Thursday Watch

Evening Headlines

Bloomberg:

• Hong Kong Cuts Base Rate After Fed as City Slides Into Recession.    

• Negative Interest Rate Skepticism Grows at the European Central Bank.

• Samsung Profit Beats as Smartphone Profits Offset Chip Slump.

• Jho Low Gives Up $1 Billion in Assets to Settle 1MDB Suits.   

• Brazil to Extend Rate Cuts With Easing Cycle at Cruising Speed.

• Asia Stocks Trade Mixed; Treasuries Rally Stalls. Stocks in Asia were mixed after the Federal Reserve indicated that it’s unlikely to move in either direction any time soon following its latest interest-rate cut, while corporate results continued to roll in. Gains in Treasuries petered out. Japanese shares opened flat, while equities in Sydney slipped. Seoul saw gains after earnings at Samsung Electronics Co. topped estimates. The S&P 500 earlier edged up to a fresh-all time high when Fed Chairman Jerome Powell said rate hikes won’t occur as long as inflation remains persistently cool. Nasdaq futures rose as Apple Inc. projected sales that beat expectations. The offshore yuan held on to gains, while the yen was steady ahead of the Bank of Japan’s policy decision. Japan’s Topix index was little changed as of 9:06 a.m. in Tokyo. South Korea’s Kospi index added 0.8%. Australia’s S&P/ASX 200 Index slid 0.1%. Futures on the S&P 500 Index were flat. The underlying gauge rose 0.3% on Wednesday.  

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

• Powell Signals Fed Policy on Hold as Economy Eyes Soft Landing.

• Fidelity Fund Slashes Value of Its Juul Stake by Almost 50%. 

• The Drone Wars Are Already Here.  

• Six Strategists on Why Stocks Didn’t Lose It Over Tougher Powell.  

• Lyft Tops Sales Estimates on Rider Growth; Raises Outlook.

Wall Street Journal:

• Protesters Fuel Unrest, Rattling Arab Leaders.

• How China Manages Money American-Style, in 17 Charts.

• The Democrats’ Spooky Politics.

• Fed Cuts Rate for a Third Time This Year, Signals Pause in More Reductions.

• New California Fire Threatens Reagan Library.

• Fiat Chrysler and Peugeot Owner PSA Agree to Merge.

• Bipartisan House Deal Opens Path to Citizenship for Illegal Immigrant Farm Workers.

• The Link Between Diet, Exercise and Alzheimer’s.

Fox News:

• Dramatic video of operation targeting ISIS boss Baghdadi released by Pentagon.

CNBC:

• Apple(AAPL) stock rises on earnings beat.

• Powell aces tricky Fed transition to ending interest rate cuts, doing ’100% the right things’.

• US lawmaker urges White House to quickly finalize plan to pull flavored e-cigarettes off the market.

• When Fed cuts interest rate three times and pauses, it’s great for stocks, history shows.

• Stocks making the biggest moves after hours: Apple, Facebook, Lyft and more.

Zero Hedge:   

• Nigel Farage's Brexit Party May Pull Out Of 100s Of Races In Surprise Deal With Conservatives.

• Yes, Virginia, There Is A Deep State And It's Feeding The Anti-POTUS Mob.

• Adam Schiff Coached Alexander Vindman Throughout Impeachment Testimony: Nunes.

• Crashing To Earth: Masa Son Speaks To "Almost Empty" Room At "Davos In The Desert".

• Twitter To Ban Political Advertising, Because "Reach Should Be Earned".

• Fed Cuts Rates On Day GDP Beats Expectations, Sending Stocks To New All Time High.

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 66.75 +.75 basis point.

• China Sovereign CDS 39.5 +.75 basis point.

• Bloomberg Emerging Markets Currency Index  66.31 +.05%.

• FTSE 100 futures n/a.

• S&P 500 futures +.06%.

• NASDAQ 100 futures +.17%.

Morning Preview Links

Earnings of Note 
Company/Estimate

Before the Open:

• (ATI)/.33

• (MO)/1.15

• (AMT)/1.77

• (ADM)/.71

• (AVP)/.02

• (BWA)/.85

• (BMY)/1.07

• (CI)/4.37

• (CLX)/1.54

• (DLPH)/.56

• (DNKN)/.81

• (DD)/.95

• (EL)/1.60

• (FCAU)/.80

• (FLIR)/.58

• (FLR)/.30

• (IDXX)/1.14

• (ICE)/.96

• (IP)/1.00

• (KHC)/.54

• (MUR)/.20

• (PH)/2.66

• (RDS/A)/.49

• (SNY)/1.72

• (W)/-2.05

• (YETI)/.26

• (YRCW)/-.19

After the Close:

• (ANET)/2.40

• (CAR)/3.64

• (BGS)/.57

• (LOCO)/.18

• (MTZ)/1.62

• (RMAX)/.57

• (X)/-.27

Economic Releases

• None of note

Upcoming Splits

• None of note

Other Potential Market Movers

• The Eurozone CPI report and the weekly EIA natural gas inventory report 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.