Evening Headlines
Bloomberg:
- ECB Weighs Emergency Funding After Tsipras Wins Greece Bailout Vote. Greek lawmakers passed a bailout agreement that keeps the country in
the euro for now, shifting attention to the European Central Bank as it
weighs whether to pump more money into the country’s hobbled financial
system. After more
than four hours of debate stretching into the early hours
of Thursday, 229 members of the 300-seat parliament in Athens approved
new austerity measures that are a precondition of as much as 86 billion
euros ($94 billion) in aid. Among those who opposed the bill were 32
members of Prime Minister Alexis Tsipras’s Coalition of the Radical
Left, or Syriza, a sign the premier may have lost his majority.
- Tsipras Must Rebuild Government After Wave of Bailout Defections. Greek Prime Minister Alexis Tsipras will have to rebuild his
government after more than a quarter of his own lawmakers rebelled
against a bailout that he accepted to keep the country in the euro. After more than four hours of emotional debate, 38 of Syriza’s 149
lawmakers refused to back the bill, ripping the heart out of a
government that came to power on an anti-austerity platform in January.
That makes Tsipras dependent on opposition votes to continue in
government.
- China’s Stocks Frenzy Propped Up GDP, Raising Second-Half Doubts. China’s frenzied stock market boom -- which soured in the second
half of June -- helped drive a surge in financial sector growth that
underpinned the economy’s better-than-expected gross domestic product
result.
Financial services surged 17.4 percent in the first six months from a
year earlier, according to China’s statistics authority, as exchanges
and brokerages registered surging revenue amid record trading volume.
- Asian Stocks Rise as Greek Lawmakers Approve Austerity Measures. Asian stocks rose after Greek lawmakers passed a bailout agreement
that keeps the country in the euro for now as the European Central Bank
weighs whether to pump more money into Greece. The MSCI Asia Pacific Index gained 0.2 percent to 143.71 as of 9:03 a.m. in Tokyo.
Greece’s parliament endorsed the bailout without the support of Prime
Minister Alexis Tsipras’s Syriza bloc, as riot police tussled with
protesters outside. The new austerity measures are a precondition for as
much as 86 billion euros ($94 billion) in aid.
Federal Reserve Chair Janet Yellen was upbeat on the economy and
repeated that the Fed will probably raise its main interest rate this
year.
- Kiwi to Aussie Ape Loonie Slide to 2009 Low as Commodities Slump. The New Zealand dollar slumped to a six-year low as commodity
currencies tumbled after Canada’s interest-rate cut sharpened the
divergence between sagging growth in resource exporters and a
strengthening U.S. economy. The kiwi dropped as much as 0.8 percent Thursday to levels last seen
in July 2009 after whole milk prices tumbled and inflation slowed. The
loonie and the Aussie also extended losses as declining prices for the
nations’ major exports spurred speculation policy makers will keep
cutting borrowing costs that are already at or near record lows. Oil is
set for a third weekly loss after Iran reached a nuclear deal with world
powers.
Wall Street Journal:
- The Iranian Nuclear-Inspection Charade. Iran is allowed ample time, up to 24 days, to hide or destroy evidence before inspectors are given access.
In the months leading up to Tuesday’s announcement of a nuclear
agreement with Iran, American proponents and skeptics of the deal at
least agreed on one thing: the importance of “anywhere, anytime”
inspections of Iran’s nuclear facilities. On the skeptical side, House
Foreign Affairs Committee Chairman Ed Royce (R., Calif.)...
Evening Recommendations
Night Trading
- Asian equity indices are -.25% to +.50% on average.
- Asia Ex-Japan Investment Grade CDS Index 107.5 -1.0 basis point.
- Asia Pacific Sovereign CDS Index 59.75 +.5 basis point.
- NASDAQ 100 futures +.25%.
Earnings of Note
Company/Estimate
Economic Releases
8:30 am EST
- Initial Jobless Claims are estimated to fall to 285K versus 297K the prior week.
- Continuing Claims are estimated to fall to 2300K versus 2334K prior.
10:00 am EST
- Philly Fed Business Outlook for July is estimated to fall to 12.0 versus 15.2 in June.
- The NAHB Housing Market Index for July is estimated at 59.0 versus 59.0 in June.
4:00 pm EST
- Net Long-term TIC Flows for May are estimated to fall to $30.0B versus $53.9B in April.
Upcoming Splits
Other Potential Market Movers
- The
Fed's Yellen Senate testimony, ECB's Draghi speaking, ECB rate
decision, weekly Bloomberg Consumer Comfort Index, Bloomberg Economic
Expectations Index for July, weekly EIA natural gas inventory report and the (RIO) operational update could also impact trading today.
BOTTOM LINE: Asian indices are mostly higher, boosted by real estate
and consumer shares in the region. I expect US stocks to open
modestly higher and to weaken into the afternoon, finishing mixed. The Portfolio is 50% net long heading into the day.
