Trade developments between the US and China remain this morning’s focal point, with pre-market futures positioned higher as Trump reportedly held a position, more eager than ever, to strike a deal to help revive the flagging stock market rally he took credit for.

While concerns linger surrounding the impact of protectionist tensions on global growth, investors are hopeful of a resolution to the trade dispute and will be hawk-eyed, waiting for any signs of a potential deal. China’s Foreign Ministry said Wednesday that its trade talks with the United States had concluded and that results would soon be released.

This follows suit to Tuesday’s session, where Wall Street finished higher amid optimism on trade as scheduled talks between the US and China were extended by an extra day.

The S&P 500 concluded trading up +0.94% higher, notching its third straight advance. Real Estate being the benchmark’s biggest gainer, climbing -1.82%, followed by Communication Services, up -1.68%.

The Dow Jones Industrial Average rose +1.09%, while the Nasdaq Composite climbed to close +0.90% higher.

Aside from trade-developments, traders are likely to monitor the US government shutdown as President Donald Trump showed no signs of letting up, addressing immigration and border security Tuesday night, where he made his case for the proposed wall along the US-Mexico border a key sticking point.

In terms of economic data, market participants may have moved on from the Federal Reserve’s December policy meeting where Chairman Jerome Powell offered soothing remarks, saying the central bank is “prepared to adjust policy quickly”, but most likely won’t dismiss the minutes of the session, which are due to be released today at 2pm EST.

In corporate news, earnings season is well underway, with; Acuity Brands (AYI), Constellation Brands (STZ), The Greenbrier (GBX), Lennar (LEN), Skyline (SKY), MSC (MSM) and Schnitzer Steel (SCHN) all expected to post their results before the opening bell.

Meanwhile, WD-40 (WDFC), Bed Bath & Beyond (BBBY), KB Home (KBH) and PriceSmart (PSMT) are set to release their latest financial figures after the close.


Trade: US-China Trade Talks Conclude on Optimistic Note. (Bloomberg)
China and the US wrapped up three days of trade talks, with people familiar with the discussions saying their positions were closer on areas including energy and agriculture but further apart on harder issues.

Politics: Trump Makes His Case for a Border Wall as Shutdown Drags On. (The WSJ)
President Trump in a prime-time address Tuesday said a wall along the southern border is key to national security, as he called for lawmakers to fund it and end a partial government shutdown that is days away from becoming the longest in US history.

In the televised address from the Oval Office, Mr. Trump’s first in his nearly two years as president, he emphasized it is to support law-enforcement officials.

Today’s Economical Announcements

09:00AM – ★☆☆ – Chicago Fed President Evans Speaks
10:30AM – ★★★ – Crude Oil Inventories (Previous: 0.007M)
11:30AM – ★★☆ – FOMC Member Rosengren Speaks
02:00PM – ★★★ – FOMC Meeting Minutes

Pre-Market Movers & News Related Stocks

Skyworks Solutions (SWKS): [REVIEW] Canaccord Genuity slashed its price target on Skyworks to $84 from $96 a share, citing weak smartphone demand around the world.

Morgan Stanley (MS): [UPGRADE] Citigroup upgraded Morgan Stanley to “buy” from “neutral,” noting higher market volatility can lead to higher trading revenue throughout the year.

Tesla (TSLA): [NEWS] The electric car maker is being sued after a passenger died last year due to a defective battery. The suit alleges Tesla “failed to warn purchasers of its vehicles of the battery’s dangerous condition.”

Lowe’s (LOW): [DOWNGRADE] Barclays downgraded the home-improvement retailer to “equal weight” from “overweight,” noting “it is unproven that the company can accelerate comps into a decelerating macro⁄industry across the board in 2019.”

Nike (NKE): [DOWNGRADE] Baird downgraded Nike to “neutral” from “outperform” amid concern its high valuation may not be sustainable.

Foot Locker (FL): [UPGRADE] Baird upgraded Foot Locker to “outperform,” noting the near-term fundamentals for the company “can continue to inflect positively” amid strong Nike same-store sales.

Apple (AAPL): [NEWS] Nikkei reported that Apple is cutting iPhone production by 10 percent between January and March.

Facebook (FB): [NEWS] CEO Mark Zuckerberg said he will host a series of discussions about tech’s role in society in the future.

Bank of America (BAC): [UPGRADE] Upgraded to “buy” from “neutral” at UBS, with analysts noting Bank of America “should continue improving efficiency metrics and, importantly, appears comparatively well positioned to withstand a turn in credit.”

Tilray (TLRY): [RATING] Initiated with an overweight rating and a $90 price target at Piper Jaffray. “The timing of a regulatory change is hard to predict, but we expect continued global momentum for medical and recreational marijuana legalization,” Piper said.