Tuesday Watch

Weekend Headlines 
Bloomberg: 

• Asian Stocks Pare Loss as Yen Falls, Boosting Exporters. Asian stocks pared losses, with volatility in Japanese shares reaching the highest in more than two years, as a weakening yen boosted the earnings outlook for exporters. Woolworths Ltd. (WOW) sank 1.1 percent, a fifth day of declines for Australia’s largest retailer. Toho Holdings Co. lost 5.3 percent as the maker of medical equipment said it will raise funds to reinvestment in capital. Toyota Motor Corp., the world’s biggest carmaker, climbed 3.2 percent as a weakening yen boosted the earnings outlook for Japanese exporters. The MSCI Asia Pacific Index slid 0.1 percent to 136.77 as of 11:05 a.m. in Hong Kong, with about three stocks rising for every two that fell. 

Zero Hedge:

• Abenomics 101 - The 15 Most Frequently Asked Questions.

• Here Are $18.6 Billion SAC Capital's Largest Stock Positions.

• Mystery Surrounding Collapse Of Hong Kong Mercantile Exchange Deepens; Four Arrested.

• "Those Who Believe In Abenomics Are Suffering From Amnesia".

• The Fed's Real Worry - A Pick Up In Deflation.

• Japan Opposition Accuses Ruling Party Of Creating Stock Bubble.

• Asset Valuation And Fed Policy: We've Seen This Movie Before. 

• Grant Williams: "Do The Math!"

• The Chart That The BoJ Is Most Worried About (And So Should You Be). (graph)

• Which Asset Class Is The Most Sensitive To a Fed "Taper"?

• Hedge Fund Performance Update: Dan Loeb Is Crushing It In 2013, Everyone Else - Not So Much.

• Europe Ends Arms Embargo For Syrian Rebels, Desperate To Break Russian NatGas Export Monopoly.

Business Insider:

• 21 Stock Market Warning Signs Giving Global Investors Cold Sweats.

• In One Chart, Here's How Investors Are Massively Giving Up On Commodities.

• REPORT: SAC Capital's Biggest Outside Investor Wants To Pull Money Out.

• Google(GOOG) Is Planning To Build Its Own Wireless Network.

• New Satellite Pictures Show A Revolution Waiting To Happen In Bahrain.

• Stockholm Riots Leave Sweden's Dreams Of Perfect Society Up In Smoke.

• The Surging Yen, The Plunging Aussie Dollar, And Everything Else Going On In The Currency Markets.

• Rail Traffic Confirms That The Economy Remains Sluggish. (graph)

• Investors Are Borrowing Like Crazy To Leverage Up Their Stock Market Bets.

• Another Electric Car Company Is Going Bankrupt.

• MAULDIN: Japan Is On The Brink Of Disaster.

• Bombs Found In Oregon Teen's Bedroom, Allegedly Planning An Attack Bigger Than Columbine.

• Drones With Facial Recognition Technology Will End Anonymity, Everywhere.

Wall Street All-Stars:

• Indicator Update: Look for even more volatility this week!

Welt:

• German Anti-Euro Party Says Euro Breakup Matter of Time. Bernd Lucke, the Alternative for Germany party's leader, comments in an interview. The government is delaying a breakup of the currency through cash payments, increasing the amount German citizens will have to pay in the end, Lucke said. Lucke says he fears the breakup, which will be "completely out of control" when it happens, will lead to "major disruptions," including not being able to pay social benefits and pensions.

Sueddeutsche Zeitung:

• Munich Re CEO Says Some EU States Worry Him, Nikolaus von Bomhard says France is causing him "big concern" as the country is missing "important first steps" in reforms, citing interview.

People's Daily:

• China Shouldn't Rely on Economic Stimulus. China should not rely on issuing stimulus policies similar to the ones introduced in the past for its economic growth, citing Li Xuesong, a researcher at the Chinese Academy of Social Sciences. Since China's GDP continues to grow, the size of the stimulus needed will get larger, therefore using stimulus is not sustainable, the report cites Li as saying. China will not introduce a new 4t yuan stimulus plan, the report says.

Night Trading

• Asian indices are unch. to +.50% on average.

• Asia Ex-Japan Investment Grade CDS Index 109.50 +3.5 basis points.

• Asia Pacific Sovereign CDS Index 93.75 +2.0 basis points.

• FTSE-100 futures +.92%.

• S&P 500 futures +.30%.

• NASDAQ 100 futures +.48%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (TIF)/.52

• (UNFI)/.64 

Economic Releases
9:00 am EST

• The S&P/CS 20 City MoM% SA for March is estimated to rise +1.0% versus a +1.24% gain in February.

10:00 am EST

• The Richmond Fed Manufacturing Index for May is estimated to rise to -4 versus -6 in April.

• Consumer Confidence for May is estimated to rise to 71.0 versus 68.1 in April.

10:30 am EST

• The Dallas Fed Manufacturing Activity Index for May is estimated to rise to -10.0 versus -15.6 in April. 

Upcoming Splits

• (NBL) 2-for-1

• (WFM) 2-for-1

Other Potential Market Movers

• The Italian 10Y auction, Eurozone retail sales data, BoJ's Kuroda speaking, 2Y T-Note auction and the (LSTR) Mid-Quarter Update could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by automaker and consumer staple shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed. The Portfolio is 50% net long heading into the week.