U.S. markets are shrugging off the chaos overseas, and marching higher in anticipation of the trade balance report at 8:30 a.m. ET. Econoday expects imports will continue to outstrip exports as a weak dollar makes overseas goods cheaper and consumers step up demand. So a bigger negative number — an estimated negative -$42.7 billion in May vs -$40.9 billion in April — signals strength in the U.S. economy. Also out later on Tuesday: the JOLTS report on job openings at 10:00 a.m. ET.
Greece bites Europe. The euro has dipped below $1.10 but stocks have stabilized near their lows since the Greek referendum. The Spanish and French stock markets are officially in correction territory. And half of 18 markets tracked by Bloomberg are down more than 10% from their 2015 highs. Bloomberg
Merkel draws line in sand on Greece. Thomas Piketty may lecture the German Chancellor on the history of sovereign debt — Germany has defaulted more often than Greece (ahem) — but Angela Merkel has informed Greece that it has only hours to come up with a reasonable offer on reform if it wants its European creditors to continue funding the insolvent country. The European Central Bank tightened the screws Monday when it declined to increase emergency funding and raised the haircut on collateral. The Eurogroup meets on Tuesday at 1 pm (8 a.m. ET) to discuss the Grecian dilemma. Bloomberg
Did someone say Chaos? Shanghai Chaos? It’s the irony hour for the markets. A hedge fund shorting copper has closed out its positions amid the market downdraft. No one is sure if Chaos closed out the positions to return badly needed cash to investors suffering losses in other parts of the market or if the company had changed its market views on copper. Either way, Shanghai Chaos is no longer a top 20 holder of a short in copper. And short interest in the metal has fallen 16% since the Shanghai Composite Index peaked on June 12. Financial Times (paywall)
Chinese shares sink again. Despite more measures introduced by the government, its agencies, and the infusion of funds into the market through stock purchases, equities remained down. The Shanghai Composite Index finished the session 1.3% lower. The Nikkei closed up 1.3%, while the Hang Seng Index was last seen down 1%, mirroring the performance of Shanghai. CNBC
Nearly one-quarter of mainland China firms suspend trading in their shares, freezing $1.4 trillion in equity. Since June 29, 651 firms have their shares suspended in Shanghai and Shenzhen bourses. On Tuesday alone, more than 200 firms did so to protect their shares from the bear market. Financial Times (paywall)
Six bank accounts frozen as part of probe of Malaysia’s Prime Minister Najib Razak. Government investigators have traced $700 million in deposits in Najib’s private accounts as part of a probe of the 1Malaysia Development Bhd. fund. “The government probe documents what investigators believe to be the movement of cash among government agencies, banks and companies linked to 1MDB before the money ended up in Mr. Najib’s personal accounts, the Journal reported.” Wall Street Journal (paywall)
Samsung Electronics sees 2Q profit below estimate — marking seventh straight profit drop. According to a earnings guidance released Tuesday, Samsung probably had a 6.9 trillion won ($6.13 billion) operating profit in the second quarter, less than the 7.2 trillion won forecast. From a year earlier, profit fell 4%, its seventh straight period of decline on a yearly basis. Reuters, Wall Street Journal (paywall)
Java lubbers: Oh, no! Starbucks raising prices 1% on average. The Seattle-based chain says it needs to cover rising wages and rents. Coffee bean prices are actually falling. Wall Street Journal (paywall)
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