Here is what you need to know.
There is optimism surrounding a deal for Greece. The Greek government has folded to the demands of its creditors and has submitted a proposal that is largely in-line with what its referendum rejected. There will be no upfront debt relief and the government must “run primary budget surpluses, cut pensions and make significant structural reforms, all in exchange for about €53.5 billion ($US59.44 billion),” according to Business Insider’s Mike Bird. Greece’s 2-year yield is down 2,150 basis points at 32.89%.
Chinese stocks surged for a second day. The Shanghai Composite surged 4.5%. Friday’s gain has the index up 10.6% over the last two sessions. However, Chinese stocks remain in a bear market, down 25% from their June 12 high.
The IEA sees slowing oil demand. The International Energy Agency warned “oil has yet to run its course.” For 2016, the IEA thinks global demand will slow to 1.2 barrels per day, down from 1.4 million in 2015. The agency believes two disruptors to its forecast are any fallout that would occur if Greece leaves the euro and the possible lifting of sanctions against Iran.
Worldwide PC shipments sank. Gartner reported worldwide PC shipments totaled 68.4 million units in the second quarter, down 9.5% from a year ago. The research firm attributed the steep decline in shipments to price hikes, unusually positive desk-based growth and the third quarter release of Windows 10. Lenovo maintained the top spot in terms of market share with 19.7%.
Gap same-store sales missed. The retailer announced June sales of $US1.54 billion, which was unchanged compared to the previous year. Same-store sales slipped 1%, versus to a 2% drop a year ago. “As previously announced, we’re taking significant actions to help improve Gap brand’s performance,” CFO Sabrina Simmons said.
Zillow’s CFO is out. Chad Cohen has stepped down from his role as chief financial officer at Zillow. The company said Cohen is leaving to “pursue other business interests” with his resignation taking effect August 7. According to the Wall Street Journal, Cohen’s resignation comes as Zillow “struggles to unite operations with its one-time rival, Trulia, following its roughly $US2.5 billion acquisition in February.”
Barracuda Networks topped estimates, but the stock is getting smoked. The security solutions provider earned an adjusted $US0.09 per share, topping analyst estimates by a penny. Revenue jumped 17.8% to $US77.97 million, beating the $US77.22 million Wall Street was expecting. Fox Business reports, “The cloud-based security and storage services provider said it didn’t sign as many large and lengthy storage deals in the first quarter as it had in the previous quarter and said more customers chose virtual and cloud products.” The stock was down more than 17% in after hours trade.
Fed Chair Janet Yellen will speak on the economy. Yellen will speak at The City Club of Cleveland’s Sally Gries Forum Honouring Women of Achievement. Her speech is scheduled to begin at 12:30 p.m. ET.
Stocks are higher around the world. France’s CAC (+2.9%) leads European markets higher after China’s Shanghai Composite (+4.5%) and Hong Kong’s Hang Seng (+2.1%) paced the gains in Asia. Japan’s Nikkei (-0.4%) was a notable laggard. S&P 500 futures are higher by 23.00 points at 2064.25.
US economic data is light. Wholesale inventories is due out at 10 a.m. ET and the Baker Hughes rig count crosses the wires at 1 p.m. ET. The US 10-year yield is up 4 basis points at 2.36%.