Friday Watch

Evening Headlines

Bloomberg:         

• China's Liu Expected to Visit U.S. Soon for Trade Talks, Mnuchin Says.

• Australia’s Housing-Sector Slump Shows Up in Another Sickly Set of Data 

• Asia Stocks Extend Week's Climb; Yuan Adds to Gain. Asian equities climbed Friday and were on course for the strongest week since early November that’s been driven in part by optimism over U.S.-China trade negotiations. The yuan extended its advance, while Treasury yields dipped. Shares in Tokyo rose and futures pointed to a higher start in Hong Kong. The S&P 500 earlier extended its rally since Christmas Eve beyond 10 percent, though gains were limited as retailers sank amid concerns about a sales slowdown. Markets also saw some volatility as Federal Reserve Chairman Jerome Powell said the central bank is sticking with its process of shrinking its balance sheet to a more normal level, while comments from vice chair Richard Clarida suggested caution about moving ahead with interest-rate increases. Japan’s Topix index rose 0.8 percent as of 9:02 a.m. in Tokyo. Australia’s S&P/ASX 200 Index added 0.1 percent. The S&P 500 Index rose 0.5 percent. Hang Seng futures rose 0.8 percent.  

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

• Powell's Patience, Yuan Defies Slowdown, U.S. Inflation: Eco Day.

• Mexico Finance Ministry Completes Oil Hedges at $55 a Barrel.

• JPMorgan to Boost Bonus Pool for Stock Traders, Bankers.

• Google Board Sued for Hushing Misconduct Claims About Rubin.

• The Winners and Losers of Big Oil's Offshore Spending Revival.

Wall St. Journal: 

• Fed Chief Affirms Flexibility on Rates.

• How the U.S. Can Protect Corporate America’s Tech Secrets From China.

• Ford to Slash Jobs, Shut Plants in Major European Revamp.

• Cohen Will Testify Before House Oversight Committee.

• Pentagon Pushes Forward on Syria Pullout.

• Apple’s Pressing Challenge: Build Its Services Business.

• Mortgage Rates Hit Lowest Point in Nine Months.

MarketWatch.com:

• The stock market just got off to its best start in 13 years.

• Fed’s Clarida: At this stage, patience on interest rates ‘is a virtue’.

• Bitcoin tumbles 10% to hit lowest level in nearly 4 weeks.

Fox News:

• Trump highlights human trafficking as he calls for 'strong barrier' in border visit.

• BRETT VELICOVICH: Mainstream media hiding facts about border security.

CNBC:

• Stocks are rallying on days they should drop and that’s a good sign, says Jim Cramer.

• Fed’s No. 2 says US policy would react if ‘crosswinds’ persist.

• Netflix(NFLX) shares rise after hours on upgrade by UBS.

• These are the 25 best-paying jobs in America in 2019.

• Stocks making the biggest moves after hours: Netflix, Activision Blizzard and more.

• Intel(INTC) has the biggest addressable market it’s ever seen, says company’s interim CEO.

Zero Hedge:

• Seattle TV Station Caught Doctoring Trump's Face During National Address.

• Graham Calls On Trump "To Use Emergency Powers" To Build Wall.

• Cars Will Soon Be Monitoring Their Drivers And Selling The Data They Collect.

• Trump Could Use Money Earmarked For Puerto Rico To Build The Wall: Reports.

• Mexico Reinforces Southern Border As New Caravan Prepares For Northbound Exodus.

• Global Earnings Downgrades At Highest Level In 10 Years.  

• "I Can't Say I Know": Fed's Evans Surprised Market Is "Concerned" About Fed's Balance Sheet.

• White House Prepares For Ginsburg Supreme Court Vacancy: Report.

• "Patient" Powell "Substantially" Spooks Stocks But Dip-Buyers Rescue Best Run In A Decade.

Telegraph:

• A no-deal Brexit is off the table, and sterling assets are a screaming buy.

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 89.25 -1.25 basis points. 

• China Sovereign CDS 63.25 -.25 basis point.

• Bloomberg Emerging Markets Currency Index 67.99 -.03%.

• FTSE 100 futures +.34%.

• S&P 500 futures -.08%.

• NASDAQ 100 futures -.08%.

Morning Preview Links

Earnings of Note
Company/Estimate
Before the Open:

• None of note

After the Close:

• None of note

Economic Releases

8:30 am EST

• The CPI MoM for Dec. is estimated to fall -.1% versus unch. in Nov.

• The CPI Ex Food and Energy MoM for Dec. is estimated to rise +.2% versus a +.2% gain in Nov.

• Real Avg. Weekly Earnings YoY for Dec. are estimated to rise +1.2% versus a +.5% gain in Nov.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The UK Industrial Production report and the Bloomberg US Economic Survey for Jan. could also impact trading today.

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