US/China trade war concerns continue to cast a shadow over the markets.  Another 2-day meeting that includes China’s vice premier Lieu He is confirmed to start Jan 30 in the US.  The US government shutdown is now in day 27 and there was concern the next US/China meeting would be delayed as the self-imposed March 1 deadline is quickly approaching.  Further concerns were cast by US actions that US federal prosecutors are investigating allegations that Huawei Technologies stole trade secrets from US companies.  Additionally, a bi-partisan bill was launched in Congress seeking to ban US companies from exporting goods that violated State Department sanctions; specifically, Chinese company Huawei and ZTE Corp.  The economic calendar is light with Philly Fed and Claims @ 8:30am EST.  Housing Starts will not be released due to the government shutdown.  The Fed’s Quarles speaks @ 10:45am EST.  JPM and GS both beat expectations yesterday.  CSX also beat but warned of slowing growth which sent the stock down over 4% this morning.  On deck today are NFLX, MS, AXP, BBT, JBHT, and KEY.  Volatility is remaining steady with price moving easier to the downside than the upside.  Size bias is short into the US session open.

Confusion and doubt are creeping into the markets over exactly what was accomplished during Trump and China’s Xi Jinping over Sat dinner’s trade talks.  The WH economic advisor Larry Kudlow tried to detail specifics from the meeting but only conflicted with trade talk information released by the Chinese.  The start date of the 90-day truce is in question as Kudlow says it’s Dec 1 and China said it was Jan 1.  With no agreement written down and signed, markets are a little nervous.  Meanwhile yields between the 3 and 5-year note have inverted for the first time in over 10 years suggesting that the US economy is slowing.  Nothing of significance on today’s US economic calendar.  The Fed’s Williams holds a press conference @ 10:00am EST.  Earnings include TOL, DG, AZO, MRVL, and HPE.  Volatility remains elevated, however could shrink into today’s US close as US stock markets will be closed National Day of Mourning for former US President George H.W. Bush.  Size bias is short on lighter Globex volume into the US session open.

North Korea is threatening to pull out of a meeting with Trump scheduled for June 12 in Singapore.  The US is pushing for total denuclearization which North Korea continues to balk at.  North Korea issued the statement “If the US is trying to drive us into a corner to force out unilateral nuclear abandonment, we will no longer be interested in such dialogue and cannot but reconsider our proceeding to the DPRK-US summit.”  The US Supreme Court earlier this week lifted a ban on sports betting in New Jersey.  The decision is causing a lot of activity in the sports business world including potential sports-betting mergers and a $2.2B purchase of the NFL Carolina Panthers by hedge fund billionaire David Pepper.  The dollar continues to inch higher as yesterday’s Retail Sales number were solid and expectations are set the Fed will raise rates sooner rather than later.  The economic calendar focus is Permits and Housing Starts @ 8:30am EST, Industrial Production @ 9:15am EST, and Oil @ 10:30am EST.  Earnings today include CSCO, M, JACK, and TWO.  Volatility continues to remain muted with higher probability for a pickup to the downside rather than the upside.  Size bias is leaning long into the 8:30am EST housing numbers.

US Stock markets are closed today for the Martin Luther King Federal holiday.  DTG will resume posting tomorrow.  Do something, enjoy the day away from the markets!