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Morning Brief

Stocks to drop | CAT suffers double downgrade | SEC wants to penalize Elon Musk


U.S. stock futures were pointing to a lower open this morning after Wall Street saw its highest closes since early November. While surging this year, the Dow, S&P 500, and Nasdaq were, respectively, 2.8 percent, 4.8 percent, and 6.9 percent away from last year's record highs. (CNBC)

Dow component Home Depot (HD) and retailer Macy's (M) lead this morning's list of quarterly earnings reports. Red Robin (RRGB), TiVo (TIVO), and Weight Watchers (WW) are among the companies releasing earnings after today's closing bell. (CNBC)

* Home Depot shares fall on earnings, revenue, same-store sales all miss estimates (CNBC)

Shares of Dow component Caterpillar sink in the premarket after UBS double downgraded the stock from buy all the way down to sell. Citing slowing global construction demand, UBS also lowered its 12-month price target to $125 from $154 per share. (CNBC)

On Tuesday's economic calendar, the government releases its shutdown delayed report on December housing starts at 8:30 a.m. ET. The December S&P Case-Shiller report on home prices comes at 9 a.m. ET. The Conference issues its February consumer confidence index at 10 a.m. ET. (CNBC)

Fed Chairman Jerome Powell heads to the Senate this morning and the House tomorrow to deliver his semiannual report on the economy. Lawmakers are sure to pepper Powell in the Q&A sessions on his so-called pivot to a slower path higher for interest rates. (CNBC)


North Korean leader Kim Jong Un arrived in Vietnam today for tomorrow's summit with President Donald Trump. They will try to reach an agreement on Pyongyang's pledge to give up its nuclear weapons program. Trump is set to touch down in Hanoi tonight. (Reuters)

* Trump expects to sign a trade deal with China 'fairly soon' (Washington Post)
* Huawei says there is no evidence supporting US spying claims (CNBC)
* Foreign companies say China is increasingly respecting intellectual property (CNBC)

The president's former personal lawyer, Michael Cohen, begins three days of congressional appearances today. He's expected to detail what he claims to know about Trump's contacts with Russia, hush payments made prior to the 2016 election, and other sensitive matters. (CNBC)

* Lawyers for ex-Trump campaign chairman Paul Manafort say a long prison term would 'likely amount to a life sentence' (USA Today)

GOP leaders are scrambling to keep rank-and-file members in line ahead of today's House vote to kill Trump's declaration of a national emergency on the Mexican border. Democrats are appealing to Republicans to protect Congress' constitutional power to control federal spending. (NY Times)

Top executives from seven of the largest pharmaceutical companies are set to testify before the Senate Finance Committee today, setting up a showdown the soaring cost of medicines. Drugmakers blames pharmacy benefit managers. (CNBC)

'Wacky' drug price system keeps costs high for patients paying for prescriptions, FDA Chief says (CNBC)

Voters in Chicago to choose from a crowded field today, vying to succeed Mayor Rahm Emanuel. The ex-Obama official opted not to run for a third term. One of the leading candidates is former Clinton and Obama aide Bill Daley, whose father and older brother led the city. (USA Today)

The SEC asked a federal judge to hold Tesla (TSLA) CEO Elon Musk in contempt of court, saying he violated a settlement reached last year by tweeting about the automaker's projected production volumes last week. Tesla shares were lower in the premarket. (CNBC)

Musk lashes out on Twitter: 'Something is broken with SEC oversight' (CNBC)

Amazon (AZMN) is adding former PepsiCo CEO Indra Nooyi to its board of directors. Nooyi is the second woman to join the board this month, following the appointment of Starbucks COO Rosalind Brewer. (CNBC)


Tenet Healthcare (THC) reported adjusted quarterly profit of 51 cents per share, well above estimates. The hospital operator's revenue also came in above forecasts, citing meaningfully improved 2018 financial performance.

Etsy (ETSY) beat estimates by 11 cents with quarterly earnings of 32 cents per share. The online arts and crafts marketplace saw revenue beat as well. Etsy also issued strong 2019 revenue guidance.

Shake Shack (SHAK) reported adjusted quarterly profit of 6 cents per share, doubling estimates. Revenue and same-restaurant sales also beat forecasts. However, the burger chain's forward guidance was largely below projections.

Hertz Global (HTZ) lost 55 cents per share in its latest quarter, nearly half the loss expected by analysts. The car rental company's revenue also beat forecasts, saying it had strong momentum going into 2019.


Warren Buffett bought $114.75 in stock at age 11. Buffett, now 88, said in his annual letter to Berkshire Hathaway (BRK.a) shareholders that if he had put that money into a no-fee S&P 500 index fund then it would be worth $606,811 today. (CNBC)

* Buffett likes stocks for the long haul, sees no value in bitcoin, and admits he messed up with Kraft (CNBC)