Before the Open (Feb 16)

Good morning. Happy Tuesday. Hope you had a good weekend and enjoyed your extra day off. Time to get back to work.
Yesterday…
China dropped in its first day of trading after being closed for a week. Otherwise the Asian/Pacific markets did great. Japan rallied better than 7%; Hong Kong, Singapore, India, Australia and New Zealand also did well.
Europe posted solid, across-the-board gains. Greece rallied better than 7%, Denmark better than 5%, and France, Austria, Belgium, Norway, Sweden, Prague, Spain, the Netherlands and Italy moved up more than 3%.
Today…
The Asian/Pacific markets mostly posted solid gains. China gained 3.3%; Hong Kong, Singapore, Australia, South Korea and Taiwan rallied more than 1%.
Europe is currently mixed; very few markets have moved much. The Czech Republic is down 1.3%; otherwise Germany, Austria and Switzerland are weak; Russia and London are doing well.
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Futures here in the States point towards a big gap up open for the cash market.
The dollar is up. Oil and copper are up. Gold and silver are down. Bonds are down.
We finished last week with a relatively big lower tail on the weekly candle.

The NYSE was starting to form a positive divergence with its bullish percent chart.

The percentage of NYSE stocks above their 200-day moving averages was forming a positive divergence.

The cumulative AD volume line was putting in a higher low.

Japan surged yesterday, and China did not collapse after being closed for a week.
Add in a couple bright spots on the technical side, and the stage is set for a rally attempt.
Overall I remain bearish and think new lows will be hit. But in the near term respect the possibility of bounce. More after the open.
Stock headlines from barchart.com…
ADT Corp. (ADT +1.90%) surged over 40% in pre-market trading after it agreed to be purchased by Apollo Global affiliates for $6.9 billion or $42 a share.
Freeport McMoRan (FCX +13.09%) jumped almost 8% in pre-market trading after it agreed to sell an additional stake n one of its biggest mines to Sumitomo Metal Mining for $1 billion.
Goldman Sachs (GS +3.87%) was upgraded to ‘Overweight’ from ‘Underweight’ at JPMorgan Chase.
Hormel Foods (HRL -0.46%) reported Q1 EPS of 43 cents, better than consensus of 39 cents.
Flowers Foods (FLO -6.54%) was upgraded to ‘Buy’ from ‘Hold’ at BB&T Capital Markets.
AutoZone (AZO +2.37%) was upgraded to ‘Outperform’ from ‘Neutral’ at Wedbush.
Peabody Energy (BTU +2.97%) was downgraded to ‘Underweight’ from ‘Hold’ at BB&T Capital Markets.
EMC Corp. (EMC -0.12%) gained over 1% in after-hours trading after Baupost Group LLC Holdings reported that it purchased 29.2 million shares in the company.
USG Corp. (USG +7.05%) fell over 1% in after-hours trading after Appaloosa Management LP Holdings said it sold its stake in USG.
Groupon (GRPN +29.02%) climbed over 2% in after-hours trading after BABA reported a 5.6% stake in the company.
Energy Transfer Partners LP (ETP +8.38%) rose 1% in after-hours trading after Perry Corporation Holdings and Appaloosa Management LP Holdings reported new stakes in the company.
Waterstone Financial (WSBF +0.81%) CFO Allan Hosack will resign effective March 1 and Mark Gerke was named interim CFO.
Anworth Mortgage (ANH +0.24%) reported Q4 core EPS of 15 cents, better than consensus of 14 cents.
Earnings and Economic Numbers from seekingalpha.com…
Today’s Economic Calendar
8:30 Empire State Mfg Survey
9:00 Fed’s Harker speech
10:00 NAHB Housing Market Index
10:30 Fed’s Kashkari speech
4:00 PM Treasury International Capital
7:30 PM Fed’s Rosengren: Economic Outlook
Today’s Earnings here
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers