Mike’s Morning Brief – June 15, 2015

Market opens lower again as the Greek negotiations ended with no deal in sight.  European Markets were hit hard overnight, although it’s being felt around the globe.  ECB President Mario Draghi presents his Qtly update to the European Parliament today, which no doubt will include comments about Greece and what the future might look like.  All eyes will be on him today.  Our Fed holds its June meeting this week as well, though rates are not expected to change. The China bubble calls are getting louder after Bloomberg released some analysis. Target is selling its pharmacy business to CVS, which is an interesting deal that looks good for both parties.  M&A continues to be a hot theme.  Jurassic World had the best opening weekend in box office history, bringing in over $500 Million.  Stocks are lower, Bonds are higher, interest rates are lower as is crude.  Gold is getting a pop.

It’s being reported that the discussions between Greece and its European creditors collapsed, pushing Athens closer to a debt default that threatens its future in the European Union. With both sides refusing to soften their long-held bargaining positions, talks on Sunday broke down after just 45 minutes. Many now see the Eurogroup meeting on June 18 as the last chance for Greece to secure a deal on an agreed list of the economic reforms.  That’s this Thursday.  June 30 is the next formal deadline, but they all keep getting pushed out.  Ultimately, something has to give.  Expect more bumps ahead.

The battle over the Trans Pacific Partnership is expected to resume this week after President Obama’s request for “fast-track” authority was rejected in the House of Representatives. The bill would have granted the necessary rights to complete negotiations for the TPP, restricting lawmakers to a yes-or-no vote on the finished agreement. House Republican leaders say they will try to hold another vote on the trade legislation by Tuesday.  It has become a very controversial issue.

According to a study performed by Bloomberg, stocks with primary listings in China are now valued at $10.05 Trillion, an increase of $6.7 Trillion in the past 12 months. Many consider the heavy expansion as worrisome. No other stock market has grown as much in dollar terms over a 12-month period, valuations are now their greatest in five years and margin debt has climbed to record highs, all while the economy is mired in its weakest expansion since 1990. For perspective: The size of Japan’s stock market is $5 Trillion . The U.S. market is valued at almost $25 Trillion.  Apple is nearly $1 Trillion itself.

Jeb Bush is expected to officially announce his candidacy for President today.

Hydraulic fracturing will begin in the UK, after Lancashire County Council planners recommended the approval of gas exploration company Cuadrilla’s application to frack at a site in north England. The step comes as the U.K. moves from being a net exporter of oil and gas to a net importer, as supply in the North Sea dwindles. A final decision on whether the controversial gas extraction method will be permitted will conclude on Friday.

Boeing and Airbus are expected to win at least 220 orders for competing narrow-body jets at the Paris Air Show, representing at least $23 Billion, according to Bloomberg. Press conferences to unveil their orders will begin today, when the event formally opens. The Max is the latest version of Boeing’s top-selling 737 and is due to enter service in 2017. Airbus has scheduled the A320neo’s debut for later this year.

The Warriors snatched another victory last night in Oakland, now needing to win 1 of remaining 2 games to claim the title for the first time in 40 years.  The power of teamwork.  The slogan, “Strength in Numbers” means something. They give a damn, and it shows.  It’s what greatness comes from.  They try to close it out tomorrow night in Cleveland.

On this day, in 1752, Benjamin Franklin discovered electricity.  Well, he proved electricity was found in lightening.  He had a kite and a key.  Ben made things happen.


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