Overnight Markets and News

Sep E-mini S&Ps (ESU18 +0.16%) this morning are up +0.19% at a 6-1/2 month high on strength in technology stocks led by a 1% increase in Apple in pre-market trading after Bank of America/Merrill Lynch reiterated its Buy rating on the stock and raised its price target on Apple to $250 from $230. European stocks are higher by +0.70% on strength in miners and commodity producing stocks as Sep COMEX copper (HGU18 +0.94%) gains +0.94% on signs of increased copper demand after LME canceled warrants, or orders to withdraw copper from LME warehouses, rose +18,000 MT to a 1-1/2 month high. Asian stocks settled mostly higher: Japan +0.09%, Hong Kong +0.56%, China +1.31%, Taiwan +0.87%, Australia -0.96%, Singapore -0.15%, South Korea +1.15%, India +0.02%. Chinese stocks rose for a second day and the yuan strengthened to a 1-week high against the dollar on speculation that government buying of equities will limit declines. The Shanghai Composite rebounded from a 2-1/3 year low in the last hour of trade Monday on reports of buying of Chinese blue chip stocks by state-sponsored funds. Japan's Nikkei Stock Index shook off early losses and closed higher after USD/JPY recovered from a 1-3/4 month low and moved higher, which boosted Japanese exporters.

The dollar index (DXY00 -0.40%) is down -0.37% at a 1-week low on negative carry-over from Monday's comments from President Trump who said ne “should be given some help by the Fed” and that he's “not thrilled” with Fed Chair Powell raising interest rates. EUR/USD (^EURUSD +0.42%) is up +0.31% at a 1-week high. USD/JPY (^USDJPY +0.14%) is up +0.15%.

Sep 10-year T-note prices (ZNU18 -0-045) are down -5 ticks.

UK Aug CBI trends total orders fell -4 to 7, weaker than expectations of -3 to 8. The Aug CBI trends selling prices rose +2 to 15, stronger than expectations of +1 to 14.

UK Jul public sector net borrowing fell -2.9 billion pounds, weaker than expectations of -2.0 billion pounds and the biggest decline in 6 months.

U.S. Stock Preview

Key U.S. news today includes: (1) no economic reports or Fed speakers scheduled.

Notable Russell 2000 earnings reports today include: Toll Brothers (consensus $1.03), Medtronic (1.11), Kohl's (1.64), Nordstrom (1.60), TJX (1.05), Urban Outfitters (0.77).

U.S. IPO's scheduled to price today: Megalith Financial Acquisition Corp (MFAC/U)

Equity conferences during the remainder of this week: BMO Capital Markets Silicon Valley Tech Tour on Tue, Data Integrity Seminar on Wed, Mobile Payments Conference 2018 on Wed-Thu, ACI US Base Oils and Lubricants Summit on Thu, SEB Industrial & Technology Seminar on Thu, UBS Kohler Utility Mini-Conference on Thu, NGAUS Conference on Fri.

Market Comments

Sep S&P 500 E-minis (ESU18 +0.16%) this morning are up +5.50 points (+0.19%) at a 6-1/2 month high. Monday's closes: S&P 500 +0.24%, Dow Jones +0.35%, Nasdaq 100 -0.08%. The S&P 500 on Monday rose to a 1-week high and closed higher on strength in miners as copper prices jumped +1.50% on signs of stronger demand. There was also strength in energy stocks as crude oil prices climbed +0.79%. Stocks also received a boost from some optimism that China and the U.S. may be able to resolve their trade differences as the two countries hold trade talks this Wed/Thu.

Sep 10-year T-notes (ZNU18 -0-045) this morning are down -5 ticks. Monday's closes: TYU8 -0.50, FVU8 -0.50. Sep 10-year T-notes on Monday rallied to a 2-1/2 month high and closed higher on fund short-covering as CFTC data showed that speculative short positions on 10-year T-notes exploded to a record high 698,194 contracts in the week ended Aug 14. T-notes were also supported by comments by Atlanta Fed President Bostic who said “businesses are increasingly cautious” due to trade uncertainty, which creates a downside risk for the economy.

The dollar index (DXY00 -0.40%) this morning is down -0.358 (-0.37%) at a fresh 1-week low. EUR/USD (^EURUSD +0.42%) is up +0.0036 (+0.31%) at a 1-week high. USD/JPY (^USDJPY +0.14%) is up +0.17 (+0.15%). Monday's closes: Dollar Index -0.201 (-0.21%), EUR/USD +0.0044 (+0.38%), USD/JPY -0.43 (-0.39%). The dollar index on Monday fell to a 1-week low and closed lower on the fall in the 10-year T-note yield to a 1-1/2 month low, which reduces the dollar's interest rate differentials, and on dovish comments from Atlanta Fed President Bostic who said “businesses are increasingly cautious” due to trade uncertainty.

Metals this morning are higher with Dec gold (GCZ18 +0.49%) +5.7 (+0.48%), Sep silver (SIU18 +0.75%) +0.125 (+0.85%) and Sep copper (HGU18 +0.94%) +0.025 (+0.94%). Monday's closes: Dec gold +10.4 (+0.88%), Sep silver +0.039 (+0.27%), Sep copper +0.0395 (+1.50%). Metals on Monday closed higher on a weaker dollar. Copper found support on stronger Chinese copper demand as China unwrought copper imports from Jan-Jul rose +16% y/y to 3.043 MMT. Copper was also supported by signs of stronger demand after LME cancelled warrants, or orders to withdraw copper from LME warehouses, jumped +11,525 MT to a 1-1/4 month high of 36,050 MT.

Sep WTI crude oil (CLU18 +0.90%) this morning is up +49 cents (+0.74%). Sep gasoline (RBU18 +0.64%) is +0.91 (+0.45%). Monday's closes: Sep crude oil +0.52 (+0.79%), Sep gasoline +3.42 (+1.73%). Sep crude oil and gasoline on Monday closed higher on the fall in the dollar index to a 1-week low and on global supply concerns as oil workers began a strike at North Sea oil platforms run by Total SA. Crude oil prices were undercut by the stronger dollar.

Overnight U.S. Stock Movers

Apple (AAPL -0.97%) gained nearly 1% in pre-market trading after Bank of America/Merrill Lynch reiterated its 'Buy' rating on the stock and raised their price target on Apple to $250 from $230.

Discovery (DISCA +3.60%) was upgraded to 'Buy' from 'Hold' at Jeffries with a price target of $34.

Ingersoll-Rand Plc (IR +0.02%) was rated a new 'Overweight' at Morgan Stanley with a price target of $111.

MercadoLibre (MELI -1.37%) lost 1% in after-hours trading after it reported an $800 million convertible senior note offering.

Lennox International (LII +1.19%) was rated a new 'Underweight' at Morgan Stanley with a price target of $201.

Honeywell International (HON +0.19%) was rated a new 'Overweight' at Morgan Stanley with a price target of $175.

Nordson (NDSN -0.22%) dropped nearly 9% in after-hours trading after it forecast Q4 EPS of $1.38 to $1.64, the midpoint below consensus of $1.53.

Conagra Brands (CAG +0.08%) was rated a new 'Overweight' at Stephens with a price target of $45.

Paylocity Holding (PCTY +1.07%) was rated a new 'Buy' at Guggenheim Securities with a price target of $80.

Fabrinet (FN +0.78%) climbed more than 6% in after-hours trading after it reported Q4 revenue of $345.3 million, above consensus of $338.0 million, and then forecast Q1 revenue of $347 million to $355 million, the midpoint above consensus of $348.3 million.

Workday (WDAY +0.45%) was upgraded to 'Buy' from suspended coverage at Guggenheim Securities with a price target of $175.

Jeffries Financial Group (@symbolPercentChange(JEF was rated a new 'Outperform' at Keefe, Bruyette & Woods with a price target of $29.

Appian (APPN +0.11%) slid more than 2% in after-hours trading after it announced the launch of a proposed underwritten public offering of 2.0 million shares of its Class A common stock, of which 1.675 million are being offered by Appian and 325,000 shares are being offered by existing stockholders of Appian.

Vital Therapies (VTL unch) gained more than 2% in after-hours trading after it was rated a new 'Overweight' at Cantor Fitzgerald with a price target of $18.