Morning Call For Friday, Dec. 28

Overnight Markets And News

Mar E-mini S&Ps (ESH19 +0.55%) this morning are up +0.60% at a 1-week high and European stocks are up +1.78%. U.S. stock indexes extended their rebound from late Thursday, led by gains in technology stocks. Energy stocks also pushed higher with Feb WTI crude oil (CLG19 +1.03%) up +1.88%. Asian stocks settled mostly higher: Japan -0.31%, Hong Kong +0.10%, China +0.44%, Taiwan +0.89%, Australia +1.02%, Singapore +0.29%, South Korea +0.54%, India +0.75%. Most Asian bourses settled higher today although Japanese stocks closed lower as they were weighed down by economic concerns after Nov industrial production declined and Nov retail sales fell by the most in 6 months.

The dollar index (DXY00 -0.29%) is down -0.27% at a 1-week low. EUR/USD (^EURUSD +0.34%) is up +0.29%. USD/JPY (^USDJPY -0.64%) is down -0.68%.

Mar 10-year T-note prices (ZNH19 -0-035) are down -4 ticks.

Japan Nov industrial production fell -1.1% m/m, a smaller decline than expectations of -1.5% m/m.

Japan Nov retail sales fell -1.0% m/m, weaker than expectations of -0.4% m/m and the biggest decline in 6 months.

The Japan Nov jobless rate unexpectedly rose +0.1 to 2.5%, weaker than expectations of no change at 2.4%. The Nov job-to-applicant ratio rose +0.01 to 1.63, right on expectations.

Japan Oct vehicle production rose +6.3% y/y, the largest increase in a year.

U.S. Stock Preview

Key U.S. news today includes: (1) Nov wholesale (inventories expected +0.5%, Oct +0.7%), (2) Dec Chicago PMI (expected -6.1 to 60.3, Nov +8.0 to 66.4), (3) Nov pending home sales (expected +1.0% m/m, Oct -2.6% m/m and -4.6% y/y), (4) EIA weekly Petroleum Status Report.

Notable Russell 1000 earnings reports today include: none.

U.S. IPO's scheduled to price today: none.

Equity conferences during the remainder of this week: none.

Market Comments

Mar S&P 500 E-minis (ESH19 +0.55%) this morning are up +15.00 points (+0.60%) at a 1-week high. Thursday's closes: S&P 500 +0.86%, Dow Jones +1.14%, Nasdaq 100 +0.41%. The S&P 500 on Thursday recovered from early losses and closed higher on technical short-covering after the S&P 500 failed to take out Wednesday's lows. Stocks were also supported by some optimism about US/Chinese trade tensions after China's Ministry of Commerce said that U.S. and China trade negotiators have been in close contact and the U.S. will send its negotiating team to Beijing the week of Jan 7. Stocks were undercut by the Dec Conference Board U.S. consumer confidence report that fell -8.3 to a 5-month low of 128.1, weaker than expectations of -2.2 to 133.5. There was also weakness in energy stocks after crude oil prices tumbled -3.48%.

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