. pre-market trading.

China Aircraft Leasing suspends orders for 100 Boeing 737 MAXs: report

China Aircraft Leasing Group Holdings has put its order for 100 Boeing 737 MAX jets on hold, until it is assured of the aircraft’s safety, South China Morning Post reported on Monday, citing a company statement.

Merck KGaA wins Versum’s support for sweetened $6.5 billion offer

Merck KGaA won the support of Versum Materials Inc’s board with a sweetened $6.5 billion takeover proposal, topping an agreed merger with rival Entegris.

SoftBank-backed Grab seeks another $2 billion funding in expansion drive

Grab is looking to raise another $2 billion this year to ramp up expansion, its CEO Anthony Tan told Reuters, only weeks after announcing more than $4.5 billion of funding in what has become Southeast Asia’s largest round of private financing.

Exclusive: Mexico’s Walmart pressures suppliers on pricing, forcing some to ditch Amazon

Walmart’s Mexico unit has penalized food companies supplying groceries to rival Amazon, pressure that has forced some to pull their products from the world’s largest online retailer, four people familiar with the matter said.

Mike Flynn’s Alleged Honeypot Slams Russiagate ‘Spy’ Stefan Halper And Journos Who Covered For Him

A Russian-born academic accused of being a Kremlin operative claims she was “used” to smear former National Security Adviser Michael Flynn over an unplanned contact they had at a 2014 dinner at the University of Cambridge, England when Flynn was the Director of the Defense Intelligence Agency under President Obama.

38-year-old Svetlana Lokhova met Flynn at the February 2014 Cambridge dinner organized by Sir Richard Dearlove – a former head of MI6 who was launching an organization called the Cambridge Security Initiative, according to the BBC. Also part of the organizing group was alleged American spy Stefan Halper, a longtime spook and then-Cambridge professor emeritus widely reported to have infiltrated the Trump campaign and spied on several aides during the 2016 US election.

“There Is Stealing From The Boxes”: Lira Tumbles After Erdogan Demands Istanbul Vote Probe

In the aftermath of last weekend’s local elections in Turkey, which saw Erdogan’s ruling AKP party lose control of Turkey’s two main cities, Ankara and Istanbul, on Monday President Erdogan demanded that the country’s election board investigate “widespread irregularities” in local elections in Istanbul, where a partial recount is already underway after the ruling party contested its defeat, sending the lira tumbling to the lowest level since March 25.

“There is stealing from the boxes,” Erdogan said, adding that “we’re applying to the YSK against that organized intervention at the ballot box,” referring to the High Election Board. In the U.S. “they renew elections when there is a one percentage point difference,” the president said in what appeared to signal a push for a new election in the city.

“Given the huge economic challenges facing Turkey, this is the last thing Turkey needs at this stage,” said Tim Ash, senior strategist at BlueBay Asset Management LLP in London, said by email.

As we reported at the time, the March 31 municipal vote ended a quarter century of rule by Erdogan’s movement in Ankara, the capital. But it was the defeat in Istanbul that has galvanized his ruling AK Party into refuting the preliminary results. As a reminder, the AK Party and its predecessors have been holding Istanbul since Erdogan won the mayor’s office in 1994, and a defeat there would hinder social policies that rally the support of poorer citizens.

“No one has the right to claim victory in Istanbul with just a 13,000 to 14,000 vote difference,” Erdogan said, referring to the gap between the candidate of the opposition CHP, who was initially declared winner, and the AKP’s pick for mayor.

Erdogan’s party has already sought the cancellation of voting in Istanbul’s Buyukcekmece district and applied to the election board for a recount of all votes in the remaining 38 districts across …

Blain: “Speaking To Clients There Is A Distinct “Been Here Before” Mood”

Blain’s Morning Porridge, submitted by Bill Blain

“The eggs chase the bacon round the frying pan.. “

News over the weekend leave me un-enlightened:

The denouement of the Brexit crisis on Thursday? Who knows..?

Kudlow saying its “closer” gives us no reason to think China and the US will actually sign a trade deal – it seems to be wallowing. Does it matter?

Saudi Arabia’s Aramco attracting a $30 bln book for its new bond. How quickly we forget..

Earnings kick off this week in the US – some say lower numbers will likely to test the stock market’s resolve and the current high valuations. Test, but unlikely to break?

How much are consumers over-levered across global housing, and personal lending? Lots, but rates are lower for longer.. until.

The global economy continues to look like its slowing..

Politics remains febrile (what a great word..) around the globe: a Salvini Le Pen love in, Trump vs Democrats, Trump losing Homeland chief, and the AfD.

Is the great Asset Reset button about to be pressed? What ARB?

Hilarious article on Zerohedge has a senior Blackrock exec calling for ECB to start buying European equities as next stage of boosting Europe’s recovery and inflation. Really? Because it’s worked so well in Japan?

Despite all the above, markets feel unconcerned. Speaking to clients there is a distinct “been here before” mood. Is it complacency, or is it an understanding that uncomfortable news might be hyped and fake, and signals often mislead? Despite all the negativity – investment managers tend to discount the known bad news. It’s the unknowns that sink markets. This is the last full week before the Easter break.

There are three things I’ve got on my watch list for the coming week:

More Boeing Backlash: China Suspends $6 Billion Order For 100 737s

Dealing another blow to public confidence in Boeing’s ability to swiftly reassure regulators that its 737 MAX 8 can be made safe for passenger travel, the South China Post on Monday reported that China Aircraft Leasing Group Holdings has put an order for 100 new 737s on hold, until it can be assured of the aircraft’s safety.

This follows a decision by Indonesia’s national carrier to cancel a $6 billion 737 MAX order. The airline had been planning to order 49 planes. Boeing last week said it would cut its pace of production by 20% to just 42 a month.

China was the first country to ground the 737s after Ethiopian Airlines flight ET302 crashed just minutes after takeoff – the second deadly incident involving the planes in just 5 months. A preliminary report from investigators found that the pilots followed Boeing’s safety procedures, but were still unable to right the plane.

Boeing is working on an update of its MCAS anti-stall software, which is believed to have contributed to both the crash of ET302 and a deadly Lion Air crash that occurred just five months earlier, but the fix is taking longer than anticipated.

Peter Morici: Let the states experiment with competing health-care approaches

Neither major political party will be able to transform the ACA, so the best alternative is a compromise that lets the states show us what will work best.

Bond Report: Treasury yields hold ground as traders watch for geopolitical jitters

Treasury yields struggle for direction on Monday as investors eyed developments around Britain’s planned exit from Europe’s trade bloc and Libyan military clashes. A key inflation reading later this week is also on investors’ radar.

Metals Stocks: Gold rebounds on dollar slump, stock uncertainty after S&P’s run

Gold futures firmed Monday, an attempt to reverse what was a weekly loss for the haven metal, as investors turned slightly cautious ahead of the launch of a new earnings season.