Monday, October 27, 2014

Tuesday Watch

Evening Headlines 
Bloomberg:
  • Putin Narrative of Abandoned Ukraine East Fueled by Vote. Vladimir Putin may have more ammunition to extend his influence over the Ukraine’s war-torn east after the country’s parliamentary election. A surge in support for pro-European parties leaves the area, the bedrock of ousted leader Viktor Yanukovych’s popularity, with less of a say in the nation’s future. Parties backing President Petro Poroshenko’s bid to steer Ukraine away from its Soviet past are set to form a coalition, a move that may make reconciliation in the east more difficult and fuel complaints from Putin that Russian speakers are being trampled. 
  • WHO Said to Track 111 People in Mali After Ebola Death. Health officials in Mali have identified 111 people who came into contact with the nation’s first Ebola patient last week, according to an internal World Health Organization document. Workers have been unable to find at least 40 of those people who may have been exposed to the toddler, the Geneva-based WHO said in the document, seen by Bloomberg News. The two-year-old girl contracted the disease in Guinea and died on Oct. 25 in Mali.
  • Asian Stocks Fall Before Fed as U.S. Data Disappoint Investors. Asian stocks fell, following U.S. shares lower, after American data from home sales to manufacturing fell short of estimates and investors awaited a Federal Reserve decision on its stimulus program. The MSCI Asia Pacific Index (MXAP) dropped 0.1 percent to 138.22 as of 9:02 a.m. in Tokyo, before markets opened in Hong Kong and China.
  • Oil Drops as Asia Shares Fluctuate With Dollar Before Fed. Oil fell for a third day as U.S. supplies were estimated to be near a four-month high. Asian stocks fluctuated and the dollar held losses as investors await a Federal Reserve decision on its stimulus program. West Texas Intermediate oil slid 0.5 percent as of 10:54 a.m. in Tokyo, taking its decline since June to 25 percent.
Wall Street Journal:
  • CDC Rejects Mandatory Ebola Quarantines. Federal Officials Push for Voluntary Isolation of Those at High Risk. The Obama administration laid out new guidelines Monday calling for voluntary isolation and monitoring of travelers exposed to Ebola, to counter a proliferation of divergent state rules over how to contain the outbreak.
CNBC:
  • Why OPEC's losing its ability to set oil prices. (video) U.S. shale oil will replace the Organization of the Petroleum Exporting Countries as the first-mover "swing producer," according to a Goldman Sachs report from the weekend—meaning OPEC is losing its power to set global prices for crude.
Zero Hedge:
Business Insider:
Washington Times: 
  • Reinflating the housing bubble. The feds are pushing the same lax rules that triggered the crash. The headline in newspapers one recent weekend read like an April Fool’s joke, but it wasn’t April 1. The Obama administration announced it wants to provide a little more juice to the now-lackluster housing market by bending the home lending rules to make it easier for banks to make loans and marginal buyers to take on a mortgage.
Reuters: 
Telegraph:
Evening Recommendations
  • None of note
Night Trading
  • Asian equity indices are -.50% to +.50% on average.
  • Asia Ex-Japan Investment Grade CDS Index 114.0 -1.0 basis point.
  • Asia Pacific Sovereign CDS Index 67.0 -.75 basis point.
  • FTSE-100 futures +.25%.
  • S&P 500 futures +.04%.
  • NASDAQ 100 futures  +.02%.
Morning Preview Links

Earnings of Note

Company/Estimate
  • (SCHN)/.31
  • (CMI)/2.28
  • (NBL)/.36
  • (AN)/.86
  • (CPLA)/.55
  • (GLW)/.38
  • (ACI)/-.41
  • (PCAR)/.96
  • (HCA)/1.17
  • (AET)/1.58
  • (DD)/.53
  • (WHR)/3.13
  • (COH)/.45
  • (SHW)/3.22
  • (TRW)/1.69
  • (PFE)/.55
  • (AMTD)/.36
  • (FCX)/.61
  • (AGCO)/.63
  • (MCK)/2.73
  • (GILD)/1.93
  • (AFL)/1.43
  • (EA)/.53
  • (FB)/.40
  • (WYNN)/1.82
  • (OI)/.73
  • (PNRA)/1.43
  • (APC)/1.27
  • (ESRX)/1.29
  • (X)/1.20
  • (BXP)/1.37
  • (WDC)/2.04
Economic Releases
8:30 am EST
  • Durable Goods Orders for September are estimated to rise +.5% versus a -18.2% decline in August.
  • Durables Ex Transports for September are estimated to rise +.5% versus a +.7% gain in August.
  • Cap Goods Orders Non-Defense Ex Air for September are estimated to rise +.7% versus a +.6% gain in August.
9:00 am EST
  • The S&P/CS 20 City MoM SA for August is estimated to rise +.18% versus a -.5% decline in July. 
10:00 am EST
  • Consumer Confidence for October is estimated to rise to 87.0 versus 86.0 in September.
  • The Richmond Fed Manufacturing Index for October is estimated to fall to 11.0 versus 14.0 in September.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The China Industrial Profits report, $29B 2Y T-Note auction,  weekly US retail sales reports, (KR) investor conference and (AMGN) business review could also impact trading today.
BOTTOM LINE: Asian indices are mostly lower, weighed down by industrial and commodity shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing mixed. The Portfolio is 50% net long heading into the day.

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