Morning Call For October 19, 2016

OVERNIGHT MARKETS AND NEWS

Dec E-mini S&Ps (ESZ16 unch) are up +0.02% on a rally in energy producing stocks as the price of crude oil (CLX16 +1.29%) climbs +1.37% after API data released late yesterday showed U.S crude supplies declined -3.8 million bbl last week. Gains were limited and European stocks are down -0.2%after weaker-than-expected Chinese industrial output fuels global growth concerns. Also, technology stocks are weaker led by a nearly 5% decline in Intel in pre-market trading after it forecast weaker-than-expected Q4 revenue. Asian stocks settled mostly higher: Japan +0.21%, Hong Kong -0.38%, China +0.03%, Taiwan +0.67%, Australia +0.45%, Singapore +0.49%, South Korea +0.09%, India -0.24%. China’s Shanghai Composite eked out a 5-week high on speculation the government may boost stimulus measures after the pace of Chinese industrial production unexpectedly slowed.

The dollar index (DXY00 -0.07%) is down -0.16%. EUR/USD (^EURUSD) is unch. USD/JPY (^USDJPY) is down -0.47% at a 1-week low.

Dec 10-year T-note prices (ZNZ16 unch) are up +0.5 of a tick at a 2-week high.

China Sep industrial production rose +6.1% y/y, weaker than expectations of +6.4% y/y.

China Q3 GDP was unchanged for the second straight quarter at 6.7% y/y, right on expectations and the slowest pace of growth in 7-1/2 years.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly MBA mortgage applications (previous -6.0% with purchase sub-index -2.6% and refi sub-index -8.0%), (2) Sep housing starts (expected +2.9% to 1.175 million, Aug -5.8% m/m to 1.142 million), (3) San Francisco Fed President John Williams (non-voter) speaks at Rutgers University, (4) Dallas Fed President Robert Kaplan (non-voter) takes part in a moderated Q&A at a luncheon sponsored by the Fort Worth Chamber of Commerce, (5) Fed Beige Book, (6) EIA Weekly Petroleum Status Report.

Notable S&P 500 earnings reports today include: Morgan Stanley (consensus $0.63), AMEX (-0.96), Halliburton (-0.06), Abbott Labs (0.58), Citrix (1.19), Kinder Morgan (0.16), eBay (0.44).