Before the Open (Dec 17)

Good morning. Happy Wednesday. Happy Fed Day.
The Asian/Pacific markets closed mixed. Taiwan (down 1.37%) and China (up 1.31%) were the only 1% movers. Singapore, Japan and Malaysia also moved up; Hong Kong and India moved down. Europe is currently mostly down. Russia is down more than 2%; Italy, Spain, Amsterdam and Austria are down more than 1%; Germany, France, London and Prague are also doing poorly. Futures here in the States point towards a gap up open for the cash market.

The dollar is up. Oil and copper are down. Gold and silver are down.
Yesterday the S&P rallied 40 points off its opening level but then gave it all back plus some. The index has fallen 6 of 7 days in route to dropping 100 points off its high. Approx. 30 days of gains have been whipped out in 7 days. The market takes the stairs up and the elevator down.
Today is Fed day. The consensus is that the Fed will start to raise rates in the middle of next year, Wall St. is likely pricing this scenario in. Perhaps the recent weakness will push the date out (not likely), or maybe the situation in Russia will cause the Fed to be extra careful. We’ll see. There’s plenty of time for them to change their mind, so I’m not expecting a big change in their statement.
Risk is elevated right now…in both directions. The trend is down, and my bias remains to the downside, but with several big intraday rallies the last week, it’s been an uncomfortable ride (at times) for the bears. The bulls still have some life in them. I’m still in the camp that is looking for a complete washout before a bottom is put in place, and with so many traders expecting an end-of-year rally, a washout may be delayed a few extra days. If the bulls are holding and waiting for a chance to short a bounce…well, the bounce won’t materialize just yet.
Again, risk is elevated in both directions. The easy money has been made on the short side. More after the open.
Stock headlines from barchart.com…
General Mills (GIS -0.66%) reported Q2 EPS of 80 cents, better than consensus of 76 cents.
FedEx (FDX -1.14%) reported Q2 EPS of $2.14, below consensus of $2.22.
JPMorgan Chase keeps an ‘Overweight’ rating on CVS Health (CVS +2.72%) and raises the price target on the stock to $108 from $92.
Consolidated Edison (ED +0.14%) was downgraded to ‘Sell’ from ‘Hold’ at Deutsche Bank.
PG&E (PCG -0.76%) was downgraded to ‘Hold’ from ‘Buy’ at Deutsche Bank.
Joy Global (JOY +0.30%) reported Q4 EPS of $1.25, higher than consensus of $1.14.
Northrop Grumman (NOC +1.33%) was awarded a $657.4 million government contract that will provide the Republic of Korea four RQ-4B Block 30 Global Hawk air vehicles, two spare engines, and the applicable Ground Control Environment elements.
GIC Private reported a 7.07% passive stake in UBS (UBS +0.23%).
Colfax (CFX -1.52%) lowered guidance on fuscal 2015 EPS to $2.20-$2.40, below consensus of $2.58 and said it sees fiscal 2015 revenue of $4.53 billiob-$4.68 billion, less than consensus of $4.8 billion.
Gabelli reported an 11.09% stake in Griffin (GRIF +1.16%) .
Thermo Fisher (TMO -1.76%) was initiated with a ‘Buy’ at KeyBanc with a price target of $144.
Ruby Tuesday (RT -1.10%) reported Q2 company-owned Same-Store-Sales down 1%, weaker than same-store-sales guidance provided on October 8 of up 1%-2% for Q2.
Darden Restaurants (DRI -2.26%) rose over 1% in after-hours trading after it reported Q2 EPS of 28 cents, better than consensus of 27 cents.
Earnings and Economic Numbers from seekingalpha.com…
Today’s economic calendar:
7:00 MBA Mortgage Applications
8:30 Current Account
8:30 Consumer Price Index
10:30 EIA Petroleum Inventories
2:00 PM FOMC Announcement
2:00 PM FOMC Forecast
2:00 PM Chairman Press Conference
Notable earnings before today’s open: EGRX, FDX, GIS, JOY
Notable earnings after today’s close: APOG, JBL, MLHR, ORCL
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers