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Pre-Market Primer: Euro Officials Confirm -- and Then Deny -- Planning a Greek Exit


Facebook IPO is on tap.


Never believe anything in politics until it has been officially denied.
-- Otto von Bismarck

Asian and European markets were volatile and mixed in today's trading, and US index futures gained ahead of the third-biggest IPO in history.

Facebook (FB) priced shares at $38 last night. The firm should pick up $16 billion in extra capital after hitting the Nasdaq. The company's market cap is $104 billion.

Futures on the major US indices are pointing towards a positive open today. After hitting a four-month low yesterday on weak economic data and uncertainty in Europe, futures on the S&P 500 (SPY) are up 0.49% at 1,307.70. Dow (^DJI) futures are up 0.41% at 12,464.00 and Nasdaq (^IXIC) futures gained 0.39%.

As expected, Moody's downgraded 16 Spanish banks, including Banco Santander (STD) and its UK-domiciled subsidiary. Toxic debt held by Spanish banks rose to a 17-year high of 147.97 billion euros, or 8.37% of all loans held in March. Non-performing loans are 10 times more prevalent than they were in 2007.

Spanish bond yields are still above 6.18%, but fell 12.6 basis points this morning.

Fitch downgraded Greece's long-term credit yesterday evening on speculation that anti-austerity parties will force an exit from the eurozone. In an interview with a Belgian newspaper, EU trade commissioner Karel De Gucht let slip that the European Central Bank and European Commission are "working on emergency scenarios in case Greece doesn't make it," suggesting that an exit is not being ruled out. A European Commission spokesperson swiftly denied that there is a secret contingency plan in the works.

Leaders of major countries will meet in Camp David, Maryland, for a G8 conference this weekend. President Obama will meet with the new French president Francois Hollande at the conference. The focus of the talks will reportedly be on turning around western Europe's economic situation.

JPMorgan Chase (JPM) shares have slid about 16.5% since the company revealed its disastrous $2 billion trading blunder, erasing about $25 billion in shareholder wealth. Yesterday, reports came out that the loss was actually $3 billion. This morning, the Wall Street Journal reported that the firms positions could result in a total of $5 billion in losses when derivatives losses are added in.

Hewlett-Packard (HPQ) intends to cut 25,000-30,000 workers, about 10% of its workforce.

Chinese home prices continue to fall. 46 of the 70 cities surveyed by the government saw property prices decline. The prices in the city of Wenzhou fell 12.3% from the year before.

Twitter: @vincent_trivett
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