Monday Watch

Today's Headlines

Bloomberg:

• Japan's February Exports Grow 1.8% as Trade Recovery Continues. (video) A continued growth in exports suggest the global recovery remains firm. Yet a stronger yen poses some risks, making imports cheaper, weighing on inflation and cutting into exporters’ profits. The risk of a trade war due to U.S. President Donald Trump’s tariffs is another potential source of downside pressure on Japan’s economy.

• Russia Is This Week’s Emerging-Market Focus as the G-20 Meets on Trade. Emerging-market investors are bracing for further fallout from allegations Russia was behind a nerve-agent attack in the U.K., overshadowing an election that’s expected to extend Vladimir Putin’s tenure as the Kremlin’s longest-serving leader since Josef Stalin. Elsewhere, traders will be rooting for Group of 20 finance ministers and central bankers to find ways to avoid a global trade war when they meet in Argentina on Monday and Tuesday, while Wednesday’s Federal Open Market Committee meeting should provide guidance on the path of U.S. monetary policy. Bloomberg Economics estimates a trade war could chop $470 billion from the global economy by 2020.

• Asia Stocks Start Week Mixed as Traders Eye Fed: Markets Wrap. Stock benchmarks nudged lower in Japan and Korea, and rose in Australia, while futures signaled gains in Hong Kong. Investors are assessing the implications of a new head at China’s central bank, after the Wall Street Journal reportedthat Yi Gang was named to run the PBOC. Trade tensions remain in focus as U.S. Treasury official David Malpass said he misspoke hours after claiming the U.S. was pulling out of decade-old formal economic talks with Beijing. The dollar made modest gains against major peers for a third day, while bond yields rose. Japan’s Topix index fell 0.2 percent and the Nikkei 225 Stock Average traded down about 0.3 percent as of 9:20 a.m. in Tokyo. Australia’s S&P/ASX 200 Index rose 0.2 percent. South Korea’s Kospi index lost 0.2 percent. Futures on Hong Kong’s Hang Seng Index climbed 0.3 percent. Futures on the S&P 500 Index were flat.

• Five Things You Need to Know to Start Your Day. (video)

• Death of Iran's Nuclear Deal Could Set Oil Bulls Loose.

• CACI(CACI) Is Said to Top General Dynamics(GD) Bid for CSRA, WSJ Says.

• Bond Traders' March Fed Guide: Beware the Four-Hike Hype So Soon.

Wall Street Journal: 

• Facebook(FB) Ignites Debate Over Third-Party Access to User Data. It says that a firm kept data for years despite saying records were destroyed.

• The Next Housing Crisis: A Historic Shortage of New Homes. Fewer new houses are being built in America than at almost any time before; ‘It’s a good time to be here in Grand Rapids, if you can get a house’.

• Trump Steps Up Attacks on Mueller Investigation. President also jabs at former FBI deputy director Andrew McCabe.

• Trade Associations to Petition Trump Administration to Halt China-Tariff Plans. Imposing tariffs ‘would trigger a chain reaction of negative consequences for the U.S. economy,’ groups say in letter. 

• Congress Braces for Battle Over Massive Spending Bill. Party leaders begin setting terms of debate on Obamacare subsidies, immigration enforcement, tax provisions and infrastructure.

• With Grip on Power Assured, China’s Xi Elevates Lieutenants. President, inner circle look to shore up a sluggish economy, eradicate poverty and enhance country’s global standing amid threat of trade war with U.S.

• Trump’s Opioid Battle Plan Includes Seeking More Death-Penalty Prosecutions. The president will ask the Justice Department to press more cases against drug traffickers under current law.

• Oil Hedge Fund BBL Looks to Launch $1 Billion Macro Fund. Firm says work on oil and other commodities gives it a unique view into global trends.

MarketWatch.com:

• This political-risk gauge just hit a 15-year high — and here’s what it means for the stock market.

• What to expect from the new Fed dot plot on interest rates.

• Stock bears hibernate as optimism jumps across the economy.

• Zscaler shares more than double after IPO as CEO touts cloud-based security.

• Warning, crypto investors: You must pay taxes on your bitcoin.

• These companies jumped on the bitcoin train right before it derailed. (graph)

Barron's:

• Had bullish commentary on (AGN), (TDOC), (ATHN) and (GPS).

Fox News: 

• Paul denounces ‘disgraceful’ ex-CIA chief Brennan over anti-Trump tirade. (video)

• Trump to seek death penalty for some drug traffickers in plan to fight opioid crisis. (video)

• Some officials wanted Stoneman Douglas suspect Nikolas Cruz committed in 2016, documents show. (video)

CNBC: 

• Exit poll say that Vladimir Putin has won the presidential election with more than 70 percent of the vote: AP.

• Washington turmoil has bull ‘limping’ but S&P at 3,000 still looks likely: RBC. (video)

• Facebook(FB) is facing its biggest test ever -- and its lack of leadership could sink the company.

• China and Germany agree to work on steel overcapacity following US tariffs.

• This 3-D printed electric car costs $7,500 and took three days to make. (video)

• President of Steven Cohen’s Investment Firm Quits Amid Gender Bias Lawsuit.

• Chinese search giant Baidu's video streaming unit iQiyi launches $2.4 billion US IPO.

• Uncertainty is the biggest headwind facing the market, money manager Douglas Gordon says. (video)

Zero Hedge:

• McCabe Bailout: Dozens GoFundMe Campaigns Launched; Dem Congressman Offers Job For Full Pension.

• Cambridge Analytica Denies Facebook(FB) Data Abuses: "This Isn't A Spy Movie".

• US Ends Formal Economic Talks With China Ahead Of Trade Wars.

• Bitcoin Battered To Fresh Lows After Twitter Joins Crypto Ad Ban. (graph)

• In Angry Tweetstorm, Trump Accuses Comey Of Perjury, Slams McCabe "Fake Memo", Assails Mueller Team.

• China Unexpectedly Names Yi Gang As Next Central Bank Chief.

• This Is What The CIA's Venture Capital Fund Is Investing In Now.

Night Trading

• Asian indices are -.75% to -.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 65.50 -.75 basis point.

• Asia Pacific Sovereign CDS Index 11.5 unch.

• Bloomberg Emerging Markets Currency Index 74.95 -.08%. 

• FTSE 100 futures -.40%.

• S&P 500 futures -.30%.

• NASDAQ 100 futures -.53%.

Morning Preview Links

Earnings of Note

Company/Estimate

• (CSIQ)/.95

• (ORCL)/.72

Economic Releases

• None of note
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Eurozone Trade Balance report and the Japan Trade Balance report could also impact trading today.

BOTTOM LINE: Asian indices are lower, weighed down by technology and industrial shares in the region. I expect US stocks to open modestly lower and to maintain losses into the afternoon.  The Portfolio is 50% net long heading into the week.