cross fade erases track

I have been using Cubase since Cubase 3 days and just updated to 7.5.

When I try to cross fade an event the track erases. I have tried both hitting X on the keyboard and using the cross fade menu on Audio. It happens both times. Therefore, I can not cross fade a punch.

Cubase 7.5

Windows 8.1, i7 chip set, 32 gigs ram, ASUS Maximus VI Hero Motherboard, 260 gig solid state Hard Drive (c:) RME RayDAt interface, Apogee 16x A/D, Big Ben Clock. Mackie Control surface.