Dow Jones 30: Industrials Index

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Monday, December 27, 2010...

Overnight U.S. Stock News

•   March S&Ps this morning are down -4.80 points. The stock market last Thursday finished mixed as valuation concerns offset strong economic data: Dow +0.12, S&P 500 -0.16%, Nasdaq Composite -0.22%. The Dow posted a 2-1/4 year high.

                Bullish factors included (1) the larger-than-expected decline in weekly US continuing unemployment claims to their lowest level in 2 years (-103,000 to 4.064 million versus expectations of -35,000 to 4.100 million), (2) the +0.4% m/m increase in Nov personal spending along with the upward revision to Oct (+0.7% from the previously reported +0.4%), a sign that the US economic recovery may continue with US personal spending increasing for the fifth consecutive month, and (3) the as-expected increase in the Dec US University of Michigan consumer confidence to a 6-month high (+0.3 to 74.5).


•   Bearish factors included (1) weakness in home builders after Nov US new home sales rose less than expected (+5.5% to 290,000 versus expectations of +6.0% to 300,000), (2) valuation concerns as the recent rally in stocks has pushed the P/E ratio on S&P 500 companies up to a 6-month high, and (3) the ongoing European sovereign-debt crisis after Fitch Ratings cut Hungary's and Portugal's credit ratings with negative outlooks and credit-default swaps to insure Greek government debt rose +38 bp to a 1-month high of 1,019 bp.


•   Ford Motor (F) slipped 1.6% and General Motors (GM) fell 1.1% in pre-market trading on carry-over weakness from a decline in European automakers after China raised intereat rates.

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Tuesday, December 28, 2010...

Overnight U.S. Stock News

•   March S&Ps this morning are up +2.50 points and posted a fresh contract high in overnight trade. The stock market yesterday overcame early weakness and finished mixed after AIG surged and after Treasury yields fell back after a successful 2-year T-note auction: Dow -0.16, S&P 500 +0.06%, Nasdaq Composite +0.062%.

                Bullish factors included (1) strength in financial companies after AIG surged when it announced it had received $4.3 billion in bank credit lines, which signals an improvement in AIG that may allow early repayment of government funds it received during the financial crisis, and (2) the drop in Treasury yields which fell from 1-week highs after a well-received $35 billion auction of 2-year T-notes.


•   Bearish factors included (1) carry-over weakness from a slump in Chinese and European stock markets after China raised interest rates for the second time in 2 months, which may slow the global economy, and (2) concerns the European sovereign-debt crisis may worsen after ECB Executive Board member Stark said that while some European economies have shown surprisingly strong recoveries, high debt levels don't only affect individual nations and that "we are still in an open crisis."


•   General Motors (GM) climbed 1.3% in European trading after JPMorgan Chase, Morgan Stanley, RBC Capital, Citigroup, BofA Merrill Lynch Global Research, Barclays Capital, and Credit Suisse Group AG all recommended the automaker.

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Wednesday, December 29, 2010...

Overnight U.S. Stock News

•   March S&Ps this morning are up +1.10 points at a fresh contract high. The stock market yesterday gave up an early rally and settled mixed after US consumer confidence unexpectedly declined: Dow +0.18, S&P 500 +0.08%, Nasdaq Composite -0.16%. The S&P 500 Index and the Dow posted 2-1/4 year highs.

                Bullish factors included (1) the report from MasterCard Advisors' SpendingPulse, which measures retail sales by all payment forms, that showed US retailers' 2010 holiday sales jumped 5.5% y/y, the strongest pace of sales in 5 years, (2) the larger-than-expected increase in the Dec Richmond Fed manufacturing index to its best level in 7 months (+16 to 25 versus expectations of +2 to 11), and (3) strength in commodity producers after copper posted a record high and fueled optimism that the global economy will continue to expand and keep demand firm for basic resources.

   Bearish factors included (1) weakness in homebuilders after the larger-than-expected drop in home prices in the Oct S&P/CaseShiller composite-20 home price index (-1.0% m/m and -0.8% y/y versus expectations of -0.6% m/m and -0.2% y/y), (2) the unexpected decline in Dec US consumer confidence (-1.8 to 52.5 versus expectations of +2.3 to 56.4), and (3) the 13 bp jump in the 10-year T-note yield after demand for the Treasury's $35 billion auction of 5-year T-notes was the weakest in 6 months.

[setravis]

Thursday, December 30, 2010...

Overnight U.S. Stock News

•   March S&Ps this morning are down -1.40 points. The stock market yesterday finished higher on speculation that global economic growth will accelerate into next year: Dow +0.09, S&P 500 +0.10%, Nasdaq Composite +0.15%. The S&P 500 Index and the Dow both posted 2-1/4 year highs.

                Bullish factors included (1) strength in raw-materials and energy producers on optimism that an expanding global economy will lead to increased demand for commodities, (2) data from the US Census Bureau that said US state tax revenue increased +4.8% y/y in Q3, the third-straight quarterly increase, as gains in consumer spending boosted retail-sales tax receipts, and (3) the -14 bp drop in yield on the 10-year T-note after strong foreign demand was seen at the Treasury's $29 billion 7-year T-note auction.


   Bearish factors included (1) weakness in money-center banks after Credit Agricole Securities cut its Q4 earnings estimates for Goldman Sachs and Morgan Stanley, citing lower-than-expected trading in their fixed-income, currencies and commodities units, and (2) valuation concerns as the current stock market rally has pushed the P/E ratio on S&P 500 companies up to a 6-month high.


•   Anadarko Petroleum (APC) rose 3% in pre-market trading after the Daily Mail reported that BHP Billiton may make a $90 a share bid for the independent oil and natural gas producer.


•   Qwest Communications (Q) climbed 2.2% in pre-market trading after the company said it has reduced its debt by about $3.3 billion since Feb.

[setravis]

Friday, December 31, 2010...

Overnight U.S. Stock News

•   March S&Ps this morning are down -1.80 points. The stock market yesterday settled slightly lower in thin holiday trade as valuation concerns overshadowed better-than-expected economic data: Dow -0.14, S&P 500 -0.15%, Nasdaq Composite -0.15%.

                Bearish factors included (1) valuation concerns as the recent rally in stock prices has sent the P/E ratio on S&P 500 companies up to 15.76, a 6-month high, (2) weakness in energy producers after crude oil prices fell below $90 a barrel, and (3) the 4 bp increase in the yield on the 10-year T-note.


   Bullish factors included (1) the larger-than-expected decline in weekly initial US unemployment claims which fell to their lowest level in 2-1/3 years (-34,000 to 388,000 versus expectations of -5,000 to 415,000), (2) the unexpected increase in the Dec Chicago purchasing managers index which expanded at its fastest pace in 22 years (+6.1 to 68.6 versus expectations of -1.5 to 61.0), and (3) strength in homebuilders after the stronger-than-expected increase in Nov pending home sales (+3.5% m/m versus expectations of +0.8% m/m).

[setravis]

Tuesday, January 4, 2011...

Overnight U.S. Stock News

•   March S&Ps this morning are trading up 4.40 points (+0.35%) mainly due to the sharp 1.46% rally in the Euro Stoxx 50 on economic optimism in Europe. The US stock market on Monday rallied fairly sharply: Dow +0.81%, S&P 500 +1.13%, Nasdaq Composite +1.46%. The stock market rallied on Monday on (1) hopes for a big round of new buying by institutional investors as the New Year begins, (2) the 0.4 point rise in the US ISM manufacturing index to a new 7-month high and the third consecutive month of increases for construction spending (Nov +0.4%), which fueled additional optimism about the U.S. economy, (3) the upward revision in the Dec Euro-Zone PMI manufacturing index by 0.3 points to 57.1 from 56.8, which helped European stocks, and (3) rating upgrades for Alcoa (+2.7%) by Deutsche Bank and for GM (+0.5%) by Goldman Sachs. Bank of America on Monday rallied by 6.4% after settling with Freddie Mac and Fannie Mae over claims for selling them bad mortgages.

[setravis]

Stocks End Mixed as Dow Hits New High
Tuesday, 4 Jan 2011 | 4:41 PM ET

Stocks closed mixed a day after hitting multiyear highs despite positive economic news and after word the Federal Reserve didn't believe the economy had improved enough by December to alter its economic stimulus program.

The Dow Jones Industrial Average rose 20.43 points, or 0.2 percent, to close at 11,691.18, its highest close since Aug. 28, 2008.

Tuesday's lackluster session comes a day after upbeat news on manufacturing across the world encouraged investors to get the new year off to a strong start. All the major indexes closed Monday at multi-year highs.

Alcoa [AA  16.52    0.72  (+4.56%)] and Disney [DIS  38.99    1.17  (+3.09%)] led blue-chips higher, while McDonald's [MCD  74.31    -2.29  (-2.99%)] and Coca Cola [KO  63.87    -1.35  (-2.07%)] declined.

The S&P 500 fell 1.67 points, or 0.13 percent, to close at 1,270.20, while the Nasdaq fell 10.27 points, or 0.4 percent, to close at 2,681.25, ending off the lows of the session. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell below 18.

Among key S&P sectors, energy, consumer discretionary and materials fell, while telecom rose.

At the Dec. 14 Federal Open Market Committee meeting, central bank officials believed the economic recovery hadn't gained enough strength to warrant a change in the Fed's $600 billion bond-buying program.

If the Fed didn't have enough evidence of a turnaround in the economy to change its stimulus program in December, they probably won't see enough evidence in coming months, Todd Schoenberger, managing director at LandColt Trading told CNBC.com.

That's because, while the economy is improving, headwinds remain, including rising gas prices and still anemic job growth, Schoenberger said.

"The Fed is not going to have evidence that's going to help them to trim back on that $600B," he said. "That's good news for stocks—the market wants QE2," he added, referring to the second round of quantitative easing, the name given to the Fed's gradual purchases of long-term bonds. 

A deal between Qualcomm [QCOM  50.97    0.79  (+1.57%)   ] and Atheros Communications [ATHR  44.00    6.98  (+18.85%)   ], a semiconductor manufacturer, could be announced later this week for $45 a share, or $3.5 billion, according to the New York Times, citing "two people with direct knowledge of the talks."

Ford [F  17.38    0.13  (+0.75%)   ] advanced even after the automaker reported its U.S. sales for December rose 6.7 percent from a year earlier, and 30 percent more than November levels.

General Motors [GM  37.90    0.84  (+2.27%)   ] gained after the automaker reported sales rose 7.5 percent from the same month last year, its best showing for last year. GM began trading on the New York Stock Exchange in mid-November. Meanwhile, RBC started coverage on GM with an "outperform" rating and a $42 price target.

Chrysler's sales, meanwhile, rose 16.4 percent in December from the same time in 2009, while the automaker's sales rose 17 percent for the year.

Toyota's [TM  79.86    0.43  (+0.54%)   ] sales, however, fell 5.5 percent in December from the same month a year ago. But Nissan's [NSANY  19.76    0.61  (+3.19%)   ] sales rose 28 percent in December from a year earlier.

Overall, December auto sales were expected to reach 12.3 million, according to economists surveyed by Reuters.

Commodities sold off as investors took profits and moved into riskier assets. The Reuters-Jefferies CRB index [.CRB  327.73    -5.29  (-1.59%)] fell more than 1.5 percent.

Oil prices sank, closing down 2.37 percent, at $89.39 a barrel, after trading near 27-month highs in a volatile session as investors took profits.

Energy stocks fell, led by Anadarko Petroleum and Nabors Industries. ConocoPhilips and Chevron also declined.

Shares of BP [BP  46.26    1.11  (+2.46%)] jumped following newspaper reports that rival oil major Royal Dutch Shell [RDSA  67.46    0.38  (+0.57%)] was considering buying the troubled firm.

Gold also fell sharply to $1,378.50 on profit taking and as investors moved into riskier assets such as stocks. Freeport-McMoran [FCX  118.75    -0.83  (-0.69%)   ] declined more than 2 percent, and Fronteer Development [FRG  10.89    -0.52  (-4.56%)   ] tumbled more than 5 percent, despite being added to RBC's best ideas portfolio.

Poll: Is the Gold Bubble Popping?
Materials also suffered after UBS cut its stock-investment ratings on Vulcan Materials [VMC  42.14    -2.32  (-5.22%)   ] and Martin Marietta Materials [MLM  86.98    -6.02  (-6.47%)   ] to "neutral" from "buy." 

Meanwhile, severe floods in north-east Australia decimated an area that produces coking coal used in steel making. Coal stocks, including Peabody Energy [BTU  62.83    -1.69  (-2.62%)   ] and Puda Coal [PUDA  13.95    -0.75  (-5.1%)   ] took a plunge following the news. (Read more: Australia's Floods Offer Trading Opportunities).

But Alcoa [AA  16.52    0.72  (+4.56%)   ] continued to surge a week ahead of its earnings release, and a day after Deutsche Bank raised the aluminum producer to "buy" from "hold."

The commodities selloff, as well as signs of U.S. economic growth, appeared to boost the dollar [.DXY  79.42    0.295  (+0.37%)   ], which rose against a basket of currencies.

Motorola split into two companies and began trading today. Motorola Mobility [MMI  33.12    2.88  (+9.52%)   ], which makes cell phone and cable set-top boxes, rose more than 6 percent at the outset, while Motorola Solutions [MSI  39.77    2.46  (+6.59%)   ], which sells police police radios and barcode scanners to government agencies and large companies, rose slightly.

In other news, the Pentagon faces cuts and savings of $100 billion, sources told Reuters. The U.S. Defense Secretary Robert Gates is expected to announce the cost-cutting measures this week.

Borders [BGP  0.8399    -0.1201  (-12.51%)   ] sank further after news the bookstore chain's general counsel and chief information officer resigned. The departures came in the wake of Borders' disclosure it would delay payment to vendors.

Chain store sales are scheduled to be reported on Wednesday and Thursday, and were expected to show a 3.3 percent gain in December, marking a strong end to the holiday shopping season. But analysts were divided as to whether consumers will continue to shop now that the holidays are over.

Overall, retailers were largely lower Tuesday, but Polo Ralph Lauren shares [RL  108.36    -3.33  (-2.98%)   ]  gained after the luxury apparel maker was raised to "buy" from "hold" by Citigroup.

Supervalu shares [SVU  9.00    -0.61  (-6.35%)   ] slid after Morgan Stanley cut its rating on the grocer to "underweight" from "equalweight." Rival grocery chains also dropped including Safeway [SWY  21.64    -0.85  (-3.78%)   ] and Whole Foods [WFMI  49.04    -1.71  (-3.37%)   ].

Shares of J.M. Smucker [SJM  63.29    -2.28  (-3.48%)   ] fell sharply after Sanford Bernstein cut the maker of jams and ice-cream toppings to "underperform" from "market perform."

Volume on the consolidated tape of the New York Stock Exchange reached 4.7 billion shares. On the NYSE floor, 1.1 billion shares changed hands. Declines outpaced advances nearly 2 to 1.

In the day's economic news, November factory orders jumped 0.7 percent, more than expected, and up from a 0.9 percent decline in October, according to the Commerce Department. Economists surveyed by Reuters had expected factory orders to fall 0.1 percent.

European stocks closed mostly higher as the FTSE-100 surged ahead of the other major indexes.

On the Calendar This Week:

WEDNESDAY: MBA mortgage applications, Challenger job-cut report, ADP employment report, ISM non-manufacturing index, oil inventories; earnings from Family Dollar. Kansas City Federal Reserve President Hoenig speaks.
THURSDAY: Chain store sales, Monster employment index, ECB announcement, jobless claims, natural gas inventories, Treasury STRIPS, money supply; earnings from Monsanto.
FRIDAY: Nonfarm payrolls report, consumer credit; Federal Reserve Chairman Bernanke speaks, Federal Reserve Vice Chairman Janet Yellen speaks.

Dow Jones 30 Industrials...

[setravis]

Wednesday, January 5, 2011...

Overnight U.S. Stock News

•   March S&Ps this morning are trading down -7.10 points. The US stock market on Tuesday closed mixed: Dow +0.18%, S&P 500 -0.13%, Nasdaq Composite -0.38%. The stock market on Tuesday was supported by fresh data indicating US economic strength with news that Nov factory orders rose +0.7% (versus expectations of -0.1%) and that US Dec vehicle sales rose to a new 2-1/4 year high (excluding the cash-for-clunkers program during summer 2009) of 12.53 million units from 12.26 million units in November. In addition, European stocks rallied sharply on Monday in response to economic optimism with the UK Dec purchasing managers index posting a new 16-year high of 58.3. The stock market received some support from news that FOMC members at the Dec 14 meeting were generally opposed to considering a roll-back of QE2. The stock market was hurt yesterday by some long liquidation pressure that started in the commodity markets and found its way into stocks as well.


•   Alcoa (AA) slipped 1.8% in pre-market trading after Citigroup downgraded the company to "hold" from "buy" and cut its EPS estimate for the stock to 17 cents from 19 cents.

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Friday, January 7, 2011...

Overnight U.S. Stock News

•   March S&Ps this morning are trading down -0.40 of a point ahead of this morning's Dec US payrolls report. The US stock market on Thursday fell back from an early rally and finished mixed: Dow -0.22%, S&P 500 -0.21%, Nasdaq Composite +0.28%. The S&P 500 climbed to a 2-1/4 year high and the Nasdaq posted a 9-3/4 year high.

                Bearish factors for stocks included (1) valuation concerns as the S&P 500 Index is trading for almost 16 times the operating profits of its companies, the highest in 6 months, (2) weakness in retailers after some Dec retailer sales were reported weaker than expected after blizzards kept shoppers away from stores the last week of Dec, and (3) profit-taking and long liquidation ahead of Friday's all-important monthly payrolls report.


   Bullish factors included (1) a sign that the US labor market is improving after the US Labor Department reported that the 4-week average of applications for US jobless benefits slipped to 410,750, a nearly 2-1/2 year low, and (2) optimism that company earnings' will continue to improve, as the start of Q4 earnings reporting season begins next week.


•   Immucor (BLUD) gained 6.2% in pre-market trading after the company said Q2 EPS rose 30 cents, higher than analysts' estimates of 27 cents, and it forecast 2011 adjusted EPS of $1.08-$1.18 a share, 2 cents higher than analysts' projections of $1.16.

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Monday, January 10, 2011...

Overnight U.S. Stock News

•   March S&Ps this morning are trading down -5.90 points. The US stock market last Friday settled moderately lower: Dow -0.19%, S&P 500 -0.18%, Nasdaq Composite -0.25%.

                Bearish factors for stocks included (1) (1) the smaller-than-expected increase in Dec nonfarm payrolls (+103,000 versus expectations of +150,000), (2) comments from Fed Chairman Bernanke who said the US economy is in a "weak" and "fragile" condition and that "it could take 4 to 5 more years for the job market to normalize fully," (3) weakness in financial shares after US Bancorp and Wells Fargo lost a foreclosure case in Massachusetts's highest court, which increases concern about results in other lawsuits between bank practices and state real estate laws.
               

                Bullish factors included (1) the larger-than-expected decline in the Dec unemployment rate (-0.4 to a 19-month low of 9.4% versus expectations of -0.1 to 9.7%), (2) the upward revision to Nov nonfarm payrolls (+71,000 versus the originally reported +39,000), and (3) the 9 bp drop in the yield on the 10-year T-note.


•   ConocoPhillips (COP) lost 1.3% and Exxon Mobil (XOM) slid 0.8% in pre-market trading after an oil leak forced the companies and partner BP Plc to shut down the Trans Alaska Pipeline System, which carries 15% of US crude output.

[setravis]

Tuesday, January 11, 2011...

Overnight U.S. Stock News

•   March S&Ps this morning are trading up +6.50 points. The US stock market yesterday recovered from early losses and finished mixed: Dow -0.19%, S&P 500 -0.18%, Nasdaq Composite -0.25%. The Nasdaq rose to a 3-year high.

                Bearish factors for stocks included (1) concerns that indebted European nations may struggle to repay their debts and intensify the sovereign-debt crisis after the Markit Group Ltd.'s index of credit-default swaps protecting the debt of 15 western European governments rose 3.5 bp to a record 223, (2) weakness in for-profit education companies after Strayer Education plunged when it cut its 2011 EPS estimate because winter new enrollment declined -20% from a year ago, and (3) comments from Atlanta Fed President Lockhart who said he sees further "headwinds" to the recovery even as the US economy improves in 2011.


   Bullish factors included (1) the action by UBS to raise its 2011 per-share earnings estimates on the S&P 500 Index to $96 from $93 and raise its 2012 S&P 500 forecast to $104 a share from $101, citing a better outlook for the US economy, and (2) increased M&A activity after Dupont acquired Danisco A/S for $5.8 billion and Duke Energy bought Progress Energy for $13.7 billion, which will make Duke Energy the largest US utility.


•   Nvidia (NVDA) jumped 5.5% in pre-market trading after Intel agreed to a long-term cross-license agreement with Nvidia in which Intel will pay Nvidia $1.5 billion over the next 5 years and the companies will receive a license to each other's patents.


•   Hewlett-Packard (HPQ) rose 1.1% in European trading after UBS upgraded its recommendation on the stock to "buy" from "neutral."

[setravis]

Wednesday, January 12, 2011...

Overnight U.S. Stock News

•   March S&Ps this morning are trading up +7.40 points at a fresh contract high. The US stock market yesterday traded sideways in positive territory the entire day and finished with modest gains: Dow +0.30%, S&P 500 +0.37%, Nasdaq Composite +0.33%. The Nasdaq rose to a 3-year high.

                Bullish factors for stocks included (1) carry-over support from a rally in European stocks after Japan pledged to buy European bonds, (2) strength in energy producers after crude oil rallied and gasoline climbed to a 27-month high, and (3) expectations for positive Q4 company earnings results after companies in the S&P 500 posted higher-than-expected results in all three quarters so far for 2010.


   Bearish factors included (1) the unexpected decline in Nov wholesale inventories (-0.2% versus expectations of +1.0%), which signals inventories will provide less of a boost to economic growth, (2) data from the BLS that showed the US job openings rate, or the number of job openings as a percent of total employment plus job openings, fell to 2.4% in Nov from 2.5% in Oct, and (3) comments from ECB Council member and Bundesbank President Weber who said optimism on containing the European sovereign-debt crisis is "premature."


•   Lululemon Athletica (LULU) jumped 6.7% in pre-market trading after the company raised its forecst for Q4 profit to 55 cents a share, topping analysts' estimates of 50 cents.

[setravis]

Thursday, January 13, 2011...

Overnight U.S. Stock News

•   March S&Ps this morning are trading down -0,30 of a point. The US stock market yesterday shot higher and finished at its best level in over 2 years: Dow +0.72%, S&P 500 +0.90%, Nasdaq Composite +0.75%. The Nasdaq rose to a 9-3/4 year high and the Dow and the S&P 500 posted 2-1/3 year highs.

                Bullish factors for stocks included (1) carry-over support from a rally in European stocks as sovereign-debt concerns eased after Portugal successfully auctioned 10-year debt at lower yields than a previous auction along with speculation that European leaders will increase their efforts to stem the debt crisis after European Union Economic and Monetary Affairs Commissioner Rehn called for a "comprehensive" plan to contain the sovereign debt crisis, (2) strength in bank stocks after Wells Fargo raised its rating on the largest US banks to "overweight" from "market weight," saying dividend payout ratios may double this year, (3) a rally i n energy producers after crude oil gained when weekly crude inventories fell more than expected, and (4) the Fed's Beige Book that said holiday-season spending and increased manufacturing drove an economic expansion in Nov and Dec, and that businesses are cautiously optimistic about their 2011 outlooks.


   Bearish factors included (1) the Fed's Beige Book that stated housing markets were "weak and sluggish" across a majority of regions, which may limit growth in the economy, and (2) the prediction from well-known bank analyst Meredith Whitney that she expects more than 1 million job losses among state and local governments as they increase their austerity measures in an attempt to trim their budget deficits.


•   Deere & Co. (DE) climbed 1.2% in European trading after JPMorgan Chase raised its recommendation for the company to "overweight" from "neutral."

[setravis]

Friday, January 14, 2011...

Overnight U.S. Stock News

•   March S&Ps this morning are trading down -4.40 points. The US stock market yesterday traded sideways the entire day and finished with slight losses: Dow -0.20%, S&P 500 -0.17%, Nasdaq Composite -0.07%. The Nasdaq posted a 9-3/4 year high but gave up its gains and settled slightly lower.

                Bearish factors for stocks included (1) the unexpected increase in weekly initial US unemployment claims which climbed to their highest level in 2 months (+35,000 to 445,000 versus expectations of unchanged at 409,000), (2) the larger-than-expected increase in the Dec PPI which posted its biggest monthly advance in 11 months (+1.1% m/m and +4.0 y/y versus expectations of +0.8% m/m and +3.8% y/y), and (3) comments from Fed Chairman Bernanke who said that US growth of 3.0% to 4.0% this year won't be enough to reduce unemployment at the pace the Fed would like.


   Bullish factors included (1) carry-over support from a rally in European stocks as sovereign-debt concerns eased after Spain and Italy had successful auctions of government debt, and (2) the unexpected narrowing of the Nov US trade balance to its smallest deficit in 10 months (-$38.3 billion versus expectations of -$40.5 billion), which is positive for GDP growth.


•   Intel (INTC) climbed 2.6% in European trading after the company late yesterday forecast Q1 revenue will range from $11.1 billion and $11.9 billion, ahead of analysts' estimates of $10.7 billion.

[setravis]

Dow Jones 30: Industrials Index

USA
Dow Jones Industrial Average...
The Dow is advancing to 12000* after breaking resistance at 11450. Rising Twiggs Money Flow (13-week) reflects strong buying pressure. Reversal below 11000 is most unlikely, but would also warn of a primary trend reversal.

* Target calculation: 11000 + ( 11000 - 10000 ) = 12000