Before the Open (Dec 29)

Good morning. Hope you had a good weekend.
The Asian/Pacific markets closed mostly up. Hong Kong and Australia rallied more than 1%. India, New Zealand and Taiwan also did well. South Korea dropped 1%, and Japan dropped 0.5%. Europe is currently mostly down. Greece is down almost 5%; Italy is down 2.2%, Spain 2%; Austria, London and Germany are also weak. Futures here in the States point towards a moderate gap down open for the cash market.

The dollar is down. Oil and copper are up. Gold is down, silver is up.
I don’t have anything to add to the comments already made in the Weekend Report. Several indexes hit new highs last week, and most indicators are supporting the strength. But the indicators need to continue moving in their supportive directions – in fact we need them to move to extreme levels – to suggest the market is strong and likely to continue on its path for at least a couple more weeks. This would entail the AD line and AD volume moving up, new highs moving up, the ATR and put/call ratio moving down, and the percentage of stocks above their 20-day MA and at 20-day highs moving up. So far, so good, but we need the movement to continue.
We have another holiday-shortened week this week. The market is closed Thursday, and I’d expect volume and activity to remain low. That doesn’t mean there won’t be trading opportunities; it just means expecting robust follow through on breakouts is asking a little too much.
Oil presents the best trading opportunity heading into the new year. Many stocks have rallied big time the last two weeks and are now consolidating. They could bust out and run again or head back to their lows. Whatever the case, if you’re looking for movement, oil stocks is where you want to focus your attention. More after the open.
Stock headlines from barchart.com…
Endologix (ELGX +0.20%) and Towers Watson (TW -0.47%) were identified as top picks at Piper Jaffray for 2015.
MarkWest Energy (MWE +0.33%) was upgraded to ‘Overweight’ from ‘Equal Weight’ at Stephens.
Manitowoc (MTW +4.29%) jumped over 10% in pre-market trading after activist investor Carl Icahn reported a 7.7% stake in the company.
Macquarie reiterates its ‘Outperform’ rating on Live Nation (LYV -0.34%) and raises its price target on the stock to $30 from $28.
Gilead (GILD)was upgraded to ‘Overweight’ from ‘Equal Weight’ at Morgan Stanley who raised their price target on the stock to $104 from $100.
RF Micro Devices (RFMD +0.84%) and MacLinear (MXL +0.55%) were both downgraded to ‘Hold’ from ‘Buy’ at Needham.
China Mobile selects Ericsson (ERIC +0.24%) as the sole supplier for its LTE FDD/TDD network.
A weekend article in Barron’s said that CarMax (KMX unch) looks to have become a momentum stock and investors should consider buying General Motors (GM +0.90%) or Ford (F +0.98%) instead.
Earnings and Economic Numbers from seekingalpha.com…
Today’s economic calendar:
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
Notable earnings before today’s open: none
Notable earnings after today’s close: none
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers