Market Alert - Pre-Market

Futures vs FV: SP -7.85, DJ -59.34, NASDAQ -24.11

Futures start the week lower as the Thursday and Friday downside continues. Nothing major, but lower on world economic data, Brexit odds. This is certainly better than trying to bounce on the open, relieving any downside pressure and setting up sharper selling.

Futures tried to bounce after MSFT announced it was buying LNKD. Since then, however, futures are back down near session lows. Down, but not slaughtered at this point.

The Data is not good.
Japan: May manufacturing -11.1%. NIKKEI drops 3%

China: Fixed investment 9.6% vs 10.5% expected. Lowest since 2000
China retail sales: 10.0% vs 10.1% expected. Lowest since 2006
Yuan: China devalues back to near 5 year lows. Again, a steady reserve currency -- subject of course to direct government intervention whenever it feels like it.

FOMC: June meeting this week. No chances of a hike according to the Fed Funds Futures contracts. 13% chance in July. The odds don't cross 50% until February 2017, but that far out the handicapping of the FFF is poor. Suffice it to say there is little expectation of a rate hike this week and not much for July.


OTHER MARKETS
Bonds: 1.627% vs 1.64% 10 year

EUR/USD: 1.1258 vs 1.1257

USD/EUR: 106.045 vs 106.938

Oil: 48.31, -0.76

Gold: 1288.50, +12.60


A sloppy start for the market as it digests the continued worry over the UK vote, declining world economic data, and sadly, the global terror war. More and more money to be spent there as well as European immigration, draining more economic activity/resources.

Again, a weaker start for the week on top of the Thursday/Friday pullback is better for the upside than a bounce higher. Doesn't mean the selling ends today, indeed it doesn't mean the selling ends at all. Indices still have to show they can hold and bounce and there is more to go at this point.

We will look at the DIA puts to see if we can get a decent entry after a downside open. No rush, just want to pick entries and see how the current positions hold support as well as the leadership groups in general.



Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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