Before the Open (Jan 20)

Good morning. Happy Wednesday.
The Asian/Pacific markets closed with stiff, across-the-board losses. Hong Kong, Japan and Singpore dropped 3% or more. South Korea and Taiwan fell more than 2%, and China, Australia, India and Indonesia lost more than 1%. Europe is getting crushed. Greece is down almost 6%; London, France, Austria, Norway and Italy are down more than 3%, and Germany, Belgium, the Netherlands, Sweden, Switzerland, the Czech Republic, Denmark, Finland, Spain, and Portugal are down more than 2%. Futures in the States point towards a big gap down for the cash market.
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The dollar is flat. Oil and copper are down. Gold and silver are up. Bonds are up.
For the second time in three days we’re going to get a huge gap down to start the day. Perhaps some additional intense selling pressure will finally cause the VIX to spike. This has been the missing ingredient (if you have been looking for a bottom). Most indicators have moved to extreme levels and would support a bounce, but the selling has been mostly orderly and traders have not been overly concerned. Lack of concern is not a good climate for a bounce attempt. We need fear, but there hasn’t been much.
Here’s the daily VIX chart. Perhaps with today’s huge gap down we’ll finally get a spike.

A glance at social media tells me traders have been looking for a bounce. We need some panic first…and it looks like we may get some today. More after the open.
Stock headlines from barchart.com…
International Business Machines (IBM -1.48%) fell over 4% in pre-market trading after it said it sees 2016 operating EPS of at least $13.50, well below estimates of $15.00.
Lockheed Martin (LMT -0.32%) was rated a new ‘Buy’ at Guggenheim with a price target of $250.
Wells Fargo (WFC -1.25%) was upgraded to ‘Positive’ from ‘Neutral’ at Susquehanna.
Prudential Financial (PRU -1.25%) was downgraded to ‘Neutral’ from ‘Buy’ at Bank of America.
Sherwin-Williams (SHW -1.14%) was upgraded to ‘Buy’ from ‘Neutral’ at Goldman Sachs.
Netflix (NFLX +3.70%) jumped over 3% in pre-market trading after it forecast Q1 EPS of 3 cents, higher than consensus of 2 cents, and said it sees Q1 international streaming net adds of 4.35 million, above estimates of 3.72 million.
Spirit Airlines (SAVE -1.76%) rallied over 5% in after-hours trading after it raised guidance on Q4 operating margin to 22.5%, more than a previous estimate of 17.5%.
Cree Inc. (CREE +0.62%) jumped over 3% in after-hours trading after it reported Q2 adjusted EPS of 30 cents, higher than consensus of 24 cents, and then raised guidance on Q3 adjusted EPS to 22 cents-29 cents, above consensus of 22 cents.
Advanced Micro Devices (AMD -3.94%) slid over 6% in after-hours trading after it estimated Q1 revenue would be down -11% to -17%, much weaker than estimates of down -6%.
SunEdison (SUNE -9.85%) rose 2% in after-hours trading after Luxor Capital reported a 5.3% stake in the company.
Microchip Technology (MCHP +2.91%) rose nearly 1% in after-hours trading after it acquired Atmel for $3.6 billion.
Synthetic Biologics (SYN -5.59%) surged 18% in after-hours trading after it said a Phase 2 clinical trial of its propriety SYN-010 for treatment of irritable bowel syndrome with constipation met its primary endpoint.
Earnings and Economic Numbers from seekingalpha.com…
Today’s Economic Calendar
7:00 MBA Mortgage Applications
8:30 Consumer Price Index
8:30 Housing Starts
8:55 Redbook Chain Store Sales
Today’s Earnings here
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers