Wednesday, February 25, 2015

Thursday Watch

Evening Headlines 
Bloomberg:  
  • Ukraine Risks Losing IMF Support for Aid If War Escalates. Ukraine risks losing support from IMF member countries for a proposed $17.5 billion bailout if the conflict in the former Soviet republic continues to escalate, according to two people familiar with the matter. The new four-year loan program is awaiting approval by the International Monetary Fund’s executive board, which represents the lender’s 188 member nations. Getting the panel’s consent will become more challenging if pro-Russia rebels continue their advance and seize territory such as the strategic port city of Mariupol, one of the people said. 
  • Bond Rout Might Not Be So Bad as Economists Cut Yield Forecasts. This year’s selloff in Treasuries might not be so bad after all. While economists surveyed by Bloomberg predict prices will fall, sending benchmark 10-year yields up more than half a percentage point, they’re also scaling back forecasts for the size of the decline. Ten-year yields will be 2.62 percent by Dec. 31, based on the latest responses, down from about 3.60 percent that the surveys projected six months ago. 
  • Asian Stocks Retreat From Highs as Aussie Bonds Climb. Asian stocks slipped from a five-month high while Australian bond yields fell to a three-week low after the nation’s business investment slumped more than estimated. Oil held above $50 a barrel in New York. The MSCI Asia Pacific Index dropped 0.3 percent by 11:10 a.m. in Tokyo, with five stocks falling for every three that gained.
Wall Street Journal:
  • Fed’s Yellen Fends Off Charges of Partisan Tilt. House Republicans seize on calendar records, pre-election speeches that seem to favor Democrats as evidence of need to audit central bank. Federal Reserve Chairwoman Janet Yellen came under fire from Republican lawmakers who charged she had politicized the central bank, allegations she rejected in her most acrimonious congressional hearing in a year as Fed chief.
  • U.S., Israel Trade Barbs Over Iran Talks. Top U.S. officials sharpened efforts to undermine Israeli Prime Minister Benjamin Netanyahu ahead of his Washington visit. Top U.S. officials sharpened efforts to undermine Israeli Prime Minister Benjamin Netanyahu ahead of his visit to Washington next week as tensions rose over his push to scuttle a possible nuclear deal with Iran. At what U.S. officials say is a historic low point in relations between the longtime allies, the White House now sees Mr. Netanyahu as a serious threat to President Barack Obama’s efforts to reach an agreement with Iran.
CNBC:
Zero Hedge:
Business Insider:
Telegraph: 
Edaily:
  • S. Korea Showing Signs of Deflation Stage, PM Lee Says. South Korea's economy is showing signs typical of deflation stage amid global economic slowdown, citing Prime Minister Lee Wan Koo.
Evening Recommendations 
  • None of note
Night Trading
  • Asian equity indices are -.50% to +.25% on average.
  • Asia Ex-Japan Investment Grade CDS Index 100.75 unch.
  • Asia Pacific Sovereign CDS Index 63.75 -1.75 basis points.
  • S&P 500 futures +.03%.
  • NASDAQ 100 futures +.04%.
Morning Preview Links

Earnings of Note

Company/Estimate
  • (CRI)/1.27
  • (SFY)/-.32
  • (DDD)/.25
  • (CHS)/.02
  • (KSS)/1.80
  • (SHLD)/-1.89
  • (JCP)/.13
  • (ROST)/1.11
  • (GPS)/.74
  • (MTZ)/.38
  • (HLF)/1.22
  • (MNST)/.59
  • (ADSK)/.24
  • (OVTI)/.29
Economic Releases
8:30 am EST 
  • The CPI for January is estimated to fall -.6% versus a -.4% decline in December.
  • The CPI Ex Food and Energy for January is estimated to rise +.1% versus unch. in December.
  • Durable Good Orders for January is estimated to rise +1.6% versus a -3.4% decline in December.
  • Durables Ex Transports for January are estimated to rise +.5% versus a -.8% decline in December.
  • Cap Goods Orders Non-Defense Ex Air for January are estimated to rise +.3% versus a -.6% decline in December.
  • Initial Jobless Claims are estimated to rise to 290K versus 283K the prior week.
  • Continuing Claims are estimated to fall to 2395K versus 2425K prior.
9:00 am EST
  • The FHFA House Price Index for December is estimated to rise +.5% versus a +.8% gain in November.
11:00 am EST
  • The Kansas City Fed Manufacturing Activity Index for February is estimated at 3.0 versus 3.0 in January.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The Fed's Lockhart speaking, Japan CPI, German Unemployment Rate, $27B 7Y T-Note auction, weekly Bloomberg Consumer Comfort Index, weekly EIA natural gas inventory report and the (CR) analyst conference could also impact trading today.
BOTTOM LINE: Asian indices are mostly lower, weighed down by commodity and technology shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower. The Portfolio is 50% net long heading into the day.

No comments: