Friday Watch

Evening Headlines 
Bloomberg: 

• Greece Will Have to Exit the Euro Zone: Tchir. (video) 
• Kaisa Keeps Creditors Guessing as China Dollar Default Looms. Kaisa Group Holdings Ltd. has until Monday to find $52 million for missed payments on two of its dollar bonds as it seeks to avoid default.
• Nielsen: Why I'm Worried About Emerging Markets. (video)
• Most Asian Stocks Fall as Regional Gauge Poised for Weekly Gain. Most Asian stocks fell after the regional benchmark index closed Thursday at a seven-year high. Japanese shares slid to pare a third weekly advance. Two shares dropped for each that rose on the dollar-denominated MSCI Asia Pacific Index, which was little changed at 154.44 as of 9:05 a.m. in Tokyo. The measure closed at its highest level since January 2008 on Thursday, and is poised to end the week 1.4 percent higher. Japan’s Topix index lost 0.4 percent and Australia’s S&P/ASX 200 Index slid 0.1 percent.
• Schlumberger(SLB) Cuts More Jobs as Oil Industry Braces for Next Wave. Schlumberger Ltd., the world’s largest oilfield services provider, will eliminate an additional 11,000 positions in a sign the industry will undergo another round of job cuts as a result of tumbling crude prices. The latest announced reductions bring the company’s total to 20,000, making its workforce about 15 percent smaller than it was during the third quarter of 2014. Schlumberger had announced plans in January to eliminate 9,000 positions, in what was then the single largest cut in the industry.
• Virtu’s Shareholders Said to Include Industry Critic T. Rowe. T. Rowe Price Group Inc., one of the biggest critics of high-frequency trading, now finds itself in a seemingly surprising spot: It acquired shares of HFT firm Virtu Financial Inc., a key player in reshaping how everything from stocks to currencies are bought and sold. The money manager purchased shares in Virtu’s initial public offering Wednesday, according to people familiar with the matter who asked not to be identified because the information is private.

Wall Street Journal:

• U.S. Says Ramadi at Risk of Falling to Islamic State. Anbar residents flee provincial capital as Islamist forces advance. U.S. defense officials said a provincial capital in Iraq could soon fall to Islamic State, while America’s top military officer sought to minimize the strategic importance of the city. At a Pentagon news conference, Gen. Martin Dempsey, chairman of the Joint Chiefs of Staff, suggested that maintaining control of Ramadi, the capital of Anbar province, isn’t central to the U.S. and Iraqi aims of defeating Islamic State forces.
• Fed Shies Away From June Rate Hike. Weak economic data causing some officials to rethink timing of first increase in more than 6 years. A patch of soft economic data has created uncertainty inside the Federal Reserve about when to start raising short-term interest rates, dimming the chances of a move as early as June. Recent reports showed a slowdown in U.S. hiring in March, tepid growth in consumer spending at retail stores, a big drop in industrial output and softer-than-expected home.
• How Citadel and the Fed Crossed Paths Before the Hedge Fund Hired Ben Bernanke. The news that former Federal Reserve Chairman Ben Bernanke will become a senior adviser to Citadel, the Chicago-based hedge fund, has renewed attention on the tendency of former regulators and economic policy makers to move to financial institutions once leaving office.
• The Nuclear Deal With Iran Needs Work—Lots of It by James A. Baker III. If Iran demands the removal of all sanctions once a final deal is signed, there shouldn’t be a final agreement. Within days of the April 2 announcement of the tentative agreement to curb Iran’s nuclear-weapons program, it was apparent that there are substantial misunderstandings about a deal the administration has hailed as “an historic understanding.” Clearly, much work must be done if there is to be a final agreement by the June 30 deadline.

Fox News: 

• Nothing sacred: ISIS destroys Christian grave sites in Mosul. Even Iraq's dead Christians aren’t safe from ISIS. The Islamic State's campaign of terror across the war-torn nation, which has already seen countless beheadings, destruction of priceless art and religious artifacts and insistence that Christians submit or die, now includes mass desecration of graves. Photos of the black-clad, extremist ghouls smashing headstones in cemeteries in the key northern city of Mosul were posted Thursday online under the title "Leveling Graves and Erasing Pagan Symbols."

Zero Hedge:

• A World Of Bubbles. (graph)
• If QE Is So Great, Why Stop Printing Now?
• So You Want Bridgewater To Manage Your Money? There Is One Small Condition.
• 3 Things: Retail Sales, Real Unemployment, Optimism. (graph)
• Sex-Partying, Teen-Hooker-Funding DEA Agents Get Slap On Wrist, None Fired.
• Fed-Speaker Confusion Sparks Dollar Slump, Stocks Pump'n'Dump. (graph)
• Conspiracy Theorists, Bloggers Compared To ISIS During Congressional Hearing.
• Signs That 'The Elites' Are Feverishly Preparing For Something Big.
• Hong Kong Insanity Launches Exchange Operator's Shares Into Orbit. (graph)

Business Insider:

• Slack CEO: 'It's a wonderful, crazy environment to raise capital'.
• Nearly half the drones approved to fly in US airspace are from this Chinese company.
• Germany's finance minister is worried about China's debt and shadow banking.

Reuters:

• AmEx revenue misses on strong dollar, loss of co-branded tie-ups. American Express Co, the world's largest credit card issuer, reported quarterly revenue that fell short of analysts' estimates, hurt by a stronger dollar and the loss of several co-branded tie-ups. AmEx's shares fell 1.4 percent to $79.80 after the bell on Thursday.

Telegraph: 

• Grexit dangers mount as Greece's Yanis Varoufakis warns of 'liquidity asphyxiation'. The Greek finance minister said his country would not continue deception of 'Ponzi austerity' even if this means a showdown with creditors.

Evening Recommendations 

• None of note

Night Trading

• Asian equity indices are -.75% to +.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 104.0 -1.75 basis points.

• Asia Pacific Sovereign CDS Index 59.25 unch.

• S&P 500 futures -.07%.

• NASDAQ 100 futures -.06%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (CMA)/.73
• (GE)/.30
• (HON)/1.39
• (RAI)/.80
• (STX)/1.04

Economic Releases
8:30 am EST

• The CPI for March is estimated to rise +.3% versus a +.2% gain in February.
• The CPI Ex Food & Energy for March is estimated to rise +.2% versus a +.2% gain in February.

10:00 am EST

• Preliminary Univ. of Mich. Consumer Sentiment for April is estimated to rise to 94.0 versus 93.0 in March.
• The Leading Index for March is estimated to rise +.3% versus a +.2% gain in February. 

Upcoming Splits

• None of note

Other Potential Market Movers

• The UK Jobless Claims report, (THOR) investor meeting and (SYMC) financial analyst day could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by real estate and consumer 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.