Bull Radar

Style Outperformer:

• Large-Cap Value (-.05%)

Sector Outperformers:

• 1) Banks +.68% 2) Homebuilders +.68% 3) REITs +.49%

Stocks Rising on Unusual Volume:

• AIG, SWIR, AGM, MA, ELON, TPCG, BBOX, KIRK, ITMN, STU, AM, YPF, MHO, TOD and GNI
  

Stocks With Unusual Call Option Activity:

• 1) ACAS 2) PBR 3) ABC 4) ITW 5) CSX
  

Stocks With Most Positive News Mentions:

• 1) SNE 2) MRK 3) SCHW 4) KEM 5) AAPL
  

Monday Watch

Night Trading

• Asian indices are -.25% to +.50% on average.
• Asia Ex-Japan Investment Grade CDS Index 104.0 +1 basis point.
• Asia Pacific Sovereign CDS Index 104.0 +.5 basis point.
• S&P 500 futures -.18%.
• NASDAQ 100 futures -.11%.

Morning Preview Links

BOTTOM LINE: Asian indices are mostly higher, boosted by technology and financial shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing modestly higher. The Portfolio is 100% net long heading into the week.

Weekly Outlook

U.S. Week Ahead by MarketWatch (video).
Wall St. Week Ahead by Reuters.
Stocks to Watch Monday by MarketWatch.
Weekly Economic Calendar by Briefing.com.

BOTTOM LINE: I expect US stocks to finish the week mixed as diminishing economic fear, seasonal strength, buyout speculation, investment manager performance anxiety and short-covering offsets profit-taking, rising sovereign debt angst and China inflation worries. My intermediate-term trading indicators are giving mostly bullish signals and the Portfolio is 100% net long heading into the week.

Market Week in Review

S&P 500 1,256.77 +1.12%*



The Weekly Wrap by Briefing.com.

*5-Day Change

Weekly Scoreboard*

Indices

• S&P 500 1,256.77 +1.12%
  
• DJIA 11,573.49 +.65%
  
• NASDAQ 2,665.60 +1.07%
  
• Russell 2000 788.96 +1.60%
  
• Wilshire 5000 13,127.21 +1.06%
  
• Russell 1000 Growth 575.09 +.76%
  
• Russell 1000 Value 637.82 +1.60%
  
• Morgan Stanley Consumer 753.33 +.81%
  
• Morgan Stanley Cyclical 1,037.78 +1.05%
• Morgan Stanley Technology 663.85 +1.07%
  
• Transports 5,078.92 -.16%
  
• Utilities 405.73 +1.30%
  
• MSCI Emerging Markets 46.65 +.59%
  
• Lyxor L/S Equity Long Bias Index 1,032.09 +.41%
  
• Lyxor L/S Equity Variable Bias Index 870.49 +.31%
  
• Lyxor L/S Equity Short Bias Index 704.46 -1.77%
  

Sentiment/Internals

• NYSE Cumulative A/D Line +110,102 +1.87%
  
• Bloomberg New Highs-Lows Index +261 -140
  
• Bloomberg Crude Oil % Bulls 53.0 +103.85%
  
• CFTC Oil Net Speculative Position n/a
  
• CFTC Oil Total Open Interest n/a
  
• Total Put/Call .90 +8.43%
  
• OEX Put/Call 1.22 -.81%
  
• ISE Sentiment 121.0 -29.65%
  
• NYSE Arms 1.60 +92.77%
  
• Volatility(VIX) 16.47 -5.29%
• G7 Currency Volatility (VXY) 12.21 -1.05%
  
• Smart Money Flow Index 9,815.19 +.43%
  
• Money Mkt Mutual Fund Assets $2.788 Trillion -.30%
  
• AAII % Bulls 63.30 +26.02%
  
• AAII % Bears 16.40 -39.59%
  

Futures Spot Prices

• CRB Index 329.38 +3.79%
  
• Crude Oil 91.51 +3.09%
  
• Reformulated Gasoline 244.26 +5.19%
  
• Natural Gas 4.08 +.66%
  
• Heating Oil 254.08 +2.68%
  
• Gold 1,380.50 +.35%
  
• Bloomberg Base Metals 251.99 +2.50%
  
• Copper 425.85 +2.10%
  
• US No. 1 Heavy Melt Scrap Steel 342.83 USD/Ton unch.
  
• China Hot Rolled Domestic Steel Sheet 4,567 Yuan/Ton +1.53%
• S&P GSCI Agriculture 508.74 +5.19%
  

Economy

• ECRI Weekly Leading Economic Index 128.0 +.55%
  
• Citi US Economic Surprise Index +12.50 -5.2 points
  
• Fed Fund Futures imply 74.0% chance of no change, 26.0% chance of 25 basis point cut on 1/26
• US Dollar Index 80.47 +.13%
  
• Yield Curve 274.0 +2 basis points
  
• 10-Year US Treasury Yield 3.39% +6 basis points
  
• Federal Reserve's Balance Sheet $2.410 Trillion +1.79%
  
• U.S. Sovereign Debt Credit Default Swap 41.44 +2.43%
• California Municipal Debt Credit Default Swap 292.50 +.22%
  
• Western Europe Sovereign Debt Credit Default Swap Index 1197.83 +5.98%
  
• 10-Year TIPS Spread 2.32% +3 basis points
  
• TED Spread 17.0 -3 basis points
  
• N. America Investment Grade Credit Default Swap Index 85.53 -1.87%
  
• Euro Financial Sector Credit Default Swap Index 149.53 +3.73%
  
• Emerging Markets Credit Default Swap Index 206.66 -1.35%
  
• CMBS Super Senior AAA 10-Year Treasury Spread 252.0 unch.
  
• M1 Money Supply $1.810 Trillion -.47%
  
• Business Loans 609.30 +.31%
  
• 4-Week Moving Average of Jobless Claims 426,000 +.60%
  
• Continuing Claims Unemployment Rate 3.2% -10 basis points
  
• Average 30-Year Mortgage Rate 4.81% -2 basis points
  
• Weekly Mortgage Applications 479.90 -18.62%
  
• ABC Consumer Confidence -41 +2 points
  
• Weekly Retail Sales +3.3% +20 basis points
  
• Nationwide Gas $3.03/gallon +.05/gallon
  
• U.S. Heating Demand Next 7 Days 5.0% above normal
• Baltic Dry Index 1,773 -11.31%
  
• Oil Tanker Rate(Arabian Gulf to U.S. Gulf Coast) 40.0 +14.29%
  
• Rail Freight Carloads 220,187 -5.88%
  
• Iraqi 2028 Government Bonds 91.79 +1.0%
  

Best Performing Style

• Mid-Cap Value +1.99%

Worst Performing Style

• Large-Cap Growth +.76%

Leading Sectors

• Coal +5.97%
• Education +4.31%
• REITs +3.40%
• Banks +3.37%
• I-Banks +2.76%

Lagging Sectors

• Networking -.10%
• Restaurants -.32%
• Road & Rail -.37%
  
• Drugs -.54%
• Airlines -.56%

One-Week High-Volume Gainers

One-Week High-Volume Losers

*5-Day Change

Stocks Slightly Lower into Final Hour on Profit-Taking, Rising Euro Debt Angst, Surging Commodity Prices

Broad Market Tone:

• Advance/Decline Line: Slightly Lower
  
• Sector Performance: Most Sectors Declining
  
• Volume: Light
  
• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• VIX 16.83 +8.93%
  
• ISE Sentiment Index 121.0 -7.63%
  
• Total Put/Call .90 +9.76%
  
• NYSE Arms 1.50 +40.78%
  

Credit Investor Angst:

• North American Investment Grade CDS Index 85.65 +.84%
  
• European Financial Sector CDS Index 160.44 bps +6.14%
  
• Western Europe Sovereign Debt CDS Index 196.83 bps +1.20%
  
• Emerging Market CDS Index 207.0 bps +.35%
  
• 2-Year Swap Spread 26.0 +3 bps
  
• TED Spread 17.0 unch.
  

Economic Gauges:

• 3-Month T-Bill Yield .13% unch.
  
• Yield Curve 273.0 unch.
  
• China Import Iron Ore Spot $170.70/Metric Tonne -.18%
  
• Citi US Economic Surprise Index +14.30 -3.3 points
  
• 10-Year TIPS Spread 2.32% +1 bp
  

Overseas Futures:

• Nikkei Futures: Indicating -36 open in Japan
• DAX Futures: Indicating +16 open in Germany

Portfolio:

• Slightly Higher: On gains in my Medical, Biotech and Ag long positions
  
• Disclosed Trades: None
  
• Market Exposure: 100% Net Long

BOTTOM LINE: Today's overall market action is mildly bearish as the S&P 500 trades just slightly lower despite recent stock gains, Korean peninsula concerns, surging commodity prices and rising eurozone sovereign debt angst. On the positive side, Coal, Ag, Gold, Drug and Education shares are especially strong, rising more than .5%. The S&P GSCI Ag Spot Index is rising another +.5% and is making a new record high. Lumber is also rising +1.2%. The 10-year yield is stable again. The Citi Asia-Pacific Economic Surprise Index is rising +4.1 points to +15.4, which is the best level since Oct. 26th. On the negative side, Airline and Homebuliding shares are under pressure, falling more than 1.0%. The Greece sovereign cds is climbing +5.62% to 1,053.70 bps and the Italy sovereign cds is rising +3.26% to 232.62 bps. The Euro Financial Sector CDS Index remains at the highest level since mid-June and the Western Europe Sovereign CDS Index remains very near its record high set last month, which is also a big negative. The broad market continues to display exceptional resiliency as negatives continue to be ignored. The NYSE Arms has been high throughout the day, yet equity losses are minimal. I still believe the slow grind higher in the major averages to new 52-week highs could result in a short-term spike higher in stocks before any meaningful pullback commences as shorts throw in the towel and underperforming longs come in to finish out the year. I expect US stocks to trade mixed-to-higher into the close from current levels on seasonal strength, less economic fear, short-covering, technical buying, buyout speculation and investment manager performance angst.