Wednesday, February 19, 2020

Thursday Watch

Evening Headlines
Bloomberg:   
  • Japan Stocks Rise as Yen Slides; U.S. Futures Gain. Japanese stocks gained after a slide in the yen, while stocks elsewhere in Asia opened with more modest gains as investors scrutinized the infection rate for the coronavirus after another methodology change in China. The yen slumped overnight to its weakest in nine months amid concern the Japanese economy is heading toward recession and as Chinese stimulus reduces demand for some haven assets. China’s benchmark borrowing costs for new loans is expected to drop Thursday amid a swath of policy measures to fight the impact of the deadly coronavirus. Shares in South Korea and Australia opened firmer, while U.S. and European equities earlier closed at record highs. Japan’s Topix index rose 1.1% as of 9:10 a.m. in Tokyo. Futures on the S&P 500 Index added 0.2%. The gauge advanced 0.5% on Wednesday, when the Stoxx Europe 600 Index jumped 0.8%. South Korea’s Kospi index added 0.6%. Australia’s S&P/ASX 200 Index rose 0.4%.
Zero Hedge:
John Hopkins University:
Night Trading 
  • Asian equity indices are +.25% to +1.0% on average.
  • Asia Ex-Japan Investment Grade CDS Index 46.75 -.75 basis point.
  • China Sovereign CDS 34.0 -.5 basis point.
  • Bloomberg Emerging Markets Currency Index  64.75 -.08%.
  • FTSE 100 futures +.26%.
  • S&P 500 futures +.14%.
  • NASDAQ 100 futures +.14%.
Morning Preview Links

Earnings of Note 
Company/Estimate
Before the Open:
  • (AKS)/-.10
  • (AEP)/.58
  • (AAWW)/3.01
  • (CLF)/.24
  • (DPZ)/2.97
  • (HRL)/.46
  • (NEM)/.47
  • (RS)/1.73
  • (RGEN)/.18
After the Close:
  • (BYD)/.45
  • (ED)/.80
  • (DBX)/.14
  • (FSLR)/2.04
  • (RMAX)/.46
  • (SFM)/.14
  • (OLED)/.75
  • (ZS)/.03
Economic Releases 
8:30 am EST
  • The Philly Fed Business Outlook Index for Feb. is estimated to fall to 11.0 versus 17.0 in Jan.
  • Initial Jobless Claims for last week are estimated to rise to 210K versus 205K the prior week.
  • Continuing Claims are estimated to rise to 1717K versus 1698K prior.
10:00 am EST
  • The Leading Index for Jan. is estimated to rise +.4% versus a -.3% decline in Dec.
11:00 am EST
  • Bloomberg consensus estimates call for a weekly crude oil inventory gain of +2,627,000 barrels versus a +7,459,000 barrel gain the prior week. Gasoline supplies are estimated to rise by +228,100 barrels versus a -95,000 barrel decline the prior week. Distillate inventories are estimated to fall by -1,337,300 barrels versus a -2,013,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to fall by -.45% versus a +.6% gain prior.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The Fed's Barkin speaking, Japan CPI report, weekly Bloomberg Consumer Comfort Index, Bloomberg Economic Expectations Index for Feb. and the Germany IFO Business Climate Index could also impact trading today.
Market Hours
Normal:
  • 9:30 am - 4:00 pm EST
BOTTOM LINE: Asian indices are higher, boosted by technology and commodity shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher. The Portfolio is 75% net long heading into the day.

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