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Pre-Market Primer: Greeks Run on the Banks, Dimon Goes to the Hill


Retail sales in the US fell for a second straight month.

MINYANVILLE ORIGINAL Stock futures are pointing towards a lower opening after news that retail sales in the United States fell for a second month.

Retail sales fell 0.2% in May according to data released today. Economists expected this drop in sales as consumers scaled back their spending. April sales were initially thought to have fallen by 0.1%, and this number was revised down to 0.2% today. Since consumer spending accounts for about two thirds of the US economy, two straight months of weak retail spending does not bode well.

Producer prices fell 1% in May. Excluding food and energy, prices actually rose 0.2%. The drop in oil prices could account for the lower producer prices. Oil futures fell 0.73% to $82.71/barrel this morning. Later today, the government will release US petroleum inventory statistics.

Index futures dropped this morning, as did European and Asian indices. Dow (^DJI) futures fell 0.21% to 12,488.00. S&P 500 (SPY) futures dropped 0.36% to 1,315.30 and Nasdaq (^IXIC) futures were down 0.27% at 2,538.25.

Ahead of this weekend's crucial election that might decide whether Greece stays in the eurozone, Greeks are withdrawing money from banks at a staggering rate of 100 to 500 million euros per day, according to Bloomberg. A virtual bank run is the type of strain that Greece's already troubled banks probably don't need. At this rate, bank withdrawals are exceeding peaks seen at the beginning of the country's fiscal and financial crisis.

Eurozone CPI hit a 15-month low in May. Last month, inflation rose by 2.4% after rising 2.6% in April. Low levels of inflation increase the likelihood of central bank action. Most economists expected the European Central Bank to decide to cut interest rates by at least 25 basis points in its June 7 meeting, but this did not occur. Italy's bond yields jumped to their highest in six months at an auction today, rising to 3.97% for the one-year bill.

JPMorgan Chase (JPM) CEO Jamie Dimon will testify before the Senate Banking Committee today at 10:00 a.m. EDT. The senators will grill Dimon over the bank's risk management after it lost at least $2 billion on derivatives trades.

Dell (DELL) shares rose after the electronics maker said that it would start a $0.08 quarterly dividend. Phillip Morris (PM) announced that it will repurchase $18 billion in shares.

Twitter: @vincent_trivett
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