Monday Watch

Today's Headlines

Bloomberg:  

• China Pledges Support to Markets, Quarantine Expanded: Virus Update.

• Fatalities Reach 360 as China Returns From Holiday: Virus Update.

• Thailand Sees Good Result from Using Drug Mixture on Coronavirus.  

• Coronavirus: These Countries, Airlines Restrict Travel to China.

• Johnson Prepared to Walk Away From EU Talks Without Formal Deal.

• OPEC+ Weighs Emergency Response as Oil Slumps.

• China Oil Demand Has Plunged 20% Because of the Virus Lockdown.

• Asia Stocks Drop as China Traders Return; Oil Dips. Asian stocks retreated ahead of the reopen of mainland Chinese markets as a deadly virus outbreak showed no signs of slowing. U.S. equity futures edged higher along with the offshore yuan in a sign of some stabilization after the China’s government unveiled support measures. Shares opened lower in Tokyo, Sydney and Seoul, while traders braced for China’s onshore currency and equities to begin trading later on Monday after a holiday. S&P 500 Index futures rose about 0.2% after the gauge slumped 1.8% on Friday. Investors are assessing intervention from China’s central bank, which is providing more than $21 billion of liquidity. Among the weekend’s coronavirus developments, a man died in the Philippines in the first fatality outside China and China’s death toll reached at least 360. Oil fell amid concern demand in the world’s second-largest economy is plunging. Australian bonds climbed with the three-year yield heading for a record low. Japan’s Topix index lost 1.4% as of 9:12 a.m. in Tokyo. South Korea’s Kospi index retreated 1.5%. Australia’s S&P/ASX 200 Index dropped 1.4%. Future on the S&P 500 added 0.3%.  

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

• China’s Cash Injection, RBA’s Nightmare, Gloomy Titans: Eco Day.

• Biden Advisers Say He’s ‘Anything But Doomed’ Ahead of Iowa Vote.

• Sanders Leads in Iowa on Eve of Caucuses in Emerson Poll.  

• Joe Biden Could Be Impeached by GOP Over Ukraine if He Wins, Iowa Senator Says.

Wall Street Journal:

• Latest Front in Food Delivery: Kitchens in Empty Malls.

• U.K. Companies Brace for Bumps on Brexit Homestretch.

• Super Bowl 2020 Ads Aim to Uplift, Mostly.

• Coronavirus Kills Its First Victim Outside China as Toll Grows.

• Traders Brace for More Stock Volatility.

• JPMorgan’s ‘High-Class Problem’: Its Rising Stock Makes Buybacks More Expensive.

• Boeing’s Woes Create Headwinds for U.S. Economy. 

• China’s Once-Hot Peer-to-Peer Lending Business Is Withering.

• India to Cut Taxes, Increase Spending in Bid to Revive Growth.

CNBC:

• Coronavirus live updates: White House studying economic impact, France evacuates citizens.

• UK police shoot man after terrorism-related incident in south London.

• More retailers file for bankruptcy twice as they struggle with rising debt, pressure from Amazon.

• Women are watching the NFL in record numbers, and Super Bowl Ads are starting to reflect that.

• Voters largely favor capitalism over socialism amid Sanders’ rise in 2020 primary.

• FBI warns of new online threat to personal, credit card information.

Zero Hedge:    

• Coronavirus Pandemic Spreads To 17,205 Cases, Resulting In 362 Fatalities; 152,000 Under Observations.  

• China Bans Short Selling, Plans Massive Liquidity Injection To Prevent Market Crash.

• The One Number That Could Reveal A Chinese Coronavirus Cover-Up.

• Philippines Reports First Death Due To Coronavirus Outside China; 137,600 Under Observation In China. 

• Shocking Footage Inside China's Newly-Constructed Hospitals, 'Like Jail Cells Where You Go To Die'.

• Terrorist Incident In South London Leaves Several Stabbed, Attacker Dead.

• The Primary Mechanism Of Your Oppression Is Not Hidden At All.

• China Censors Top Local Media Outlet Over Claims Beijing Is Underreporting Cases, Deaths.

• BuzzFeed Journo Reportedly Blogged About Pedo Fantasies, Rape Jokes And Doxing.

• Why Are Liberal Cities Such A Mess?

• City In East China Launches Facemask Lottery.

• Brexit: The Unquenchable Fire Spanning The Globe .

• Rewriting History Of World War II Is Ominous Warning.

• Japan Set To Release 1.2 Million Tons Of Radioactive Fukushima Water Into Ocean, Causing "Immeasurable Damage".

• How Government And Media Are Prepping America For A Failed 2020 Election.

• Mayor Of City With 6 Million People Next To Wuhan Warns Of "Significant Increase" In Coronavirus Cases This Weekend.

• Senator Tom Cotton Shreds China's Official Virus Story, Warns Of "Super Laboratory" Proximity.

Business Insider:

• Here are all of the new products Apple is expected to launch this year.  

• 30 Big Tech Predictions for 2020.

John Hopkins University:

• Wuhan Coronavirus Global Cases. (map)

Night Trading

• Asian indices are -2.0% to -1.0% on average.

• Asia Ex-Japan Investment Grade CDS Index 58.0 +1.0 basis point.

• China Sovereign CDS 42.5 +2.25 basis points.

• Bloomberg Emerging Markets Currency Index 65.99 -.01%.

• FTSE 100 futures +.33%.

• S&P 500 futures +.67%.

• NASDAQ 100 futures +.77%.

Morning Preview Links

Earnings of Note

Company/Estimate

Before the Open:

• (AMG)/4.09

• (CHKP)/1.97

• (ON)/.32

• (SYY)/.84

After the Close:

• (GOOG)/12.65

• (FN)/.93

• (HIG)/1.33

• (NXPI)/2.02

Economic Releases
10:00 am EST

• Construction Spending MoM for Dec. is estimated to rise +.5% versus a +.6% gain in Nov.

• ISM Manufacturing for Jan. is estimated to rise to 48.5 versus 47.2 in Dec.

• ISM Prices Paid for Jan. is estimated to fall to 51.5 versus 51.7 in Dec.

Afternoon

• Wards Total Vehicle Sales for Jan. is estimated to rise to 16.8M versus 16.7M in Dec..

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The RBA decision and the Democratic Iowa Caucuses could also impact trading today.

Market Hours
Normal:

• 9:30 am - 4:00 pm EST

BOTTOM LINE: Asian indices are lower, weighed down by industrial and commodity shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing modestly lower.  The Portfolio is 50% net long heading into the week.