Friday Watch

Evening Headlines

Bloomberg:

• Crypto Stock Fever Misses China as Investors Sour on Small Caps. Chinese stock investors don’t seem to share the global enthusiasm for companies jumping on the cryptocurrency bandwagon. Shenzhen Forms Syntron Information Co. has fallen 22 percent since announcing in March an agreement to promote blockchain in Hong Kong and the banking industry. Easysight Supply Chain Management Co. has lost 18 percent since saying in April it will work with IBM to use blockchain. Compare that with the U.S., where companies making everything from juice to sports bras have seen their shares surge after announcing cryptocurrency ventures.

• Asia Stocks Extend Strong 2018 Start; Dollar Slips. Asian stocks are on the cusp of their best week in almost six months as investors around the world pile into equities at the start of 2018 amid robust economic data from the U.S. to Europe to China. Benchmark indexes in Tokyo and Sydney are in the green after U.S. shares surged to fresh records Thursday. The dollar is headed for a fourth straight week of losses as the global economic expansion spurs investors to look at markets with lower valuations and better risk-return prospects. Commodities steadied after a record run of gains, with oil trading close to its highest in three years. Japan’s Topix Index rose 0.6 percent as of 9:06 a.m. in Tokyo, and the Nikkei 225 Stock Average was up 0.5 percent. Futures on the S&P 500 Index were little changed after the underlying gauge gained 0.4 percent Thursday to a record close. Futures on Hong Kong’s Hang Seng Index rallied 0.4 percent. Australia’s S&P/ASX 200 Index gained 0.6 percent.

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

• Warren Buffett Says Years of U.S. Growth ‘Certainly Lie Ahead’. Billionaire Warren Buffett remains optimistic about the U.S. economy and the nation's prospects for the future. Buffett wrote an essay for Time magazine that appeared online Thursday, part of an issue edited by Bill Gates that was dedicated to "The Optimists." In his essay, Buffett explained why he often says that most American children will live better than their parents. Buffett said that even if the economy continues to grow at a modest pace of about 2 percent a year, the next generation of Americans will fare better because the economy will still grow faster than the U.S. population does. Buffett said American businesses will also continue to innovate. "This game of economic miracles is in its early innings. Americans will benefit from far more and better 'stuff' in the future," Buffett wrote.

• Peter Thiel Is Reportedly Exploring Launching Conservative News Outlet.

• Apple(AAPL) Says All Macs, iPhones and iPads Exposed to Chip Security Flaws.

Wall Street Journal:

• As Dow Tops 25000, Individual Investors Sit It Out. Since 2012, $1 trillion has been pulled from retail-investor mutual funds that target U.S. stocks.

• Make Iran Great Again. Like Barack Obama, Iran’s leaders don’t know how a real economy works.

• Trump Administration Proposes Massive Expansion of Oil Drilling. Plan would open 90% of offshore areas for drilling starting in 2019.

• Weinstein Co. Close to Sale for Less Than $500 Million. Bidders include private investors, entertainment companies, investment firms.

• Blizzard Conditions Slam East Coast. Snow fell along the Mid-Atlantic coast, closing schools, workplaces and airports and making roads treacherous.

• NFL Ratings Fall at Faster Pace. Average audience for a game fell 9.7% to 14.9 million, but league says NFL programming still accounted for 33 of top 50 programs on TV in 2017.

MarketWatch.com:

• 10 favorite stocks for 2018 from top-ranked stock newsletter writers.

• New tax laws will boost stock markets, Wells Fargo(WFC) says.

• SEC, CFTC warn of risk of virtual currencies and initial coin offerings.

Fox News:

• DOJ deal gives Nunes access to 'all' documents, witnesses sought in Russia probe, letter says. (video)

CNBC: 

• Dow closes above 25,000 for the first time after strong jobs data. (video)

• Stocks making the biggest moves after hours: SHLD, SONC & more.

• Stunning images of the 'bomb cyclone'. (pic)

• Investor who called last two major market crashes says bitcoin is a bubble.

• Trump aims to open nearly all federal waters to offshore drilling in biggest lease sale ever. (video)

• David Tepper says market is as 'cheap’ as a year ago, bullish on Trump’s tax cuts. (video)

• Former Walmart.com CEO says Walmart store closures are a good sign for e-commerce. (video)

Zero Hedge:

• Global Commodities Surge To Longest Win Streak In History. (graph)

• Republican Senator Releases Full Unedited Comey Memo Showing Clinton "Grossly Negligent".

• The Debt Beneath.

• These Are The 103 Stores That Sears Announced It Will Be Closing.

• Homeland Security Data Breach Exposed Over 240,000 DHS Employees In "Unauthorized Exfiltration".

• Pot Stocks Tumble After Jeff Sessions Rescinds Policies Allowing States To Legalize Pot.

• Tesla(TSLA) Bonds Tumble - Now 'Riskier' Than Indonesia.

• Dow Tops 25k As Gold Surges To All-Time Record Win Streak. (graph)

Business Insider:

• Top conservative megadonor cuts ties with Bannon as pressure grows to oust him from Breitbart News.

• Apple(AAPL) just shared some staggering statistics about how well the App Store is doing.

• JetBlue(JBLU) is giving all of its crew members a $1,000 bonus.

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 64.75 -1.0 basis point. 

• Asia Pacific Sovereign CDS Index 12.0 -.75 basis point.

• Bloomberg Emerging Markets Currency Index 75.21 +.03%.

• S&P 500 futures +.06%.

• NASDAQ 100 futures +.06%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (AZZ)/.58

• (CALM)/.70

• (STZ)/1.89

Economic Releases

8:30 am EST

• Change in Non-Farm Payrolls for December is estimated to fall to 190K versus 228K in November.

• The Unemployment Rate for December is estimated at 4.1% versus 4.1% in November.

• Average Hourly Earnings MoM for December are estimated to rise +.3% versus a +.2% gain in November.

• The Trade Deficit for November is estimated at -$50.0B versus -$48.7B in October.

10:00 am EST

• ISM Non-Manufacturing for December is estimated to rise to 57.5 versus 57.4 in November. 

• Factory Orders for November are estimated to rise +1.1% versus a -.1% decline in October.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Mester speaking, Fed's Harker speaking and the Eurozone Retail Sales/CPI reports could also impact trading today.

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