Before the Open (Dec 14)

Good morning. Happy Monday. Hope you had a good weekend.
The Asian/Pacific markets closed mostly down. Australia, South Korea and Japan dropped more than 2%; Hong Kong, Singapore, Malaysia, New Zealand and Taiwan were also weak. China rallied better than 2%. Europe is currently mostly down. Germany, Finland, Spain, Italy and Portugal are down more than 1%; Austria, the Netherlands, Norway, Russia and Turkey are also weak. Greece is up 1%. Futures in the States, which were up solidly overnight, are pointing towards a down open for the cash market.
The dollar is up. Oil and copper are down (oil now has a 34 handle). Gold and silver are down. Bonds are down.
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S&P Select Week in Review
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The market got hit hard Friday. There’s no way to sugar coat it. The number of big down days and big down weeks is adding up. The internals and lack of good set-ups have been hinting at internal weakness. Last week the price action started to reflect this.
The big event this week is the Fed. They very likely will raise the target on overnight rates to 25 basis points. They don’t really have a reason to raise – the current situation is the same as it was in September and last June – but they seem to want to raise, so they will. It’ll be the first time in 10 years rates will move up. Wall St. will continue focusing on their statement, but instead of looking for clues as to whether they’ll raise, they’ll look for clues as to how often they’ll raise and how quickly they’ll raise going forward. Will they raise 25 basis points and stop, or will this be the beginning of a trend?
Last weekend I said I wasn’t impressed with the market, and given what happened last week, I’m certainly not more impressed. The lack of participation is bothersome. We can’t have a handful of stocks doing very well and everything else doing so-so.
Near term bias is to the downside, but overall I’m don’t expect the market to completely fall apart. Start building a list of quality names you want to buy on a dip. The market isn’t going to just fall apart. There will be tradable bounces along the way.
Here’s the 60-min S&P to give us some perspective.

Stock headlines from barchart.com…
Prologis (PLD -1.38%) was downgraded to ‘Sell’ from ‘Neutral’ at Goldman Sachs.
Hormel Foods (HRL +0.53%) was downgraded to ‘Hold’ from ‘Buy’ at Deutsche Bank.
Newell Rubbermaid (NWL -4.11%) said it will acquire Jarden Corp. ({=JAH for about $13 billion.
National Oilwell Varco (NOV -1.51%) was rated a new ‘Buy’ at KLR Group with a price target of $52, and Schlumberger Ltd. (SLB -2.32%) was also rated a new ‘Buy’ at KLR Group with a price target of $105.
Tyco International (TYC -1.52%) was downgraded to ‘Neutral’ from ‘Outperform’ at Credit Suisse.
DuPont (DD -5.51%) was upgraded to ‘Outperform’ from ‘Market Perform’ at Wells Fargo Securities.
Mattel (MAT +2.66%) was upgraded to ‘Outperform’ from ‘Market Perform’ at BMO Capital Markets..
Bloomberg reports that Shire is getting close to a deal to acquire Baxalta (BXLT -1.70%) after Baxalta rejected a previous $30 billion all-stock offer from Shire.
Blackstone reported a 13.86% stake in NCR Corp. (NCR -1.55%) .
Atmel (ATML -2.76%) jumped over 8% in after-hours trading after its board said it received an unsolicited proposal of $9 a share for the company.
The WSJ reports that Congress is likely to lift the crude oil export ban that has been in place for 40 years.
Earnings and Economic Numbers from seekingalpha.com…
Today’s Economic Calendar
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Today’s Earnings here
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers