Wednesday Watch

Evening Headlines

Bloomberg:     

• In Hong Kong, Xi Jinping Takes a Page From Vladimir Putin’s Playbook.   

• Record $666 Billion China Local-Debt Wave Sees Foreigners Wary.

• Brazil Has Deadliest Day; NYC Keeps Reopening Plan: Virus Update. 

• Stocks Rise for Third Day on Outlook for Reopening: Markets Wrap. U.S. stocks rose alongside equities in Europe and Asia amid new bouts of stimulus and positive economic signals as coronavirus lockdowns ease. The dollar slumped for a fourth consecutive day. Two shares rose on the S&P 500 Index for every one that fell, lifting the benchmark to its highest since March 4. Gunmakers extended rallies in the wake of President Donald Trump’s promise to deploy large numbers of troops if cities and states don’t act to contain violence from protests over police brutality. The S&P 500 Index rose 0.8% at the close of trading in New York for its third straight gain. The Stoxx Europe 600 Index advanced 1.6%. The MSCI Asia Pacific Index increased 1%. The MSCI Emerging Market Index gained 1.7%.

• Oil’s Comeback Encourages U.S. Shale and Complicates OPEC+ Task.

• U.S. Cases Rise 1.2%; NYC Keeps Monday Reopening: Virus Update.

• NYC Nears Nighttime Curfew After Cuomo Scolding: Protest Update.  

• Amazon Delivery Drivers Say They Fear Becoming Target of Looters.  

• Gun Stocks Rally On After Background Checks Surge 75% In May.

• Google Sued for Secretly Amassing Vast Trove of User Web Data.

• Deutsche Bank’s Dealings With Epstein Under Scrutiny in New York.

Wall Street Journal:

• The Myth of Systemic Police Racism.

• U.S. Cities Tighten Curfews as Protests Continue.

• China Cites U.S. Unrest to Offset Criticism Over Hong Kong.

• Dave Patrick Underwood, RIP.

• Six Atlanta Officers Charged With Using Excessive Force.

• Array of Sports Stars Rush to Embrace ‘Black Lives Matter’.

• White House Weighs Options for Next Stimulus Bill.

• Warner Music, ZoomInfo Poised to Boost IPO Market.

• Cuomo, De Blasio Spar Over Handling of New York City Protests.

Fox News:

• Police may bust high-ranking Antifa members soon, amid concerns over riots hitting suburbia.

CNBC.com:

• This may be overtaking the coronavirus as the market’s biggest risk.

• Amazon plans summer sale for June 22 to ‘jumpstart sales’ after coronavirus crunch.

• Dr. Fauci says coronavirus vaccine may not provide immunity for very long.

• Zuckerberg stands firm in refusal to moderate Trump despite employee walkouts and resignations.

MarketWatch.com:        

• Zoom Video earnings and sales blow away expectations.

Zero Hedge: 

• Shocking New AP Report Shows WHO Actively Covered Up For China's Lies

• CEOs Of Looted Stores Pledge Solidarity With Protesters

• California Faces "Financial Collapse" As It Moves To Allow Businesses To Walk Away From Commercial Leases.

• NYC Bans Cars Below 96th Street As Riots Go Global.

• Lancet Issues Major Disclaimer On Anti-HCQ Study, As Manufactured Disinformation Foments Hysterics.

• Looters Steal $2.4 Million In Rolex Watches From New York Store.

• Overdose Deaths Skyrocketed In Chicago As COVID Lockdowns Continued

• Tiffany Plunges On Report LVMH Takeover "Uncertain"

• Silicon Valley Has Effectively Banned The Freedom Of Speech. It's Time We Take It Back

• America Is Literally Coming Apart At The Seams.

• There's No End In Sight To The Zombie Economy.

• WTI Holds Day's Big Gains After Surprise Crude Draw.

• Minnesota To Test All 7,000 National Guardsmen Deployed To Quell Riots As First Tests Positive

• S&P Futures Surge 10 Points In One Tick On $3.2BN Market On Close Buy Imbalance

•  Dead Cops, Looted Shops, Cities Burning, Buy Stocks!

The Epoch Times:

• WHO Praised Beijing in Public While Complaining Internally About Its Withholding of Virus Data: Report.

• Wuhan’s Mass Virus Testing Results Called Into Question as Another Doctor Dies.

• Telus, Bell Announce Partnership With Huawei Rivals for 5G, Delivering Major Blow to Chinese Telecom Giant.

John Hopkins University:

• Coronavirus Global Cases. (map)

BNO News:

• Tracking Coronavirus: Map, data and timeline.

KFF:

• State Data(Tests/Hospitalizations).

Night Trading 

• Asian equity indices are +.75% to +1.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 96.0 -3.5 basis points.

• China Sovereign CDS 51.25 -3.25 basis points.

• Bloomberg Emerging Markets Currency Index 61.23 +.13%.

• FTSE 100 futures +.65%

• S&P 500 futures +.32%.

• NASDAQ 100 futures +.25%.

Morning Preview Links

Earnings of Note 
Company/Estimate

Before the Open:

• (AEO)/-.31

• (CPB)/.54

• (GOOS)/-.12

• (VRA)/-.27

After the Close:

• (CLDR)/.01

Economic Releases
8:15 am EST

• The ADP Employment Change for May is estimated at -9000K versus -20236K in April.

10:00 am EST

• The ISM Non-Manufacturing Index for May is estimated to rise to 44.4 versus 41.8 in April.

• Factory Orders for April are estimated to fall -13.4% versus a -10.3% decline in March.
  

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory gain of +3,326,360 barrels versus a +7,928,000 barrel gain the prior week. Gasoline supplies are estimated to fall by -238,550 barrels versus a -724,000 barrel decline the prior week. Distillate inventories are estimated to rise by +3,198,450 barrels versus a +5,495,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to rise by +.8% versus a +1.9% gain prior.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The German Unemployment report, weekly MBA Mortgage Applications report, (COST) May sales results, Piper Sandler Virtual FinTech Conference, Needham Virtual Auto Tech Conference and the (ADSK) investor day could also impact trading today.

Market Hours
Normal:

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are higher, boosted by industrial and technology shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed. The Portfolio is 75% net long heading into the day.