The Early Look: Futures Flying on Summit Agreement

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The Early Look

Here’s a brief look at the pre-market action for Jun 28, 2012 @ 06:52 AM

Good morning. Global markets rallied hard after an announcement came out of the EU summit in the early morning hours Brussels time.

According to Bloomberg:

"Global stocks rallied after policy makers eased repayment rules for Spanish banks, relaxed conditions for possible aid to Italy and unveiled a $149 billion growth plan for the region’s economy.

After 13 1/2 hours of talks ending at 4:30 a.m., leaders of the 17 euro nations dropped the requirement that governments get preferred-creditor status on crisis loans to Spain’s banks and opened the door to recapitalizing lenders directly with bailout funds once Europe sets up a single banking supervisor.

The leaders also discussed reducing the market pressure on Italy and Spain by allowing them to access rescue loans without relinquishing control of their economies.

European Union leaders late yesterday approved a 120 billion-euro ($149 billion) plan to promote growth in the 27- nation bloc including a capital boost for the European Investment Bank."

Asian markets were up about +1.7%.

European markets are trading up +1.8%, with some markets higher.

U.S. futures have been up in a range of +14-20 points and the Dow in a range of +100-150.

According to Reuters, the talks were tense as much pressure put on Merkel for concessions and many further details to be worked out:

"Euro zone leaders returned early on Friday to discuss longer-term plans to build a much closer fiscal union. Merkel wants her partners to cede control over their budgets before agreeing to bolder steps like joint debt issuance, that some experts believe is necessary to truly stem the crisis."

In other headlines, some data out of Japan was mixed, with notable drops in manufacturing and industrial production but better than expected housing data and employment.

Fallout and analysis from the U.S. Supreme Court healthcare decision will continue today.

Nike earnings disappointed last evening after the close and they joined the growing chorus of global companies citing lower than expected sales due to economic conditions. Ford also out with cautionary look at international sales.

U.S. reports today include Personal Income at 8:30 am edt, Chicago PMI at 9:45 am edt, and Consumer Sentiment at 9:55 am edt.

Italy, ironically, defeated Germany in the Euro football championship semifinals 2-1. (which is getting a lot of play in the media in the context of Merkel's concessions last evening).

Good Trading!
David W. (aka The Underground Trader)

Pre-Game Indicators

Here are the Pre-Market indicators we review each morning before the opening bell...

• Major Foreign Markets:
  • Australia: +1.22%
    
  • Shanghai: +1.35%
    
  • Hong Kong: +2.19%
    
  • Japan: +1.50%
    
  • France: +2.71%
    
  • Germany: +2.56%
    
  • Italy: NA
    
  • Spain: +2.56%
    
  • London: +1.43%
  
  
• Crude Oil Futures: +$2.78 to $80.47
  
• Gold: +$29.60 to $1580.00
  
• Dollar: lower against the yen, euro, and pound
  
• 10-Year Bond Yield: Currently trading at 1.561%
  
• Stock Futures Ahead of Open in U.S. (relative to fair value):
  • S&P 500: +19.01
    
  • Dow Jones Industrial Average: +140
    
  • NASDAQ Composite: +40.55

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