Wednesday Watch

Around X:

• @Business  

• AI is upending law firms' billing, hiring and even their legal products.
• Fed Chairman Kevin Warsh has hired conservative policy analysts Paul Winfree and Daniel Heil as temporary advisers, according to sources. 
• Get up to speed on what's moving global markets.
• Here’s what you need to know to start your day.     

• @ZeroHedge

• *SPACEX TARGETS SALE OF 555.6M SHRS AT $135 EACH IN IPO: REUTERS.
• I don't know if market cares about renewed Iran sit. But I do know that market is very long calls. and not long downside hedges (puts). this makes the put call open interest ratios near their ~10 year lows. that transition could be violent.
• US Treasury Sanctions Iran's Largest Crypto Exchange.
• Trump Signs AI 'Cyber Defense' Executive Order.
• BREAKING! Iran just struck US targets in Kuwait after the US struck Qeshm today. Also, alarms just went off in Bahrain, seems Iran is striking there too. Iranian source tells me Iran has stopped playing the tit-for-tat game. Instead, it's now striking back "at least 1.5x as hard" for every attack the US against Iran.
• US, China Militaries Hold 'Candid' Deconfliction Talks In Hawaii As Trump Goes Quiet On Taiwan.
• and UAE too. 
• The Islamic Revolutionary Guard Corps (IRGC) said on Tuesday it carried out “precise and concentrated missile strikes” targeting US military bases in Kuwait in response to what it described as a US attack on Iran’s Qeshm Island, according to a statement. "Any new folly, any further aggression, or any move that even touches an inch of our borders and sovereignty will be met with a seismic, crushing, and decisive response that will go beyond the usual rules and boundaries, and our brave forces will not hesitate to turn all aggressors’ bases and their interests in the region into ashes," the statement said. "The time of “hit and run” is over, and the oppressive forces must accept the grave consequences of their ignorance and reckless adventurism."          
• AIR RAID SIRENS ACTIVATED AT US BASES IN SAUDI ARABIA: FARS.
• US Bill Would Prevent Chinese Connected Cars In Canada From Entering United States.
• Iran Sends Missiles, Drones Targeting Airbases In Kuwait After US Nighttime Attack On Qeshm Island.
• Dems Have A Voter Problem. Gerrymandering Was Never Going To Fix It.
• *KUWAIT SAYS CURRENTLY INTERCEPTING DRONE, MISSILE ATTACKS.
• Permadrought: 75% Of Global Population Lives In A Country Affected By 'The Great Drying'.
• Bamboozled Once Again....
• Bitcoin Battered, Black Gold Bid As Job Openings Battle Hormuz Closings.      

• @CNBC

• Asia-Pacific markets set to open mixed as concerns over Middle East conflict rise.
• Wednesday's big stock stories: What’s likely to move the market in the next trading session.
• Palo Alto CEO says customer meeting requests have surged amid AI security concerns.
• Iran has mined 'large segments' of Hormuz Strait, Secretary of State Rubio says.
• Stock futures are little changed after S&P 500 closes at another record: Live updates.

• @TheTranscript

• $NVDA CEO: "I have a very exciting announcement that today we are announcing that we plan to return 50% or more of free cash flow to our shareholders this year, next year, and beyond. To infinity and beyond...We plan to increase our stock repurchases and our dividend over time."
• Palo Alto CEO: "Q3 was a standout quarter for Palo Alto Networks, with accelerating organic bookings growth as customers turn to us to secure their AI deployments at scale," $PANW: +11% AH.
• Ulta Beauty CEO: "Fiscal 2026 is off to a strong start driven by broad-based growth across all channels and major categories" $ULTA: +5% AH. 

• @WallStEngine

• $PANW Q3’26 EARNINGS HIGHLIGHTS. Revenue: $3.0B (Est. $2.94B) ; +31% YoY. Adj. EPS: $0.85 (Est. $0.80). NGS ARR: $8.1B; +60% YoY. RPO: $18.4B; +36% YoY. FY Guide: Revenue: $11.42B-$11.43B (Est. $11.29B). Adj. EPS: $3.77-$3.79 (Est. $3.70). NGS ARR: $8.90B-$8.95B; +59% to +60% YoY. RPO: $20.9B-$21.0B; +32% to +33% YoY. Non-GAAP Operating Margin: 28.9% to 29.2%. Adjusted FCF Margin: 37.5%. 

Night Trading 

• Asian equity indices are +.25% to +1.25% on average. 
• Asia Ex-Japan Investment Grade CDS Index 70.5 -75 basis point. 
• China Sovereign CDS 40.0 -.25 basis point.
• China Iron Ore Spot 104.0 USD/Metric Tonne -1.2%. 
• Crude Oil 94.84/bbl. +1.2% 
• Gold 4,502.8 USD/t oz. -.4%. 
• Swiss Franc/Offshore Chinese Renminbi Cross 8.59 -.02%.
• Bloomberg Emerging Markets Currency Index 35.28 -.04%.
• Bloomberg Global Risk-On/Risk Off Index 124.0 +1.0%.
• US 10-Year Yield 4.45% +1.0 basis point.
• Japan 30-Year Yield 3.86% -1.0 basis point. 
• Volatility Index(VIX) futures 20.2 -.4 %.
• Euro Stoxx 50 futures -.20%. 
• S&P 500 futures -.03%.
• NASDAQ 100 futures -.17%.

Morning Preview Links

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