Wednesday Watch

Evening Headlines

Bloomberg:

• U.S. Tariff List Aims at Technology China Wants to Dominate. (video) The U.S. proposed imposing 25 percent tariffs on about $50 billion worth of Chinese-made products, focusing on high-tech items from semiconductors to lithium batteries while seeking to minimize the impact on American consumers. “This level is appropriate both in light of the estimated harm to the U.S. economy, and to obtain elimination of China’s harmful acts, policies, and practices,” the U.S. Trade Representative’s office said in a report on Tuesday. The U.S. is targeting the 1,300 product lines to try and force China to change its intellectual property practices, the office said.

• Stocks to Watch After Trump Announces Proposed China Tariffs. (video)

• The Tokyo Whale Steps Up With Record Buys of Japanese Stocks.

• Stocks in Asia Trade Mixed; Treasuries Steady. Equity benchmarks fluctuated in Tokyo, Sydney and Seoul. A recovery in U.S. equities from a technology-fueled drubbing on Monday seemed to be largely overshadowed by the Trump administration’s announcement that came after the close of stock trading in New York. The S&P 500 Index is still more than 9 percent below its January record. Treasuries were steady after sliding Tuesday as risk appetite returned. The Topix index was little changed as of 9:15 a.m. in Tokyo. Australia’s S&P/ASX 200 Index fell 0.2 percent. South Korea’s Kospi index lost 0.2 percent. Contracts on the S&P 500 fell 0.2 percent.

• Five Things You Need to Know to Start Your Day. (video)

• OPEC Output Falls to Lowest in a Year Amid Venezuela Woes.

• Despite Trump’s Tweets, White House Isn’t Talking About Amazon(AMZN) Action. (video)

Wall Street Journal:

• U.S. Announces Tariffs on $50 Billion of China Imports. Levies target 1,300 separate product categories.

• The Fuel Economy Fraud. Pruitt is right to rewrite rules that are mostly honored in the breach.

MarketWatch.com:

• This volatility ratio offers stock-market bulls a reason to be cheerful.

Fox News:

• YouTube shooting injures 4, woman believed to be shooter dead, police say. (video)

• Homeland Security finds suspected phone surveillance devices in Washington.

CNBC:

• Mueller reportedly told Trump's lawyers the president is not a criminal target at this point.

• Chinese ambassador to US: We will take measures to fight back very soon.

• Stocks making the biggest moves after hours: Cloudera, Dave & Buster's & more.

• Apple(AAPL) hires Google’s(GOOG) AI chief.

• Trump’s tax cut windfall lifts stock dividends to new record.

• Earnings reports can't get here soon enough for a market trying to find its footing. (video)

Zero Hedge:   

• Trade War Round 2: US Releases China Tariff List Targeting 1,300 Products.

• "It Is Difficult To Explain What Happened": Einhorn Lost Money On Both His Longs And Shorts In Q1.

• What Reflation? Despite Massive Money Printing, Japan's Industrial Production Still Below 2008 Levels.

• Stocks Soar After Bloomberg Report Unleashes Amazon Buying Panic. (graph)

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 77.75 -.75 basis point. 

• Asia Pacific Sovereign CDS Index 13.25 -.25 basis point.

• Bloomberg Emerging Markets Currency Index 75.21 +.03%.

• FTSE 100 futures -.21%.

• S&P 500 futures -.29%.

• NASDAQ 100 futures -.42%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (AYI)/2.09

• (LEN)/.77

• (KMX)/.87

• (OLLI)/.50

• (RECN)/.17

Economic Releases
8:15 am EST

• The ADP Employment Change for March is estimated to fall to 210K versus 235K in February.

10:00 am EST

• ISM Non-Manufacturing Composite for March is estimated to fall to 59.0 versus 59.5 in February.

• Factory Orders for February is estimated to rise +1.7% versus a -1.4% decline in January.

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory build of +1,396,820 barrels versus a +1,643,000 barrel gain the prior week. Gasoline supplies are estimated to fall by -1,577,640 barrels versus a -3,472,000 barrel decline the prior week. Distillate inventories are estimated to fall by -1,360,640 barrels versus a -2,090,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to rise by +.13% versus a +.6% gain prior.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Mester speaking, China Services PMI report, Eurozone CPI report and the weekly MBA Mortgage Applications report could also impact trading today.

BOTTOM LINE:  Asian indices are mostly higher, boosted by retail and industrial 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.