Tuesday, December 10, 2019

Wednesday Watch

Evening Headlines
  • Stocks Dip in Asia on U.S. Tariff-Hike Concern: Markets Wrap. Asian stocks dipped along with U.S. futures amid concern that an American tariff hike on Chinese imports scheduled for Sunday could still go ahead, despite reports on progress in trade talks. After another lackluster open for trading Wednesday, benchmarks in Tokyo and Seoul saw modest declines after White House adviser Peter Navarro cited no indication that the tariff hike will be averted. The yuan edged lower in offshore trading, though moves remain muted as traders await decisive signs on the U.S.-China trade front. Treasuries ticked higher, with investors also awaiting the Federal Reserve’s final policy decision of the year. Crude oil retreated. Topix index fell 0.2% as of 9:55 a.m. in Tokyo. Australia’s S&P/ASX 200 Index rose 0.2%. South Korea’s Kospi index was down 0.1%. S&P 500 futures dipped 0.1%. The S&P 500 Index fell 0.2%.
Night Trading 
  • Asian equity indices are -.25% to +.25% on average.
  • Asia Ex-Japan Investment Grade CDS Index 64.0 unch.
  • China Sovereign CDS 38.5 -.25 basis point.
  • Bloomberg Emerging Markets Currency Index  65.67 -.01%.
  • FTSE 100 futures -.01%.
  • S&P 500 futures -.15%.
  • NASDAQ 100 futures -.18%.
Morning Preview Links

Earnings of Note 
Before the Open:
  • (AEO)/.48
  • (PLCE)/3.02
  • (UNFI)/.27
  • (VRA)/.18
After the Close:
  • (LULU)/.93
  • (OXM)/.08
  • (NX)/.38
Economic Releases 
8:30 am EST
  • The CPI MoM for Nov. is estimated to rise +.2% versus a +.4% gain in Oct.
  • The CPI Ex Food & Energy MoM for Nov. is estimated to rise +.2% versus a +.2% gain in Oct. 
  • Real Avg. Weekly Earnings YoY for Nov.
10:30 am EST
  • Bloomberg consensus estimates call for a weekly crude oil inventory decline of -2,924,180 barrels versus a -4,856,000 barrel decline the prior week. Gasoline supplies are estimated to rise by +2,534,900 barrels versus a +3,385,000 barrel gain the prior week.  Distillate inventories are estimated to rise by +1,563,600 barrels versus a +3,063,000 barrel gain the prior week.
2:00 pm EST
  • The FOMC is expected to leave the benchmark Fed Funds Rate at 1.5-1.75%.
  •  The Monthly Budget Deficit for Nov. is estimated at -$206.2B versus -$134.5B in Oct.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The FOMC press conference, UK elections, weekly MBA Mortgage Applications report, Barclays Tech/Media/Telecom Conference, (AWK) investor day, (HD) investor conference, (SWI) investor day and the (CS) investor day could also impact trading today.
BOTTOM LINE: Asian indices are mostly higher, booseted by industrial and technology shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing mixed. The Portfolio is 75% net long heading into the day.

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