Monday Watch

Today's Headlines

Bloomberg:    

• May's Team Rejects New Brexit Referendum After Week of Crisis.  

• North Korea Tells U.S. That Sanctions, Pressure ‘Won’t Work’.   

• China Sees Bankruptcies Surge; Bondholders May Get Less Back.

• Russia Threat High With Troops at Border, Ukraine President Says.

• The Bulls Versus Bears Guide to the World Economy in 2019. 

• Asian Stocks Mixed as Sell-off Eases; Yuan Steady. Stocks in Asia opened mixed, following two weeks of losses driven by a backdrop of uncertain trade conditions and signs that some key economies are slowing. Treasury yields steadied just below 2.90 percent. U.S. equity futures edged up with stocks in Japan, Australia and Hong Kong, while shares in Shanghai fluctuated. Treasuries held last week’s gains and the yen was steady after a bout of risk aversion that hammered global equities in recent sessions. The dollar is coming off the back of a strong week that took it to the highest in a month. Oil remains below $52 in New York. The yuan is little changed offshore. Japanese bonds are in focus as a recent slide in yields threatens to push the benchmark 10-year bond yield below zero percent. Japan’s Topix index added 0.2 percent as of 10:31 a.m. in Tokyo. Shanghai Composite Index was down 0.1 percent. Hang Seng Index up 0.1 percent. Australia’s S&P/ASX 200 Index rose 0.2 percent. Futures on the S&P 500 rose 0.2 percent.     

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

• U.S. Pessimism, Australia Sees Surplus, New China Plan: Eco Day.

• Ghosting and Social Stalking: Modern Signs of a Hot Jobs Market.

• BIS Tells Recession Hunters It Can Top the Yield Curve Indicator.

• U.S. B-Schools Take Nine of Top 10 Spots in Global Ranking.

• This Killer Opioid Could Become a Weapon of Mass Destruction.  

• Meet ‘Millie’ the Avatar. She’d Like to Sell You a Pair of Sunglasses.  

• Bitcoin Investors Lied to Themselves to Justify Mania’s Prices.

Wall Street Journal:   

• Higher Interest Rates Pinch Small Banks.

• Leaders at Impasse on Border Wall as Shutdown Nears.

• Robot Vacuums Are Finally Good—Now Which One to Buy?

• Did Chivalry Go Down With the Titanic?

• Blue-Collar Voters Are Up for Grabs in 2020.

• To Expand Access to Emergency Contraception, Colleges Try Vending Machines.

• California’s New Tax on Texting.

• Amazon Targets Unprofitable Items, With a Sharper Focus on the Bottom Line.

• With Migrants Stalled at U.S. Doorstep, Mexico Offers Fresh Start.

• Health-Law Ruling Puts Political Divide In Stark Relief.

• State and Local Investment Gets Lift From Rising Revenues.

• Germany Tightens Acquisition Rules Amid China’s Push for Tech Deals.

Fox News:

• Trump attorney Giuliani says president will not sit down with Mueller, rips Cohen as liar. 

• DEROY MURDOCK: Dems and the border – What they don’t want you to know. 

CNBC:

• Google CEO Sundar Pichai had a tough and terrible year — but it was still better than Facebook's.

• Virtual reality start-ups offer a VR experience that's part movie theater, part theme park.

• How air carriers are experimenting with biometric scanning to speed up lines. 

Zero Hedge:     

• "No Wall In Any Form": Govt Shutdown Odds Explode Amid Trump-Schumer Standoff.

• Mapping America's Most-Distressed Communities.

• 76-Year-Old Joe Biden Is Officially The Frontrunner For 2020 Democratic Nomination.

• May's Cabinet Denies "Second Referendum" Rumors As MPs And Traders Wonder: "What On Earth Do We Do Next?"

• China Press Warns To "Prepare For Escalation Of Conflict With Canada".

• "It May Get Even Uglier": Hedge Fund Armageddon.

• Illinois Pension Shortfall Worsens To $134 Billion Despite Strong Markets, Increased Contribs.

• The Charts Bulls And Bears Are Obsessing Over For 2019.

• Just One Misplaced Dot By The Fed, And Expect Curve Inversion "Within Weeks".

• Belgium Police Fire Tear Gas, Water Cannon As Anti-Migration Protests Turn Violent.

• "I Wouldn't Touch Them With A 10 Foot Pole": Why Bears Think Gundlach Is Dead Wrong On Emerging Markets.

• Stunning Images Emerge After Massive Restaurant Explosion In Japan; Dozens Injured.

• Robot Trucks Coming To US Army in 2019 

• Former FBI SSA Exposes McCabe & Mueller's "Unethtical, Target & Destroy Coercion" Tactics, Defends Flynn.

• "Peak TV": Streaming Originals Overtake Basic Cable.

• US Medicare-For-All & Big-Tech: The Future Of Mass Patient Surveillance.

Business Insider:

• Amazon is building an air hub in Texas — and that means more bad news for FedEx and UPS, Morgan Stanley says.

• DC is literally overrun with rats.

Telegraph:

• Plunge in Bitcoin value hits $262bn since peak of its craze.

Night Trading

• Asian indices are -.25% to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 93.0 +.5 basis point.

• Asia Pacific Sovereign CDS Index 9.75 +.25 basis point.

• Bloomberg Emerging Markets Currency Index 66.70 +.01%.

• FTSE 100 futures -.01%.

• S&P 500 futures +.16%.

• NASDAQ 100 futures +.23%.

Morning Preview Links

Earnings of Note

Company/Estimate
Before the Open:

• None of note

After the Close:

• (HEI)/.48

• (ORCL)/.78

• (RHT)/.87

Economic Releases
8:30 am EST

• Empire Manufacturing for Dec. is estimated to fall to 20.0 versus 23.3 in Nov.
  

10:00 am EST

• The NAHB Housing Market Index for December is estimated to rise to 61.0 versus 60.0 in November.
  

4:00 pm EST

• Net Long-Term TIC Flows for October.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The EU trade data and the RBA Minutes 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 modestly higher and to weaken into the afternoon, finishing mixed.  The Portfolio is 50% net long heading into the week.