OVERNIGHT MARKETS AND NEWS

Mar E-mini S&Ps (ESH17 +0.32%) are up +0.26% at a new all-time nearest-futures high and European stocks are up +1.10% at a 1-week high on optimism over the global economic outlook. Mar COMEX copper (HGH17 -0.55%) climbed to a 1-3/4 month high in overnight trade before falling back as expectations for stronger economic growth fueled gains in commodity producing stocks. European bourses found support on strength in bank stocks and insurance companies, while the CBOE Volatility Index, or VIX, a gauge of fear in the equity market, fell to a 2-1/2 year low today. Positive Japanese trade data also gave global equity markets a boost after Japan Dec exports climbed +5.4% y/y, the biggest increase in 17 months. Mar WTI crude oil (CLH17 -0.92%) is down -0.96% after API data late Tuesday showed U.S. crude supplies rose +2.93 million bbl last week. Asian stocks settled mostly higher: Japan +1.43%, Hong Kong +0.43%, China +0.22%, Taiwan closed for holiday, Australia +0.38%, Singapore -0.07%, South Korea +0.32%, India +1.21%.

The dollar index (DXY00 -0.42%) is down -0.32%. EUR/USD (^EURUSD) is up +0.18%. USD/JPY (^USDJPY) is down -0.27%.

Mar 10-year T-note prices (ZNH17 +0.01%) are down -1.5 ticks.

ECB Executive Board member Lautenschlaeger said "all preconditions for a stable rise in inflation exist and I am optimistic that we can soon turn to the question of an exit" from the ECB's bond-buying program.

The German Jan IFO business climate unexpectedly fell -1.2 to 109.8, weaker than expectations of +0.3 to 111.3.

The Japan Dec trade balance widened to a surplus of 641.4 billion yen, larger than expectations of 281.1 billion yen. Dec exports rose +5.4% y/y, stronger than expectations of +1.1% y/y and the largest increase in 17 months. Dec imports fell -2.6% y/y, weaker than expectations of -0.8% y/y.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly MBA mortgage applications (previous +0.8% with purchase sub-index -5.2% and refi sub-index +6.8%), (2) Nov FHFA house price index (expected +0.4%, Oct +0.4% m/m), (3) the Treasury auctions $15 billion of 2-year floating-rate notes and $34 billion of 5-year T-notes, (4) House and Senate Republicans begin a 3-day policy retreat in Philadelphia, (5) EIA Weekly Petroleum Status Report.

Notable S&P 500 earnings reports today include: Abbott Labs (consensus $0.65), Boeing (2.32), Citrix (1.50), eBay (0.54), AT&T (0.66).

U.S. IPO's scheduled to price today: App Dynamics (APPD), ObsEva (OBSV), AnaptysBio (ANAB).

Equity conferences: Hart Energy DUG Marcellus Utica Midstream Conference on Wed-Thu.

OVERNIGHT U.S. STOCK MOVERS

Boeing (BA +1.72%) climbed 1.5% in pre-market trading after it reported Q4 core EPS of $2.47, above consensus of $2.32.

Seagate Technology PLC (STX +2.94%) jumped 10% in after-hours trading after it reported Q2 adjusted EPS of $1.38, higher than consensus of $1.08, and said it sees fiscal 2017 EPS "at least" $4.50, above consensus of $3.77.

Discover Financial Service (DFS +0.87%) lost 1% in after-hours trading after it reported Q4 provision for loan losses of $579 million, up from $445 million in Q3.

Intuitive Surgical (ISRG +1.68%) rose 1% in after-hours trading after it reported Q4 adjusted EPS of $6.09, better than consensus of $5.98.

Capital One Financial (COF +2.14%) slipped nearly 2% in after-hours trading after it reported Q4 adjusted EPS of $1.45, weaker than consensus of $1.62.

Alcoa (AA +3.33%) gained over 2% in after-hours trading after it said it sees 2017 adjusted Ebitda ex-items $2.1 billion-$2.3 billion, up from $1.1 billion in 2016.

Phillips 66 Partners (PSXP +1.17%) was upgraded to 'Buy' from 'Neutral' by Citigroup, citing strong organic growth, ability to attract third-party revenue and compete with large non-sponsored MLPs.

Cree Inc (CREE -0.29%) rallied 4% in after-hours trading after it reported Q2 adjusted EPS of 20 cents, higher than consensus of 11 cents.

CA Technologies (CA +1.54%) fell over 2% in after-hours trading after it cut its full year adjusted EPS from continuing operations growth estimate to flat to up +2%, below a previous projection of up 2%-5%.

Bob Evans (BOBE -0.39%) jumped 15% in after-hours trading after it announce a sale of its restaurants to Golden Gate Capital for $565 million.

Concho Resources (CXO +2.24%) rose nearly 3% in after-hours trading after it sold a Permian Basin crude oil gathering system to Plains All-American for $1.2 billion.

Mercury Systems (MRCY +8.37%) lost 3% in after-hours trading after it announced a public offering of 5 million shares of common stock.

Newtek Business Services (NEWT +2.33%) dropped nearly 5% in after-hours trading after it announced a public offering of 1.5 million shares of common stock.

Michaels Cos. (MIK +0.65%) slid 2% in after-hours trading after it announced a secondary offering of 18 million shares of common stock.

MARKET COMMENTS

Mar E-mini S&Ps (ESH17 +0.32%) this morning are up +6.00 points (+0.26%) at a new all-time nearest-futures high. Tuesday's closes: S&P 500 +0.66%, Dow Jones +0.57%, Nasdaq +0.70%. The S&P 500 on Tuesday rallied to a fresh record high and closed higher on the +0.8 point increase in the U.S. Jan Markit manufacturing PMI o 55.1, stronger than expectations of +0.2 to 54.5 and the fastest pace of expansion in 1-3/4 years. In addition, mining stocks rallied after copper prices rose to a 1-week high and energy producers rallied as the price of crude oil rose +0.36%. Stocks were undercut by the -2.8% decline in U.S. Dec existing home sales to 5.49 million, weaker than expectations of -1.6% to 5.52 million.

Mar 10-year T-notes (ZNH17 +0.01%) this morning are down -1.5 ticks. Tuesday's closes: TYH7 -19.00, FVH7 -11.00. Mar 10-year T-notes on Tuesday closed lower on signs of strength in U.S. manufacturing that bolstered the case for additional Fed rate hikes after the Jan Markit manufacturing PMI rose +0.8 to a 1-3/4 year high of 55.1. T-notes were also undercut by reduced safe-haven with the rally in stocks and supply pressures as the Treasury auctions $103 billion of T-notes this week.

The dollar index (DXY00 -0.42%) this morning is down -0.32 (-0.32%). EUR/USD (^EURUSD) is up +0.0019 (+0.18%). USD/JPY (^USDJPY) is down -0.31 (-0.27%). Tuesday's closes: Dollar index +0.19 (+0.19%), EUR/USD -0.0034 (-0.32%), USD/JPY +1.08 (+0.96%). The dollar index on Tuesday closed higher on the stronger than expected U.S. Jan Markit manufacturing PMI report and the increase in T-note yields, which improved the dollar's interest rate differentials.

Mar WTI crude oil prices (CLH17 -0.92%) this morning are down -51 cents (-0.96%) and Mar gasoline (RBH17 -1.55%) is -0.0274 (-1.71%). Tuesday's closes: Mar crude +0.19 (+0.36%), Mar gasoline -0.0087 (-0.55%). Mar crude oil and gasoline on Tuesday settled mixed. Oil prices were boosted by signs that OPEC members are adhering to their production cut agreements after Iraq, OPEC's second-biggest producer, said it has already reduced crude output by 180,000 bpd and will cut its output by another 30,000 bpd by the end of the month. Crude oil prices were undercut by a stronger dollar and by expectations that Wednesday's EIA crude inventories will climb by 2.5 million bbl.