Wednesday Watch

Evening Headlines

Bloomberg:

• Yuan Bears Turn Bulls as a Weak Dollar Rescues China's Currency.

• Stock Futures Fall as Trump Reloads Tariff Bazooka. U.S. and Japan equity futures dropped with Treasury yields on news that the Trump administration is preparing the biggest list yet of Chinese goods to be hit with tariff increases. The yen climbed and the Aussie and kiwi retreated. Futures on the S&P 500 Index tumbled, ending the positive tone to equities enjoyed at the start of the week thanks to optimism about the corporate-earnings season. Treasuries rose at the end of Tuesday’s session as news about the plans emerged. The U.S. Trade Representative office said that President Donald Trump has ordered the preparation of a proposed list of $200 billion of Chinese imports for tariff hikes. Futures on the S&P 500 fell 0.8 percent. The underlying gauge earlier closed 0.4 percent higher on Tuesday. Futures on Japan’s Nikkei 225 dropped 0.7 percent.  

• Five Things You Need to Know to Start Your Day.  

• Reduce Prices or Expect Demand to Sink, Oil Guzzler Warns OPEC.   

• Blackstone to Seek More Than $20 Billion for Buyout Fund.  

• Kavanaugh Could Usher In Even More Business-Friendly Era on Supreme Court.

Wall Street Journal:

• U.S. Sets Tariffs on $200 Billion More in China Goods.

• Morgan Stanley Drops Succession Clue by Elevating CEO Contender.

• Oil’s New Technology Spells End of Boom for Roughnecks.

• Pfizer to Roll Back Price Increases After Trump Criticism.

• Trade Conflict Ripples Through Emerging Markets.

MarketWatch.com:

• Stock-market bulls look for earnings to trump trade-war fears.

• These five ‘mega trends’ are producing soaring stocks regardless of Trump, tariffs or the economy.

• Nvidia(NVDA) scores big win with Daimler, Bosch self-driving-car platform.

• Americans quitting their jobs at fastest rate since 2001 — and that’s a good thing.

Fox News:

• Schumer, Warren lash out over Supreme Court pick's call to shield presidents from criminal investigation.

CNBC:   

• Trump administration announces list of tariffs on $200 billion in Chinese goods.

• Tech companies and banks are expected to post big numbers this earnings season.

• Apple has 5,000 people working on autonomous cars, says criminal complaint against ex-engineer. 

• Employers are looking to fill millions of jobs. Here's where to find one.

• After-hours buzz: AIR, WDFC & more.

• Stocks have rallied since China trade war officially began as investors bet it won't escalate further.

• Walmart(WMT) and Target(TGT) will 'survive' against Amazon, says O'Leary. 

• America's Top States for Business 2018.

Zero Hedge:

• US Equity Futures Tumble As US Readies $200 Billion China Tariff List.

• As Global Debt Hits A Record $247 Trillion, The IIF Issues A Warning.

• Stock Buybacks Hit Record $680 Billion In The First Half.

• A Quarter Of Bill Gross' Fund Redeemed After Abysmal Returns.

• CO2 Emissions Hit 67-Year Low In Trump's America, As Rest-Of-World Rises.

• "Godfather Of Payday Lending" Stripped Of $64 Million, Sentenced To 14 Years.

• WTI Extends Gains After Big Crude Draw.

• Trade-War Buying-Panic Stalls As US Yield Curve Tumbles To Fresh 11 Year Lows.

Business Insider:

• China is building ties with Latin America, and now it has its eyes on a major trading hub.

• Housing demand in the US is unfazed by rising rates — even among millennials.

Night Trading 

• Asian equity indices are -.75% to unch. on average.

• Asia Ex-Japan Investment Grade CDS Index 91.75 +.25 basis point. 

• Asia Pacific Sovereign CDS Index 14.50 unch.

• Bloomberg Emerging Markets Currency Index 70.05 +.24%.

• FTSE 100 futures -.50%.

• S&P 500 futures -.39%.

• NASDAQ 100 futures -.38%.

Morning Preview Links

Earnings of Note
Company/Estimate
Before the Open:

• (FAST)/.66

• (MSM)/1.39

After the Close:

• (OZRK)/.89

Economic Releases 
8:30 am EST

• The PPI Final Demand MoM for June is estimated to rise +.2% versus a +.5% gain in May.

• The PPI Ex Food and Energy MoM for June is estimated to rise +.2% versus a +.1% gain in May.

10:00 am EST

• The Wholesale Trade Sales MoM for May is estimated to rise +.5% versus a +.8% gain in April.
  

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory decline of -3,893,750 barrels versus a +1,245,000 barrel gain the prior week. Gasoline supplies are estimated to fall by -922,180 barrels versus a -1,505,000 barrel decline the prior week. Distillate inventories are estimated to rise by +863,640 barrels versus a +134,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to rise by +.19% versus a -.4% decline prior.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Williams speaking, NATO Summit, Monthly OPEC Oil Market report, Australia Lending report, weekly MBA Mortgage Applications report, $22B 10Y T-Note auction, (COST)/(ZUMZ) Monthly Sales reports and the (GIS) investor day could also impact trading today.

BOTTOM LINE:  Asian indices are mostly lower, weighed down by industrial and financial shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing mixed.  The Portfolio is 100% net long heading into the day.