Wednesday Watch

Evening Headlines
Bloomberg:        

• BOJ Seen Holding for Now Amid Easing Talk: Decision Day Guide.

• Asia Stocks to Gain on Trade, Stimulus Optimism. Asian stocks looked set to follow gains in global shares on optimism over progress in the U.S.-China trade war and indications of more stimulus from the European Central Bank. Treasuries climbed and oil surged. Futures pointed higher in Japan, Hong Kong and Australia. The S&P 500 Index rose 1% after President Donald Trump tweeted he will meet Chinese President Xi Jinping at the G-20 summit next week, though gains were tempered by news his administration explored demoting Federal Reserve Chairman Jerome Powell in February. Ten-year Treasury yields came close to touching 2% before recovering. Futures on Japan’s Nikkei 225 climbed 1.3% in Singapore. Hang Seng futures earlier added 1.7%. Futures on Australia’s S&P/ASX 200 Index gained 0.6%. Futures on the S&P 500 Index were little changed.

• Facebook Triggers Fresh Washington Fury Over Crypto Project. 

• Fourth Carcinogen Discovered in Heart Pills Used by Millions.

• The Hot New Thing in Funds Is Higher Fees and More Restrictions.

• OPEC+ Close to Agreeing Next Meeting Takes Place on July 1-2.  

• Hedge Funds for Everyone: SEC Ponders Letting in the Not-So-Rich.

Wall Street Journal:

• FBI and Dominican Republic Officials Investigate Tourist Deaths.

• The Trick High-Schoolers Are Using to Boost Their Grades.

• Private-Equity Firms Are Raising Bigger and Bigger Funds. They Often Don’t Deliver.

• Trump Administration’s Plan to Step Up Deportations Faces Obstacles.

Fox News:

• As thousands line up for Trump rally, president preps to make his case for 2nd term.

• Fox News beats liberal CNN, MSNBC combined in ratings, tops all of cable.

• GOP congressman blasts Ocasio-Cortez's criticism of border facilities.

MarketWatch.com:

• Value of debt with negative-yields nears $12 trillion.

CNBC:

• Trump on demoting Fed Chair Jerome Powell, day before rate decision: ‘Let’s see what he does’.

• Adobe(ADBE) rises despite soft guidance.

• Tariffs hurt the economy, but China must be held accountable, Union Pacific CEO says.

• Stocks making the biggest moves after hours: Adobe, US Steel, and more.

Zero Hedge:

• How The "Draghi Shock" Unleashed Chaos On Powell's Most Important Day.

• Maxine Waters Demands Facebook Stop All Development Of Libra Crypto Project.

• WTI Holds Best Gains In 5 Months After API Reports Modest Crude Draw.

• What Your iPhone May Be Telling Mysterious Companies About You... Without Your Permission.

• Merkel Misfires; Shakes Violently At Ukraine Ceremony, Reboots By Drinking Water

• How Are Traders Positioned Ahead Of The Fed?

• Stocks Near Record Highs As Xi Hope & Powell Hype Trump Global Economic Collapse.

Business Insider:

• Truckers are warning of a 'bloodbath' as trucking companies go bankrupt or slash their profit expectations.

• Hong Kong protests dealt China’s all-powerful Xi Jinping an embarrassing blow that could sting for a while.

Telegraph:

• Facebook's Libra cryptocurrency plans should come with a 'health warning' as Europe's regulators circle.

Night Trading 

• Asian equity indices are +.5% to +1.0% on average.

• Asia Ex-Japan Investment Grade CDS Index 72.0 -.75 basis point.

• China Sovereign CDS 47.25 -3.0 basis points.

• Bloomberg Emerging Markets Currency Index 66.67 +.05%.

• S&P 500 futures +.09%.

• NASDAQ 100 futures +.17%.

Morning Preview Links 

Earnings of Note 
Company/Estimate

Before the Open:

• (BKS)/-.24

• (WGO)/1.03

After the Close:

• (AOBC)/.16

• (ORCL)/1.07

• (SCS)/.18

Economic Releases
10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory decline of -1,444,440 barrels versus a +2,206,000 barrel gain the prior week. Gasoline supplies are estimated to rise by +231,250 barrels versus a +764,000 barrel gain the prior week. Distillate inventories are estimated to rise by +156,250 barrels versus a -1,000,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to rise by +.3% versus a +1.4% gain prior.

2:00 pm EST

• The FOMC is expected to leave the benchmark Fed Funds rate at 2.25-2.5%.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The FOMC Press Conference, UK inflation data report, weekly MBA Mortgage Applications report, JMP Securities Life Sciences Conference and the (HQY) investor day could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by commodity and technology shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing modestly mixed. The Portfolio is 75% net long heading into the day.