Friday Watch

Evening Headlines

Bloomberg:           

• Draghi Is Pressing Ahead With Rate Hike in 2019 Despite Risks.   

• The Australian Dollar Is Acting Like an Emerging-Market Currency.

• Asia Stocks End Torrid Week With Drop; Yen Gains. Asian stocks are ending the worst week since March with further declines amid ongoing concerns about global trade and emerging markets. The yen rose and Treasuries held onto gains. Equities fell in Japan, Australia and South Korea, while futures in China and Hong Kong pointed to losses. Weakness in technology shares weighed on U.S. markets amid concern about the durability of chip demand, and the VIX index headed for its biggest weekly increase in two months. Emerging-market stocks and currencies steadied after further losses overnight. The yen strengthened after the Wall Street Journal reported President Donald Trump may turn his sights on trade with Japan. Japan’s Topix index slid 0.5 percent as of 9:02 a.m. in Tokyo. South Korea’s Kospi index lost 0.4 percent. Australia’s S&P/ASX 200 index slipped 0.2 percent. Futures on Hong Kong’s Hang Seng index lost 0.6 percent. FTSE China A50 index futures declined 0.1 percent.  

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

• What Happened This Week in the World Economy and What It Means.

Wall Street Journal:

• Senior White House Officials Scramble to Deny Writing Op-Ed.

• Gen Z Is Coming to Your Office. Get Ready to Adapt.

• CBS Directors Negotiating Exit of Chief Executive Moonves.

• Emerging-Market Stocks Enter Bear Territory.

• Justice Department Probing Wells Fargo’s Wholesale Banking Unit.

• Colleges That Give You the Best Value in WSJ/THE Rankings.

• Kavanaugh Deflects Questions on Abortion, Campaign Finance and Presidential Powers.

• Broadcom(AVGO) Profit Surges as Enterprise Storage Business Grows.

MarketWatch.com:

• Why Trump turmoil still isn’t rattling stock-market investors.

• Look beyond Nike to these seven sporty stocks.

Fox News:

• Dems press Kavanaugh over old emails as Booker drops new ‘confidential’ files.

CNBC: 

• House GOP's second phase of tax reform aims to make individual cuts permanent.

• Retirement and 529 education accounts would be expanded under GOP tax plan '2.0'.

• Third Point reportedly wants to replace Campbell Soup's entire board.

• The 'deep web' may be 500 times bigger than the normal web. Its uses go well beyond buying drugs.

• Short seller Andrew Left sues Tesla and Elon Musk, claiming stock manipulation.

• A decade after housing crash, Fannie Mae and Freddie Mac are Uncle Sam's cash cows.

• If you bought at the top of the crypto bubble, here's how much you've lost.

• After-hours buzz: FIVE, GME & more.

Zero Hedge:

• Twitter(TWTR) Permanently Bans Alex Jones, Infowars.

• Secret Grand Jury Proceedings Underway Against Andrew McCabe; Witnesses Summoned.

• Federal Employees Have Higher Pay, More Job Security Than Private Sector.

• 1 In 4 Facebook(FB) Users Delete Facebook App As Millennial Exodus Continues.

• Social Justice Books Your Kids Are Reading For College.

• Brazil's "Donald Trump" Presidential Candidate Stabbed At Campaign Event.

• CDC Investigating After Multiple Passengers Fall Ill At Philadelphia Airport.

• USDJPY Tumbles After Trump Hints At Japan Trade War Next.

• Dorsey Admits Twitter(TWTR) "Unfairly" Shadowbanned 600,000 Accounts.

• Stocks Sink As FANG Suffers Longest Losing Streak In 7 Months. 

Business Insider:

• Apple(AAPL) is building a special portal for law enforcement officials to get user data — here's Apple's letter describing the plan.

• A trusty recession signal is telling the Fed 'we're about where we need to be' on interest rates.

• Okta(OKTA), the company that helps employees log in to their corporate apps, soars 16% on major earnings and revenue beat.

Fast Company:

• Survey says Nike’s(NKE) brand image has dropped because of Colin Kaepernick ad. Morning Consult reports that Nike’s brand favorability and consumer purchase consideration have significantly sunk, but Nike is playing a long game. According to the survey, before the Kaepernick announcement, Nike had a net +69 favorable impression among consumers. That has now dropped by 34 points to +35 favorable. Before the ad, 49% of Americans said they were absolutely certain or very likely to buy Nike products, and that figure is down to 39% now. Another key point of the survey is that brand favorability didn’t only drop for folks you might expect to be red hat-sporting members of the MAGA brigade, but also among millennials, Gen Z, and African-Americans.

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 82.5 -1.0 basis point. 

• Asia Pacific Sovereign CDS Index 12.75 -.25 basis point

• Bloomberg Emerging Markets Currency Index 65.14 -.07%.

• FTSE 100 futures +.03%.

• S&P 500 futures -.21%.

• NASDAQ 100 futures -.31%.

Morning Preview Links

Earnings of Note
Company/Estimate
Before the Open:

• (GCO)/-.03

After the Close:

• None of note

Economic Releases

8:30 am EST

• The Change in Non-Farm Payrolls for August is estimated at 195K versus 157K in July.

• The Unemployment Rate for August is estimated to fall to 3.8% versus 3.9% in July.

• Average Hourly Earnings MoM for August is estimated to rise +.2% versus a +.3% gain in July.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Mester speaking, Fed's Rosengren speaking, Eurozone GDP report, China Foreign Reserves report, Goldman Biotech Symposium, (QSII) Analyst Day and the (MDLZ) Investor Day could also impact trading today.

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