Stocks Lower into Final Hour on Rising Fiscal Cliff Fears, Rising Eurozone Debt Angst, More Global Growth Worries, Tech/Financial Sector Weakness

 Broad Market Tone:

• Advance/Decline Line: Modestly Lower
  
• Sector Performance: Mixed
• Volume:Below Average
• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• VIX 16.35 -1.98%
• ISE Sentiment Index 98.0 +5.4%
• Total Put/Call .74 -24.29%
• NYSE Arms .62 -46.92%

Credit Investor Angst:

• North American Investment Grade CDS Index 105.32 bps -1.33%
• European Financial Sector CDS Index 180.37 bps -1.20%
• Western Europe Sovereign Debt CDS Index 120.59 bps +2.65%
• Emerging Market CDS Index 237.56 bps -.64%
• 2-Year Swap Spread 12.0 +.25 basis point
• TED Spread 22.25 +.5 basis point
• 3-Month EUR/USD Cross-Currency Basis Swap -28.0 -1.25 basis points

Economic Gauges:

• 3-Month T-Bill Yield .09% unch.
• Yield Curve 134.0 -1 basis point
• China Import Iron Ore Spot $122.30/Metric Tonne +.16%
• Citi US Economic Surprise Index 60.70 -.1 point
• 10-Year TIPS Spread 2.42 -1 basis point
  

Overseas Futures:

• Nikkei Futures: Indicating +35 open in Japan
• DAX Futures: Indicating -11 open in Germany

Portfolio:

• Slightly Higher: On gains in my Retail sector longs, index hedges and emerging markets shorts
• Disclosed Trades: Added to my (IWM)/(QQQ) hedges, added to my (EEM) short
• Market Exposure: Moved to 25% Net Long

BOTTOM LINE: Today's overall market action is mildly bearish as the S&P 500 was unable to build on a morning reversal higher at its 200-day moving average on rising global growth fears, rising eurozone debt angst, earnings worries and increasing US "fiscal cliff" fears. On the positive side, Retail shares are especially strong, rising more than +1.0%. Oil is falling -.38%, gold is down -.11%, copper is gaining +.29% and the UBS-Bloomberg Ag Spot Index is down -.17%. Major European indices were higher, led by a +1.7% gain in Spain. The Bloomberg European Bank/Financial Services Index is rising +1.5%. Brazil is rising +.75%. The Germany sovereign cds is falling -1.3% to 32.38 bps and the Italy sovereign cds is falling -2.0% to 311.24 bps. The Italian/German 10Y Yld Spread is falling -1.5% to 362.57 bps and the Spain 10Y Yld is falling -.67% to 5.85%. On the negative side, Alt Energy, Software, Networking and I-Banking shares are under pressure, falling more than -1.25%. Financial and Tech shares have traded poorly throughout the day. Lumber is falling -.9%. The 10Y Yld is -2 bps to 1.59%. The Spain sovereign cds is gaining +1.0% to 356.94 bps, the Portugal sovereign cds is rising +1.7% to 621.01 bps, the China sovereign cds is rising +2.2% to 69.16 bps and the Japan sovereign cds is gaining +1.5% to 69.35 bps. The benchmark China Iron/Ore Spot Index is down -32.4% since 9/7/11. As well, copper and oil continue to trade poorly given equity investor perceptions that the Eurozone has successfully kicked-the-can, US housing has hit a major bottom, China's economy is rebounding and global central bank stimuli will boost economic growth in the near future. US weekly retail sales have decelerated to a very sluggish rate at +1.2%. Moreover, the weekly MBA Home Purchase Applications Index has been around the same level since May 2010 despite investor perceptions of a big improvement in the nationwide housing market. The Baltic Dry Index has plunged around -55.0% from its Oct. 14th high and is now down around -45.0% ytd. Shanghai Copper Inventories have risen +461.0% ytd. Oil tanker rates have plunged, with the benchmark Middle East-to-US voyage down to 25.0 industry-standard worldscale points, which is near the lowest since May, 2009. US Rail Traffic is starting to weaken too much. The 10Y T-Note continues to trade too well. There still appears to be a fairly high level of complacency among US investors regarding the deteriorating macro backdrop. It remains unclear to me whether or not Germany will destroy its own balance sheet or allow the ECB to monetize debt in a major way in an attempt to "save" the euro even as investors continue to price this outcome into stocks. Massive tax hikes and spending cuts have still yet to hit in several key eurozone countries that are already in recession. A lack of economic competitiveness and growth incentives remain unaddressed problems. The European debt crisis is also really affecting emerging market economies, which will further pressure exports from the region and further raise the odds of more sovereign/bank downgrades over the coming months. I continue to believe that China's problems are much larger than commonly perceived and cannot be solved with another massive stimulus package given their real estate bubble, rising food prices/labor costs, massive overcapacity in certain key parts of the economy and growing bad loans problem. The most likely outcome for the US fiscal cliff crisis is our own can-kicking, which would leave much investor uncertainty over the intermediate-term. Moreover, any of the likely "solutions" being bandied about would hurt economic growth, which would more than offset the benefits to investors from less uncertainty going forward. As well, little being done by global central bankers will actually boost global economic growth to an extent that overcomes the growing macro headwinds over the intermediate-term, in my opinion. Over the intermediate-term, the Fed's recklessness greatly increases the chances of hard-landings in key emerging markets and of a serious global stock swoon, in my opinion. Moreover, uncertainty surrounding the effects on business of Obamacare will likely become more and more of a focus for US investors next year. The Mid-east continues to unravel at an alarming rate, as well. Overall broad market health remains poor as breadth, volume, leadership, lack of big volume/gainers and copper relative weakness all continue to be concerns. The fact that the S&P 500 is just hovering at its 200-day moving average without being able to sustain a meaningful bounce is a bad sign. For this year's equity advance to regain traction, I would expect to see further European credit gauge improvement, a subsiding of hard-landing fears in key emerging markets, a rising 10-year yield, better volume, stable-to-lower food/energy prices, a US "fiscal cliff" solution/can-kicking, a calming in Mid-east and China/Japan tensions and higher-quality stock market leadership. I expect US stocks to trade modestly lower into the close from current levels on more eurozone debt angst, rising global growth fears, US fiscal cliff fears, more shorting and tech/financial sector weakness.

Bear Radar

Style Underperformer:

• Small-Cap Value -.09%

Sector Underperformers:

• 1) Software -1.45% 2) Networking -1.31% 3) Alt Energy -1.23%
  

Stocks Faling on Unusual Volume:

• WPZ, NLY, TWO, CYS, MSFT, IVR, EVER, EVEP, SXL, MTGE, CRAY, LPLA, SLCA, CQP, PMT, BIG, MWE, WMC, AMTG and ACM

Stocks With Unusual Put Option Activity:

• 1) JNK 2) AKS 3) WFT 4) KORS 5) DKS
  

Stocks With Most Negative News Mentions:

• 1) LL 2) TSL 3) BIG 4) AKS 5) TEX
  

Charts:

• ETFs Falling on Unusual Volume
• Stocks Falling on Unusual Volume

Bull Radar

Style Outperformer:

• Mid-Cap Growth +.54%

Sector Outperformers:

• 1) Retail +1.22% 2) Airlines +.97% 3) Utilities +.89%
  

Stocks Rising on Unusual Volume:

• HK, EGY, DTSI, GBX, CSOD, DMND, CLNE, NTI, DKS, HD, NS, INFI, GBX, ALNY and STRA

Stocks With Unusual Call Option Activity:

• 1) EWY 2) NSC 3) M 4) KORS 5) MON
  

Stocks With Most Positive News Mentions:

• 1) FFIV 2) MNST 3) ADP 4) HD 5) BK

Charts:

• ETFs Rising on Unusual Volume 
• Stocks Rising on Unusual Volume

Tuesday Watch

Evening Headlines 
Bloomberg: 

• Europe Gives Greece 2 More Years to Reach Deficit Targets. Euro-area finance ministers gave Greece two extra years to wrestle down its budget deficit, pledging to plug the resulting financing gaps in order to keep the country in the single currency and prevent a renewed flareup of the debt crisis. Finance ministers granted Greece until 2016 to cut the deficit to 2 percent of gross domestic product. They put off until Nov. 20 a decision on how to cover additional Greek needs of as much as 32.6 billion euros ($41 billion) and left unclear whether the International Monetary Fund will continue to contribute. In the latest compromise in three years of crisis fighting, creditors led by Germany opted to keep money flowing to Greece instead of risking a default that could lead to the nation’s exit from the euro and stir more turmoil for countries left in it.
• Austerity Backlash Threat to Peripheral Bond Rally: Euro Credit. Spain and Portugal are among the so-called peripheral countries preparing for labor unrest, putting pressure on euro-region leaders to water down the austerity measures that helped power this year's bond-market rally. Spanish Prime Minister Mariano Rajoy faces a general strike tomorrow and Portuguese Premier Pedro Passos Coelho is bracing for social tumult as part of Europe-wide protests against debt-crisis budget tightening. "We've crosses a Rubicon in terms of societies buying into reform programs," said Richard McGuire, a senior fixed-income strategist at Rabobank in London. "Rajoy is walking a tightrope and Portugal is an example of popular unrest diverting or diluting reforms, with the ultimate risk of derailing them." The growing popular backlash against rising unemployment and slumping wages stemming from government efforts to shore up public finances threatens to slow the pace of economic reform. At the same time, the austerity measures are deepening recessions, making deficit goals tougher to achieve and perpetuating the need for additional belt tightening.
• Why French Economy Can’t Delay Its Competitiveness Shock. The government of French President Francois Hollande deserves credit for its decision last week to cut payroll taxes. Unfortunately, by itself, the 20 billion euro ($25 billion) reduction in costs for companies won’t administer the “competitiveness shock” that a dire, government-commissioned study recommended Nov. 5 to revive growth. It certainly won’t allay the concerns of France’s largest trading partner, Germany, whose own economy would be at risk from a meltdown across the Rhine. As Germany’s Council of Economic Experts delivered its annual report to Chancellor Angela Merkel last week, one of its members, Lars Feld, warned that “the largest problem isn’t Greece anymore, or Spain or Italy, but France because France has done nothing to rebuild its competitiveness and is even heading in the opposite direction.” A recent cover line on the daily Bild Zeitung baldly asked: “Will France Be the New Greece?” The French government’s response fails to tackle the more fundamental challenge of curbing out-of-control public spending and easing France’s rigid labor laws, which were identified as the gravest threats to the economy both in the report by former Airbus SAS Chairman Louis Gallois and in a review published the next day by the International Monetary Fund. 
• China Stocks Fall to 7-Week Low on Property Tax, Retail Concerns. China’s stocks fell to the lowest level in seven weeks after the Xinhua News Agency reported the government may expand a property tax trial and Haitong Securities Co. said retailers may post weak sales this month. China Vanke Co. (000002) and Poly Real Estate Group Co. led declines for developers after Xinhua cited the housing minister as saying the government is watching for signs of surging transaction volumes and home prices. Suning Appliance Co. plunged 5 percent as Haitong said November sales for traditional retailers will be hurt by a shift towards online purchases. China Petroleum & Chemical Corp. slumped to the lowest in more than two weeks after the Beijing Times said China may cut gas prices tomorrow. “The economy seems to be stabilizing but there’s no solid evidence that it will pick up further,” said Wei Wei, an analyst at West China Securities Co. in Shanghai. “Some investors are taking profits ahead of the year-end. Investors should avoid the property sector amid policy uncertainty.” The Shanghai Composite Index (SHCOMP) slid 1.4 percent to 2,050.05 at the 11:30 a.m. local-time break, heading for the lowest level since Sept. 26.
• Empty Offices Loom in Sydney as Building Spree Meets Bank Cuts. Sydney’s office vacancies are set to surge as Lend Lease Group (LLC)’s A$6 billion ($6.2 billion) financial center opens and older buildings are renovated while big tenants including Macquarie Group Ltd. cut jobs. About 400,000 square meters (4.3 million square feet) of space will hit the market in the next five years, including Lend Lease’s Barangaroo redevelopment in the former docklands district, according to UBS AG. That compares with 870,000 square meters added over the past 20 years.
• Consumers Closing Wallets in Japan Add to Noda’s Woes: Economy. Japanese consumers are closing their wallets as the economy’s outlook darkens, making it harder for Prime Minister Yoshihiko Noda to stave off the nation’s third recession in four years. Households are holding the most cash since 2005, shunning risk as they grow gloomier, Bank of Japan data shows. Sliding private consumption contributed to an annualized 3.5 percent decline in gross domestic product in the past quarter, a Cabinet Office report showed yesterday. 
• Carry Trades Lose Most Since ’11 as HSBC Gauge Warns: Currencies. The foreign-exchange market is signaling more pain ahead for currencies that benefit from a sustained global recovery, five years after the onset of the worst financial crisis since the Great Depression. HSBC Holdings Plc’s Global Hazard Indicator, which combines implied volatility readings in options for the dollar, euro and yen, shows wider price swings in currencies over the next year than in the coming three months. If history is any guide, that means the dollar and yen will strengthen and higher-yielding, higher-risk currencies such as the Brazilian real and South African rand will depreciate.

Wall Street Journal: 

• Nursing Homes Said to Overbill U.S. Hundreds of nursing homes overcharge Medicare every year for so-called skilled services, adding $1.5 billion in annual costs to the program, according to a federal report to be released Tuesday. About one-fourth of Medicare bills from facilities examined in the report were incorrect. The majority of these claims involved so-called upcoding, where a nursing home or other provider inflates the cost of its bill to Medicare by claiming more intensive services were done than actually performed. In other cases, nursing homes provided treatments that were inappropriate.
• FBI Agent in Petraeus Case Under Scrutiny. A federal agent who launched the investigation that ultimately led to the resignation of Central Intelligence Agency chief David Petraeus was barred from taking part in the case over the summer due to superiors' concerns that he had become personally involved in the case, according to officials familiar with the probe. New details about how the Federal Bureau of Investigation handled the case suggest that even as the bureau delved into Mr. Petraeus's personal life, the agency had to address questionable conduct by one of its own—including allegedly sending shirtless photos of himself to a woman involved in the case.
• Afghan Women Fear Rights Will Erode as U.S. Leaves. Rokhshana, a 14-year-girl, has been behind bars here since March. She is serving a yearlong adultery sentence after what she describes as rape by her adult cousin, who remains a free man. "I love my country, but there's no justice here," says Rokhshana at Herat's juvenile prison, her arms bearing the signs of beatings. 
• McGurn: Sex, Lies and Gmail. Did David Petraeus's personal troubles influence what he said to Congress about Benghazi?

MarketWatch.com: 

• Concern China banks under-reporting bad loans. Lenders could be giving some toxic debts generous reclassifications.

CNBC:

• Trouble Brewing for Euro as Greece Worries Grow. The euro, which hit a two-month low against the dollar on Tuesday as hopes that Greece would receive essential aid soon faded, faces further losses as concern about Greece’s future grow, currency analysts warn. 
• Could the Petraeus Scandal Scuttle a 'Fiscal Cliff' Deal?
• Fear of 'Fiscal Cliff' Taxes Puts Chill on Dividend Stocks. 
• Wealthy Dump Assets Amid Worries About Going Over 'Cliff'.
• ‘Social Risk’ Test Ordered By China for Big Projects.

Zero Hedge: 

• The Gini Is Out Of The Bottle: Did China "Outcapitalism" The US, Or Did America "Outcommunism" China?
• Post-Election Performance: Dip-Buyer's Dream Or Valuation Slump.
• Kerry, John Kerry: Defense Secretary.

Business Insider: 

• Microsoft(MSFT) Just Lost Its Most Important Executive.
• The Scene At The Rockaways Is Still Surreal, Weeks After Being Devastated By Sandy. (pics)
• Why Liberals Are Furiously Trying To Rename The Fiscal Cliff.
• Paula Broadwell's Father: 'This Is About Something Else Entirely, And The Truth Will Come Out'.
• China Is 'Actively Studying' An Expansion Of An Experimental Property Tax.
• NBCUniversal Is Laying Off 450 Workers.
• GLENN BECK TO REPUBLICANS: The Tea Party Is 'Doubling Down'.

The Blaze:

• Odd? Romney Got ZERO Votes In 59 Precincts in Philly, and 9 Precincts in Ohio. What if there are parts of the country where Romney not only got zero percent of the vote (a possibility in the case of vote totals so small that rounding renders them null), but actually got literally zero votes? For the nominee of a major party, that would be truly extraordinary – so extraordinary, in fact, that it would strain credulity. And seeing as this highly unlikely turn of events happened not in one or two precincts, but in over 59 in Philadelphia, and 9 in Cleveland, that credulity can be safely said to be completely strained, if not broken. From the Philadelphia Inquirer:

Telegraph: 

• Angela Merkel sticks to austerity script in Portugal as revolt builds. German Chancellor Angela Merkel braved hostile crowds in Portugal on Monday to show unflinching support for the country’s austerity ordeal and plead for patience as social cohesion frays.

Evening Recommendations 

• None of note

Night Trading

• Asian equity indices are -1.5% to -.75% on average.
• Asia Ex-Japan Investment Grade CDS Index 124.0 +.5 basis point.
• Asia Pacific Sovereign CDS Index 89.25 -1.5 basis points.
• FTSE-100 futures -.43%.
• S&P 500 futures -.62%.
• NASDAQ 100 futures -.56%.

Morning Preview Links

Earnings of Note
Company/Estimate 

• (HD)/ .70
• (DKS)/.37
• (SKS)/.12
• (TJX)/.61
• (CSCO)/.46

Economic Releases
7:30 am EST

• The NFIB Small Business Optimism Index for October is estimated to rise to 93.0 versus 92.8 in September.

2:00 pm EST

• The Monthly Budget Deficit for October is estimated to widen to -$113.0B versus -$98.5B in September.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Yellen speaking, Eurozone Non-Farm Payrolls/Current Account, European/UK inflation data, Italy bill auction, Germany ZEW Sentiment Index, weekly retail sales reports, CSFB Healthcare Conference, Lazard Healthcare Conference, Stephens Investment Conference, Morgan Stanley Consumer/Retail Conference, Barclays Automotive Conference, Bank of America Merrill Banking/Financial Services Conference, (SWI) analyst day, (HUM) investor day and the (BBY) analyst day could also impact trading today.

BOTTOM LINE: Asian indices are lower, weighed down by technology and financial shares in the region. I expect US stocks to open modestly lower and to maintain losses into the afternoon. The Portfolio is 50% net long heading into the day.

Today's Market Take:

Broad Market Tone:

• Advance/Decline Line: Slightly Lower
  
• Sector Performance: Mixed
• Volume: Light
• Market Leading Stocks: Underperforming

Equity Investor Angst:

• VIX 16.93 -9.03%
• ISE Sentiment Index 93.0 -23.3%
• Total Put/Call .97 -17.09%
• NYSE Arms 1.02 +24.36%

Credit Investor Angst:

• North American Investment Grade CDS Index 106.74 bps +.12%
• European Financial Sector CDS Index 182.55 bps +1.99%
• Western Europe Sovereign Debt CDS Index 120.91 bps +6.63%
• Emerging Market CDS Index 239.09 bps -.21%
• 2-Year Swap Spread 11.75 unch.
• TED Spread 21.75 unch.
• 3-Month EUR/USD Cross-Currency Basis Swap -26.75 unch.

Economic Gauges:

• 3-Month T-Bill Yield .09% unch.
• Yield Curve 135.0 unch.
• China Import Iron Ore Spot $122.10/Metric Tonne unch.
• Citi US Economic Surprise Index 60.80 +.1 point
• 10-Year TIPS Spread 2.43 unch.
  

Overseas Futures:

• Nikkei Futures: Indicating +23 open in Japan
• DAX Futures: Indicating +8 open in Germany

Portfolio:

• Slightly Lower: On losses in my Tech and Retail sector longs
• Disclosed Trades: None
• Market Exposure: 50% Net Long

Today's Headlines

Bloomberg: 

• European Stocks Fall to Two-Week Low on Greek Meeting. European stocks fell to a two-week low as euro-area finance ministers met to discuss Greek aid and concern grew that impending U.S. tax increases and spending cuts will harm the world’s biggest economy. Alpha Bank (ALPHA) SA led Greek banks lower as the nation’s creditors said the country may face a 15 billion-euro ($19 billion) financing gap. Cobham Plc (COB) slid 9.7 percent after the world’s largest maker of airborne-refueling equipment forecast weaker revenue and profitability. 
• EU May Scrap Plan to Hand ECB Sole Power on Bank Licenses. The European Union may scrap plans to give the European Central Bank sole power to grant and withdraw banking licenses in the euro area as nations tussle over the details of setting up a single supervisor. Some EU countries insist “that the key issue of access to and removal from the market should remain within the remit of national authorities,” for at least as long as the EU does not have a central system to handle failing banks, according to a document on the bloc’s website. The concerns mean current proposals must be revised, according to the document prepared by Cyprus, which holds the rotating presidency of the EU. Because setting up the new supervisor is so complex, EU finance ministers also may decide to lengthen the period over which the ECB would assume its new powers.
• Goldman Sachs(GS) Says Beware Europe Peripheral Stocks. European companies most dependent on revenue from Spain, Italy, Greece and Portugal are rising in the stock market at the fastest pace in five years, providing chances for short sellers after two earlier rallies fizzled. Similar rallies for companies serving so-called peripheral countries heralded losses of as much as 44 percent through November 2010 and July 2012, data compiled by Bloomberg show. 
• Faurecia to Cut 3,000 Jobs as Growth Focus Shifts Outside Europe. Faurecia (EO), Europe’s largest maker of car interiors, plans to cut about 3,000 jobs in its home region, or 7.5 percent of the workforce, by the end of next year as it retrenches in lackluster European markets.
• Obama Seeks Outside Support for Fiscal Cliff Negotiations. President Barack Obama is working to enlist outside support for his position that high-income people pay more taxes as he heads into negotiations with House Speaker John Boehner on how to avoid the so-called fiscal cliff. Obama will hold separate meetings with labor and business leaders at the White House this week ahead of his Nov. 16 meeting with Boehner, House Minority Leader Nancy Pelosi, Senate Majority Leader Harry Reid and Minority Leader Mitch McConnell. Obama will host labor leaders tomorrow and business leaders on Nov. 14, according to a White House official who asked for anonymity.
• Americans Say Europe’s Austerity Lesson Means Act Now. When the housing bubble burst in 2006, U.S. policy makers looked to Japan for clues about what to do -- and not do -- in response. Now their attention is shifting to Europe as America gets set to follow that region with a concerted attack on its budget deficit.
• Baby Boomers Blunt Fed Easing While Saving for Retirement.
• India Industrial Output, Exports Decline as Economy Falters. Indian industrial production unexpectedly fell in September and the trade deficit widened to a record last month as exports declined, adding to signs that Asia’s third-largest economy is struggling. Output at factories, utilities and mines dropped 0.4 percent from a year earlier after a revised 2.3 percent gain in August, the Central Statistical Office said in a statement in New Delhi today. The median of 28 estimates in a Bloomberg News survey was for a 2.8 percent increase. Manufacturing dropped 1.5 percent in September from a year earlier, while capital goods output decreased 12.2 percent, today’s data showed. India’s exports merchandise shipments fell 1.6 percent in October from a year earlier to $23.3 billion in October, while imports climbed 7.4 percent to $44.2 billion, according to the Commerce Ministry. Consumer prices rose 9.75 percent in October from a year earlier, after a previously reported 9.73 percent gain in September, a report showed today.
• Russian Third-Quarter GDP Grew at Slowest Since 2010 Rebound. Russia’s economy expanded in the third quarter at the slowest pace since it began recovering at the start of 2010 as a drought hurt agricultural output and stuttering global growth curbed demand for commodities exports. 
• China Solar Giants Likely to Get State Bailouts: Experts. China’s $20 billion solar industry is avoiding loan defaults and mergers by taking aid from local governments, preserving jobs at money-losing companies such as LDK Solar Co., the world’s second-biggest maker of solar cells.
• Gasoline Fluctuates on Tight Supplies and Debt Crisis Concern. Gasoline fluctuated as supplies around New York Harbor tightened after Hurricane Sandy and on concern that the European debt crisis will linger, curtailing economic growth and fuel demand.

Wall Street Journal:

• Fiscal Cliff: Live Stream.
• Need More Pessimism Before ‘Good Bottom’ For Stocks. 
• Syrian Jet Bombs Area Near Turkish Border. Turkey said Monday that a Syrian war plane had bombed a rebel-held town just meters from the border, shattering windows in a nearby Turkish town and sending scores of Syrian refugees fleeing across the neighbors' shared frontier.
• IEA Pegs U.S. as Top Oil Producer by 2020. A shale-oil boom means the U.S. will overtake Saudi Arabia as the world's largest oil producer by 2020, a radical shift that could profoundly transform not just the world's energy supplies but also its geopolitics, the International Energy Agency said. In its closely watched annual World Energy Outlook, the IEA, which advises industrialized nations on their energy policies, said the global energy map "is being redrawn by the resurgence in oil and gas production in the United States." 
• Leucadia to Acquire Jefferies.
  

CNBC: 

• Wave of Evictions Leads to Homeless Crisis in Spain. 
• Greece's 'Monster' Debt Problem Haunts Europe. Euro zone finance ministers meeting in Brussels on Monday won't make a final decision on aid for Greece, despite Athens passing a new austerity budget. But one former European Central Bank (ECB) official has told CNBC that Europe must give Athens more time.

Zero Hedge:

• Israel Continues Shelling Of Syrian Targets For Second Consecutive Day. 
• "Fiscal Cliff" Soars After Obama Win. (graphs) 
• Elmo Puppeteer On Leave Following Child Molestation Accusations. 
• Greek Banks Slump, Spanish Bonds Dump, Juncker 'Fist Pump'. (graphs) 
• The UK's Most Disturbing Number: Total Unfunded Pension Obligations = 321% Of GDP. 
• October Hedge Funds Performance Update: Mixed.

Business Insider:

• Chris Christie Said Nothing About A Massive Inmate Escape During Sandy. 
• An International War In Mali Could Take Place Sooner Than Anyone Realizes. 
• FACEBOOK(FB) LOCKUP RELEASE: An Astounding 777 Million Shares Become Available On Wednesday. 
• Morgan Stanley(MS) Has The Best Summary Of The State Of The World We've Seen Yet. 
• Neither Hillary Clinton Nor David Petraeus Will Testify At Benghazi Hearings. 
• Here's Goldman's(GS) Prediction For What The Fiscal Cliff Deal Ultimately Looks Like. The key ideas: The payroll tax cut will expire, taxes on the rich will rise, and rather than a 3.5% GDP drag, the effect will only be 1.4%. Most managements do not expect the business environment in 2013 will be materially different from today. In that case, the biggest economic risk from the fiscal cliff may not be going off it completely, but rather embracing growth-limiting austerity through too much compromise.
• China's Leadership Transition Doesn't Look Good If You're A Foreign Businesses. 
• Mysterious Explosion In Indianapolis Drives 200 People Out Of Their Homes. (pics)
• Google(GOOG) Will Have To Make A Deal If It Doesn't Want To Get Sued By The US.
• 8 Middle Class Tax Breaks That Might Be On The Chopping Block. 
• Iran Launches Massive Air Drill As 'Warning' To Enemies.
  

Reuters: 

• Celgene(CELG) stock soars on promising pancreatic cancer drug data. Shares of Celgene Corp rose as much as 9.7 percent on Monday after a late-stage clinical trial showed its drug Abraxane improved survival in patients with pancreatic cancer. Celgene, which unexpectedly reported the results late on Friday, did not give details of the extent of the improvement, saying it would do so at a medical meeting in January. Abraxane is already approved to treat breast and lung cancer and the company will apply for approval from regulators to market the drug to treat pancreatic cancer as well.
• Troika sees Greek debt at 144 pct/GDP in 2020 - sources. International lenders are reaching a consensus that Greece's debt burden will fall to 144 percent of gross domestic product in 2020 and roughly 10 percentage points lower two years later if current policies do not change, several officials told Reuters on Monday.

Telegraph:

• Debt crisis: No report on Greece as Troika can't agree on who pays - live. Greece's international lenders are split over how to deal with Greece not making a debt “sustainability” target of 120pc of GDP by 2020 and cannot agree on how much Greece is going to cost or who should pay.
• S&P and Fitch accused of market manipulation in Italy. Italian prosecutors have filed charges against Deven Sharma, the former president of Standard & Poor’s, and six other credit rating officials for issuing downgrades that destablised the country and fuelled the debt crisis. 
• Greece will need €32.6bn if Troika agrees to bailout extension. Greece's international creditors will have to find €32.6bn if they agree to extend its debt bailout by two years to 2016, as it wants, according to a draft report.

  ABC:

• Spanish bnaks may have to reduce their workforce by 30%, or about 70,000 people, through the end of 2014 as they need to cut costs, boost efficiencies, citing people close to govt.