Quartz Daily Brief—Merkel’s coalition talks, Asia’s typhoon trifecta, shutdown bubble, opulent puffer fish

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Good morning, Quartz readers!

What to watch for today

Merkel’s coalition talks. German Chancellor Angela Merkel discusses forming a coalition government with the country’s Social Democrats, who want a nationwide hourly minimum wage of 8.50 euros ($11.51).

Washington deal-makers scramble. The US government has three days until it risks running out of cash, and US lawmakers are scrambling to come up with a deal to extend the country’s borrowing limit. IMF head Christine Lagarde and the heads of three of the world’s most powerful banks warned that the fate of the global economy hangs in the balance.

Mother nature beats up Asia. Typhoon Wipha is headed to the Philippines, then Japan. Typhoon Nari is expected to hit Vietnam after battering the Philippines. Here are radar images of Wipha, Nari and Cyclone Phailin, which landed in India Saturday.

Market holidays. US bond markets close for Columbus Day. Egypt and a few other exchanges in the Middle East close for the beginning of the Eid religious holiday. The Tokyo Stock Exchange closes for the country’s national day celebrating sports and health, Hong Kong for a holiday celebrating ancestor worship and India for Dussehra, celebrating the annihilation of evil.

While you were sleeping

Netflix is discussing cable deals. The online video service is in talks with cable-TV companies like Comcast and Suddenlink Communications to offer Netflix via their set-top boxes, the Wall Street Journal reports. 

Life got pricier in China. September consumer prices rose more than expected, increasing 3.1% from a year earlier and advancing from 2.6% in August; policymakers want to ensure a rebound without too much inflation.

Singapore’s economy shrank less than expected. The city-state’s gross domestic product for the third quarter fell 1% compared to the second quarter, thanks to a strong services sector and manufacturing gains.

Argentina’s president left the hospital. Five days after brain surgery to remove a blood clot, 60-year-old Cristina Fernandez returned to her official residence. She faces 30 days of rest; it’s unclear when she’ll resume work.

The US stayed wedded to Afghanistan. Officials from the US and Afghanistan agreed on a preliminary deal that would leave some US troops in Afghanistan after 2014, the deadline for America’s withdrawal, but only if Afghanistan agrees that US soldiers not be subjected to Afghan law.

Iran refused to give up the goods. Iran rejected Western demands that the country ship sensitive nuclear material out of the country. Negotiations between the five permanent members of the United Nations Security Council, Germany and Iran over Iran’s nuclear program are set to start in Geneva on Tuesday.

The euro zone left the hot seat. Top German finance officials said the euro zone, no longer in a recession, is posing less of a risk to the global economy.

Sponsor content by Quartzlive

The dumbphones market is skyrocketing. There are more mobile phones on Earth than people, but only 26% are smartphones. As more people come online, that percentage will only get smaller. Join innovators from Mozilla, Microsoft, and more who are shaping the coming wave of connectivity at The Next Billion, Quartz’s first full-day forum, 11/6 in NYC.

Quartz obsession interlude

Todd Woody on how the second-biggest clean technology investor is an oil giant. ”The second-most active corporate deal-maker isn’t a ‘don’t be evil’ Silicon Valley tech giant. Rather it’s a company from the Dr. No sector—oil multinational ConocoPhillips, according to a new report from research and advisory firm Cleantech Group. Between the third quarter of 2011 and the second quarter of 2013, ConocoPhillips invested in 18 deals, putting cash into startups such as Cool Planet, biofuels developer, and Skyonic, which has invented a technology to capture carbon dioxide from industrial emissions.” Read more here.

Matters of debate

Forget about your passion and goals. Fail your way to success, says “Dilbert” creator Scott Adams.

The G20 is losing focus. Leaders of the G20 once focused on hammering out deals on fiscal stimulus; now their agenda is confused and amorphous, ranging from climate change to food security.

Yellen isn’t the issue. The US Federal Reserve has bigger problems to confront than who’s running it; There’s waning confidence that its policy tools can fix the economy.

The Nobel Peace Prize winner is in trouble. The Organization for the Prohibition of Chemical Weapons (OPCW), which just won this year’s Nobel Peace Prize, is bogged down by budget and staff cuts that are jeopardizing one of the most successful nonproliferation agreements.

The US political system is the country’s latest bubble. If market participants believe that the US’s once capable system is now dysfunctional and unpredictable, a pivotal event like a default could move markets dramatically.

Surprising discoveries

The story of quinoa’s rise. Bolivian farmers, an in-demand grain, and the triumph of delivery.

If you cried in space, the tears would pool in your eyes like a blob. So says this astronaut’s fact-check of the sci-fi film Gravity.

Ninjas are au courant in Japanese fast food. Burger King is burger-ifying a national icon, the ninja, by using blackened buns and a long strip of bacon.

One giant brass puffer fish takes on China’s Communist Party. The city of Yangzhong, in China’s Jiangsu Province, built a 295-foot-long brass-encased sculpture of a puffer fish to lure visitors to a gardening expo, bucking the government’s austerity drive.

Our best wishes for a productive day. Please send any news, comments, burger innovations and puffer fish sightings to hi@qz.com. You can follow us on Twitter here for updates during the day.

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Alcoa Kicks Off Earnings Season With a Beat

Stocks opened flat on Turnaround Tuesday only to cascade down to the lows of the day shortly thereafter. However, crude oil futures acted in the exact opposite fashion, rising nearly 3% to $92.25. Early in the trading session, Apple (AAPL) fell as much as 2% to $623, but recovered nicely on the day, closing the day down only 0.25%.

German Chancellor Angela Merkel visited Greek Prime Minister Samaras today in Athens amidst 25,000 protesters. Merkel pledged her support for a country that has seen youth unemployment levels skyrocket and a recession deepen. The troika (ECB, IMF, and EU) officials continue to analyze the Greek government’s pledges to cut spending and boost growth in order to allow the next tranche of aid to be released to Greece from the region’s bailout fund.

The latest Gallup poll showed that Romney gained on Obama among likely voters. Romney now holds an estimated 49% of the vote compared to Obama’s 47%, with a margin of error of 2%. Last week’s poll showed Obama holding a lead over Romney at 50% to 45%. Today’s sell-off likely disproves the theory that stocks rose last Thursday on Romney’s outperformance of Obama at the presidential debate.

Following up on a lawsuit filed last week against JPMorgan (JPM) that involved defective mortgage loans stemming from its acquisition of Bear Stearns, the US filed a lawsuit against Wells Fargo (WFC), stating that the bank falsely certified FHA loans that once defaulted and had to be paid for by the US government.

Aluminum manufacturer Alcoa (AA) kicked off earnings season by beating earnings-per-share estimates. The company reported EPS of $0.03 vs estimates of break-even and lowered their global aluminum demand forecast for 2012 to 6% from 7%.

The Fed will release its beige book of economic conditions throughout the 12 Fed districts. Today, the minutes from the regional directors’ meeting were released, and noted the fiscal uncertainty ahead, positive changes in housing, and increasingly weak manufacturing.

In the morning, the Census Bureau will release Merchant Wholesalers Inventories for August with economists forecasting a monthly decline to 0.4% from 0.7%. In the afternoon, the Treasury will sell $21 billion in 10-year notes. The current 10-year note closed at a yield of 1.71% today.

In earnings, Costco (COST), Progressive (PGR), ADTRAN (ADTN), and OCZ Technology (OCZ) will report earnings.

Monday NAS -23.60 Gold +2.890 USD +0.102 DOW -26.50 S&P -5.05 CRB +1.97

E X T R E M E   M A R K E T   C O M M E N T A R Y
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STOCK INDEXES & MARKETS http://quotes.ino.com/exchanges/?c=indexes+

GENERAL STOCK MARKET COMMENT: The U.S. stock indexes closed
weaker today on some profit taking. Stock index bulls still
have the overall near-term technical advantage. It was a
moderate “risk-off” trading day in the market place Monday.
News the World Bank lowered its forecast for China’s annual
economic growth rate to 7.7% (from 8.2% in an earlier
forecast) did put some general selling pressure into the
raw commodity sector and world stock markets Monday. With
the U.S. government closed for the Columbus Day holiday
Monday there were no economic reports released. U.S.
markets were open as usual, but they were quieter. The Euro
currency fell Monday on some more disappointing economic
data coming out of the European Union. Industrial output in
Germany declined by 0.5% in August. European Union finance
ministers met late Monday in Brussels to discuss their
ongoing debt crisis. On Tuesday German Chancellor Angela
Merkel goes to Athens to discuss Greece’s finance problems.
Spain has yet to formally ask for a fresh bailout package
from the EU, to the consternation of many Euro currency
bulls.

_____________________________________________________________________

INTEREST RATES http://quotes.ino.com/exchanges/?c=interest

December U.S. T-Bonds closed up 22/32 at 148 6/32 today.
Prices closed nearer the session high and saw short
covering and some bargain hunting amid a bond-market-

bullish risk-off trading day in the market place today.

Bulls and bears are on a level near-term technical playing
field as a 2.5-month-old downtrend line is in place on the
daily bar chart.

ENERGY MARKETS http://quotes.ino.com/exchanges/category.html?c=energy

ENERGIES: November crude oil closed down $0.30 a barrel
at $89.58 today. Prices closed nearer the session high
today. Prices were pressured by worries about weak demand
from China and the EU, and by a firmer U.S. dollar index.
Bears have the near-term technical advantage as a three-

week-old downtrend is in place on the daily bar chart.

November heating oil closed down 51 points at $3.1508
today. Prices closed near mid-range today. Bulls still have
the overall near-term technical advantage amid choppy
trading.

November (RBOB) unleaded gasoline closed down 531 points at
$2.8996 today. Prices closed nearer the session low today.
Prices Friday hit a six-month high amid problems at U.S.
refineries that have helped drive gasoline futures sharply
higher. Bulls have the solid overall near-term technical
advantage.

November natural gas closed up 1.3 cents at $3.409 today.
Prices closed nearer the session high today. Bulls still
have the near-term technical advantage. A bearish pennant
pattern has formed on the daily bar chart.

CURRENCIES http://quotes.ino.com/exchanges/category.html?c=currencies

CURRENCIES: The December Euro
currency closed down 60 points at 1.2982 today. Prices
closed near mid-range today and saw some profit taking.

The Euro bulls still have the solid overall near-term
technical advantage.

The December Japanese yen closed up 57 points at 1.2773
today. Prices closed near mid-range today. Bulls still have
the slight overall near-term technical advantage but need
to show more power soon. There is some stiff overhead
resistance that has stalled recent rallies and such appears
to be the case again.

The December Swiss franc closed down 38 points at 1.0733
today. Prices closed near mid-range today on some profit
taking. The Swissy bulls still have the overall near-term
technical advantage.

The December Canadian dollar closed up 21 points at 1.0219
today. Prices closed near mid-range today. Bulls have the
overall near-term technical advantage and have regained
upside momentum recently.

The December British pound closed down 108 points at 1.6030
today. Prices closed nearer the session low and hit a fresh
four-week low today as the bulls are fading. Prices have
been trending lower for the past three weeks. Bulls do
still have the overall near-term technical advantage.

The December U.S. dollar index closed up 22 points at 79.65
today. Prices closed near mid-range today on short covering
in a bear market. The bears still have the solid overall
near-term technical advantage. Prices are in a 10-week-old
downtrend on the daily bar chart.

PRECIOUS METALS http://quotes.ino.com/exchanges/?c=metals

METALS: December gold futures closed down $4.90 an ounce
at $1,775.90 today. Prices closed near mid-range today on
some profit taking after prices Friday hit a seven-month
high. The key “outside markets” were bearish for gold today
as the U.S. dollar index was higher and crude oil prices
were weaker. Gold bulls still have the solid overall near-

term technical advantage. Prices are in a three-month-old
uptrend on the daily bar chart.

December silver futures closed down $0.557 an ounce at
$34.015 today. Prices closed near mid-range today on profit
taking. The key “outside markets” were in a bearish posture
for silver today as the U.S. dollar index was higher and
crude oil prices were weaker. Silver bulls are still in
overall near-term technical command, but are fading just a
bit and need to show some fresh power soon. Prices are
still in a 2.-month-old uptrend on the daily bar chart, but
now just barely.

December N.Y. copper closed down 570 points at 372.10 cents
today. Prices closed nearer the session low today. The key
“outside markets” were in a bearish posture for copper
today as the U.S. dollar index was higher and crude oil
prices were weaker. Copper bulls have the overall near-term
technical advantage. Prices are still in a nine-week-old
uptrend on the daily bar chart, but now just barely.

FOOD & FIBER http://quotes.ino.com/exchanges/category.html?c=food

SOFTS: March sugar closed down 19 points at 21.35 cents
today. Prices closed near mid-range today. The key “outside
markets” were bearish for the sugar market today, as the
U.S. dollar index was higher and crude oil prices were
weaker. Sugar bulls have the slight near-term technical
advantage but need to show fresh power soon to keep it.

December coffee closed steady at 168.10 cents. Prices
closed near mid-range and hit a fresh four-week low today.
The key “outside markets” were bearish for the coffee
market today, as the U.S. dollar index was higher and crude
oil prices were weaker. Coffee bears have regained the
near-term technical advantage.

December cocoa closed up $3 at $2,385 a ton. Prices closed
nearer the session high today but did hit a fresh nine-week
low. The key “outside markets” were bearish for the cocoa
market today, as the U.S. dollar index was higher and crude
oil prices were weaker. Cocoa prices are in a four-week-old
downtrend on the daily bar chart.

December cotton closed up 29 points at 71.78 cents today.
Prices closed nearer the session high today. The key
“outside markets” were bearish for the cotton market today,
as the U.S. dollar index was higher and crude oil prices
were weaker. Cotton bears still have the near-term
technical advantage.

November orange juice closed down 240 points at $1.1270
today. Prices closed nearer the session low today. Bears
have the overall near-term technical advantage. A bear flag
has formed on the daily bar chart.

November lumber futures closed down $1.60 at $274.50 today.
Bulls and bears are on a level near-term technical playing
field, but the bulls are fading.

GRAINS http://quotes.ino.com/exchanges/category.html?c=grains

GRAINS: December corn futures were down 6 1/2 cents at
7.41 1/2 in late trading today. Prices were nearer the
session low. The key “outside markets” were bearish for the
corn market today, as the U.S. dollar index was higher and
crude oil prices were weaker. The corn bulls have the
slight overall near-term technical advantage, but are
fading again and need to show fresh power soon. Traders are
awaiting Thursday morning’s latest USDA supply and demand
report.

November soybeans were down 1 1/2 cents at $15.50 a bushel
in late trading today. Prices were near mid-range. The key
“outside markets” were bearish for the soybean market
today, as the U.S. dollar index was higher and crude oil
prices were weaker. Traders are awaiting Thursday morning’s
latest USDA supply and demand report. Bulls and bears are
on a level near-term technical playing field. However, a
five-week-old downtrend is still in place on the daily bar
chart.

December soybean meal was up $0.20 at $471.40 in late
trading today. Prices were nearer the session high. Meal
bulls and bears are on a level near-term technical playing
field. However, prices are still in a five-week-old
downtrend on the daily bar chart.

December bean oil was down 8 points at 51.11 cents in late
trading today. Prices were near mid-range. The key “outside
markets” were bearish for the bean oil market today, as the
U.S. dollar index was firmer and crude oil prices were
weaker. Bean oil bears have the overall near-term technical
advantage. Prices are in a steep five-week-old downtrend on
the daily bar chart.

December Chicago SRW wheat was up 4 cents at $8.61 1/2 in
late trading today. Prices were near mid-range. Traders are
awaiting Thursday morning’s latest USDA supply and demand
report. Prices remain in a choppy and sideways trading
range at higher price levels, but now at the bottom of that
range. My bias is still that this market has put in a major
top. Wheat bulls still have the slight overall near-term
technical advantage.

December K.C. HRW wheat was up 6 1/2 cents at $8.85 1/4 in
late trading today. Prices were nearer the session high
today. Trading remains in a choppy and sideways trading
range at higher price levels. Prices are now at the bottom
of that range.

LIVESTOCK http://quotes.ino.com/exchanges/?c=livestock

LIVESTOCK: December live cattle closed up $0.10 at
$126.30 today. Prices closed nearer the session low today.
The key “outside markets” were bearish for the cattle
market today, as the U.S. dollar index was higher and crude
oil prices were weaker. Cattle bears have the overall near-

term technical advantage.

November feeder cattle closed up $0.10 at $146.30 today.
Bears have the overall near-term technical advantage.

December lean hogs closed up $0.30 at $76.85 today. Prices
closed near mid-range today and did hit a fresh nine-week
high early on today. Hog market bulls have the overall
near-term technical advantage. A four-week-old uptrend is
in place on the daily bar chart.

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E X T R E M E   F U T U R E S
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Updated every 10 minutes around the clock.
More at http://quotes.ino.com/analysis/extremes/futures/

WINNERS

BCX.Q13 SOYBEANS CRUSH INDEX Aug 2013               56.75      3.50  +6.57
AA.Y$$  BUTTER-GRADE AA Cash                       1925.0      65.0  +3.49
RR.X12  ROUGH RICE Nov 2012                        15.365     0.260  +1.72
SM.V12  SOYBEAN MEAL Oct 2012                       478.5       3.8  +0.80
CSI.X12 SOYBEAN-CORN PRICE RATIO Nov 2012           2.090     0.016  +0.77
NG.H13  NATURAL GAS Mar 2013                        3.838     0.024  +0.63
LH.Z12  LEAN HOGS Dec 2012                         76.875     0.325  +0.42
W.Z12   WHEAT Dec 2012                              861.0       3.5  +0.41
LC.Z13  LIVE CATTLE Dec 2013                       135.90      0.45  +0.33
FC.H13  FEEDER CATTLE Mar 2013                    152.025     0.325  +0.21

LOSERS

LB.K13  LUMBER (RANDOM LENGTH) May 2013               305        -3  -0.97
ND.H13  NASDAQ 100 INDEX Mar 2013                 2771.00    -26.75  -0.96
C.Z12   CORN Dec 2012                              741.50     -6.50  -0.87
LH.J13  LEAN HOGS Apr 2013                          87.25     -0.55  -0.63
VB      RUSSELL 2000 VALUE INDEX                  1107.30     -6.17  -0.55
BO.V12  SOYBEAN OIL Oct 2012                        50.48     -0.28  -0.55
RG      RUSSELL 1000 GROWTH INDEX MINI             674.50     -3.63  -0.54
GH      RUSSELL 2000 GROWTH INDEX                  481.19     -2.43  -0.50
SP.Z14  S&P 500 INDEX Dec 2014                     1397.0      -5.7  -0.41
BCX.Z13 SOYBEANS CRUSH INDEX Dec 2013               63.00     -0.25  -0.40

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Free Video Seminar – “Spotting breakouts that lead to trend reversals”

http://broadcast.ino.com/redirect/?linkid=1952

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____________________________________________________________________________

E X T R E M E   S T O C K S
____________________________________________________________________________

Updated every 10 minutes around the clock.
More at http://quotes.ino.com/analysis/extremes/stocks/

WINNERS

BIOF    BIOFUEL ENERGY                               6.45      1.29  +25.00
VRNG    VRINGO                                     5.4006    0.8606  +18.96
ALNC    ALLIANCE FINANCIAL                         45.788     6.378  +16.18
NBG.PR.A NATIONAL BANK of GREECE                      6.28      0.80  +14.60
FONR    FONAR                                        6.30      0.73  +13.11
TPCG    TPC GROUP                                 45.7999    5.1299  +12.61
HLFDY   HALFORDS GROUP ADR                          10.03      1.10  +12.32
NFLX    NETFLIX                                   73.5499    6.9899  +10.50
MWW     MONSTER WORLDWIDE                            8.05      0.75  +10.27
VVUS    VIVUS                                       20.44      1.89  +10.19

LOSERS

REGI    RENEWABLE ENERGY GROUP                       5.60     -1.52  -21.35
GDOT    GREEN DOT                                   10.24     -2.61  -20.31
PRGS    PROGRESS SOFTWARE                         18.5098 -2.9702  -13.83
NTWK    NETSOL TECHNOLOGIES                          5.95     -0.73  -10.93
ISIL    INTERSIL                                     7.31     -0.80  -9.86
XNPT    XENOPORT                                    11.75     -1.11  -8.63
CCBC    CHINO COMMERCIAL BANCORP                     9.05     -0.85  -8.59
ACTG    ACACIA RESEARCH                             23.13     -2.00  -7.96
CTS     CTS                                          8.65     -0.73  -7.78
AVEO    AVEO PHARMACEUTICALS                         9.23     -0.76  -7.61
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T H A N K   Y O U
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GREECE – Factors to Watch on August 24

ATHENS, Aug 24 (Reuters) – These are news stories, press reports and events which may affect Greek financial markets on Friday:
MERKEL AND HOLLANDE UNITE IN TOUGH MESSAGE FOR GREECE
German Chancellor Angela Merkel and FrenchPresident Francois Hollande presented a united front towards Greece on Thursday, telling Athens it should not expect leeway on its agreement unless it sticks to tough reforms. (news)

GERMAN FINANCE MINISTRY STUDYING “GREXIT” COSTS – PAPER
A working group led by Germany’s deputy finance minister is studying the possible economic impact of a Greek exit from the euro zone, a newspaper reported on Friday, as Chancellor Angela Merkel prepared for talks with Greece’s prime minister.(news)

DUTCH MINISTER URGES GERMANY TO HOLD FIRM ON GREECE
Dutch Finance Minister Jan Kees De Jager urged Germany to maintain its tough stance on aid to Greece in an interview due to be published on Friday, when Greece’sprime minister is due to hold talks in Berlin with Chancellor Angela Merkel. (news)

GERMAN FINMIN-MORE TIME WON’T SOLVE GREEK PROBLEMS
Granting Greece more time to implement spending cuts would not solve its problems, GermanFinance Minister Wolfgang Schaeuble said in an interview on Thursday, adding however Athens’ difficult situation must be acknowledged. (news)

GREEK BETTING FIRM OPAP’S PROFIT TOPS FORECAST
OPAP, the Greek lotterygames operator and Europe’s biggest listed gambling company, reported an 18 percent rise in second-quarter profits on Thursday, helped by lower tax liabilities and a rise in revenues from games related to the Euro 2012 soccer tournament.(news)

STATE RESERVES WILL LAST UNTIL MID-OCTOBER – PAPER
State cash reserves will last until the middle of October, while the troika report, on which the next disbursement of 31.5 billion euros hinges, is expected by earlyOctober, daily Kathimerini reported. http://www.kathimerini.gr

GREEK PM MEETS GERMAN CHANCELLOR ON FRIDAY
Greek Prime Minister Antonis Samaras is due to meet German Chancellor Angela Merkel in Berlin later on Friday and French PresidentFrancois Hollande on Saturday.

EUROPEAN FACTORS TO WATCH-STOCKS SET TO EXTEND RETREAT
European stocks were seen edging lower on Friday, adding to the previous session’s falls and tracking losses on Wall Street, hurt by brewing worries overglobal growth and as investors scale back expectations of a new round of stimulus from the Federal Reserve following comments made by a Fed member.

DIARY – Political and General News Events From July 10 to September 30

Reuters will issue this diary daily at around 0930 GMT and 1700 GMT.

All times in GMT unless otherwise stated.

Items marked ** denote new or amended listings.

– – – – – – – – – – – – – – – – – – – – – – – – – – – – – –

JULY 2012
BERLIN/PARIS/ BRUSSELS – Greek Prime Minister Antonis Samaras expected to visit Germany, France and Belgium.

JERUSALEM – U.S. Republican presidential candidate Mitt Romney visits Israel and meets with Prime Minister Benjamin Netanyahu.

– – — – – – – – –

TUESDAY, JULY 10
BRUSSELS – EU Economic and Financial Affairs Council (ECOFIN) Meeting.

LONDON – British Prime Minister David Cameron meets French President Francois Hollande.

** IOWA – U.S. President Barack Obamaattends a campaign event.

JAKARTA – German Chancellor Angela Merkel to meet Indonesian President Susilo Bambang Yudhoyono.

** TOKYO – Afghan President Hamid Karzai meets with Japanese Emperor Akihito.

GENEVA – WTO Dispute Settlement BodyMeeting (0800).

** KARLSRUHE, Germany – Germany’s top court holds public hearing on legality of German ratification of ESM and fiscal pact (0800).

PHNOM PENH – Association of Southeast Asian Nations (ASEAN) foreign ministers meet counterpartsfrom Japan, China and South Korea.

** BERLIN – Jewish religious leaders will hold an international meeting to discuss how to respond to a German court ruling against performing circumcision on baby boys, which also sparked protests from Muslims andChristians in Germany.

** JAKARTA – IMF chief Christine Lagarde meets with Indonesia President Susilo Bambang Yudhoyono.

** BEIJING – French Foreign Minister Laurent Fabius meets Chinese Premier Wen Jiabao and vice Premier Li Keqiang. LJUBLJANA – Italian President Giorgio Napolitano and Slovenian President Danilo Turk holds bilateral meeting, a news conference to follow.

** MOSCOW – Representatives of Syrian National Council to hold news conference.

CAIRO – German ForeignMinister Guido Westerwelle to meet with Egyptian President Mohamed Mursi.

HONG KONG – Hong Kong Financial Secretary John Tsang to brief at Legislative Council Financial Affairs Panel meeting on latest economic situation (0030).

** KHARKIV,Ukraine – (DELAYED TO JULY 23) The trial against former Ukrainian Prime Minister Yulia Tymoshenko continues in Kharkiv court.

LONDON – Barclays (BARC.L) chairman Marcus Agius will appear before parliament’s Treasury Select Committee to answer questions about the Libor rate-fixing scandal (0900).

JERUSALEM – Verdict in corruption trial of Former Prime Minister Ehud Olmert in three cases of alleged bid-rigging, bribery and fraud.

THE HAGUE, Netherlands – The International CriminalCourt rules on sentence for Congolese warlord Thomas Lubanga. Lubanga was found guilty in March for using child soldiers in the Democratic Republic of Congo in a five-year jungle war that killed some 60,000 people around the turn of the century(0730).

BERLIN – Transparency International to release its latest study ‘Transparency in Corporate Reporting: Assessing the World’s Largest Companies.’ (0300).

BARCELONA, Spain – IAAF World Junior Championships (to July 15).

– – — – – – – – –

WEDNESDAY, JULY 11
** PARIS – French President Francois Hollande meets Abu Dhabi’s Crown Prince Sheikh Mohammed bin Zayed al-Nahayan (1500).

HOUSTON, TX – U.S. Republican presidential candidate Mitt Romney addressesthe annual convention of the National Association for the Advancement of Coloured People (NAACP), the nation’s oldest civil rights organisation.

WASHINGTON – Republicans in the U.S. House of Representatives vote on whether to repeal theAffordable Health Care Act of 2012, the centrepiece of U.S. President Barack Obama’s domestic policy which was upheld last month in the Supreme Court as constitutional.

** VIENTIANE – U.S. Secretary of State Hillary Clinton to visit Laos. RIYADH – Egyptian President Mohamed Mursi visits Saudi Arabia meets King Abdullah.

** BRUSSELS – European Parliament President Martin Schulz to meet Romania’s Prime Minister Victor Ponta.

** MOSCOW – Syria’s delegation of 10 members led by thegroup’s head, Abdelbasset Sida, will meet Russian Foreign Minister Sergei Lavrov.

** SOFIA – German deputy Foreign Minister Michael Link visits Bulgaria.

** BRUSSELS – European Council President Van Rompuy to meet Bulgarian Prime Minister BoikoBorisov.

** LISBON – Portuguese Prime Minister Pedro Passos Coelho gives speech in parliament on state of the nation followed by debate.

ATHENS – Finnish Minister for European Affairs and Foreign Trade Alexander Stubb to visit Greece and meetwith Prime Minister Antonis Samaras, Foreign Minister Dimitris Avramopoulos and Finance Minister Yiannis Stournaras.

BUENOS AIRES – The governor of Argentina’s Buenos Aires province expected to send a bill to the legislature seeking “superpowers” to handle a government cash crunch.

** BUNAGANA, Uganda – DR. Congo rebels M23 are to hold a media briefing on the Uganda border, where they are expected to introduce their political wing for negotiations with the government.

VIENNA – OPEC topublish Monthly Oil Market Report.

GLOBAL – United Nations World Population Day.

MUMBAI – 6th anniversary of deadly bomb attacks on Mumbai’s commuter rail network.

** SREBRENICA, Bosnia – Thousands of people gather in the eastern Bosniantown of Srebrenica to mark the 17th anniversary of the 1995 massacre of up to 8,000 Bosnian Muslim men and boys by Bosnian Serb forces and bury the remains of 500 newly identified victims exhumed from dozens of mass graves.

– – – – – – – – – –

THURSDAY, JULY 12
** PARIS – French President Francois Hollande meets Lebanese President Michel Suleiman (1800).

PHNOM PENH – Association of Southeast Asian Nations (ASEAN) Foreign Ministers sign protocol to the Treaty on theSoutheast Asia Nuclear Weapon-free zone.

YALTA, Ukraine – Russian President Vladimir Putin meets with Ukrainian President Victor Yanukovich.

** ATHENS – EU Commissioner on Regional Policy Johannes Hahn to visit Greece (to July 13).

LAGOS- African Women Economic Summit (AWES) (to July 14).

BANGKOK – IMF Managing Director Christine Lagarde, ADB President Haruhiko Kuroda and Bank of Thailand Governor Prasarn Trairatvorakul to give speech at an opening panel session on “Stabilityand Inclusive Growth” at Thailand ADB-IMF Conference “Towards a More Stable Global Economic System” (0315).

BRUSSELS – Finnish Minister for European Affairs and Foreign Trade Alexander Stubb visits Belgium, to participate in bilateral negotiations with the Cypriot Presidency on the EU’s Multiannual Financial Framework 2014-2020.1`
PARIS – OECD publishes Economic Survey of Turkey.

VILNIUS – Lithuania’s President Dalia Grybauskaite holds annual news conference.

KIEV – FormerUkrainian Prime Minister Yulia Tymoshenko appeals her 2011 conviction for abuse of office in a 2009 gas deal she signed with Russia at Ukraine’s High Specialised Court.

– – – – – – – – – –

SATURDAY, JULY 14
CAIRO – U.S.Secretary of State Hillary Clinton visits Egypt “to express the United States’ support for Egypt’s democratic transition and economic development” (to July 15).

BAIKONUR COSMODROME, Kazakhstan – Launch of Soyuz TMA-05M, which will carry threeExpedition 32/33 crew members to the International Space Station.

PARIS – Bastille Day.

– – – – – – – – – –

MONDAY, JULY 16
** JERUSALEM – U.S. Secretary of State Hillary Clinton visits Israel to discuss the Middle East peace effort amid tentative signs that Israeli and Palestinian leaders are open to resuming some form of dialogue after months ofstalemate (to July 17).

WASHINGTON – IMF releases updated World Economic Outlook and Global Financial Stability Report.

PARIS – French lower house of parliament to discuss the revised 2012 budget bill (to July 18).

BRUSSELS – EUAgriculture and Fisheries Council Meeting (to July 17).

KHABAROVSK, Russia – APEC Meeting of Ministers Responsible for Environment.

HO CHI MINH, Vietnam – The Third APEC Business Advisory Council (ABAC) meeting (to July 19).

– – – – – – – – – –

TUESDAY, JULY 17
** ANKARA – Turkey’s Main opposition Republican People’s Party holds convention (to July 18).

** BUDAPEST – IMF/EU delegation expected to arrive to Budapest to start talks on a financing backstop (to July25).

** TOKYO – Turkish Economy Minister Zafer Caglayan to visit Japan (to July 21) with business delegation.

GLOBAL – World Day for International Justice, which commemorates the adoption of the founding treaty of the International CriminalCourt, the Rome Statute, on July 17, 1998.

** GUANTANAMO BAY, Cuba – Pre-trial hearing in death penalty case against Guantanamo prisoner Abd al Rahim al Nashiri accused of spearheading the boat-bomb attack on the USS Cole, which killed 17 U.S.sailors off the coast of Yemen in 2000 (to July 20).

– – – – – – – – – –

WEDNESDAY, JULY 18
WASHINGTON – The Financial Services Committee to receive the semiannual “Monetary Policy Report to the Congress” from Federal Reserve Chairman Ben Bernanke (1400).

GLOBAL – Nelson Mandela International Day.

JOHANNESBURG – 94th birthday of South African leader Nelson Mandela.

– – – – – – – – – –

THURSDAY, JULY 19
ROYAL LYTHAM & ST. ANNES,England – GOLF – The Open Championship 2012 (British Open) (to July 22).

– – – – – – – – – –

FRIDAY, JULY 20
BRUSSELS – (TBC) Eurogroup Meeting.

CYPRUS – Cyprus marks the anniversary of the Turkish invasion in 1974. YOSHINOBU LAUNCH COMPLEX, Japan – Launch of The H-II Transfer Vehicle “Kounotori3” spacecraft which delivers cargo to the International Space Station.

– – – – – – – – – –

SATURDAY, JULY 21
** SINGAPORE – Turkish Economy Minister Zafer Caglayan visits Singapore (to July 24) with business delegation.

KENNEDY SPACE CENTER, Fl – 1st anniversary of conclusion of NASA’s space shuttle program after successful completion of mission STS-135.

– – – – – – – – – –
SUNDAY, JULY 22
MALI – Parliamentary election (SECOND ROUND).

OSLO – First Anniversary of Norway bombing and mass shooting at youth summer camp on the nearby Utoya Island where 77 people killed.

WASHINGTON – XIX International AidsConference (to July 27).

– – – – – – – – – –

MONDAY, JULY 23
BRUSSELS – EU Foreign Affairs Council Meeting.

NICOSIA – EU Informal meeting of Ministers for Justice and Home Affairs (to July 24).

– – – – – – – – – –

TUESDAY, JULY 24
BRUSSELS – EU General Affairs council Meeting.

PARIS – French upper house of parliament to debate revised 2012 budget bill (to July 26).

WEDNESDAY, JULY 25
GENEVA – WTO General Council meeting (toJuly 26).

BAYREUTH, Germany – Annual Bayreuth festival (to Aug. 28).

– – – – – – – – – –

THURSDAY, JULY 26
BRUSSELS – EU Economic and Financial Affairs Council (ECOFIN) Budget Meeting.

– – – – – – – – – –
FRIDAY, JULY 27
LONDON – Olympic Games (to Aug. 12).

– – – – – – – – – –

SATURDAY, JULY 28
NEW ORLEANS, LA – National Medical Association Annual Convention & Scientific Assembly (to Aug. 1).

GLOBAL – WorldHepatitis Day.

GLOBAL – 98th anniversary of the beginning of World War 1.

– – – – – – – – – –

MONDAY, JULY 30
BOGOTA – The first round of negotiations for a free trade agreement between Colombia and Costa Rica to be heldand will be headed by Trade Ministers Sergio Diaz-Granados of Colombia and Anabel Gonzalez of Costa Rica.

– – – – – – – – – –

TUESDAY, JULY 31
SOFIA – Deadline expires for Bulgaria’s energy ministry to pick a winner for adeepwater gas exploration works at a field off Bulgaria’s Black Sea coast.

BAIKONUR COSMODROME, Kazakhstan – Launch of ISS Progress 48, A Progress resupply spacecraft will deliver cargo to the International Space Station.

AUGUST 2012
SOMALIA – Presidential Elections.

LINDAU, Germany – (TBC) 5th Meeting of the Winners of the Sverige Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. Economics Laureates and young economists from various countries will meet inLindau (Germany) to exchange ideas, discuss the state of their discipline and build international networks.

– – – – – – – – – –

WEDNESDAY, AUGUST 1
** ANKARA – Turkey’s Supreme Military Council meets (to Aug. 4).

LONDON,UK – Olympic Games (to Aug. 12).

GLOBAL – World Breastfeeding Week (to Aug. 7).

WARSAW – Poland marks 67th anniversary of its war-time Warsaw Uprising against the Nazi occupation.

CHINA – 85th founding anniversary of the People’sLiberation Army.

– – – – – – – – – –

FRIDAY, AUGUST 3
CHICAGO – Lollapalooza festival (to Aug. 5).

– – – – – – – – – –

SUNDAY, AUGUST 5
EDINBURGH, Scotland – Edinburgh Fringe Festival (to August 29).

– – – – – – – – – –

MONDAY, AUGUST 6
HIROSHIMA, Japan – Hiroshima Commemorations 67th Anniversary of 1945 nuclear attacks.

SILIVRI, Turkey – Hearing scheduled in the trial of 365 defendants accused of involvement in thealleged Sledgehammer plot to overthrow the government. However, the case could be transferred to a new court before then.

– – – – – – – – – –

THURSDAY, AUGUST 9
EDINBURGH, Scotland – Edinburgh International Festival 2012 (to Sept. 2). Link http://www.eif.co.uk/-

SOUTH CAROLINA – GOLF – 94th PGA Championship (to Aug. 12).

BRISTOL, England – Bristol International Balloon Fiesta (to Aug. 12).

VIENNA – OPEC to publish Monthly Oil Market Report.

NAGASAKI,Japan – NAGASAKI Commemorations 67th Anniversary of 1945 nuclear attacks.

GLOBAL – International Day of the World’s Indigenous People.

KIAWAH ISLAND, SC – 94th PGA Championships (to Aug. 12).

– – – – – – – – – –

SATURDAY,AUGUST 11
EDINBURGH, Scotland – Edinburgh International Book Festival (to Aug. 27). Link: http://www.edbookfest.co.uk/-
COWES, Isle of Wight – SAILING – Cowes Week (to Aug. 18).

– – – – – – – – – –

SUNDAY, AUGUST 12 PUERTO RICO – Voters would be asked whether they want to change Puerto Rico’s political status. If the majority votes “yes,” a second ballot on Nov. 6 would ask them to choose among three nonterritorial options — U.S. statehood, independence or sovereign free association.

GLOBAL – International Youth Day.

– – – – – – – – – –

MONDAY, AUGUST 13
THE HAGUE – International Criminal Court (ICC) trial of former Ivory Coast leader Laurent Gbagbo on charges of crime against humanity during a four-month civil war that followed his refusal to stand down after losing a 2010 presidential election.

– – – – – – – – – –

TUESDAY, AUGUST 14
FLORIDA – Presidential Primary election.

PAKISTAN – 65thanniversary of Pakistan Independence from British rule.

LEBANON – Hezbollah marks sixth anniversary of its “divine victory” — the end of its war with Israel.

PLOVDIV, Bulgaria – 2012 World Rowing Senior and Junior Championships (to Aug. 19).

– – – – – – – – – –

WEDNESDAY, AUGUST 15
JAPAN – 67th anniversary of country’s surrenderin World War Two.

INDIA – 65th anniversary of Indian Independence from British rule.

LIECHTENSTEIN – 206th Anniversary of Independence.

– – – – – – – – – –

FRIDAY, AUGUST 17
TRALEE, Ireland – Rose of Tralee InternationalFestival (to Aug. 21).

– – – – – – – – – –

SATURDAY, AUGUST 18
KABUL – Afghanistan celebrates Independence Day.

– – – – – – – – – –

SUNDAY, AUGUST 19
GLOBAL – World Humanitarian Day.

MOSCOW -21st anniversary of the failed Soviet coup against Mikhail Gorbachev which accelerated the collapse of the Soviet Union.

– – – – – – – – – –

THURSDAY, AUGUST 23
BALTIC WAY – 23rd anniversary of the Baltic Way, a human chainof people in 1989 stretching from Vilnius to Tallinn to mark solidarity in the struggle for independence from the Soviet Union.

– – – – – – – – – –

FRIDAY, AUGUST 24
POLAND – Poland marks the 23rd anniversary of the creation of the first post-communist government in 1989.

UKRAINE – 21st Anniversary of Independence.

– – – – – – – – – –

SATURDAY, AUGUST 25
** PHNOM PENH – 44th ASEAN Economic Ministers Meeting and Related Meetings, 14th ASEAN-Mekong Basin Development Cooperation (AMBDC) Ministerial Meeting and 4th Mekong-Japan Economic Ministers’ Meeting (to Sept. 1).

URUGUAY – Uruguay’s Independence Day.

CAPE CANAVERAL AIR FORCE STATION, Fla. – Launch of Atlas V-401, Radiation BeltStorm Probes (RBSP) Mission to understand the Sun’s influence on Earth and Near-Earth space by studying the Earth’s radiation belts on various scales of space and time.

– – – – – – – – – –

SUNDAY, AUGUST 26
LONDON – (TBC)London International Animation Festival (to Sept. 4).

– – – – – – – – – –

MONDAY, AUGUST 27
TAMP/FLORIDA – Republican convention (to Aug. 30).

MELBOURNE – TENNIS – U.S. Open 2012 (to Sept. 9).

– – – – – – – – —

WEDNESDAY, AUGUST 29
NICOSIA – EU Informal Meeting of Ministers and State Secretaries for European Affairs (GAC) (to Aug. 30).

TEHRAN – Summit of the Non-Aligned Movement.

LONDON, UK – Summer Paralympic Games (to Sept. 9).

VENICE, Italy – 69th Venice Film Festival (to Sept. 8).

– – – – – – – – – –

FRIDAY, AUGUST 31
ANGOLA – Parliamentary election.

– – – – – – – – – –

SEPTEMBER (UNDATED)
WASHINGTON – Egyptian PresidentMohamed Mursi visits United States.

– – – – – – – – – –

SATURDAY, SEPTEMBER 1
VLADIVOSTOK, Russia – APEC summit.

NORTH OSSETIA, Russia – 8th Anniversary of the terrorist attack at Beslan school.

– – – – – – — – –

SUNDAY, SEPTEMBER 2
NARA, Japan – 12th International Conference on Radiation Shielding (ICRS-12), organised by the American Nuclear Society and The Atomic Energy Society of Japan, co-sponsored by the Nuclear Energy Agency (toSept. 7). Link: http://www.icrs12.org/

– – – – – – – – – –

WEDNESDAY, SEPTEMBER 5
SVALBARD, Norway – Meeting of the Nordic Council of Ministers for Co-operation.

AKUREYRI, Iceland – 10th Conference of Parliamentarians of the Arctic Region (to Sept. 7).

MUNICH, Germany – 40th Anniversary of the attack on Israeli Olympic team by Palestinian gunmen which killed 11 Israelis.

– – – – – – – – – –

THURSDAY, SEPTEMBER 6
JEJU, South Korea – IUCNWorld Conservation Congress 2012 (to Sept. 15).

INDIA/BANGALADESH – 1st anniversary of a pact to end a 40-year border demarcation dispute between India and Bangladesh.

– – – – – – – – – –

FRIDAY, SEPTEMBER 7
NICOSIA -EU Informal meeting of Ministers for Foreign Affairs (to Sept. 8).

– – – – – – – – – –

SATURDAY, SEPTEMBER 8
LONDON – (TBC) World Congress 2012 “The Human Factor in Risk” (to Sep. 9).

– – – – – – – – – –
SUNDAY, SEPTEMBER 9
NICOSIA – EU Informal meeting of Ministers for Agriculture and Fisheries (to Sept. 11).

TOKYO – 2012 September Grand Sumo Tournament (to Sept. 23).

– – – – – – – – – –

MONDAY, SEPTEMBER 10
VIENNA – IAEA Board of Governors Meeting.

STRASBOURG, France – European Parliament Plenary Session (to Sep. 13).

GLOBAL – World Suicide Prevention Day.

– – – – – – – – – –

TUESDAY, SEPTEMBER 11
TIANJIN, China – World Economic Forum Annual Meeting of the New Champions 2012 (to Sept. 13).

USA – 11th anniversary of 9/11 attacks on the World Trade Centre and the Pentagon.

VIENNA – OPEC to publish Monthly Oil Market Report.

BERLIN – ILA 2012 Berlin Air Show (toSep. 16). Link: http://www.ila-berlin.de/ila2012/home/index_e.cfm

– – – – – – – – – –

WEDNESDAY, SEPTEMBER 12
NETHERLANDS – Parliamentary Election.

LONDON – World Nuclear Association 37th Annual Symposium (to Sept. 14).

– – – – – – – – – –

THURSDAY, SEPTEMBER 13
MEXICO CITY – G20 Meeting of Finance Ministers and Central Bank Governors.

NEW YORK – New York Fashion Week – Spring/Summer 2012 (to Sept. 19).

– – – – – – – – – –

FRIDAY, SEPTEMBER 14
NICOSIA – EU Informal Economic and Financial Affairs Council (ECOFIN) Meeting.

BEIRUT – Pope Benedict visits Lebanon (to Sept. 16).

– – – – – – – – – –

SATURDAY, SEPTEMBER 15
NICOSIA -Eurogroup Meeting.

GLOBAL – International day of Democracy.

GUATEMALA – 191st Anniversary of Independence.

EL SALVADOR – 191st Anniversary of Independence.

COSTA RICA – 191st Anniversary of Independence.

HONDURAS – 191stAnniversary of Independence.

NICARAGUA – 191st Anniversary of Independence.

LOS ANGELES – 64th Primetime Emmy Award Ceremony.

– – – – – – – – – –

MONDAY, SEPTEMBER 17
VIENNA – IAEA General Conference (to Sep. 21).

– – – – – – – – – –

TUESDAY, SEPTEMBER 18
UNITED NATIONS – 67th United Nations General Assembly starts.

– – – – – – – – – –

WEDNESDAY, SEPTEMBER 19
BRUSSELS – EU meeting of Ministers for Justice andHome Affairs (to July 24).

VIENNA – 31st Council of Europe Conference of Ministers of Justice (to Sept. 21).

MILAN – Milan Fashion Week – Women’s Spring / Summer 2013 Fashion Week (to Sept. 25).

NAPLES, Italy – Roman Catholics in Naples crowd the city’s cathedral to witness the annual miracle of Saint Gennaro, who died in the 4th century but whose dried blood is said to turn liquid on his feast day.

– – – – – – – – – –

FRIDAY, SEPTEMBER 21
GLOBAL -International Peace Day.

– – – – – – – – – –

SATURDAY, SEPTEMBER 22
MUNICH – Oktoberfest Beer Festival 2012 (to Oct. 7).

– – – – – – – – – –

SUNDAY, SEPTEMBER 23
BELARUS – Parliamentary election.

– – – – – – – – – –

MONDAY, SEPTEMBER 24
BRUSSELS – EU General Affairs council Meeting.

BRUSSELS – EU Agriculture and Fisheries Council Meeting (to Sept. 25).

VIENNA – IAEA Board of Governors Meeting.

DOHA – 25thUniversal Postal Union Congress (UPU) (to Oct. 15).

BISSAU – Guinea-Bissau marks 39th anniversary of independence from Portugal.

– – – – – – – – – –

TUESDAY, SEPTEMBER 25
UNITED NATIONS – United Nations General Assembly debate (to Oct. 5).

MEDINAH,IL – GOLF – 2012 Ryder Cup (to Sept. 30).

– – – – – – – – – –

WEDNESDAY, SEPTEMBER 26
GLOBAL – World Heart Day.

– – – – – – – – – –

THURSDAY, SEPTEMBER 27
GLOBAL – World Tourism Day.

– – – – – – – – – –

FRIDAY, SEPTEMBER 28 GLOBAL – World Rabies Day.

SEOUL – South Korea marks the 62nd anniversary of recovering Seoul from North Korea during the Korean War.

– – – – – – – – – –

SATURDAY, SEPTEMBER 29
GLOBAL – World Maritime Day.

– – – – – – – – – –

SUNDAY, SEPTEMBER 30
BERLIN – 39th BMW Berlin Marathon.

– – – – – – – – – – – – – – – – – – – – – – – – – – – – –

Bernanke Delivers the Twist

The weekly EIA petroleum report was released this morning. Crude inventories rose by 2.9 million barrels. Crude futures reacted drastically to the news, dropping from $84.50 before the news to $81.40 at the close.

The FOMC announced that the federal funds rate is expected to stay in the range of 0 to 0.25% through 2014. In addition, the Fed announced an extension of Operation Twist through the end of this year, with new purchases totaling $267 billion. The market’s initial reaction to the decision was favorable, but choppy action after Ben Bernanke’s press conference at 2:15 EDT suggested that investors had been looking for more easing than the $267 billion announced.

Also today, German Chancellor Angela Merkel indicated that bond buying from the European bailout funds was a possibility.

The European Union PMI services index flash for June will be released at 4:00 a.m. EDT tomorrow morning. The analyst estimate is 46.2, slightly less than last month’s number.

US initial jobless claims will be released at 8:30 a.m. EDT tomorrow morning. The expected number of weekly unemployment claims is 383,000, which is 3,000 less than last week.

US existing home sales for May will be released at 10:00 a.m. EDT tomorrow. The consensus estimate is 4.570 million.

The Philly Fed’s outlook will be release at 10:00 a.m. EDT tomorrow. After last month’s dip to -5.8, analysts expect 0.5 for June.

Used car retailer CarMax (KMX) is set to release first quarter earnings tomorrow.

FX MATH: Elections, The Greece That French Fries Europe by Vincent Cignarella

By Vincent Cignarella 
   Of DOW JONES NEWSWIRES

NEW YORK (Dow Jones)–Ignore the Greek elections, it’s the French parliamentary elections of June 10 and 17 that will decide the fate of the euro zone’s core.

In the French election, the risk to the core of Europe is a victory for the right. Such a victory will leave the country with a right-wing parliament and a left-wing president–a certain recipe for political gridlock. That gridlock would create an impossible political situation for German Chancellor Angela Merkel in a development that will send the grand euro experiment into a nosedive.

Two rounds of legislative elections will take place beginning on June 10 and 17 to elect the 14th National Assembly of France. All 577 single-member seats in the assembly will be in contention.

As it stands today, of the 577 seats, former President Nicolas Sarkozy’s Union for a Popular Movement party holds 314 seats, while current President Francois Hollande’s Socialists hold just 204. Hollande defeated Sarkozy by a narrow margin, 51.6% to 48.4%, in April.

The latest poll, carried out by Ipsos Logica on May 25 and 26 and released Tuesday, showed 45% of potential voters would choose the Socialist party or its allies in the first round of the parliamentary elections due to take place June 10. The Socialist party would get 31% of the vote, the far-left party Left Front and the Europe Ecologist party would get 8% and 6%, respectively.

On the other side, there was 50% for the right, with right-wing party UMP getting 35% and the far-right National Front getting 15% of the votes, the poll showed.

National Front President Marine Le Pen’s effect on the Assembly elections cannot be discounted, especially given Le Pen won nearly 20% of the popular vote and approximately 30% of the youth vote in the presidential elections.

With the election results likely to be close, the difference between the popular vote and the youth vote is the difference between a minority and a majority. The election will put her popularity with the underemployed youth to the test.

In addition, Hollande’s popularity could be a double-edged sword. His victory was a vote against Sarkozy and with Sarkozy gone, the right no longer carries the burden of his association and may gain support.

That said, the Socialists have the advantage. The latest jobs data released Wednesday showed April unemployment rose for the 12th straight month, an easy finger-point at the failure of the right-wing majority in the Assembly. Fears about jobs are likely to play a major role in the results, given there remains 2.89 million unemployed in France, with the country’s largest trade union, GCT, recently warning about an additional 45,000 in job cuts that would raise the national rate an additional 1.6%.

The pressure is on the Socialists to drive home the jobs message and stop deadlock in government. A right-wing victory would lead to blocks of Hollande’s initiatives and a political crisis.

As for Germany and Merkel, compromise is considered a four-letter word. A political crisis in France would be a political crisis in all of Europe and likely the last nail in the euro coffin.


(Vincent Cignarella is a currency strategist/columnist for DJ FX Trader. His 30 years in currency markets include working as a bank dealer at major money-center commercial banks; managing corporate-hedging for a large multinational; serving as a principal and general partner of a major currency brokerage firm; and most recently working in FX sales with Santander in New York. He can be reached at vincent.cignarella@dowjones.com)