10 things you need to know before the opening bell

Here is what you need to know.

There’s a black swan event in oil that could send prices to $25 per barrel.Bank of America Merrill Lynch’s commodities research team says continued dollar strength could cause a black swan in the oil market. The team thinks an even stronger dollar will cause Saudi Arabia to either cut its production or depeg its currency, the rial, from the dollar, which it says would be a black swan event. The fallout from such a decision could cause Brent crude oil to crash to $25 per barrel, BAML says. Currently, the energy component trades down 0.6% at $48.05 per barrel.

Germany’s ZEW survey fell. German economic sentiment fell in May. The ZEW survey sank to 6.4 from April’s 11.2 print, missing economist expectations of a move up to 12.1. “The strong growth of the German economy in the first quarter of 2016 appears to have surprised the financial market experts,” says Professor Achim Wambach, PhD, President of ZEW. “However, they seem not to expect the economic situation to improve at the same pace going forward. Uncertainties regarding developments such as a possible Brexit currently inhibit a more optimistic outlook.” The euro is weaker by 0.4% at 1.1179.

Remain is building a big lead in the Brexit vote. A new poll conducted by the ORB for the Daily Telegraph showed that 55% of people now back staying in the EU, compared to just 42% wanting to leave. The latest results have sent the British pound higher by 0.8% at 1.4603. The referendum vote is scheduled for June 23.

Deutsche Bank was downgraded. Moody’s cut Deutsche Bank’s credit rating to Baa2, down from Baa1. The credit rating agency said the downgrade is a result of the bank’s difficulty in stabilizing itself amid a low growth and low interest rate world. According to Moody’s, “Deutsche Bank’s performance over the last several quarters has been weak, and substantial operating headwinds, including continuing low interest rates and macroeconomic uncertainty, will challenge the firm.”

Sony had a rough quarter. The electronics maker announced an operating profit of 300 billion yen ($2.75 billion) for the year ending March, missing the 409 billion yen Thomson Reuters estimate. Sony said the disappointing quarter was the result of it being forced to close its sensor plant in Kumamoto after earthquakes rocked the city. Sony says the quarter would have been in-line with estimates if the quakes didn’t occur.

The hottest startup in China is flatlining. Chinese smartphone maker Xiaomi barely grew in 2015, according to a report from Fortune’s Scott Cendrowski. The report shows Xiaomi’s revenue allegedly grew just 5% in 2015 to 78 billion yuan ($11.9 billion), missing the 100 billion yuan that analysts were expecting. Additionally, the Fortune report found internet services revenue of $560 million versus $1 billion predicted. A Xiaomi spokesperson told Business Insider, “We are not able to comment on the revenue figure mentioned. What we have shared is that we sold over 70 million smartphones in 2015 despite the shrinking of the overall China smartphone market.”

Coca Cola production has been halted in Venezuela. Venezuela’s Coca Cola bottler has stopped production due to a sugar shortage, Reuters reports. According to an email sent to Reuters by spokeswoman Kerry Tressler, diet drinks that don’t contain sugar are still being produced. Venezuela is in the midst of an economic crisis that has produced food and power shortages amid high inflation.

Stock markets around the world are mixed. France’s CAC (+1.4%) leads the gains in Europe after Japan’s Nikkei (-0.9%) trailed in Asia. S&P 500 futures are up 6.25 points at 2051.25.

Earnings reporting is light. AutoZone, Best Buy, and Toll Brothers are among the names reporting ahead of the opening bell. Hewlett Packard Enterprise will release its quarterly results after markets close.

Economic data trickles out. New home sales will cross the wires at 10 a.m. ET. The US 10-year yield is higher by one basis point at 1.84%.

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