Today's heavy economic schedule will likely keep the markets focused on domestic matters. The good start provided by the positive Initial Jobless Claims report and the Empire State manufacturing survey should help reverse the downtrend of the last three trading sessions. Other key economic reports on deck include the November Industrial Production report and the Philly Fed regional manufacturing survey for December.
Of the pre-market releases, the most favorable reading was on the Initial Jobless Claims front, which continued the positive momentum from last week by falling to the lowest level in more than three years. Contrary to expectations of some sort of a give-back following last week's big drop in initial claims, we got another big 19K drop, taking the weekly initial claims level further down to 366K. The four-week average is now at 388K.
It is reassuring to see that this key series has again started moving in the right direction, which is in-line with other labor market readings. The wholesale inflation reading was tad hotter than expected, but broadly in-line with expectations.
In corporate news, we have better-than-expected results from FedEx ( FDX ) this morning. The package delivery giant also reaffirmed its outlook for the year, bucking recent trend of profit warnings from a number of major firms. In other news, Lam Research ( LRCX ), a maker of semiconductor equipment, plans to buy Novellus Systems ( NVLS ) in an all-stock deal valued at $3.3 billion.
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