Thursday, January 28, 2016

Weekday Watch

Evening Headlines
Bloomberg:
  • U.S. Plans to Sanction More Venezuelans Tied to Maduro. The U.S. is preparing to expand sanctions against Venezuela by freezing assets of 10 to 20 additional people tied to the government of President Nicolas Maduro, according to two people familiar with the matter. The action could come as soon as Tuesday, though it may be delayed as the Trump administration seeks a coordinated international response in imposing penalties on the Maduro regime for undermining democracy in the South American country, the people said. The U.S. is pressing to enlist European and South American countries -- including neighboring Colombia -- to match the sanctions and may hold off taking unilateral action if necessary for a coordinated announcement.
  • Japan Posts Current Account Surplus as Trade Turns Positive. Japan recorded a 36th consecutive current account surplus in June, supported by returns on overseas investments and a trade balance that returned to positive territory.
  • Investors Jump Back Into the Euro as Going Short Proves 'Lethal'. Hedge funds. Asset managers. Central banks. These are just some of the players in the $5.1 trillion-a-day currency market who are buying the euro after shunning it over the past three years.
  • Asia Stocks Nudge Higher Before China Trade Data. It’s been a relatively quiet start to the week for markets ahead of Friday’s U.S. inflation data that may give clues on the path of U.S. monetary policy. Gains in Japan and South Korean equities follow a muted U.S. session which saw the dollar extend its advance and gains in technology stocks offset a slide in energy producers as crude declined. West Texas Intermediate crude sat below $50 a barrel. Japan’s Topix index rose less than 0.1 percent, while Australia’s S&P/ASX 200 Index added 0.2 percent. South Korea’s Kospi index advanced 0.3 percent. Hang Seng Index futures slipped 0.2 percent.
  • Your Evening Briefing.
  • Fannie-Freddie Might Need $100 Billion in New Crisis, FHFA Says.
Wall Street Journal:
Zero Hedge:
Business Insider:
Telegraph:
  • Rip up London’s green belt and the whole country will benefit. House prices are way too high. The transport system is creaking. The schools are impossible to get into, and if you want to get a doctor’s appointment this side of 2020, good luck. We all know the reasons why people leave London for somewhere with a better quality of life. Only this month, it was reported that numbers quitting the capital had hit fresh records, up by 80pc over the last five years.
Night Trading 
  • Asian equity indices are -.25% to +.25% on average.
  • Asia Ex-Japan Investment Grade CDS Index 79.25 -.75 basis point
  • Asia Pacific Sovereign CDS Index 19.25 +.5%.
  • Bloomberg Emerging Markets Currency Index 73.84 +.02%.
  • S&P 500 futures -.07%.
  • NASDAQ 100 futures -.05%.
Morning Preview Links

Earnings of Note
Company/Estimate

  • (CVS)/1.31
  • (DF)/.32
  • (EXPD)/.59
  • (FSS)/.22
  • (IT)/.84
  • (JEC)/.79
  • )KORS)/.62
  • (RL)/.95
  • (SEE)/.36
  • (STE)/.80
  • (VRX)/.96
  • (ZTS)/.53
  • (FOSL)/-.40
  • (HTZ)/-.22
  • (JAZZ)/2.75
  • (MBI)/.01
  • (MNST)/.40
  • (MYGN)/.26
  • (PHH)/-.91
  • (PCLN)/14.22
  • (RRGB)/.52
  • (TRIP)/.31
  • (DIS)/1.55
  • (WBMD)/.52
  • (ZG)/-.01
Economic Releases 
6:00 am EST

  • The NFIB Small Business Optimism Index for July is estimated to fall to 103.5 versus 103.6 in June.
10:00 am EST
  • JOLTS Job Openings for June are estimated to rise to 5700 versus 5666 in May.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The China Trade Balance report, German Trade Balance report, $24B 3Y T-Note auction, US weekly retail sales reports, Oppenheimer Tech/Internet/Communications Conference, UBS Financial Services Conference, JPMorgan Auto Conference and the Needham MedTech Conference could also impact trading today.
BOTTOM LINE:  Asian indices are mostly lower, weighed down by energy and financial shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing modestly higher.  The Portfolio is 100% net long heading into the day.

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