Sunday, September 23, 2018

Monday Watch

Today's Headlines
Bloomberg:          
  • U.S. Stock Futures, Aussie Drop on Trade Woes. U.S. equity futures and the Australian dollar edged lower after China called off planned trade talks with U.S. officials, potentially triggering an escalation in the protracted tariff war between the world’s two-biggest economies. Some early moves Monday faded as the yen erased its advance, though the Australian and New Zealand dollars remained lower just hours before a new round of tariffs between the U.S. and China was due to take effect. Hong Kong stocks opened lower and Australian and New Zealand equities retreated. Markets are closed in Japan, China and South Korea and volumes will likely remain subdued. Treasuries won’t trade until the London open. U.S. stocks finished Friday flat and the 10-year Treasury yield held at 3.06 percent. Hong Kong’s Hang Seng Index dropped 1 percent as of 9:39 a.m. local time. Developers had among the biggest declines after China’s Guangdong province said it was considering scrapping a system used by developers to get funding and as Hong Kong builders started cutting prices. Australia’s S&P/ASX 200 Index fell 0.3 percent. New Zealand’s S&P/NZX 50 Gross Index lost 0.7 percent. Futures on the S&P 500 slipped 0.3 percent.  
Zero Hedge:     
Night Trading
  • Asian indices are -1.0% to -.25% on average.
  • Asia Ex-Japan Investment Grade CDS Index 80.75 -2.5 basis points.
  • Asia Pacific Sovereign CDS Index 9.25 -2.0 basis points.
  • Bloomberg Emerging Markets Currency Index 66.46 -.08%.
  • FTSE 100 futures -.22%
  • S&P 500 futures -.27%.
  • NASDAQ 100 futures -.48%.

Earnings of Note
Company/Estimate
Before the Open:
  • None of note
After the Close:
  • (ASNA)/.02
Economic Releases
8:30 am EST
  • The Chicago Fed National Activity Index for August is estimated to rise to .2 versus .13 in July.
10:30 am EST
  • The Dallas Fed Manufacturing Activity Index for September is estimated to rise to 31.0 versus 30.9 in August.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The German IFO Business Climate Index, $37B 2Y T-Note auction, BofA Merrill Real Estate Conference, Johnson Rice Energy Conference and the Stephens Bank Forum could also impact trading today.
BOTTOM LINE: Asian indices are lower, weighed down by industrial and technology shares in the region. I expect US stocks to open modestly lower and to maintain losses into the afternoon.  The Portfolio is 75% net long heading into the week.

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