Friday Watch

Evening Headlines

Bloomberg:

• Pay for Japanese Workers Jumps as Bonuses Pick Up. Pay for Japanese workers showed the strongest gains this year in August, according to data from the labor ministry. It’s welcome news for economic policy makers in Tokyo who are struggling to spur sustained inflation in the world’s third-largest economy. Monthly cash earnings increased 0.9 percent from a year earlier, the largest amount in more than a year, and higher than the 0.5 percent estimated by economists. That marked a rebound from a 0.6 percent drop in July, when companies cut bonus payments. Cash earnings adjusted for inflation grew 0.1 percent after a 1.1 percent drop the previous month.

• U.S. Delays Key Commerce Decision on China Until After Trump's Trip. The Commerce Department has deferred a decision on whether China should be treated as a market economy until after President Donald Trump’s visit to the Asian nation next month. Commerce on Thursday delayed a decision on whether to impose preliminary duties on aluminum foil imports from China to penalize Chinese suppliers from selling the product in the U.S. at less than fair-market value. The department said it will announce its determination on the anti-dumping probe, along with a decision on China’s non-market economy status, no later than Nov. 30.

• Stocks, Dollar Buoyed by Confidence in Economy. The S&P 500 climbed to another all-time high and Asian equities faced a positive start, while the Bloomberg Dollar Index rose to the highest level in almost three months Thursday. Better-than-forecast American factory orders and hawkish comments by regional Fed President John Williams reinforced optimism in the world’s largest economy ahead of Friday’s U.S. jobs report and a speech on monetary policy by the New York Fed chief. Asian equities are headed for their best week since mid-July -- though several markets have been closed -- and oil traded back above $50 a barrel amid the general cheer about global economic conditions. Good vibes were to be found even in Spain, where equities and bonds climbed on Thursday after reports that Catalans were stalling their push for independence from Spain. Futures on Japan’s Nikkei 225 Stock Average were about 0.3 percent higher than where the cash equity market closed in Tokyo on Thursday. Futures on Australia’s S&P/ASX 200 Index rose 0.6 percent. Hong Kong equity markets will reopen after Thursday’s holiday. China and South Korean remain closed for trading.

• Five Things You Need to Know to Start Your Day. (video)

Wall Street Journal:

•  5 Things to Watch in the September Jobs Report. 

• North Korea ‘Decoders’ Offer Dire Warnings About Nuclear Program. A video showing how experts outside U.S. government are using North Korea’s propaganda to track the regime’s nuclear weapons advancements.

• From Broken Home to Real-Estate Riches: The Life of the Las Vegas Shooter. Stephen Paddock did not fit the profile of a typical mass killer, a problem confounding authorities seeking a motive.

• No End in Sight for Stocks’ Longest Streak in 20 Years. October for some recalls the financial crisis and the crash of 1987, but this year few see signs of an imminent downturn.

Fox News:

• Challenge to Pelosi: Top Dem lashes out at party leaders, says 'pass the torch'. (video)

• Harvey Weinstein seeks 'tutoring' after damning report accuses him of sexually harassing Ashley Judd.

CNBC:

• IMF chief: Economic recovery takes hold in most of the world.

• Facebook's(FB) problems could only get worse, investor Roger McNamee says.

• House passes $4.1 trillion budget, the first concrete step toward tax reform. (video)

• Amazon’s(AMZN) new delivery program may not hurt UPS(UPS) and FedEx(FDX): Experts. (video)

• History suggests that Netflix(NFLX) will keep flying: Technical analyst. (video)

• Tropical Storm Nate pounds Central America, heads for US. (video)

• Fed's George says further rate hikes are needed.

• After hours buzz: COST, YUMC & more.

Zero Hedge:

• President Trump Warns Ominously: "It's The Calm Before The Storm".

• Which American Cities Will File Bankruptcy Next?

• ISIS Triples Down On Vegas Shooter Claims: Claims Paddock "Converted Six Months Ago".

• 7 Independence Movements That Could Destroy The EU.

• Despite Spike In Accidents, California Allows GM To Expand Self-Driving Car Fleet.

• Somali Terrorist Charged In Canada Attack Was Previously Deported From The U.S.

• Trump Expected To "Decertify" Iran Nuclear Deal Next Thursday.

• "Don't Ask Me To Pray For Victims" - Harvard Prof Calls NRA "Domestic Terrorist Organization".

• NRA Caves On "Bump Fire Stocks," Says They Should Be "Subject To Additional Regulations".

• These U.S. Companies Have The Most Cash Parked Overseas.

• Trump Reverses On Puerto Rico Debt Forgiveness: "We Will Follow The Bankruptcy Process".

• S&P Surges To Longest Record-High Streak In 20 Years As Dollar Spikes. (graph)

Business Insider:

• A mysterious piece of paper was found in the Las Vegas shooter's hotel room. (pic)

• The 5 most annoying changes in the new iPhone update — and how to fix them. (video)

Night Trading 

• Asian equity indices are +.25% to +.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 77.75 -.5 basis point. 

• Asia Pacific Sovereign CDS Index 18.0 -.25 basis point.

• Bloomberg Emerging Markets Currency Index 73.56 -.03%.

• S&P 500 futures -.02%.

• NASDAQ 100 futures +.03%.

Morning Preview Links

Earnings of Note
Company/Estimate

• None of note

Economic Releases 
8:30 am EST:

• The Change in Non-Farm Payrolls for September is estimated to fall to 80K versus 156K in August.

• The Unemployment Rate for September is estimated at 4.4% versus 4.4% in August.

• Average Hourly Earnings MoM for September is estimated to rise +.3% versus a +.1% gain in August.

10:00 am EST:

• Wholesale Trade Sales MoM for August is estimated unch. versus a -.1% decline in July.

3:00 pm EST

• Consumer Credit for August is estimated to fall to $15.54B versus $18.499B in July.

Upcoming Splits

• (ISRG) 3-for-1

Other Potential Market Movers

• The Fed's Bostic speaking, Fed's Dudley speaking, Fed's Kaplan speaking and the German Factory Orders report could also impact trading today.

BOTTOM LINE:  Asian indices are higher, boosted by commodity and technology shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher.  The Portfolio is 100% net long heading into the day.