Wednesday Watch

Evening Headlines

Bloomberg:

• Stocks Sell-Off to Reach Asia on Hawkish Powell. Futures on equity indexes in Japan and Hong Kong dropped, and Australian equities opened weaker after the S&P 500 Index slipped 1.3 percent. Ten-year Treasury yields climbed back up to 2.90 percent. China’s manufacturing PMI data for February will be a closely watched piece of data due out Wednesday, as investors move on from Powell’s perceived hawkishness. Futures on Japan’s Nikkei 225 Stock Average slid 1 percent. Australia’s S&P/ASX 200 Index fell 0.3 percent. Futures on Hong Kong’s Hang Seng Index declined 1 percent. S&P 500 futures contracts were up 0.1 percent as of 8:13 a.m. in Tokyo.

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

• China to Crack Down on Cryptocurrency Trading Loophole. (video) China is opening a new front in its battle against cryptocurrencies, targeting platforms that allow the nation’s investors to trade digital assets on overseas exchanges, people familiar with the matter said.

Wall Street Journal:

• Trump Aide Kushner Loses Top-Secret Security Clearance. Jared Kushner, president’s son-in-law, had his security clearance downgraded as part of White House chief of staff John Kelly’s push to tighten control of classified information.

• Why ‘Deaths of Despair’ May Be a Warning Sign for America - Moving Upstream. Two Princeton economists share their provocative theory in this episode of Moving Upstream.

• U.N. Report Links North Korea to Syrian Chemical Weapons. Syrian conflict proves to be a boon for North Korea, undercutting U.S. pressure campaign.

MarketWatch.com:

• 4 financial-market takeaways from Fed chief Jerome Powell’s debut.

• Young single Americans are tired, confused and scared about dating during #Metoo.

Fox News:

• Supreme Court rules that detained immigrants don't get automatic bond hearings. (video)

CNBC:

• Why March could be a better month for stocks, but there is a warning.

• Amazon(AMZN) buys smart doorbell maker Ring for a reported $1 billion. (video)

• Chinese manufacturing expanded less than expected in February.

• Stocks making the biggest moves after hours: Etsy, e.l.f. Beauty, Express Scripts, Celgene & more.

• Stocks making the biggest moves after hours: Etsy, e.l.f. Beauty, Express Scripts, Celgene & more.

• Papa John's(PZZA) will no longer be the official pizza of the NFL.

• Bill Gates: Cryptocurrency is ‘super risky’ over the long-term.

Zero Hedge:  

• News Agencies Sue For External Parkland Massacre Video Footage, Ignore Internal Inconsistencies. 

• Japanese, Chinese Data Disaster Crushes 'Global Synchronous Recovery' Narrative. (graph)

• Just Put The Avocado-Toast Down! - Millennials "Will Be The Fattest Generation On Record".

• Libor-OIS Blows Out As Libor Rises Above 2% For The First Time In 10 Years. (graph)

• Foreign Officials Discussed How To Manipulate "Naive" Jared Kushner.

• WTI/RBOB Extend Losses After Crude Inventory Build. (graph)

• 'Hawkish' Powell Sinks Stocks & Bonds As VIX Curve Re-Inverts. (graph)

Night Trading 

• Asian equity indices are -1.0% to -.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 68.0 +1.25 basis points. 

• Asia Pacific Sovereign CDS Index 12.75 unch.

• Bloomberg Emerging Markets Currency Index 75.36 -.06%.

• FTSE 100 futures -.46%.

• S&P 500 futures +.05%.

• NASDAQ 100 futures +.06%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (ADI)/1.28

• (CHS)/.09

• (FSS)/.20

• (LOW)/.87

• (ODP)/.07

• (RDC)/-.30

• (SSYS)/.15

• (TJX)/1.27

• (VRX)/.96

• (DDD)/.02

• (CTRP)/.16

• (ITRI)/.93

• (LB)/2.05

• (MNST)/.37

• (MYL)/1.41

• (CRM)/.34

• (UHS)/1.83

Economic Releases
8:30 am EST

• 4Q Personal Consumption is estimated to fall to +3.6% versus a prior estimate of a +3.8% gain.

• 4Q GDP Annualized QoQ is estimated to rise +2.5% versus a prior estimate of a +2.6% gain.

• 4Q GDP Price Index is estimated at +2.4% versus a prior estimate of +2.4%.

• 4Q Core PCE QoQ is estimated to rise +1.9% versus a prior estimate of a +1.9% gain.
  

9:45 am EST

• The Chicago Purchasing Manager for February is estimated to fall to 64.0 versus 65.7 in January.
  

10:00 am EST

• Pending Home Sales MoM for January is estimated to rise +.5% versus a +.5% gain in December.
  

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory gain of +2,232,900 barrels versus a -1,616,000 barrel decline the prior week. Gasoline supplies are estimated to rise by +346,600 barrels versus a +261,000 barrel gain the prior week. Distillate inventories are estimated to fall by -979,200 barrels versus a -2,422,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to fall by -.27% versus a -1.7% decline prior.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed Chair Powell's testimony to House, China Manufacturing/Non-Manufacturing PMI reports, Eurozone CPI report, weekly MBA Mortgage Applications report, BofA Merrill Ag/Chemicals conference, (HON) investor conference, Piper Energy Conference, Citi Asset Managers/Broker Dealer/Exchanges Conference, BofA Merrill Power/Gas/Solar Conference and the Wells Fargo Real Estate conference could also impact trading today.

BOTTOM LINE:  Asian indices are lower, weighed down by industrial and commodity shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly modestly lower.  The Portfolio is 50% net long heading into the day.