Wednesday Watch

Evening Headlines

Bloomberg:

• Putin’s Mr. OPEC Becomes an Oil Market Player.

• Asia Stocks Mixed as Tax Vote Awaits. (video) Equity benchmarks in Tokyo were mixed, and those in Sydney, Seoul, Shanghai and Hong Kong little changed. The S&P 500 Index slipped from a record Tuesday. Longer-dated U.S. Treasury yields jumped to the highest since October overnight, with little immediate news trigger. European yields also climbed as the European Central Bank prepares to slow its asset purchases next month. The dollar held within recent ranges. Oil climbed after news of a surprise drop in U.S. crude stockpiles. Most fund managers see U.S. tax cuts boosting bond yields, along with stocks, next year, a Bank of America Merrill Lynch monthly survey showed. A net 83 percent of respondents viewed bond markets as overvalued. Japan’s Topix index was up 0.2 percent as of the Tokyo lunch break, while the Nikkei 225 Stock Average slipped 0.1 percent. Hong Kong’s Hang Seng Index was flat and the Shanghai Composite Index fell 0.1 percent. Futures on the S&P 500 Index rose 0.2 percent after the underlying gauge declined 0.3 percent Tuesday. Australia’s S&P/ASX 200 was little changed. 

• Five Things You Need to Know to Start Your Day.

• Collins Says News Coverage of Her Tax Vote ‘Unbelievably Sexist’.

Wall Street Journal:

• Congress Is on Brink of Tax Overhaul. Senate expected to pass the GOP tax bill this evening, followed by another House vote Wednesday.

• GOP Tax Plan: Live Coverage.

• Big U.S. Banks Get Satisfactory Grades on ‘Living Wills’. Regulators sign off on banks’ plans spelling out how they would fail without needing a taxpayer bailout.

• 12 Days in Xinjiang: How China's Surveillance State Overwhelms Daily Life.

• Deals Boom in Push to Move Health Care Out of Hospitals. Managed-care companies such as Humana are plunging deeper into the business of delivering health care outside hospitals.

• FedEx(FDX) Raises Forecast, Says Tax Changes Could Boost It Even More. Freight carrier’s revenue climbs on what it calls a record holiday season. 

• Drug and Alcohol Deaths at U.S. Workplaces Soar. Deaths jumped more than 30% in 2016, as the struggle with a deadly opioid epidemic migrates to the workplace.

MarketWatch.com:

• These 55 stocks have at least doubled since Trump was elected.

• Wall Street expects bull market to make history in 2018.

Fox News:

• Congress votes on tax bill: What the 'Tax Cuts and Jobs Act' means for you. (video)

CNBC:

• Bitcoin plunges $1,000 in less than an hour.

• Intel(INTC) CEO to employees: 'We are going to take more risks'.

• Interest rates rise in one of the biggest 2-day moves of the year as the tax bill moves closer to law.

• Crazy town: Tiny fruit juice company soars on speculated move into bitcoin that likely isn't real.

• Infamous short-seller Andrew Left scrambling for ways to bet against bitcoin.

• Mexican billionaire Carlos Slim reportedly will cut his stake in New York Times nearly in half. (video)

• Red Hat(RHT) falls after beating on revenue and EPS. (video)

Zero Hedge:

• Wasserman-Schultz IT Aides Ran Shady "CIA" Car Dealership, Borrowed $100K From Hezbollah Fugitive.

• In Dramatic Reversal, China Gives Up On Deleveraging Pledge.

• Boeing(BA) Unveils New Drone Which Will "Change The Future Of Air Power".

• North Korea Reportedly Testing Anthrax-Tipped ICBMs.

• America's Shrinking Attention Span.

• House Must Vote Again On Tax-Reform Plan After Procedural Snag.

• NFL Co-Hosts "Social Justice" Training For College Athletes.

• Constitutional Law Attorney Says Mueller's Seizure Of Transition Emails "Likely Violated The Law".

• WTI/RBOB Extend Gains After Bigger Than Expected Crude Draw. (graph)

• Small Caps Slammed And Bonds Bloodbath As Tax-Hopers "Sell The News".

Business Insider:

• FedEx(FDX) crushes earnings and revenue figures, boosts its full-year guidance.

• Micron(MU) beats, guides above Wall Street expectations.

Night Trading 

• Asian equity indices are -.25% to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 68.5 -.75 basis point. 

• Asia Pacific Sovereign CDS Index 13.25 -.25 basis point.

• Bloomberg Emerging Markets Currency Index 73.67 -.01%.

• S&P 500 futures +.25%.

• NASDAQ 100 futures +.28%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (ATU)/.17

• (BB)/.00

• (GIS)/.82

• (WGO)/.47

• (BBBY)/.37

• (MLHR)/.57

• (RMAX)/.51

Economic Releases

10:00 am EST

• Existing Home Sales for November are estimated to rise to 5.53M versus 5.48M in October.

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory decline of -3,483,700 barrels versus a -5,117,000 barrel decline the prior week. Gasoline supplies are estimated to rise by +1,732,800 barrels versus a +5,664,000 barrel gain the prior week. Distillate inventories are estimated to fall by -145,600 barrels versus a -1,370,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to rise by +.11% versus a -.4% decline prior.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The German PPI report and the weekly MBA Mortgage Applications report could also impact trading today.

BOTTOM LINE:  Asian indices are mostly higher, boosted by industrial 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.