After tapping a fresh two-year high, the Dow Jones Industrial
Average (DJIA) settled on a gain of 54 points in the wake of the
Fed's update on U.S. monetary policy. The central bank reiterated
its stance on continued low interest rates and the $600 billion
bond repurchase program. "The economic recovery is continuing,
though at a rate that has been insufficient to bring down
unemployment," the Fed explained. Suffering from a post-Fed
hangover, and news that Moody's Investor Services placed Spain on
review for a downgrade, futures on the DJIA and the S&P 500
Index (SPX) are trading roughly 21 points and 4 points below fair
value, respectively.
Technically, the DJIA closed firmly above the 11,450 level, and
even made a run at 11,500. Look for the latter region to provide
resistance today, while the 11,400 level may be called upon for
support, should this morning's reports on consumer prices,
manufacturing, and housing come in worse than expected. As for the
SPX, the broad-market index has found resistance in the 1,246 area,
while support could arrive at 1,240, or 1,235 if early selling
pressure gains momentum.
In equity news, Yahoo! Inc. (
YHOO
) said after the close last night that it is cutting 4% of its
roughly 14,000 employees, confirming an earlier
Wall Street Journal
report on the matter. The move is intended to position the company
"for revenue growth and margin expansion and to support our
strategy to deliver differentiated products to the marketplace."
Yahoo said in a statement that it is "grateful for the important
contributions made by the employees affected by this reduction. We
are offering severance packages and outplacement services to these
employees."
On the merger and acquisition front, Swiss drug concern Novartis
AG (
NVS
) announced that will take full ownership of Alcon Inc. (
ACL
). NVS is paying $168 per share, or $12.9 billion, for the
remaining portion of ACL shares that it does not already own. "The
full merger is the logical conclusion of our initial strategic
investment in Alcon. With this step Novartis takes full ownership,
becoming the global leader in eye care, a rapidly expanding,
innovative platform based on the growing needs of an aging
population," said Novartis Chairman Daniel Vasella.
Finally, Joy Global Inc. (
JOYG
) posted a fourth-quarter net profit of $146.3 million, or $1.39
per share, as sales rose 8.9% to $1.05 billion. Analysts were
expecting a profit of $1.15 per share on sales of $921.6 million.
Looking ahead, JOYG said it sees fiscal 2011 revenue of between
$3.9 billion and $4.1 billion, with earnings of between $5.00 and
$5.30 per share. Analysts had expected 2011 earnings of $4.85 per
share on sales of $3.85 billion.
Earnings Preview
There are no more major earnings reports slated for release
today. Keep your browser at
SchaeffersResearch.com
for more news as it breaks.
Economic Calendar
The economic calendar is packed with data today, as the November
consumer price index, the December Empire State manufacturing
index, November industrial production, the National Association of
Home Builders' housing market index, and the usual weekly report on
U.S. crude inventories are slated to arrive. Thursday is also busy,
with weekly jobless claims, November housing starts, and the Philly
Fed's December manufacturing index. The flood finally abates on
Friday, with only the Conference Board's leading indicators for
November slated for release
Market Statistics
Equity option activity on the Chicago Board Options Exchange (
CBOE
) saw 1,397,782 call contracts traded on Tuesday, compared to
719,199 put contracts. The resultant single-session put/call ratio
arrived at 0.51 while the 21-day moving average dropped to
0.54.
**The volume data shown above is from the Nasdaq and NYSE
exchanges only. It does not include regional volume activity,
which means that other daily volume quotes you see may be
higher.**
Overseas Trading
Overseas trading is abysmal this morning, with only one of the
10 foreign indexes that we track in positive territory. The
cumulative average return on the collective stands at a loss of
0.73%. Asian markets closed broadly lower, with Hong Kong shares
leading the way after Moody's Investor Services placed Spain on
review for a possible downgrade. Meanwhile, Japanese stocks were
pressured lower, despite the yen's decline versus the dollar, after
the Bank of Japan's tankan survey showed that manufacturing sector
sentiment deteriorated. As you might suspect, Spain is heading up
the retreat in Europe, with euro-zone banks suffering the brunt of
this morning's selling.
Currencies and Commodities
With Spain on review, the euro is feeling the heat this morning.
In fact, the weak European currency has helped push the U.S. Dollar
Index roughly 0.45% higher in premarket trading. As you might
expect, the rally in the dollar has applied pressure to
commodities. Specifically, crude futures were last seen lower by 97
cents at $87.87, while gold futures had dropped $14.30 to trade at
$1,390 an ounce in London.
Unusual Put and Call Activity:
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Education Center
topics on
Option Volume
and
Open Interest Configurations
.
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