The Dow Jones Industrial Average (DJIA) once again staged an
afternoon rebound Tuesday to reclaim support at the 11,000 level by
the close. Given the positive news rolling in from overseas, the
bulls' tenacity has paid off, with futures on the DJIA and the
S&P 500 Index (SPX) trading roughly 113 and 12.3 points above
fair value, respectively. Specifically, Chinese manufacturing data
arrived better than expected, while the U.K.'s purchasing managers'
index soared to a 16-year high. What's more, the cost of ensuring
Portugal's and Spain's sovereign debt also fell, sparking a rally
in the euro zone banking sector.
Technically, the DJIA could be set to blow past short-term
resistance at the 11,100 level, an area that is also home to the
Dow's 10-day moving average. However, the blue chip barometer is
still staring up at potentially staunch resistance at the 11,200
level, where the DJIA's 20-day trendline resides. As for the SPX,
the broad-market index should be able to put some space between it
and support at the 1,175 level. The index could find some
turbulence near the 1,190 level, with the 1,200 possibly capping
the day's advance.
In equity news, Brown-Forman Corp. (BF) announced a special
dividend of $1 per share for its Class A and Class B common stock.
Shareholders of record as of Dec. 10 will receive the payout on
Dec. 28. "This special dividend underscores the strength of our
company's balance sheet and cash flows, and it reinforces our
belief that returning cash to shareholders plays an important role
in producing superior long-term total shareholder returns," the
Louisville, Ky, spirits maker said.
Finally, JPMorgan initiated coverage on several financial
services companies. Specifically, the brokerage firm started
American Express Co. (
) at "overweight," while initiating coverage on Capital One
Financial Corp. (
) and Discovery Financial Services (
) with a "neutral" rating.
On the earnings front, Charming Shoppes Inc. (
), Aeropostale Inc. (
), Collective Brands Inc. (PSS), Jo-Ann Stores Inc. (JAS), Krispy
Kreme Doughnuts (KKD) and Zumiez Inc. (ZUMZ) are slated to release
their quarterly reports. Keep your browser at
for more news as it breaks.
The economic calendar will be busy today. ADP and Challenger,
Gray & Christmas kick off three successive days of jobs data,
with the former reporting on private sector growth in November, and
the latter releasing data on layoffs. The Institute for Supply
Management's (ISM) manufacturing index for November is also on tap
today, as is the October construction spending and auto sales
Weekly initial jobless claims arrive tomorrow, while Friday
brings the much anticipated nonfarm payrolls and the unemployment
rate for November, which will be accompanied by October factory
orders and the ISM's services index for November.
Equity option activity on the Chicago Board Options Exchange
(CBOE) saw 1,068,602 call contracts traded on Tuesday, compared to
624,305 put contracts. The resultant single-session put/call ratio
arrived at 0.58, while the 21-day moving average held at 0.58.
**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 has come roaring back this morning, with all 10
of the foreign indexes that we track in positive territory. In
fact, the cumulative average return on the collective stands at a
gain of 1.35%. Strong Chinese manufacturing data and weakness in
the U.S. dollar provided lift for regional markets in Asia, though
gains were limited in Shanghai due to concerns that this latest
report would spur Beijing to additional interest-rate increases.
Meanwhile, European markets are sharply higher this morning, with
banks leading the way as the cost of insuring Spanish and
Portuguese sovereign debt fell. What's more, the U.K.'s purchasing
managers' index hit a 16-year high, adding to this morning's
contingent of solid overseas economic data.
Currencies and Commodities
With equities back in fashion today, the U.S. dollar has lost
its safe-haven appeal. Furthermore, the falling cost of ensuring
euro-zone debt and a strong demand for a Portuguese bond auction
lifted the euro, helping the currency to rebound from its recent
lows versus the greenback. At last check, the U.S. Dollar Index was
off 0.5% at 80.79. As you might expect, weakness in the dollar has
been a boon for commodities. Crude futures have soared 1.52% to
$85.39 per barrel, extending November's 3.2% gain. What's more,
gold futures have jumped $10.70 to $1,396.80 an ounce in London, as
the malleable metal looks to expand upon its 2.1% gain last
Unusual Put and Call Activity:
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