Tuesday, October 08, 2019

Wednesday Watch

Evening Headlines
Bloomberg:         
  • Stocks Drop as Trade Tensions Ramp Up Before Talks. Asian stocks dropped Wednesday after a slump on Wall Street spurred by escalating U.S.-China trade tensions, though declines were more modest than in the U.S. Japan’s benchmark Topix in early trading was down by about half the 1.6% drop in the S&P 500 Index overnight, continuing the pattern of outperformance seen last month. U.S. futures were little changed, as was the dollar. Ten-year Treasury yields were flat, not far from their lowest levels in a month. Crude oil dipped toward $52 a barrel in New York. Japan’s Topix index dropped 0.7% as of 9:21 a.m. in Tokyo. Australia’s S&P/ASX 200 Index declined 0.8%. Futures on the S&P 500 Index rose 0.2%.  
Zero Hedge:   
Night Trading 
  • Asian equity indices are -.75% to -.25% on average.
  • Asia Ex-Japan Investment Grade CDS Index 79.5 +1.0 basis point.
  • China Sovereign CDS 49.5 -.75 basis point.
  • Bloomberg Emerging Markets Currency Index  65.19 -.02%.
  • FTSE 100 futures -.06%.
  • S&P 500 futures +.22%.
  • NASDAQ 100 futures +.23%.
Morning Preview Links 

Earnings of Note 
Company/Estimate

Before the Open:
  • None of note
After the Close:
  • None of note
Economic Releases
10:00 am EST
  • JOLTS Job Openings for Aug. are estimated to rise to 7250 versus 7217 in July.
  • Wholesale Trade Sales MoM for Aug.
10:30 am EST
  • Bloomberg consensus estimates call for a weekly crude oil inventory gain of +1,438,300 barrels versus a +3,104,000 barrel gain the prior week. Gasoline supplies are estimated to fall by -418,000 barrels versus a -228,000 barrel decline the prior week. Distillate inventories are estimated to fall by -2,031,500 barrels versus a -2,418,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to rise +.16% versus a -3.4% decline prior.
2:00 pm EST
  • FOMC Meeting Minutes for Sept. 18.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The Fed's Powell speaking, $24B 10Y T-Note auction and the weekly MBA Mortgage Applications report could also impact trading today.
BOTTOM LINE: Asian indices are lower, weighed down by technology and industrial shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower. The Portfolio is 50% net long heading into the day.

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