Even though no rational person expected that the Greek situation would be resolved at today's talks in Riga, Latvia, apparently the algos were so caught up in spoofing each other to new record highs that futures, after surging once more overnight following the latest Google (GOOG) miss which sent the company and the Nasdaq soaring, actually dipped modestly into the red following headlines that the latest Greek talks have broken down after a "hostile" Troika "hammered" the Greek finmin, who was accused by European finmins of "being a time-waster, a gambler and an amateur."

It appears Europe is not a fan of game theory.

Bloomberg has the best summary of the latest Greek "negotiation" farce, all of which at this point serves only to kick the can not by months but by weeks until Greece runs out of confiscated money and is forced to either fold completely to Troika demands, leading to new elections or a referendum or conclude its pivot to Russia, setting off the next phase of the second cold war:

Greek Finance Minister Yanis Varoufakis was heavily criticized by his euro-area colleagues amid mounting frustration at his refusal to deliver measures to fix his country’s economy and release financial aid, according to three people familiar with the talks.

Euro-area finance chiefs said Varoufakis’s handling of the talks was irresponsible and accused him of being a time-waster, a gambler and an amateur, one of the people said. Another said the Greek complained of the hostile atmosphere in the meeting, as he was criticized from all sides. A Greek official in Riga, Latvia, for the meeting wasn’t able to comment on the talks when reached by phone.

Going into the talks, the 19-nation bloc’s finance ministers voiced their frustration over Greek Prime Minister Alexis Tsipras’s attempt to bypass their veto on financial aid with an appeal to Angela Merkel. “I demand very urgently that we get results on the table,” Austrian Finance Minister Hans Joerg Schelling said before sitting down for talks. “If you follow the media of the past days you hear time and again that ‘Tsipras says’ and ‘Tsipras thinks’, so apparently this has been moved to leaders’ level.”

With Greece running out of money and stalling over commitments to reform, euro-zone finance chiefs said the country’s authorities still haven’t shown sufficient progress on plans to revamp the economy to justify a loan payout.

Tsipras sought to circumvent the finance ministers’ authority less than 24 hours earlier, pleading his case with the German Chancellor and French President Francois Hollande on the sidelines of a summit on immigration in Brussels. Under euro-area procedures, it’s the finance ministers who have to sign off on any aid disbursement and Merkel said last month she’s not prepared to override those controls.

It could have been worse: someone could have literally beaten up VaroufakisL

• SCICLUNA: INSTITUTIONS BEING PUSHED TOWARD HOSTILITY ON GREECE

End result of today's meeting?

• MOSCOVICI SAYS FAR FROM A GLOBAL AGREEMENT ON GREECE
• DIJSSELBLOEM SAYS BIG, BIG PROBLEMS TO BE SOLVED FOR GREECE
• DIJSSELBLOEM SAYS WIDE DIFFERENCES BETWEEN GREECE, CREDITORS
• DIJSSELBLOEM: ASSESS GREECE AGAIN AT REGULAR MAY MEETING

Even the "apolitical" ECB hinted that stories leaked earlier of a surge in the collateral haircut may come true in the coming days:

• DRAGHI: ECB MAY EXAMINE CHANGE IN HAIRCUTS FOR GREEK FUNDING

So with Greece again achieving nothing, and not securing any new funds (aside from the cash it confiscated from its mayors), expect another round of pivoting toward Russia, which will promise much in exchange for the Turkish Stream deal being concluded and assuring that European energy needs are "met" courtesy of Gazprom (OGZPY) for the next decade while leaving Ukraine in gas transit limbo.

Expect the brief bout of Greek euphoria which sent Greek banks surging, i.e., Piraeus Bank: +16.6%, AlphaBank: +9.2%, National Bank of Greece: +9.6%, to promptly fizzle following this latest disappointment. The Euro is already feeling the brunt of the algo disappointment, and after surging over 1.08 on another stop hunt just before the Europen open, the EURUSD has pared nearly all its gains.

Elsewhere in Europe, on a stock specific basis, HSBC (+3.2%) has also been in the spotlight with the Co. contemplating whether it should move its headquarters away from the UK, with China a touted possibility. AstraZeneca (-3.1%) announced their earnings pre-market and have traded lower throughout the session as profits were negatively impacted as two of the Co.’s bestselling drug patents are due to expire and competition from generic sales.

Today’s pre market US earnings include: LyondellBasell (LYB), with results expected to show an increase in profits as a consequence of capacity expansion and management comments on potential buybacks and M&A deals; Biogen (BIIB), as investors eye Q1 financials after the drug maker reported positive updates in Alzheimer's and MS and American Airlines (AAL), where focus will fall on PRASM outlook for Q2 to see if the airline will continue to experience improving margins.

In fixed income markets, Bunds (159.02) are underperforming USTs amid the strength in equity markets, while the GR/GE 10yr spread is tighter by around 10bps today ahead of the aforementioned European Finance Minister meeting.

Asian equities mostly rose with Chinese bourses at the forefront, in the wake of further disappointing Chinese data. Chinese HSBC flash Mfg PMI fell tumbled to a 12-month low at 49.2 vs. Exp. 49.6, the 4th consecutive month of contraction. Shanghai Comp (-0.5%) and Hang Seng (-0.2%) traded higher, the latter posting a fresh 7yr high, as the data supports the case for more government easing, before falling from their best levels towards the close to end the session in negative territory. Nikkei 225 (-0.5%) originally rose higher than yesterday’s 15yr peak after finishing yesterday’s session above 20,000 for the first time since Apr’00, before falling in tandem with the Shanghai Comp and Hang Seng prior to the close.

The energy complex sees Brent crude futures outperform their WTI counterparts and trade above the USD 65.00 handle, bolstered by ongoing Saudi strikes in Yemen, with the ongoing conflict inciting fears that supply from the region could be affected. Elsewhere, in the metals complex, copper is the best performer today as May’15 futures contracts broke above their overnight range of USD 2.70, while iron ore is on track to rise for the third consecutive week. UK miners Anglo American (+2.1%) and BHP Billiton (+1.8%) have outperformed on the back of commodity strength,  with the latter announcing BHP Billiton announced they are curbing plans to expand.

In Summary: European shares remain higher, though off intraday highs, with the bank and telco sectors outperforming and insurance, media underperforming. German IFO above estimates. HSBC starts review over where to be headquartered. Euro-zone finance ministers meet in Latvia today. Greek finance minister heavily criticized by his euro-area colleagues, according to three people familiar with the talks. The Spanish and Italian markets are the best-performing larger bourses, Swiss the worst. The euro is stronger against the dollar. Japanese 10yr bond yields fall; Portuguese yields decline. Commodities gain, with corn , WTI crude underperforming and nickel outperforming. U.S. durable goods orders, capital goods orders due later.

Market Wrap

• S&P 500 futures up 0.1% to 2108.5
• Stoxx 600 up 0.5% to 409.1
• US 10Yr yield little changed at 1.96%
• German 10Yr yield down 0bps to 0.16%
• MSCI Asia Pacific up 0.3% to 155.7
• Gold spot down 0.2% to $1191.6/oz
• Eurostoxx 50 +0.7%, FTSE 100 +0.5%, CAC 40 +0.6%, DAX +0.8%, IBEX +1.4%, FTSEMIB +1.3%, SMI +0.2%
• Asian stocks rise with the ASX outperforming and the Sensex underperforming.
• MSCI Asia Pacific up 0.3% to 155.7; Nikkei 225 down 0.8%, Hang Seng up 0.8%, Kospi down 0.6%, Shanghai Composite down 0.5%, ASX up 1.5%, Sensex down 1.1%
• Euro up 0.28% to $1.0854
• Dollar Index down 0.2% to 97.08
• Italian 10Yr yield up 1bps to 1.41%
• Spanish 10Yr yield little changed at 1.37%
• French 10Yr yield little changed at 0.42%
  S&P GSCI Index up 0.2% to 435.9
• Brent Futures up 0.8% to $65.3/bbl, WTI Futures down 0.4% to $57.5/bbl
• LME 3m Copper up 1.2% to $6014/MT
• LME 3m Nickel up 1.7% to $12925/MT
• Wheat futures down 0% to 501.3 USd/bu

Bulletin Headline summary from Bloomberg and RanSquawk

• USD (-0.4%) has been the notable mover of the session so far, with the greenback paring all overnight gains to the benefit of major pairs, despite the USD moving off its worst levels later in the session.
• EUR saw strength this morning after positive German IFO and a relatively conciliatory tone ahead of today’s Eurogroup Finance Minister meeting, however comments heading into the North American crossover have been less optimistic and EUR gains have been capped by the large option at 1.0900 (713mln) set to expire at today’s NY cut
• Looking ahead, today sees US Durable Goods Orders (1330BST/0730CDT), comments from BoC’s Poloz and developments from the European Finance Minister meeting
• Treasuries steady overnight, head for weekly decline; market focus on Fed meeting next week, 2Y/5Y/7Y note auctions.
• Euro-area finance chiefs said Greek FinMin Varoufakis’s handling of talks was irresponsible and accused him of being a time-waster, a gambler and an amateur, according to people familiar
• Another said the Greek complained of the hostile atmosphere in the meeting, as he was criticized from all sides
• Eurogroup head Dijsselbloem says no chance of aid without comprehensive deal; Draghi says ELA will continue as long as Greek banks are solvent
• HSBC Holdings Plc is reviewing whether to move its headquarters out of Britain after more than two decades because of rising tax and regulatory costs
• Germany’s Ifo institute business climate index rose for a sixth month to 108.6 from 107.9 in March. The median estimate was for an increase to 108.4, according to a Bloomberg survey of 36 economists
• BoJ policy makers are likely to forecast that inflation will reach 2% and hold that level for two straight years from the year starting in April 2016, said people familiar with central bank’s discussions’’
• Meiji Yasuda Life, Japan’s third-largest life insurer. plans  to boost unhedged foreign bonds by over JPY1t in FY2015, it says in outline of investment for the year started April 1
• A slew of negative stories raised yet more questions over donations to the Clinton Foundation and hefty speaking fees paid to Bill Clinton during his wife’s tenure as secretary of state, a steady rumbling that could prove detrimental to her presidential aspirations
• Sovereign bond yields mostly higher. Asian stocks mostly lower, European stocks, U.S. equity-index futures gain. Crude oil mixed, gold lower, copper higher

US Event Calendar

• 8:30am: Durable Goods Orders, March, est. 0.6% (prior -1.4%)
• Durables Ex-Transportation, March, est. 0.3% (prior -0.4%, revised -0.6%)
• Cap Goods Orders Non-def Ex Air, March, est. 0.3% (prior -1.4%, revised -1.1%)
• Cap Goods Ship Non-def Ex Air, March, est. 0.3% (prior 0.2%, revised 0.3%)

DB's Jim Reid completes the overnight recap

Despite risk assets shrugging it off, it was hard to ignore the softer data coming out of the US yesterday. The flash manufacturing PMI print of 54.2 fell 1.5 points from the March reading and was also below market expectations of 55.7. New home sales for March attracted plenty of attention as the -11.4% mom (vs. -4.5% expected) was the single largest monthly decline since July 2013. The oil-sensitive Kansas City Fed manufacturing activity index for April declined for the fourth consecutive month to a lower than expected -7 (vs. -2 expected) and the lowest since May 2009. Employment data was the lone bright spot yesterday with initial jobless printing another sub 300k print (295k), keeping the four-week average at 285k. Yesterday’s weaker data in fact means that the Bloomberg US economic surprise index has struck a fresh 6-year low after a modest rebound earlier in the month. The big release today is the often volatile durable goods orders and it’ll be interesting to see what we get as analysts firm up their Q1 GDP expectations ahead of next Wednesday. Just on that, it’s interesting to take an early look at expectations for the reading. With median estimates currently running at an annualized +1.0%, it’s the range that’s fairly impressive with analyst expectations anywhere from +0.1% to +1.7%. With the Atlanta Fed GDPNow model running at +0.1%, it’ll be an important release given the now data dependent Fed.

Moving on and in terms of earnings yesterday, it was a relatively mixed session as investors digested results out of Caterpillar (CAT) (beat), Proctor and Gamble (PG) (miss), 3M (MMM) (miss), PepsiCo (PEP) (beat) and Dow Chemical (DOW) (beat) in particular. There were some encouraging signs from earnings reports after the bell however as Microsoft (MSFT) and Amazon (AMZN) in particular reported above market, while Google (GOOG) rose 4% in after-market trading. We’ve highlighted the stronger Dollar effect this reporting period which again was highlighted in a lot of the management calls after, however it was also interesting to hear both PepsiCo (PEP) and Caterpillar highlight weaker demand out of emerging markets, with both noting the instability in Brazil as a cause for concern. Caterpillar in fact also cautioned for a somewhat bleaker outlook for the remainder of the year, suggesting that demand in the remaining three quarters this year will be lower than Q1, with the impact from the downturn in oil markets potentially being felt more in the next quarter.

Having coming close to testing the 2% level intraday, Treasuries eventually ended 2.1bps tighter at 1.958%. The Dollar was a notable decliner meanwhile as the DXY finished 0.67% weaker for its second consecutive day of declines. CDX IG (-0.23bps) was a touch tighter but the main news in credit came post US close when AT&T (T) announced that they had sold $17.5bn of debt in the third largest corporate bond offering on record and second biggest this year.

Elsewhere, a bounce yesterday in oil markets certainly aided energy stocks (+0.62%) as both WTI (+2.81%) and Brent (+3.38%) finished higher – the latter reaching a new YTD high. The news yesterday that a Saudi Arabia led coalition has resumed airstrikes on Houthi rebels in Yemen – after previous reports that they were halting the strikes – probably contributed with reports on Reuters suggesting that forces would continue to target the movements of the rebels.

Closer to home yesterday, the damper tone was largely as a result of some disappointing PMI indicators for the region. For the Euro-area a 0.3pts fall in the manufacturing print and 0.5pt fall in the services print caused to the composite to fall to 53.5 (vs. 54.4 expected). Regionally, it was a similar story as Germany’s composite fell 1.2pt to 54.2 (vs. 55.6 expected) and France’s composite reading dropped 1.3pts to 50.2 (vs. 51.8 expected). Our colleagues in Europe noted, however, that although the fall was disappointing, the Euro levels generally remained above their Q1 averages and are about in line with their GDP forecasts for Q1 (+0.5% qoq) and Q2 (+0.4% qoq). They also noted that the relative resilience of the Euro area PMIs compared to Germany and France, suggest that economics outside of the ‘big two’ performed well on average in April. Wrapping up the data, UK retail sales were slightly disappointing with both the headline (-0.5% mom vs. +0.4% expected) and ex-autos (+0.2% mom vs. +0.5% expected) coming in below market.

Continuing the theme of late, Greece remained firmly in the headlight yesterday. Ahead of today’s Eurogroup, headlines on the wires suggesting that Greek PM Tsipras is urging an acceleration of talks with creditors and claiming that ‘a big part of the distance has been covered’ in particular attracted some attention, however we still remain cautious around these sorts of headlines with comments from Euro officials conflicting. European Commission Vice President Dombrovskis said yesterday that ‘progress is not good’ and that ‘it will apparently take more time’ while another EC member, Katainen, noted that ‘you cannot negotiate if you don’t trust’. With the Eurogroup meeting today however, it’ll be interesting to see where talks currently stand.

Despite the fall most European equity markets yesterday, Greek equities (+2.39%) closed higher with the headlines yesterday while 3y (-242bps), 5y (-139bps) and 10y (-52bps) yields all rallied in hope. The Euro was also a beneficiary, finishing 0.92% higher. Elsewhere, bond markets took something of a breather in Europe after the huge moves on Wednesday as 10y yields in both Germany and France closed unchanged at 0.163% and 0.412% respectively. Peripherals were a tad more mixed as Portugal (-3.0bps) and Spain (-0.6bps) closed tighter, while Italy (+1.5bps) widened.

Taking a look at today’s calendar, the only notable release in the European session this morning is the German IFO survey for April. The Eurogroup meeting in Riga and the associated commentary surrounding Greece will require a lot of attention meanwhile. The aforementioned durable goods orders in the US this afternoon will be of much focus, we’ll also get capital goods orders at the same time. Earnings wise it’s the turn of American Airlines (AAL) and Xerox (XRX).