Top 5 Things to Know in the Market on Wednesday

Investing.com -- These are the top 5 things you need to know in financial markets on Wednesday, June 12.

1. Hong Kong Protests

Police in Hong Kong fired tear gas and rubber bullets at huge crowds protesting against the introduction of a new bill that would allow people to be sent to mainland China for trial. The erosion of judicial rights is likely to undermine investor confidence in the former U.K. colony’s markets.

The protests come at an awkward time for Beijing, only days after the 30th anniversary of the Tiananmen Square massacre and weeks before a summit of world leaders in Tokyo, where Presidents Donald Trump and Xi Jinping will be looking to drum up support for their respective visions of world leadership.

The Hang Seng fell 1.9%, much more than the 0.8% drop in the benchmark Shanghai Shenzhen CSI 300 index on the mainland.

2. Oil Prices Skid

Oil prices slid further on revived concerns of a glut in global markets after the U.S. government revised down its forecast for global oil demand this year by 160,000 barrels a day.

U.S. crude futures were down 2.8% at $51.80 by 5:45 AM ET (0945 GMT), while international Brent futures were down 2.6% at $60.67.

Although the Energy Information Administration also lowered its estimate of U.S. oil production by 140,000 barrels a day, markets still took the news negatively, their fears being further stoked by the seventh rise in U.S. crude stocks in the last eight weeks, as measured by the American Petroleum Institute.

Analysts are expecting official data to show a modest draw in inventories when they’re released at 10:30 AM ET (1430 GMT).

3. Wall Street Set to Open Lower; CPI Eyed

Wall Street is set to open lower as the negative sentiment coming out of oil markets infects equities too.

At 5:50 AM ET, the S&P 500 futures contract was down 10 points or 0.4%, the Dow futures contract was down 92 points, or 0.4%, while the tech-heavy Nasdaq 100 futures contract was down 41 points, or 0.5%

With an interest rate cut by the Federal Reserve now largely priced in for July, bulls will be hoping that May’s consumer inflation reading at 8:30 AM ET won’t make it harder for the Fed to justify such a step.

4. Musk Predicts Record Quarter for Tesla

Tesla (NASDAQ:TSLA) shares are poised to open over 2% higher after CEO Elon Must said the company has “a decent shot at a record quarter on every level,” at the company’s annual shareholder meeting.

Also at the meeting, Musk said the company “may get into mining” in future, to help guarantee supply of rare elements needed by electric vehicles.

Tesla shares have now risen some 15% from their lows in the aftermath of a $2.7 billion capital raising announcement, but they’re still down over 30% for 2019 to date.

5. DoJ Sends Warning to Tech Giants

Facebook (NASDAQ:FB), Google (NASDAQ:GOOGL) and others can’t count on escaping antitrust scrutiny just because they offer services for free, the Department of Justice’s antitrust head Makan Delrahim warned in a speech.

Delhrahim compared today’s tech giants directly to Standard Oil in a speech at a conference in Israel, inviting speculation that the government intends to break them up just as it broke John D. Rockefeller’s oil company.

Delrahim, who will take the lead in regulating Apple (NASDAQ:AAPL) and Google under a recent division of responsibilities with the Federal Trade Commission, said that issues such as freedom of speech and data privacy would also fall be weighed as the authorities look for ways to regulate the sector better.

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