Friday Watch

Evening Headlines

Bloomberg:   

• Trump-Xi Dinner Offers Chance to Avert Deeper U.S.-China Rift.    

• Japan’s Factory Output Surges in Sign of Rebound in Economy.

• Deutsche Bank Raid Pulls CEO Deeper Into Vicious Circle.

• Asia Stocks Signal Mixed Trading Before G-20 Meets. Asian stocks looked set to round out the month in mixed fashion as investors await a crucial meeting between the U.S. and Chinese presidents with the course of the trade war at stake. Treasuries rose and the dollar declined overnight, when U.S. equities dipped. Futures indicated a higher start for shares in Tokyo, Hong Kong and Shanghai, though a late-in-the-day fizzling of the S&P 500’s rally and a dip in U.S. equity futures may restrain sentiment. Australian shares slipped. Doubts remain about prospects for Presidents Donald Trump and Xi Jinping to agree to a thaw in bilateral relations. Tech stocks dropped in the U.S., as did banks, as the 10-year Treasury yield held near its lowest since September. Minutes from the Federal Reserve’s November policy meeting showed the central bank preparing for a more flexible path in 2019. Australia’s S&P/ASX 200 Index fell 0.6 percent. Futures on Japan’s Nikkei 225 rose 0.4 percent in Singapore. FTSE China A50 Index futures added 0.5 percent. Futures on Hong Kong’s Hang Seng added 0.4 percent. Futures on the S&P 500 Index dropped 0.1 percent after the underlying gauge closed down 0.2 percent on Thursday.

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

• Flexible Fed, Trump Trade Hint, GM's Lessons for Powell: Eco Day.

• Powell Positions Federal Reserve for Pause: World Economy This Week.

Wall St. Journal:

• U.S. and China Exploring Deal to Ease Trade Tensions.

• NYC’s Richest Cut Losses as Manhattan Real Estate Falters.

• Consumers Step Up Spending to Start Fourth Quarter.

• Fed Minutes Signal Likely December Rate Increase, Less Certain 2019 Path.

MarketWatch.com:

• Hunker down, crypto owners, the worst is yet to come: Fred Wilson.

• Did Fed’s Powell ‘light the fuse’ for a year-end stock-market rally?

• Simon Maierhofer: Crowd psychology supports a year-end rally in stocks.

• The alarming chart that shows what’s killing Americans more than guns or AIDS ever did.

Fox News: 

• Judge Nap: Cohen plea is 'tip of the iceberg,' rest of iceberg at Mueller office.

CNBC:          

• Fed points to December rate hike but is worried about tariffs and debt.

• Trump has 'silent' support of world leaders to strike 'hard bargain' with China: Ex-NATO ambassador.

• Workday(WDAY) shares surge on cloud software company's third-quarter earnings report.

• I come to bury bitcoin, says UBS' global chief economist. (video)

• Stocks making the biggest moves after hours: GameStop, PVH and more.

• Dick Bove: The Fed has caved to President Trump's wishes and that's a game changer.

• Cramer: Fed's Powell made a 'rookie mistake' but is now doing the 'sensible thing' on rates.

Zero Hedge:  

• California Democratic Party Chairman Resigns Over Accusations Of Sexual Harassment.

• Feds Raid Trump's Former Chicago Tax Attorney And City Alderman; Seize Documents, Computers.

• Hillary Clinton Confirms Conservatives Were Right On Mass Migration.

• Gas Prices Slide To Lowest Since March As Shale Production Soars.

• Comey Fights Subpoena From House GOP; Asks Judge To Toss.

• Amid Social Unrest, China Set To Purge $176 Billion P2P Loan Market.

• SEC Charges Floyd Mayweather, DJ Khaled With Illegally Promoting ICOs.

• Trade 'Hopes' & Fed 'Nopes' Send Stocks, Bonds, & Black Gold To Critical Levels.

Telegraph:

• Comment: Academics’ devotion to the socialist dream looks more like self-interest.

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 93.75 -1.0 basis point. 

• Asia Pacific Sovereign CDS Index 10.25 unch.

• Bloomberg Emerging Markets Currency Index 67.54 +.01%.

• FTSE 100 futures +.71%.

• S&P 500 futures -.17%.

• NASDAQ 100 futures -.18%.

Morning Preview Links

Earnings of Note
Company/Estimate
Before the Open:

• (CTRN)/.00

• (SFUN)/.06

After the Close:

• None of note

Economic Releases

9:45 am EST

• The Chicago Purchasing Manager for November is estimated to rise to 58.5 versus 58.4 in October.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Williams speaking, China PMI report and the (MTU) analyst day could also impact trading today.

BOTTOM LINE:  Asian indices are mostly higher, boosted by technology and healthcare shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing mixed.  The Portfolio is 100% net long heading into the day.