Wednesday, November 09, 2016

Thursday Watch

Evening Headlines
  • After Brexit and Trump, Populists Target Next Dominoes in Europe. After success in Britain and the U.S., populists are setting their sights on the next five dominoes at risk. Votes are looming within less than a year in Italy, Austria, the Netherlands, France and then Germany. Exasperation with the political and business establishment over a raft of grievances from inequality to immigration will likely shape all of these votes, with the outcome increasingly hard to predict.
  • Yuan Falls to Six-Year Low Amid Concern Trump Will Target China. The yuan slipped to a six-year low as concern about China’s trade relationship with a more protectionist U.S. provided a new reason to sell the currency that’s heading for a third annual loss. The yuan fell 0.2 percent to 6.7907 per dollar at 11:35 a.m. in Shanghai, its lowest level since September 2010, and extending its drop this year to 4.4 percent. Declines versus the greenback were minor compared with peers after the central bank barely weakened the fixing, following a 1.4 percent surge by the Bloomberg Dollar Index on Wednesday. Trump has called China a "grand master" at currency manipulation and has threatened tariffs of up to 45 percent on the country’s imports, a step that Commonwealth Bank of Australia estimated would cut China’s shipments to the the U.S. by 25 percent in the first year.
  • A Different China Awaits Trump. (video)
  • Asian Stocks Rebound After Selloff as Markets Reassess Trump Win. Asian stocks jumped the most in almost eight months to join a global rebound on speculation Donald Trump will pursue business-friendly policies. Japanese shares surged as the yen slumped. The MSCI Asia Pacific Index added 2.3 percent to 136.49 as of 10 a.m. in Tokyo, heading for the biggest increase since March 2. The measure tumbled 3.2 percent on Wednesday, the most since Brexit roiled global markets, after Trump shocked investors by winning the U.S. presidential race against opponent Hillary Clinton.
  • SolarCity(SCTY) Heads Quietly Into the Sunset.
  • Twitter(TWTR) Names Anthony Noto COO, Initiates CFO Search. (video)
Wall Street Journal:
Fox News:
  • Trump election raises big questions for ObamaCare, immigration, Supreme Court. (video) President-elect Donald Trump hasn’t minced words about what legacy legislation would be on the chopping block from President Obama's administration. From the start, Trump has vowed to repeal ObamaCare within his first 100 days in office. His upset victory early Wednesday immediately raises thorny questions about what’s next for a range of hot-button issues – from the vacancy on the Supreme Court to pending trade deals to immigration policy to health care.
Zero Hedge:
Business Insider:
Night Trading 
  • Asian equity indices are +1.0% to +3.0% on average.
  • Asia Ex-Japan Investment Grade CDS Index 117.5 -1.25 basis points. 
  • Asia Pacific Sovereign CDS Index 36.75 +1.5 basis points.
  • Bloomberg Emerging Markets Currency Index 71.72 +.04%
  • S&P 500 futures -.02%
  • NASDAQ 100 futures +.32%.
Morning Preview Links

Earnings of Note

  • (AZN)/.96
  • (KSS)/.70
  • (M)/.41
  • (NAT)/-.15
  • (PRTY)/.12
  • (RL)/1.71
  • (SODA)/.23
  • (KORS)/.88
  • (MSCC)/.90
  • (JWN)/.52
  • (NVDA)/.68
  • (DIS)/1.16
Economic Releases
8:30 am EST
  • Initial Jobless Claims are estimated to fall to 260K versus 265K the prior week.
  • Continuing Claims are estimated to fall to 2025K versus 2026K prior.    
2:00 pm EST
  • The Monthly Budget Deficit for October is estimated at -$75.0B versus -$136.6B in September.
Upcoming Splits 
  • None of note
Other Potential Market Movers
  • The Fed's Bullard speaking, $15B 30Y T-Bond auction, Canadian Home Price report, weekly Bloomberg Consumer Comfort Index, weekly EIA natural gas inventory report, Suntrust Robinson Humphrey Financial Tech/Business/Government Services Conference, (SRCL) investor day, (MET) investor day, (SCSS) investor meeting, (ROK) investor meeting, (IRBT) analyst day and the (COP) analyst meeting could also impact trading today.
BOTTOM LINE:  Asian indices are higher, boosted by metals/mining and financial shares in the region. I expect US stocks to open higher and to weaken into the afternoon, finishing mixed. The Portfolio is 75% net long heading into the day.

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