The Dow Jones Industrial Average (DJIA) was once again rejected
by resistance at the 11,450 level on Tuesday, as the blue chip
barometer refused to break out to a fresh two-year high. The
S&P 500 Index (SPX), however, did tag a new two-year peak of
1,235.05 yesterday. However, Tuesday's late-session malaise appears
to have carried over into this morning, with futures on the DJIA
and the SPX trading roughly 8 points and 1.25 points below fair
value, respectively. Even deal making from salesforce.com Inc. (
) and Fortune Brands Inc. (
), and an earnings update from Home Depot Inc. (
), have failed to inspire bulls to resume their buying spree this
Technically, the DJIA has pulled back to support at the 11,350
level, with this region potentially providing a floor for the Dow
today. A break below this support level could send the DJIA down to
support at the 11,300 level. Resistance, meanwhile, remains firm in
the 11,450 region. As for the SPX, support lies at the 1,220 level,
with resistance near 1,230.
In equity news, Home Depot Inc. (
) said that it expects adjusted 2010 earnings of $1.97 per share,
on sales growth of about 2% to 2.5%. For 2011, HD forecast earnings
of $2.19 per share to $2.23 per share, excluding items. Wall Street
is currently looking for 2010 earnings of $1.95 per share, with
2011 earnings expected to come in at $2.22 per share. Home Depot
said that it plans to buy back $2.5 billion in stock in 2011.
Elsewhere, salesforce.com Inc. (
) announced that it will buy social networking firm Heroku.
Salesforce expects the deal to cut adjusted earnings by 2 cents per
share in the fiscal 2011 fourth quarter, and by 12 cents to 13
cents per share in fiscal 2012.
Finally, Fortune Brands Inc. (
) announced plans to split into three businesses. The company is
spinning off its home-and-security unit, with products including
Moen faucets and Master locks, in a tax-free move for stock
holders. The golf division will also be spun off, while the company
will continue to operate its liquor business as an independent
publicly traded company. "[Each] business is very well positioned
to create significant value for shareholders on its own," Fortune
On the earnings front, SAIC Inc. (
) and Smith & Wesson Holding Corp. (
) are scheduled to release their quarterly reports today. Keep your
for more news as it breaks.
The Street will be greeted with the weekly report on U.S.
petroleum supplies today, while weekly jobless claims and October's
wholesale inventories will arrive tomorrow. We round out the week
tomorrow with November's import/export prices, December's
University of Michigan consumer sentiment index, and November's
Equity option activity on the Chicago Board Options Exchange
(CBOE) saw 1,712,440 call contracts traded on Tuesday, compared to
805,420 put contracts. The resultant single-session put/call ratio
arrived at 0.47 while the 21-day moving average held at 0.57.
**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
Overseas trading looks weak this morning, as only three of the
10 foreign indexes that we track are in positive territory. The
cumulative average return on the collective stands at a loss of
0.20%. Regional indexes were broadly lower in Asia, though Japanese
exporters led the Nikkei to a nearly 1% gain due to the yen's
decline versus the U.S. dollar. Meanwhile, European markets are
trading in a tight range this morning, as stocks digest their
recent run to multi-year highs. What's more, news that Germany's
exports dropped 1.1% in October from the preceding month is
hampering investor sentiment.
Currencies and Commodities
The U.S. dollar is bouncing back a bit this morning, with the
U.S. Dollar Index popping back above the round-number 80 level. At
last check, the index was up 0.38% at 80.16. Crude futures are
taking the dollar's bounce to heart, falling 65 cents to $88.04 per
barrel in electronic trading. Finally, gold futures are extending
yesterday's late-session retreat, falling $13.70 to $1,395.30 an
ounce in London.
Unusual Put and Call Activity:
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