Before the Open (Dec 17)

Posted on by Jason Leavitt

Good morning. Happy Tuesday.
The Asian/Pacific markets closed mixed. Indonesia, Malaysia and Japan did well; China dropped 0.5%. Europe currently leans to the downside. France and Belgium are down the most; Amsterdam is up the most. Futures in the States point towards a flat-to-up open for the cash market.

The dollar is flat. Oil and copper are down. Gold is down, silver is flat.
Be alerted of new content. Join our email list here.
At this point in time, it’s all about the Fed. Will they begin the tapering process or not? What will the market’s reaction be in either case? And is the news big enough to disrupt the charts for more than just a day or two? These are the big questions.
Last week Wall St was warming up to the idea the Fed may taper. This week the attitude is shifting back to not tapering. It’s hard to determine what is priced in.
Then seasonality effects kick in. There are numerous stats which heavily favor buying into the end of the year, not to mention all the hedge funds which are severely lagging and need to do something to salvage their under-performance.
I continue to like the market long term. This has always been the case. For the last month things have been iffy. There haven’t been many good set ups to trade, and many breadth indicators have lagged. And of course this Fed meeting as loomed.
I expect today and the first half of tomorrow to be quiet. Then hopefully we can have a good run into 2014.
Stock headlines from barchart.com…
Adobe (ADBE -3.93%) was upgraded to ‘Buy’ from ‘Hold’ at Argus.
Honeywell (HON +0.88%) lowered guidance on fiscal 2014 EPS to $5.35-$5.55, at the lower end of consensus of $5.55.
AT&T (T +0.89%) will sell Connecticut wireline operations to Frontier (FTR -0.90%) for $2 billion.
Facebook (FB +0.92%) was upgraded to ‘Positive’ from ‘Neutral’ at Susquehanna.
Public Storage (PSA +0.98%) was downgraded to ‘Underperform’ from ‘Market Perform’ at BMO Capital.
Medtronic (MDT +0.81%) was upgraded to ‘Buy’ from ‘Neutral’ at Goldman.
Hewlett-Packard (HPQ +0.49%) was upgraded to ‘Overweight’ from ‘Neutral’ at JPMorgan.
Western Digital (WDC +3.30%) was upgraded to ‘Overweight’ from ‘Neutral’ at JPMorgan with a price target of $100.
Citigroup keeps its ‘Buy’ rating on Yahoo! (YHOO unch) and raised its price target on the stock to $46 from $39.
Huntington Ingalls (HII +1.73%) was upgraded to ‘Buy’ from ‘Hold’ at Deutsche Bank who also raised their price target on the stock to $100 from $78.
Plains All American (PAA -0.29%) was downgraded to ‘Hold’ from ‘Buy’ at Deutsche Bank who also lowered their price target on the stock to $55 fom $66.
Williams (WMB +3.15%) climbed over 2% in after-hours trading after Corvex disclosed a 5.28% stake in Williams.
KKR Financial (KFN -0.84%) surged over 30% in after-hours trading after it was acquired by KKR (KKR +0.40%) for $2.6 billion.
Boeing (BA +0.67%) rose 3% in after-hours trading after it raised its quarterly dividend by 50% to 73 cents per share and authorized a $10 billion share repurchase plan.
Earnings and Economic Numbers from seekingalpha.com…
Today’s economic calendar:
FOMC meeting begins
7:45 ICSC Retail Store Sales
8:30 Consumer Price Index
8:30 Current Account
8:55 Redbook Chain Store Sales
10:00 NAHB Housing Market Index
1:00 PM Results of $35B, 5-Year Note Auction
Notable earnings before today’s open: FDS, SAFM
Notable earnings after today’s close: HEI, JBL, PAY
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers

0 thoughts on “Before the Open (Dec 17)”

  1. I’m nervously bullish, but based on my technical work the market is getting old; 50 months. On the other hand the end of a run up is when the most money is made – sometimes. Personally I think QE at some level is here forever, at my age that is not a long time, but forever means that the economy will never heal to stand on its own again: socialism. Housing is down, rents in NYC are falling, corporate profits are sliding making P/E expand, taxes on health insurance are rising for all, and the White House has taken over by people from another time and another place. See why I am holding cash, not fully invested, and yes I own a bond or two. Merry Holidays to all, I am going fishing for a while. Hang on tight.

  2. Jury duty prevented my posting y’day. The defendant took the deal, my civic duty is fulfilled.
    Fri, bulls defended the 1772 region I mentioned in Fri’s post and they printed a double bottom; they launched from there on Monday.
    For today: they can pullback to 82.50 -80.00 and the uptrend is still secure. Lower than that, would be expecting a revisit of 72.
    To be sure the uptrend is in place, bulls need to take out Mon’s high at 92.25. If so, likely target is 1830-1840.

    1. CORRECTION: replace my statement beginning with “for today” with this one. Math error.
      For today: they can pull back to 77 to 72 and the uptrend is still secure.
      To clarify, we are presently in an area of support.

Leave a Reply