Wednesday Watch

Evening Headlines

Bloomberg:        

• China Says It’s Open to U.S. Talks, But Not With a Knife at Its Throat.  

• China Unlikely to Follow Fed Rate Hike as Economy Slows: Survey.  

• MSCI Considers Boosting China A-Share Weighting, Adding ChiNext.

• Trump Attacks Iranian Leaders and Defends Exit From Nuclear Deal.  

• Asia Stocks Set for Mixed Open; Treasuries Fall. Asian futures pointed to a mixed session Wednesday, with Japan on track to continue a rally that lifted the Topix index to an almost eight-month high and Chinese stocks set to remain subdued. U.S. Treasuries fell as the Federal Reserve started its two-day policy meeting. Australian contracts ticked higher with Hong Kong futures little changed as traders return from a holiday. U.S. stocks were mixed as oil drillers rallied with crude while industrial shares lagged. President Donald Trump told the United Nations that the trade deficit with China “is just not acceptable,” stoking fears of greater trade tensions. Benchmark Treasury yields touched 3.1 percent and the dollar weakened slightly. Brent oil climbed to a four-year high. Futures on the Nikkei 225 Stock Average rose 0.4 percent in Singapore. Futures on Australia’s S&P/ASX 200 Index rose 0.1 percent. Futures on Hong Kong’s Hang Seng Index were little changed. FTSE China A50 futures rose 0.1 percent.

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

• Nike(NKE) Gross Margins Disappoint for Quarter Before Kaepernick Controversy.

Wall St. Journal:

• #MeToo Becomes a Political Ploy.

• Trump Considers Retaining Rosenstein, Advisers Say.

• Shoppers Love Rewards Credit Cards. Retailers Hate Them.

• Trump Blasts Democrats Over Kavanaugh Turmoil.

• U.S. Consumer Confidence Hits 18-Year High.

• Trade Deal Could Move Ahead Without Canada, U.S. Official Says.

• Twitter Proposes Banning Dehumanizing Content.

MarketWatch.com:

• Square(SQ) stock posts best day in 19 months after company is likened to the FANGs.

• Here’s how the Fed’s statement, dot plot and forecast may shift.

• Why stock investors shouldn’t fear rising interest rates, in one chart.

Fox News:

• Feinstein can’t guarantee Kavanaugh accuser shows, as Ford bristles over role of woman attorney.

CNBC:   

• Fed expected to raise interest rates and signal more hikes are coming.

• Amazon makes first investment in a homebuilder, backing start-up focused on prefabricated houses.

• After-hours buzz: NKE, CTAS & more. 

• Nike(NKE) CEO Mark Parker says he's 'very proud' of the Kaepernick ad campaign.

• Salesforce(CRM) co-CEO Marc Benioff: The economy is 'ripping'.

• Trump tells world leaders: 'We will no longer tolerate abuse' on trade.

• SurveyMonkey prices above range at $12 per share. 

• Facebook(FB) has a talent drain problem, says Yale's Jeffrey Sonnenfeld.

Zero Hedge:

• "I Don't Give A Shit If It's A Crime": Fourth Veritas Video Reveals IRS Still Targeting Conservatives.

• Grassley Schedules Kavanaugh Vote For Friday Morning. 

• Iran Truck Drivers Go On Strike, Crippling Oil Infrastructure.

• Sweden Manhunt Underway After Car Accelerates Into 'Crowd Of 100 Children And Teachers'.

• Nike(NKE) Tumbles After Missing On Gross Margins; China, Latin America Sales.

• WTI Drops After Surprise Crude, Gasoline Build.

• Dow Drops, Silver Pops, & Bond-Sellers Stop.

Business Insider:

• 'I'm confident we're going to win': Republicans are now bullish about confirming Brett Kavanaugh very soon.

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 83.0 +.5 basis point. 

• Asia Pacific Sovereign CDS Index 9.75 +.25 basis point.

• Bloomberg Emerging Markets Currency Index 66.60 +.02%.

• FTSE 100 futures -.21%.

• S&P 500 futures +.09%.

• NASDAQ 100 futures +.14%.

Morning Preview Links

Earnings of Note
Company/Estimate
Before the Open:

• (ATU)/.35

• (KMX)/1.23

• (WOR)/1.02

After the Close:

• (BBBY)/.51

• (CMTL)/.26

• (FUL)/.90

Economic Releases

10:00 am EST

• New Home Sales for August are estimated to rise to 630K versus 627K in July.

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory decline of -1,125,770 barrels versus a -2,057,000 barrel decline the prior week. Gasoline supplies are estimated to rise by +405,500 barrels versus a -1,719,000 barrel decline the prior week. Distillate inventories are estimated to rise by +268,000 barrels versus a +839,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to fall by -.65% versus a -2.2% decline prior.
  

2:00 pm EST

• The FOMC is expected to raise the benchmark Fed Funds Rate 25.0 basis points to 2.0-2.25%.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The FOMC Press Conference, Japan Machine Orders report, tech companies testifying to Senate Commerce Committtee, weekly MBA Mortgage Applications report, (F) investor meeting, (CRM) investor day, CIBC Institutional Investor Conference,  could also impact trading today.

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