Sunday, February 26, 2017

Monday Watch

Today's Headlines
  • U.K.'s May Said to Be Ready for Lords to Rewrite Brexit Bill. U.K. Prime Minister Theresa May’s government is setting aside time for a Parliamentary battle to overturn changes she fears could be made to her draft Brexit law when it’s debated in the House of Lords this week. May and her team demand that unelected legislators in the upper house of Parliament not rewrite the 137-word European Union withdrawal bill while scrutinizing it. The premier needs Parliament to approve the law so she can start the formal Brexit process by invoking Article 50 of the EU treaty by the end of March.
  • Deutsche Bank Cuts 2016 Bonus Pool by Almost 80%, FAS Reports. Deutsche Bank AG cut its bonus pool for 2016 by almost 80 percent, Frankfurter Allgemeine Sonntagszeitung reported, a figure unmatched in the bank’s recent history as it tries to counteract the impact of low interest rates and legal expenses. Germany’s largest lender is reducing the payments with an eye toward shareholders and is aware it will be “frustrating” for employees, Chief Administrative Officer Karl von Rohr told the German Sunday newspaper. The measures will affect about a quarter of the 100,000 staff. Some workers in key positions -- about 5,000 in all -- will get a special long-term incentive tied to the bank’s performance and paid out after as long as six years, von Rohr said.
  • Asian Stocks Drop, Yen Advances Before Trump Speech. The MSCI Asia Pacific Index slipped 0.4 percent, after advancing 0.5 percent last week. Japan’s Topix dropped 0.9 percent, retreating for a third day. The S&P/ASX 200 Index fell 0.3 percent in Sydney while the S&P/NZX 50 rose 0.1 percent.
Wall Street Journal: 
Zero Hedge:
Night Trading
  • Asian indices are -.5% to +.25% on average.
  • Asia Ex-Japan Investment Grade CDS Index 95.5 unch.
  • Asia Pacific Sovereign CDS Index 25.25 unch.
  • Bloomberg Emerging Markets Currency Index 71.58 +.04%.
  • S&P 500 futures +.07%.
  • NASDAQ 100 futures +.07%.

Earnings of Note
  • (AMT)/1.34
  • (JKS)/.52
  • (BID)/1.17
  • (ESV)/.06
  • (HTZ)/-.47
  • (PCLN)/14.17
  • (THC)/.22
  • (WDAY)/-.01 
Economic Releases 
8:30 am EST
  • Preliminary Durable Goods Orders for January are estimated to rise +1.6% versus a -.5% decline in December. 
  • Durables Ex Transports for January are estimated to rise +.5% versus a +.5% gain in December.
  • Cap Goods Orders Non-Defense Ex-Air for January is estimated to rise +.5% versus a +.7% gain in December.  
10:00 am EST
  • Pending Home Sales MoM for January are estimated to rise +1.0% versus a +1.6% gain in December.
10:30 am EST
  • Dallas Fed Manufacturing Activity for February is estimated to rise to 19.4 versus 22.1 in January.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The Eurozone Industrial Production report, Eurozone Consumer Confidence report, German Retail Sales report, Morgan Stanley Tech/Media/Telecom conference, Mobile World Congress and the JMP Securities Tech conference could also impact trading today.
BOTTOM LINE: Asian indices are mostly lower, weighed down by financial and industrial shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher. The Portfolio is 75% net long heading into the week.

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