Tuesday Watch

Evening Headlines

Bloomberg:

• Mnuchin Says Trade Call With Chinese Officials Likely This Week.

• Asian Stocks Trade Mixed; Treasuries Steady. Asian stocks were mixed in early Tuesday trading as investors looked to earnings and clues from policy makers for the next catalyst. Treasuries steadied. Japanese shares dipped as traders returned from a holiday, while indexes of South Korean and Australian equities edged up. The S&P 500 Index earlier ended flat at a record high as gains in tech and utilities offset losses in energy and financial companies. Citigroup Inc., the first giant U.S. bank to report results, was little changed. Oil fell below $60 a barrel. Futures on the S&P 500 were flat as of 9:03 a.m. in Tokyo. The underlying gauge rose less than 0.1% to 3,014.30 Monday. Japan’s Topix index slid 0.2%. South Korea’s Kospi rose 0.2%. Australia’s S&P/ASX 200 Index added 0.1%. 

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

• Oil Skids Below $60 as Barry Leaves Gulf, Chinese Economy Stalls.

• Biden Leads Close Contest in New Hampshire: Campaign Update. 

• Stock Investors Go ‘All-In' With $6 Billion Bet on S&P 500 ETFs.

Wall Street Journal:

• Electric Airplanes Start to Take Off.

• Democrats Smear Democrats.

• In Global Tech Battle, a Balky U.S. Ally Chooses China.

• China Growth Slows, Raising Pressure to Step Up Stimulus.

• Trump Plans Tighter Asylum Rules at Southern Border.

Fox News:

• Progressive Dems slam WH 'occupant' Trump, demand impeachment in heated news conference.

MarketWatch.com:

• Is the Fed on the verge of sparking a stock-market ‘melt-up’?

• Gary Smith: Bitcoin buyers are only fooling themselves — again.

CNBC:

• This transport stock holds the key to earnings season.

• Mnuchin: US has ‘very serious concerns’ that Facebook’s Libra could be misused by terrorists.

• These are the best places to launch a small business in America.

Zero Hedge:

• "This Won't End Well" - Lies, Damned Lies, & China's Retail Sales Data.

• China Arrests Another Canadian National As Feud With Ottawa Intensifies.

• FBI To Ramp Up Social Media Surveillance.

• Global Debt Hits $246 Trillion, 320% Of GDP, As Developing Debt Hits All Time HIgh.

• Trump Rage-Tweets At "Radical Left Democrats" - "If You're Not Happy Here, Leave!".

• AOC And 'Snot-Nosed Punk' Chief-Of-Staff Alienating Moderate Democrats, Helping Trump: Rahm Emanuel.

• Bonds, Bitcoin, & Bullion Bid As Small Cap Lag Reaches 10-Year High.

Business Insider: 

• Hedge fund giant Glenn Dubin and his wife Eva told Jeffrey Epstein's probation officer they were '100% comfortable' with the sex offender around their kids. New documents show the extent of the billionaire couple's relationship with Epstein.

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 63.75 unch.

• China Sovereign CDS 42.0 -.5 basis point.

• Bloomberg Emerging Markets Currency Index  67.80 -.01%.

• S&P 500 futures +.07%.

• NASDAQ 100 futures +.10%.

Morning Preview Links 

Earnings of Note 
Company/Estimate

Before the Open:

• (CP)/4.15

• (SCHW)/.65

• (CBSH)/.94

• (DPZ)/2.03

• (GS)/5.03

• (JNJ)/2.43

• (JPM)/2.49

• (WFC)/1.16

After the Close:

• (CTAS)/1.93

• (CSX)/1.11

• (UAL)/4.09

Economic Releases 
8:30 am EST

• The Import Price Index MoM for June is estimated to fall -.6% versus a -.3% decline in May.

• The Export Price Index MoM for June is estimated to fall -.2% versus a -.2% decline in May.

• Retail Sales Advance MoM for June is estimated to rise +.1% versus a +.5% gain in May.

• Retail Sales Ex Autos MoM for June is estimated to rise +.1% versus a +.5% gain in May.

• Retail Sales Ex Autos and Gas for June is estimated to rise +.3% versus a +.5% gain in May.
  

9:15 am

• Industrial Production MoM for June is estimated to rise +.1% versus a +.4% gain in May.

• Manufacturing Production for June is estimated to rise +.3% versus a +.2% gain in May. 

• Capacity Utilization for June is estimated at 78.1% versus 78.1% in May.
  

10:00 am EST

• The NAHB Housing Market Index for July is estimated at 64.0 versus 64.0 in June.

• Business Inventories for May is estimated to rise +.3% versus a +.5% gain in April.
  

4:00 pm EST

• Net Long-Term TIC Flows for May.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Powell speaking, Eurozone Trade Balance report, weekly US retail sales reports, (FB)/(AMZN)/(GOOG)/(AAPL) testimonies to House Judiciary Committee and the (FB) cryptocurrency unit facing Senate hearing could also impact trading today.

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