Friday Watch

Evening Headlines

Bloomberg:       

• U.S. Treasury Staff Finds China Isn’t Manipulating Yuan.  

• Singapore Tightens Monetary Policy Amid Steady Growth Outlook.

• Australia’s Central Bank Warns of Heightened Trade-War Risk to Economy.

• Asia Stocks Start Friday Mixed, U.S. Futures Rise. Asian equity markets looked set for a mixed end to the worst week since February, with some signs that China and Hong Kong could steady after the recent slump. In another indication that sentiment might be shifting, U.S. stock futures rose. While stocks in Japan and Australia added to this week’s losses, South Korean equities rose and futures signaled gains for China, after the Shanghai Composite slumped to a four-year low. Futures on the S&P 500 Index were up 0.5 percent after the benchmark on Thursday dropped more than 2 percent. Tech shares, which bore the brunt of the selling Wednesday, fared less badly. The offshore yuan traded stronger than 6.9 per dollar. Treasuries were little changed. Singapore’s dollar was steady after the central bank tightened its stance, as anticipated by many, in its policy decision Friday. Japan’s Topix index fell 0.4 percent, bringing this week’s slide to 5.5 percent. Futures on the FTSE China A50 Index rose 0.6 percent. Futures on Hong Kong’s Hang Seng Index advanced 1.1 percent earlier. Australia’s S&P/ASX 200 Index lost 0.3 percent. South Korea’s Kospi index gained 0.7 percent. The S&P 500 fell 2.1 percent Thursday. Futures were up 0.5 percent.

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

• Sell Orders in Stocks Surge to Highest Level Since ‘Flash Crash’.  

• Junk-Bond Buyers Head for Hills, Pulling $4.9 Billion From Funds.

Wall St. Journal: 

• The Price of BernieCare.

• Big Lenders Push to Liquidate Sears Rather Than Save It.

• Turkey Is Expected to Release American Pastor on Friday.

• Saudi Journalist’s Disappearance Sends Chill Into Business Community.

• U.S. Strengthens Controls on Nuclear Tech Exports to China.

MarketWatch.com:

• Trump’s ex-lawyer Michael Cohen now reportedly a Democrat.

• Blackstone’s Byron Wien says S&P 500 on track for year-end rally to 3,000 despite stock-market wreckage. 

• Why U.S. investors should be buying this stock market pullback ‘with both arms’.

Fox News: 

• Herschel Walker calls for CNN to fire Don Lemon over ‘racist’ Kanye criticism.

• CHRIS SCALIA: What my father would've thought about Kavanaugh confirmation.

CNBC:        

• White House no longer considering Dina Powell for UN ambassador.

• Early trading in Dow futures indicate 200-point surge as stocks try to rebound from this week's rout.

• Oil prices shed more than 5% during two-day stock market sell-off.

• Rising prices and interest rates are a 'one-two punch' to homebuyers, Lennar chairman says.

• Secular trends haven't changed overnight, so don't fear tech stocks, portfolio manager says.

• After-hours buzz: SQ, URBN & more.

• Bitcoin is the 'mother of all scams' and blockchain is most hyped tech ever, Roubini tells Congress.

• Stocks are getting caught up in 'Octoberphobia' but could see a turnaround.

Zero Hedge: 

• "I Have No Words": Aerial Footage Shows Trail Of Devastation Left By Hurricane Michael.

• Facebook Purges Over 800 Accounts With Millions Of Followers; Prominent Conservatives Vanish.

• Stocks Rip Higher On WaPo Report Trump, Xi Agree To Meet At G-20.

• ECB Hands Italy An Ultimatum: 'Obey EU Budget Rules Or We Won't Save You'.

• What Do The Worst-Run States Have In Common?

• "This Week Will Be Bad" - Margin Calls Mean More Pain To Come.

• Treasury Staff Confirm China Is Not A "Currency Manipulator".

• Shocktober Day 2: Stock Rout Accelerates As Bonds, Bullion Surge.

Business Insider:

• Trump is reportedly floating 5 different names to replace Attorney General Jeff Sessions, who he expects to resign before the end of this year.

• 15 photos show Hurricane Michael's destruction from the sky.

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 87.25 +.5 basis point. 

• Asia Pacific Sovereign CDS Index 10.25 +.25 basis point.

• Bloomberg Emerging Markets Currency Index 66.56 +.12%.

• FTSE 100 futures +.02%.

• S&P 500 futures +.56%.

• NASDAQ 100 futures +.67%.

Morning Preview Links

Earnings of Note
Company/Estimate
Before the Open:

• (C)/1.67

• (JPM)/2.26

• (PNC)/2.72

• (WFC)/1.17

After the Close:

• None of note

Economic Releases

8:30 am EST

• The Import Price Index MoM for September is estimated to rise +.2% versus a -.6% decline in August.

• The Import Price Index ex Petroleum MoM for September is estimated to fall -.1% versus a -.2% decline in August.

• The Export Price Index MoM for September is estimated to rise +.2% versus a -.1% decline in August.
  

10:00 am EST

• Preliminary Univ. of Mich. Consumer Sentiment for October is estimated to rise to 100.5 versus 100.1 in September.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Bostic speaking, Fed's Evans speaking, Eurozone Industrial Production report and the China Trade Balance report could also impact trading today.

BOTTOM LINE:  Asian indices are mostly higher, boosted by technology and consumer shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher.  The Portfolio is 50% net long heading into the day.