Market Alert - Pre-Market

Futures vs FV: SP -18.58; DJ -185.01; NASDAQ -34.42

Futures are off their lows, making it to the gap down point from the early morning open, but struggling at that point. The political situation in Italy (snap elections called) has led to its bonds and stocks crashing and that is impacting the euro and European markets. Why? Because it is viewed as a potential referendum on staying in the EU. There they go again, right? Italy has suffered through high unemployment, low production, absorbing millions of migrants -- they are tired of it and are ready to vote out the pro-EU leader. Happening across the globe: the citizens are tired of being viewed as and demoted to second rate citizens in their own countries.

Futures are off their lows, but the move off the lows is jagged and is not revealing, at least pre-market, a groundswell of pent up buying interest.

The market has had ample opportunity to break higher. Thus far the market has squandered those opportunities. As in a sporting contest, when you have opportunity early and don't capitalize on it, that often comes back to hurt you (e.g. Houston Rockets). The failure to make a break higher from good patterns could come back to hurt the attempt to continue the rally off support that started over 4 weeks back.


North Korea: NK leader's right hand man is in the US discussing the summit.


Oil: Saudi Arabia, Russia have planned out how they will ramp up production as a 'Output Revival Plan' is implemented to get production levels back up. Oil was getting too high and they fear two things: 1) that consumption will be curtailed at too high of prices, and 2) the US domestic production will continue to ramp given higher prices. Saudi does not want the US players having so much say in oil prices.


Storm Alberto: Major flooding in the Southeast and on the East coast, and that will have a GDP impact near term to the downside. Rebuilding of course helps boost things, but it does not replace the lives destroyed and lost.


FB: A class action lawsuit was expanded noting that the employment screening allows to screen out older job seekers. With all that data, it is too easy to break the rules.


Soros: A major financial crisis is coming, focusing primarily on Europe. Well, yes, the EU shot itself with its forced migration policies that have wrecked the smaller countries' economies.


OTHER MARKETS
Bonds: 2.889% vs 2.931% 10 year

EUR/USD: 1.1576 vs 1.1712. Dollar surging

USD/JPY: 108.92 vs 109.37. Losing ground to yen

Oil: 67.30, -0.58. Oil continues to slide as Russia/Saudi Arabia discuss an Output Revival Plan. They want prices lower for now to impact US production.

Gold: 1296.90, -6.78


Futures continue struggling and the market will have a chance to post a comeback again -- as it did, sort of, in the back half of last week. Financial market turmoil is not welcomed by most markets, however, as they do not know the size of the issue. Markets hate being unable to quantify risks, even remote ones.

Thus, the US markets start over again today with decent patterns that will be challenged on the open, and it will show if bids are ready to return.

Jon Johnson, Chief Market Strategist
InvestmentHouse.com
______________________________________
Alert Key
http://www.investmenthouse.com/alertkey.htm

PLEASE DO NOT REPLY TO THIS EMAIL. USE THE CONTACT US PAGE ON OUR WEBSITE.

Customer Support: http://investmenthouse.com/contact_us.php