Today's Headlines

Bloomberg: 

• Ukraine Forces Suffer Worst Losses of Crisis Amid Unrest. Fighting flared anew in Ukraine four days before a presidential election, with 16 people killed near a checkpoint in the deadliest clash for the military since the secession campaign began after Russia annexed Crimea. An attack by insurgents near Volnovakha, about 50 kilometers (31 miles) south of Donetsk, left 13 soldiers dead, acting President Oleksandr Turchynov said in a statement on parliament’s website. The local government said fighting left a total of 16 dead and 32 wounded. One soldier was killed and two injured in the Luhansk region, the Defense Ministry said. “There’s a brutal war under way against our country,” Turchynov said. “Ukraine will never return to a post-Soviet neo-empire, which the Russian government dreams about.”

• French Recovery Fades as Manufacturing, Services Contract. French manufacturing and services unexpectedly shrank this month, highlighting President Francois Hollande’s struggle to revive the euro area’s second-largest economy. A Purchasing Managers Index of factory activity dropped to 49.3 from 51.2 in April, while a services gauge fell to 49.2 from 50.4, Markit Economics said today in London. Economists had forecast readings above 50, the level that divides expansion from contraction. A composite gauge of both manufacturing and services declined to 49.3 in May from 50.6 in April, Markit said. A measure of new business also dropped and employment fell at the fastest pace in three months. Markit said a number of companies indicated that payrolls were cut “in line with falling business activity.” 

• European Stocks Rise for Second Day as Daily Mail Jumps. European stocks rose for a second day as better-than-forecast manufacturing figures in China and the U.S. offset euro-area output data. Daily Mail and General Trust Plc surged 8.9 percent after announcing Zoopla Property Group’s initial public offering. Raiffeisen Bank International AG added 6 percent after posting first-quarter profit that beat analysts’ estimates. Royal Mail Plc slid the most since its initial public offering last year after reporting earnings that missed projections. The Stoxx Europe 600 Index rose 0.2 percent to 341.02 at the close in London.

• Finra Fines Cost JPMorgan 3 Minutes of Profit. The world’s biggest bond dealers, including JPMorgan Chase & Co. (JPM) and Morgan Stanley, failed to properly report trades to the industry’s price-tracking system more than 11,000 times. JPMorgan’s penalty: About three minutes of its annual profit.

• Americans’ Outlook for U.S. Economy Falls to Seven-Month Low. Americans’ expectations for the economy deteriorated to a seven-month low in May, a sign that the rebound from weakness earlier this year may be limited by still-cautious consumers. An expectations gauge that tracks where the economy is heading declined to 42.5 in May from 48 in the month prior, data from the Bloomberg Consumer Comfort Index showed today. The share of respondents who said the economy was getting worse climbed to the highest level this year. The weekly measure of sentiment declined to 34.1 in the period ended May 18 from 34.9, the third straight drop.

Wall Street Journal:

• Thailand Military Declares a Coup. Army Detains Ministers and Faction Leaders, Imposes Curfew, Orders Protests to Disband.

CNBC:

• 'Shadow' could be 2007 all over again: Cashin. (video)

• Toxic reputations are a time bomb for banks.

ZeroHedge:

• Market Instability Rising Fast As "Limit Up, Limit Down" Halts Surge.

• US Manufacturing PMI Beats But Employment Slows To Worst In 2014. (graph)

• Europe's Soaring Revulsion Against "Europe" In One Chart.

• Existing Home Sales Miss; Worst Start To Year Since 2007. (graph)

• All That Is Wrong With The US Housing Market In One Chart. (graph)

• "What Could Go Wrong" - China's "Worst Case Negative Loop".

• Congress Passes Gutted Beyond Recognition Anti-NSA Bill; Original Co-Sponsor Votes "No".

Business Insider:

• Tim Geithner Told Us What The Next Financial Doom Machine Will Look Like.  

• Evidence 'Strongly' Suggests The Suspected Boston Marathon Bombers Didn't Act Alone.

• 14 Emerging Health Technologies That Will Change The World.

• Google's(GOOG) New Update Has Stripped eBay Of 80% Of Its Best Search Listings.

• Doctors Think Emergency Room Visits Are Going To Explode Under Obamacare.

• Here Are The 49 Stocks That Big Hedge Funds Love Most.

NY Times:

• Russia and China Block Security Council Move to Prosecute Syria War Crimes. Russia and China on Thursday vetoed a Security Council resolution that would have empowered the International Criminal Court to investigate and prosecute war crimes in Syria, defying widespread support for such a move by human rights advocates and many United Nations members, including the United States. It was the fourth time that Russia and China used their veto power as permanent Security Council members to block any coercive action by the international body in the Syrian conflict, which began more than three years ago and has claimed at least 150,000 lives.

Reuters:

• Russia could build eight nuclear reactors for Iran. Russia could sign an agreement this year to build eight new reactors for nuclear power plants in Iran, state-run Russian news agency RIA reported on Thursday, citing a source it did not identify. Russia built Iran's only operating nuclear power reactor, at the Bushehr plant.Longstanding Western fears that the Bushehr project could help Iran develop nuclear weapons - something it denies it is seeking to do - receded after Iran promised to send the spent fuel from the plant back to Russia.

Xinhua:

• China Overcapacity to Take Years to Resolve, Survey Says. Survey by State Council's Development Research Center says 68% of 3,545 enterprises represented at conference expect process to take more than 3 years; 23% say over 5 years.

Shanghai Securities:

• China GDP Growth May Slow to About 5% in 2-3 Years. Ren Zeping, a researcher at the Development Research Center of the State Council, expects China's economy to grow about 5% for 20 years, after slowing to about 5% in 2-3 years, citing Ren. China's GDP growth may be about 6.0% next year.