OVERNIGHT MARKETS AND NEWS

Mar E-mini S&Ps (ESH18 +0.34%) are up +0.37% on optimism a House Republican stopgap spending plan can be passed to keep the government open through Feb 16. House Speaker Ryan is attempting to garner enough support for the spending bill that may come up for a vote in the House on Thursday. Upbeat comments from Dallas Fed President Kaplan also fueled gains in stocks when he said, "the economy is going to be strong this year" and he expects the unemployment rate to fall into the 3% range by year end and for inflation to firm up. European stocks are little changed, down by -0.07%, after a rally in EUR/USD (^EURUSD) to a new 3-year high in overnight trade undercut European exporter stocks. Asian stocks settled mixed: Japan -0.35%, Hong Kong +0.25%, China +0.24%, Taiwan +0.17%, Australia -0.54%, Singapore -0.23%, South Korea -0.25%, India +0.89%. China's Shanghai Composite climbed to a 2-year high as it found support on a rally in Hong Kong stocks to a record high. Japanese stocks gave up early gains and closed lower after USD/JPY fell to a 4-month low in overnight trade, which undercut exporter stocks.

The dollar index (DXY00 +0.42%) is up +0.42% as it recovers from a 3-year low in overnight trade. EUR/USD (^EURUSD) fell back from a new 3-year high in overnight trade and is down -0.42% after ECB Vice President Constancio said "I am concerned about sudden movements in euro appreciation which don't reflect changes in fundamentals." USD/JPY (^USDJPY) is up +0.30%.

Mar 10-year T-note prices (ZNH18 -0.18%) are down -6 ticks.

Dallas Fed President Kaplan in an interview with the WSJ said, "the economy is going to be strong this year" and he expects the unemployment rate to fall into the 3% range by year end and for inflation to firm up. He added that he feels "strongly and has a lot of conviction that the base case should be three rate hikes this year, and if he's wrong could even potentially be more than that."

Eurozone Nov construction output rose +0.5% m/m, the largest monthly increase in 9 months.

Eurozone Dec new car registrations fell -4.9% y/y to 1.088 million, the biggest decline in 8 months. For the year-to-date, new car registrations rose +3.4% y/y to 15,137,732.

Japan Nov core machine orders unexpectedly rose +5.7% m/m, stronger than expectations of -1.4% m/m.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) weekly MBA mortgage applications (previous +8.3% with purchase sub-index +5.0% and refi sub-index +11.4%), (2) Dec industrial production (expected +0.4%, Nov +0.2%), (3) Jan NAHB housing market index (expected -2 to 72, Dec +5 to 74), (4) Fed Beige Book, (5) Chicago Fed President Charles Evans (non-voter) takes part in a moderated discussion on current economic conditions and monetary policy as the American Council of Life Insurers Executive Roundtable, (6) Cleveland Fed President Loretta Mester (voter) discusses monetary policy communication at Rutgers University.

Notable Russell 1000 earnings reports today include: Goldman Sachs (consensus $4.90), Bank of America (0.45), US Bancorp (0.88), Schwab (0.42), Kinder Morgan (0.18), Fastenal (0.45).

U.S. IPO's scheduled to price today: none.

Equity conferences this week: Deusche Bank Global Auto Industry Conference on Tue-Wed, Needham & Co. Growth Conference on Wed, ACI Future of Polyolefins Summit on Wed.

OVERNIGHT U.S. STOCK MOVERS

Dick's Sporting Goods (DKS -3.00%) was upgraded to 'Buy' from 'Neutral' at Buckingham Research Group with a price target of $40.

Boyd Gaming (BYD -0.88%) was rated a new 'Buy' at Argus Research with a 12-month target price of $44.

International Business Machines (IBM +0.44%) was upgraded to 'Overweight' from 'Underweight' at Barclays with a price target of $192.

L3 Technologies (LLL -0.99%) was upgraded to 'Buy' from 'Neutral' at Bank of America/Merrill Lynch with a 12-month target price of $240.

Renasant (RNST +0.34%) lost 4% in after-hours trading after it reported Q4 EPS of 33 cents, well below consensus of 63 cents.

Juno Therapeutics (JUNO -6.46%) surged over 40% in after-hours trading after the WSJ reported Celgene was in talks to buy the company.

Nutanix (NTNX -4.84%) fell 3% in after-hours trading after it announced it will offer $400 million in convertible senior notes due 2023.

Verso (VRS +0.35%) rallied 10% in after-hours trading after it said it expanded its strategic evaluation to include other alternatives, including a merger or sale.

Boot Barn Holdings (BOOT -0.78%) fell 4% in after-hours trading after it announced the launch of a public offering of 5.5 million shares of its common stock held by certain holders.

Intrexon (XON -6.39%) dropped 7% in after-hours trading after it announced an underwritten public offering of shares of its common stock, although no size was given.

Newater Technology (NEWA +21.54%) jumped over 15% in after-hours trading after it said it will form a limited partnership with NW Blockchain to develop blockchain applications.

A10 Networks (ATEN -3.56%) slumped 23% in after-hours trading after it reported preliminary Q4 revenue was $55.5 million to $56.0 million, well below estimates of $65.1 million, as the company cited weaker-than-expected North American demand trends.

Aerohive Networks (HIVE -3.23%) tumbled 16% in after-hours trading after it reported preliminary Q4 net revenue of $37 million, weaker than a prior estimate of $40 million to $42 million, and below consensus of $40.5 million.

Cloud Peak Energy (CLD -4.32%) climbed 6% in after-hours trading after it signed a long-term contract to supply coal to a Japanese IGCC power plant beginning at the end of 2019 and continuing for a period of 30 to 40 months.

MARKET COMMENTS

Mar S&P 500 E-mini stock futures (ESH18 +0.34%) this morning are up +10.25 points (+0.37%). Tuesday's closes: S&P 500 -0.35%, Dow Jones -0.04%, Nasdaq -0.32%. The S&P 500 on Tuesday posted a fresh record high early but gave up its advance and closed lower. Stocks were undercut by the unexpected -1.9 point decline in the U.S. Jan Empire manufacturing index to a 6-month low of 17.7, weaker than expectations of +1.0 to 19.0. There was also weakness in energy stocks after crude oil prices fell -0.89% and concern about a possible U.S. government shutdown on Friday night.

Mar 10-year T-note prices (ZNH18 -0.18%) this morning are down -6 ticks. Tuesday's closes: TYH8 +1.50, FVH8 -1.00. Mar 10-year T-notes on Tuesday closed higher on the slump in stocks after the S&P 500 retreated from a new record high and on the unexpected decline in the U.S. Jan Empire manufacturing index to a 6-month low.

The dollar index (DXY00 +0.42%) this morning is .up +0.376 (+0.42%) EUR/USD (^EURUSD) is down -0.0051 (-0.42%) and USD/JPY (^USDJPY) is up +0.33 (+0.30%). Tuesday's closes: Dollar Index -0.581 (-0.64%), EUR/USD -0.0004 (-0.03%), USD/JPY -0.09 (-0.08%). The dollar index on Tuesday closed lower on the unexpected decline in the U.S. Jan Empire manufacturing index and on concern about a U.S. government shut down if Congress does not pass a continuing resolution by Friday.

Feb crude oil (CLG18 -0.47%) this morning is down -24 cents (-0.38%) and Feb gasoline (RBG18 -0.32%) is -0.0034(-0.18%). Tuesday's closes: Feb WTI crude -0.57 (-0.89%), Feb gasoline -0.0111 (-0.60%). Feb crude oil and gasoline on Tuesday closed lower on negative carry-over from Friday's Baker Hughes report that U.S. active oil rigs in the week ended Jan 12 rose by +10 rigs to a 4-month high of 752 rigs. There was also some long liquidation from funds on concern the crude market may be overbought as CFTC data showed hedge funds increased their net-long position in WTI futures and options by 10% to 437,770 contracts during the week ended Jan 9, the highest since 2006.

Metals prices this morning are mixed with Feb gold (GCG18 -0.08%) +0.2 (+0.01%), Mar silver (SIH18 +0.15%) +0.036 (+0.21%), and Mar copper (HGH18 -0.47%) -0.013 (-0.40%). Tuesday's closes: Feb gold +2.2 (+0.16%), Mar silver +0.048 (+0.28%), Mar copper +0.0010 (+0.03%). Metals on Tuesday closed higher with Feb gold at a 4-month high and Mar silver at a 2-month high. Metals prices were boosted by a weaker dollar and concern that Congress may be unable to pass a CR to avert a government shutdown after Friday, which boosted safe-haven buying of precious metals.

GLOBAL EVENT CALENDAR01/17/2018

U.S. STOCK CALENDAR01/17/2018