Thursday Watch

Evening Headlines

Bloomberg:      

• Saudi Crown Prince Vows Khashoggi Justice in Defiant Speech.  

• China's Squeezed Private Companies Face More Funding Pain.  

• South Korea’s Economy Grows More Slowly Than Expected.

• Stocks Rout Hits Asia After U.S. Slide, Yen Gains. An equities rout that wiped out this year’s gains for U.S. stocks spread to Asia Thursday as concerns mount that corporate profits and economic growth are peaking amid rising borrowing costs. The yen climbed on demand for haven assets, while Treasuries and the dollar held gains. Stock gauges in Japan and South Korea lost more than 2 percent, and futures sank in Asian markets yet to open, threatening to push the MSCI Asia Pacific Index deeper into a bear market. The S&P 500 Index erased this year’s gains following mixed earnings reports from companies such as AT&T and Texas Instruments. The benchmark extended its October rout to almost 9 percent, making it the worst month since February 2009, while the Nasdaq Composite Index fell into a correction. “The fear is palpable in stock markets at the moment,” Greg McKenna, a markets strategist at McKenna Macro, wrote in a note Thursday. “When folks are struggling to explain the driver of a move that means an obvious circuit breaker is also not in evidence. So this could get much worse before it gets better. Collapses happen after falls. That’s the danger.” Japan’s Topix index tumbled 2.9 percent and the Nikkei 225 Stock Average slumped 3.3 percent as of 9:20 a.m. in Tokyo. Australia’s S&P/ASX 200 Index fell 1.9 percent. South Korea’s Kospi index slid 2.2 percent. FTSE China A50 contracts lost 1.4 percent. Hong Kong Hang Seng Index futures lost 0.3 percent. S&P 500 futures rose 0.1 percent.  

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

• Trump's Fed Jabs, Global Labor Supply, Canada Tightens: Eco Day.

• With Stock Market in Free-Fall, Earnings Mean Almost Nothing.  

• Optimistic Analyst Calls Are Not Stopping Bank Stocks From Bleeding.

Wall St. Journal:

• Dow, S&P 500 Turn Negative for the Year; Nasdaq Drops 4.4%.

• The October Surprise Arrives.

• The $10 Billion Tussle Over Walmart’s Credit Cards.

• Saudi Crown Prince Pledges Justice for Journalist’s Death.

• New York Sues Exxon Over Climate-Change Disclosures.

• Defense Firms Gear Up for Price Clash.

• Apple(AAPL) CEO Condemns ‘Data-Industrial Complex’.

• ‘If God Allows It’: Migrants in Caravans Press Towards U.S.

MarketWatch.com:

• Yeti prices IPO at $18: 5 things you should know about the premium cooler company.

• China will do ‘whatever it takes’ to stop its falling stock market.

• Ed Yardeni: The Fed could be wrong about inflation and rate hikes.

Fox News: 

• WATCH LIVE: Trump calls on Americans -- including media -- to cut down on political tension at rally.

• FBI reveals info on 5 'suspicious packages' sent to Dems.

Miami Herald: 

• Some call possible explosives sent to Obama, Clinton, CNN a ‘false flag.’ What is that?

CNBC:        

• Tech stocks recover after hours on positive earnings from Tesla and Microsoft.

• Dow futures point to more than 100-point rebound Thursday after plunging 600 points.

• Trump and the Fed are creating 'a totally destructive tug of war' in the stock market, Cramer warns.

• AMD plummets after missing on revenue, giving weak fourth-quarter guidance.  

• The FDA just approved the first new flu treatment in nearly 20 years.

• Stocks making the biggest moves after hours: Tesla, AMD, Ford and more.

• Kevin O'Leary likes this 'garden variety' stock market correction and is adding to positions.

• Chip stocks suffer their biggest drop in nearly 10 years.

• Microsoft(MSFT) rises on earnings beat, but Azure growth slows. 

• Ford(F) shares jump after strong truck sales help third-quarter results beat expectations.

Zero Hedge: 

• Markets In Turmoil: S&P, Dow Erase 2018 Gains As Nasdaq Crashes Most Since 2011.

• China And Russia Eavesdrop On Calls Made From Trump's Personal iPhone: NYT.

• More Than Half A Million People: America's Homelessness Crisis Is Rapidly Exploding On Both Coasts.

• Orwellian Surveillance: Amazon Pitched US Gov't On Facial Recognition Cameras To Track Immigrants.

• America's Social Depression Is Accelerating.

• In Major Concession, Trump Will Allow Iran To Remain Connected To SWIFT.

• Cocaine Deaths Hit Record High; Next Wave Of Addiction Crisis Is Here.

• "Trouble In Arkansas": This Cycle's Countrywide Financial Just Imploded.

• Tesla(TSLA) Soars On "Historic" Results: Revenue, Earnings, Free Cash Flow Soar.

• Eight Reasons A Financial Crisis Is Coming.

• Over Half Of America Gets More In Welfare Than It Pays In Taxes.

• Former Fed Chair Slams Fed's "Dangerous, False Precision" Over 2% Inflation Target.

• Trump Vows To "Get To The Bottom" Of "Egregious" Pipe Bombs.

Telegraph: 

• Comment: The EU's unstoppable showdown with Italy risks a market crash and a euro break-up.

• Eurozone growth slumps as global slowdown fears deepen.

Night Trading 

• Asian equity indices are -2.5% to -1.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 91.75 +2.25 basis points. 

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

• Bloomberg Emerging Markets Currency Index 66.48 -.02%.

• FTSE 100 futures -.73%.

• S&P 500 futures +.24%.

• NASDAQ 100 futures +.49%.

Morning Preview Links

Earnings of Note
Company/Estimate
Before the Open:

• (AAN)/.76

• (ALK)/1.81

• (MO)/1.06

• (AAL)/1.13

• (BUD)/1.02

• (BWA)/.99

• (BMY)/.91

• (CELG)/2.23

• (CME)/1.43

• (CMC)/.43

• (COP)/1.19

• (DNKN)/.73

• (GPI)/2.33

• (HSY)/1.55

• (IP)/1.48

• (LEA)/4.01

• (MCK)/3.29

• (MRK)/1.14

• (NEM)/.19

• (ODFL)/1.96

• (PTEN)/-.12

• (PX)/1.70

• (RTN)/1.97

• (RCL)/3.96

• (SHW)/5.75

• (LUV)/1.08

• (SWK)/2.03

• (TSCO)/.87

• (TWTR)/.14

• (VLO)/1.97

After the Close:

• (AKS)/.23

• (GOOG)/10.69

• (AMZN)/3.09

• (BYD)/.26

• (CERN)/.63

• (CMG)/2.02

• (CY)/.38

• (DECK)/1.70

• (EXPE)/3.15

• (FSLR)/.40

• (GILD)/1.63

• (INTC)/1.15

• (MAT)/.22

• (MHK)/3.58

• (SYK)/1.68

• (WDC)/3.03

Economic Releases

8:30 am EST

• Advance Goods Trade Balance for September is estimated at -$75.1B versus -$75.5B in August.

• Wholesale Inventories MoM for September is estimated to rise +.5% versus a +1.0% gain in August.

• Retail Inventories MoM for September.

• Durable Goods Orders for September is estimated to fall -1.5% versu sa +4.4% gain in August.

• Durables Ex Transports for September is estimated to rise +.4% versus unch. in August.

• Cap Goods Orders Non-Defense Ex-Air for September is estimated to rise +.5% versus a -.9% decline in August.  

• Initial Jobless Claims for last week are estimated to rise to 215K versus 210K the prior week.

• Continuing Claims are estimated to rise to 1644K versus 1640K prior.

10:00 am EST

• Pending Home Sales MoM for September is estimated unch. versus a -1.8% decline in August.

11:00 am EST

• The Kansas City Fed Manufacturing Activity Index for October is estimated to rise to 14.0 versus 13.0 in September.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Mester speaking, ECB rate decision, ECB press conference, Germany IFO Business Climate Index, BTIG Biotech Healthcare Conference and the (ORCL) financial analyst meeting could also impact trading today.

BOTTOM LINE:  Asian indices are are sharply lower, weighed down by technology and industrial shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed.  The Portfolio is 25% net long heading into the day.