Sunday, November 12, 2017

Monday Watch

Today's Headlines
  • Saudi King Will Not Relinquish Throne, Senior Official Says. King Salman isn’t planning to abdicate in favor of his son, a senior Saudi official said, dismissing mounting speculation that Crown Prince Mohammed bin Salman will soon ascend to the throne. “There is no possibility whatsoever that the king will abdicate,’’ the official said in response to written questions. Saudi kings usually stay in power even when bad health prevents them from carrying out their job, the official said on condition of anonymity. He noted the example of King Fahd, who stayed on as monarch until his death in 2005 despite being gravely ill in the last few years of his reign.
  • China’s Appetite for Deals May Be About to Swell. China is poised for an acceleration of deals as confidence grows in the wake of last month’s Communist Party gathering and as the nation opens up to reforms. Deal-making activity will pick up now that the country’s 19th Party Congress is over, ending a wait-and-see period leading up to the event, said Carl Chien, JPMorgan Chase & Co. Asia Pacific vice chairman. Look for increased activity in the tourism and airline sectors, he said. “A lot of the question marks and uncertainties are behind us,” said Chien in an interview on the sidelines of the APEC summit in Vietnam. “We’ll be able to see activities happening which weren’t happening in the first half of the year.”
  • Asia Stocks Drop; Pound Slides With May Pressured. Equities in Asia fell as the week got under way, with no sign of the recent jump in volatility subsiding for now. The British pound took a hit as pressure mounts on U.K. Prime Minister Theresa May after a raft of political scandals and scant progress on Brexit talks. Stock indexes declined in Tokyo and Sydney. The dollar advanced against all its major counterparts, with the pound falling the most. The Aussie dollar slipped as fresh political turmoil in Australia risked undermining already fragile economic confidence. Australian bond yields tracked an increase in the U.S. at the end of last week. Oil held near $57 a barrel. Japan’s Topix index fell 0.5 percent as of 9:26 a.m. in Tokyo. The Nikkei 225 Stock Average slid 0.7 percent. South Korea’s Kospi index fluctuated. Australia’s S&P/ASX 200 Index fell 0.2 percent. Hang Seng Index futures dropped 0.1 percent.
Wall Street Journal:
Zero Hedge:
Night Trading
  • Asian indices are -.5% to +.5% on average.
  • Asia Ex-Japan Investment Grade CDS Index 80.75 +1.25 basis points.
  • Asia Pacific Sovereign CDS Index 16.0 unch.
  • Bloomberg Emerging Markets Currency Index 72.37 -.09%.
  • S&P 500 futures +.10%.
  • NASDAQ 100 futures +.10%.

Earnings of Note
  • (JD)/.72
  • (TSN)/1.35
Economic Releases   
2:00 pm EST
  • The Monthly Budget Deficit for October is estimated at -$56.5B versus -$45.8B in September.
Upcoming Splits
  • (UFPI) 3-for-1
Other Potential Market Movers
  • The Japan Machine Orders Report, UBS Tech Conference and the (GE) investor update could also impact trading today.
BOTTOM LINE: Asian indices are mostly higher, boosted by industrial and technology shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher.  The Portfolio is 100% net long heading into the week.

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