Friday Watch

Evening Headlines 
Bloomberg:

• U.S. Says Russia Firing Artillery Into Ukraine. The U.S. said Russia is firing artillery across its border into Ukraine, the first time American officials have publicly alleged such direct participation in fighting on behalf of separatists. “Russia is firing artillery from within Russia to attack Ukrainian military positions,” State Department spokeswoman Marie Harf told reporters today in Washington, offering no evidence for what she described only as information “from our intelligence friends.” 

• Obama Says Jet Downing Pushing EU Toward Russia Sanctions. President Barack Obama said he expects the shooting down of the Malaysian airliners to push European nations toward tougher sanctions against Russia. Obama said the “intertwined” economies of the European Union and Russia has been a concern for U.S. allies as they respond to Russian involvement in the turmoil in Ukraine. 

• Japan’s Export-Champ Days Are Left Behind, Chart Shows.

• Asian Stocks Rise After S&P 500 Record; Won, Copper Slip. Asian stocks climbed, with the regional index at a six-year high and headed for its 10th advance in 11 weeks. The South Korean won weakened a second day versus the dollar, while copper pared its weekly gain. The MSCI Asia Pacific Index rose 0.1 percent by 9:59 a.m. in Tokyo, set for a weekly climb of 1.2 percent.

• Coal Company Pain Accelerates as Bankruptcy Cases Rise. The coal business, after fueling the Industrial Revolution and powering U.S. growth for much of the past century, is now beset by a glut of cheap natural gas and tighter regulation. James River Coal Co. in many ways epitomizes these ills. After filing for bankruptcy almost four months ago with plans to sell its business, the Richmond, Virginia-based company has delayed an auction twice without announcing a buyer.

Wall Street Journal:

• Islamist Militants Gain in Syria. Islamic State militants launched assaults on Syrian forces across three provinces on Thursday that killed key government figures, including two brigadier generals, said activists and residents, in a rare confrontation between the two sides during the war. In one assault, the jihadists besieged two military bases outside Hasakah city in Syria's east, killing a commanding brigadier general, according to the Syrian Observatory for Human... 

• The Federal Reserve's Risky Reverse Repurchase Scheme by Shelia Bair. The mere existence of this central bank program could exacerbate liquidity runs in times of market stress.

• The ObamaCare-IRS Nexus. The supposedly independent agency harassed the administration's political opponents and saved its health-care law.

CNBC:

• Amazon(AMZN) loses 27 cents per share, vs. expected loss of 15 cents a share. Amazon.com posted a loss that was wider than Wall Street expectations Thursday, sending shares lower in extended-hours trading.

Zero Hedge:

• Things In The Middle East Are About To Get Much Worse.

• The Ten Plagues That Are Hitting America Right Now.

• Creation Of S&P 500 ETFs Rises To All Time High.

• Iraqi Oil In Context: 60% Of OPEC Growth Expectations. (graph)

• Steve "Debt-Is-Good" Liesman Meets Barack "Hope-Is-Better" Obama - Live Feed. (video)

• Where China Goes To Outsource Its Own Soaring Labor Costs.

• Japanese Inflation Holds Near 23 Year Highs As Food, Energy, & TV Costs Soar. (graph)

• The Chart That Keeps Mario Draghi Up At Night. (graph)

• Food Inflation Watch: California Farmers' Water Costs Surge 700% After Government Cuts Supply.

• The "Insider Threat Program" And The Government's War On Whistleblowers.

Business Insider:

• Divorce Filings Reveal Liberal Icon Michael Moore Has 9 Properties, Millions Of Dollars, And Is Far From An 'Everyman'.

• The Horrifying Story Of What Is Happening To Former US Interpreters In Afghanistan.

Reuters:

• U.S.-based stock funds post $7.6 bln net outflows in week -Lipper.

Obama takes on coal with first-ever carbon limits
Read more at http://www.philly.com/philly/news/politics/20130919_ap_0f857b20e0c144a5a1e1b9dddc9f9d72.html#YRThyDOhArykUeYy.99

Telegraph:

• Proposed EU sanctions threaten to shut Russia out of the world financial system.

Evening Recommendations

• None of note

Night Trading

• Asian equity indices are -.50% to +.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 101.0 -.75 basis point.

• Asia Pacific Sovereign CDS Index 70.0 unch.

• FTSE-100 futures -.21%.

• S&P 500 futures -.07%.

• NASDAQ 100 futures  -.24%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (AEP)/.75

• (AON)/1.20

• (AVY)/.79

• (B)/.59

• (COV)/1.00

• (IDXX)/1.06

• (LEA)/1.97

• (LPNT)/.55

• (LYB)/1.93

• (MCO)/1.01

• (SLAB)/.46

• (TYC)/.54

Economic Releases
8:30 am EST

• Durable Goods Orders for June are estimated to rise +.5% versus a -1.% decline in May.

• Durables Ex Transports for June are estimated to rise +.5% versus a -.1% decline in May.

• Cap Goods Orders Non-defense Ex Air for June is estimated to rise +.5% versus a +.7% gain in May.

Upcoming Splits

• None of note

Other Potential Market Movers

• The German IFO, UK gdp and the (SCHW) business update could also impact trading today.

BOTTOM LINE: Asian indices are mostly lower, weighed down by technology and industrial shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower. The Portfolio is 50% net long heading into the day.