Wednesday, December 21, 2016

Thursday Watch

Evening Headlines
  • Germany Had Monitored Berlin Truck Attack Suspect for Months. (video) German officials had deemed the Tunisian man being sought in a manhunt across Europe a threat long before a truck plowed into a Christmas market in Berlin — and even kept him under covert surveillance for six months this year before halting the operation. Now the international manhunt for Anis Amri — considered the prime suspect in Monday's deadly rampage — is raising questions about how closely German authorities are monitoring the hundreds of known Islamic extremists in the country. The issue puts new pressure on Chancellor Angela Merkel, who is running for re-election next year. Critics are lambasting her for allowing hundreds of thousands of asylum-seekers to enter the country, allegedly without proper security checks.
  • BNP Paribas' Lo: See More Defaults in China in 2017. (video) Brexit and Politics Cast Shadow Over U.K. After Tumultuous 2016. The U.K.’s long-predicted Brexit slump may finally arrive.
  • Japan Stocks Echo U.S. Drop as Oil Decline Halts: Markets Wrap. Futures on China and Hong Kong share gauges foreshadowed declines after the Dow Jones Industrial Average failed to reach the much-heralded 20,000 mark amid thinner volumes in the lead up to year-end. The Bloomberg Dollar Spot Index was steady after a 0.1 percent drop Wednesday, with the New Zealand dollar stronger following data that indicated faster-than-expected economic growth. Crude oil held above $52.50 a barrel after a report showing U.S. stockpiles increased drove it down 1.9 percent Wednesday.
  • Micron(MU) Rises on Quarterly Sales Forecast, Restored Growth. Micron Technology Inc., the largest U.S. maker of memory chips, predicted sales that exceeded some analysts’ estimates on demand for phone and computer parts that is beginning to outstrip supplies. Shares jumped as much as 10 percent in extended trading after the forecast.
Wall Street Journal:
Zero Hedge:
Business Insider:
Night Trading 
  • Asian equity indices are -.5% to +.25% on average.
  • Asia Ex-Japan Investment Grade CDS Index 121.55 -1.75 basis points.
  • Asia Pacific Sovereign CDS Index 37.25 -.5 basis point.
  • Bloomberg Emerging Markets Currency Index 69.54 +.03%
  • S&P 500 futures -.03%. 
  • NASDAQ 100 futures -.02%.
Morning Preview Links

Earnings of Note

  • (CAG)/.45
  • (RAD)/.05
  • (CALM)/-.48
  • (CTAS)/1.15  
Economic Releases 
8:30 am EST
  • Chicago Fed National Activity Index for November is estimated to fall to -.1 versus -.08 in October.
  • 3Q GDP is estimated to rise +3.3% versus a prior estimate of a +3.2% gain.
  • 3Q GDP Price Index is estimated to rise +1.4% versus a prior estimate of a +1.4% gain.
  • 3Q Personal Consumption is estimated to rise +2.8% versus a +2.8% prior estimate. 
  • 3Q Core PCE QoQ is estimated to rise +1.7% versus a prior estimate of a +1.7% gain.
  • Durable Goods Orders for November are estimated to fall -4.9% versus a +4.6% gain in October.
  • Durables Ex Transports for November are estimated to rise +.2% versus a +.8% gain in October.
  • Cap Goods Orders Non-Defense Ex-Air for November are estimated to rise +.4% versus a +.2% gain in October.
  • Initial Jobless Claims are estimated to rise to 257K versus 254K the prior week.
  • Continuing Claims are estimated to fall to 2010K versus 2018K prior.
9:00 am EST
  • The FHFA House Price Index MoM for October is estimated to rise +.5% versus a +.6% gain in September.
10:00 am EST
  • Personal Income for November is estimated to rise +.3% versus a +.6% gain in October.
  • Personal Spending for November is estimated to rise +.3% versus a +.3% gain in October.
  • PCE Core MoM for November is estimated to rise +.1% versus a +.1% gain in October.
  • The Leading Index for November is estimated to rise +.1% versus a +.1% gain in October.
11:00 am EST
  • The Kansas City Fed Manufacturing Activity Index for December is estimated to rise to 4.0 versus 1.0 in November. 
Upcoming Splits 
  • None of note
Other Potential Market Movers
  • The China Business Indicators, Bloomberg Economic Expectations for December, weekly Bloomberg Consumer Comfort Index and weekly EIA natural gas inventory report could also impact trading today.
BOTTOM LINE:  Asian indices are mostly lower, weighed down by technology and industrial 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.

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