Wall Street Greek: Pre-Market: Trade Data, GM, Geithner Testimony

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Pre-Market

GM Emerges

GM gained approval to complete its asset sales to the newly formed and mostly publicly owned entity. GM's emergence from bankruptcy will allow it to halve its product lines and cut 6K more salaried employees. This looks like a positive driver today, similar to the bank announcements in March, through which they declared their return to profitability. It's a change symbolic of putting our troubles behind us and the risk of catastrophe away.

Trade Data

The trade gap narrowed in May, surprising economists who forecast a widening deficit on the significant rise in crude oil pricing that occurred through the measured period. The trade gap narrowed to -$26.0 billion, from April's revised $28.8 billion deficit (from -$29.2 billion). Bloomberg's tally of economists had pegged consensus at a $-28.8 billion for May, and Barron's saw consensus at -$30.0 billion. The surprising result came on expanding exports that matched against declining imports, no doubt the result of a softer dollar. While a weaker dollar raises the dollar cost of imported oil, it also makes exported goods more competitive overseas. The only segment to show decrease in exports was automotive and auto parts and engines, for obvious reasons.

Import & Export Prices

The dollar impact was also visible in June's Import & Export Price data. June export prices rose 1.1% (against May's 0.5% rise), but that matched against an import price increase of 3.2% (revised 1.4% increase in May). June's import price jump was largely driven by a 20.3% increase in petroleum prices. However, non-petroleum import prices also increased 0.2%, marking the second sequential monthly rise; and likely due to the change in the dollar. Inflation is not a concern in the near-term though, given the sharp year-over-year price drops for both imports and exports.

Later Today

Geithner Testimony

Treasury Secretary Timothy Geithner testifies before the House Financial Services Committee at 10:00 a.m. The focus of the hearing is on derivatives and the President's financial reform plans.

Reuters/University of Michigan Consumer Sentiment

This data is due up at 9:55 a.m. Consensus sees further improvement to 71.5, from 70.8 in June. May produced 1.9 points of positive change, but the impact of "green shoots," and perhaps smoke, have stalled as investors weigh the potential drag of significant unemployment.

IEA Oil Report

The International Energy Agency (IEA) produces its Monthly Oil Report Friday.

Corporate EPS Schedule

The earnings slate includes Audiovoxx (Nasdaq: VOXX), Infosys Technologies (Nasdaq: INFY), PriceSmart (Nasdaq: PSMT), The Progressive Corp. (NYSE: PGR) and a few pink sheets.