Friday Watch

Evening Headlines

Wall Street Journal: 

• U.S. Gets Ready to Assist Offensive to Retake Key Iraq City From Islamic State. Additional troops arrive to bolster preparation for campaign to reclaim Mosul; defense officials anticipate battle will begin in October.
• Chinese Billionaire Linked to Giant Aluminum Stockpile in Mexican Desert. U.S. aluminum executives claim Liu Zhongtian, founder of Chinese metals conglomerate China Zhongwang, used a factory in Mexico to game the global trade system.

Fox News:

• Clinton email had 'multiple' classified markings, challenging her claim to FBI. (video) New details about the emails on Hillary Clinton's personal server that contained classified markings call into question her claim to the FBI that she didn't know what the markings meant -- and even believed they represented an alphabetical listing of paragraphs.

CNBC:

• Asia markets open mostly lower; ASX down 0.9 pct, Nikkei up 0.3 pct, Kospi down 0.8 pct. Asian markets opened mostly lower after a lower finish from U.S. equities and disappointment with the European Central Bank (ECB) decision to stand pat on policy. Traders will be watching for China's inflation data and South Korea's central bank rate decision later. Australia's S&P/ASX 200 opened down 0.9 percent, dragged by losses in its heavily-weighted financials subindex, which slid 1.15 percent, but losses were offset by its energy sector rising 0.64 percent.

Zero Hedge:

• Wells Fargo Fires 5,300 For Engaging In Massive Fraud, Creating Over 2 Million Fake Accounts.
• DB Warns That 35-Year Economic Super Cycle Is Officially Ending.
• Brace For "VaR Shock" - How The Bank Of Japan May Be About To Unleash A Global Selloff.
• Matt Lauer Slammed By Mainstream Press After Vet Tells Hillary "I Would Have Been Imprisoned" If I Did What You Did.
• Labor Department Revises Away 150,000 Jobs.
• Fed Wants To Bar Banks From Owning Physical Commodities, Equities.
• "It's Bordering Chaos": $14 Billion In Cargo Stranded At Sea, Crews "Go Crazy" On Hanjin Ghost Ships.
• Oilgasm Unable To Save Stocks As Draghi 'Dud' Sparks Bond Bloodbath. (graph)

Business Insider:

• Obama’s grand finale trip to Asia has turned into a disaster.
• US commercial bankruptcies are soaring.
• A massive oil discovery could supply every refiner on the Gulf Coast.

Telegraph:

• ECB's Mario Draghi has run out of magic as deflation closes in.
• US recession jitters stoke fears of impotent Fed and fiscal paralysis.

Night Trading 

• Asian equity indices are -.75% to -.25% on average.
• Asia Ex-Japan Investment Grade CDS Index 106.5 -.75 basis point.
• Asia Pacific Sovereign CDS Index 36.0 +.5 basis point.
• Bloomberg Emerging Markets Currency Index 73.26 -.02%. 
• S&P 500 futures +.01%. 
• NASDAQ 100 futures -.01%.

Morning Preview Links

Earnings of Note
Company/Estimate 

• (HOV)/.08
• (KR)/.45
• (MFRM)/.65 

Economic Releases
10:00 am EST

• Final Wholesale Inventories MoM for July are estimated to rise +.1% versus unch. in June.
• Wholesale Trade Sales MoM for July are estimated to rise +.2% versus a +1.9% gain in June.
  

Upcoming Splits 

• None of note

Other Potential Market Movers

• The Fed's Rosengren speaking, Fed's Kaplan speaking and the Canadian Unemployment report could also impact trading today.

BOTTOM LINE:  Asian indices are lower, weighed down by technology and commodity shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower. The Portfolio is 25% net long heading into the day.