Stocks Reversing Lower into Final Hour on Surging Emerging Markets/Eurozone/US High-Yield Debt Angst, Global Growth Fears, Yen Strength, Biotech/Commodity Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume: Around Average

• Market Leading Stocks: Underperforming

Equity Investor Angst:

• Volatility(VIX) 20.78 -1.42%

• Euro/Yen Carry Return Index 152.86 -1.12%

• Emerging Markets Currency Volatility(VXY) 10.82 +10.97%

• S&P 500 Implied Correlation 69.97 -1.58%

• ISE Sentiment Index 60.0 -10.45%

• Total Put/Call 1.05 -3.67%

• NYSE Arms 1.22 -16.39% 

Credit Investor Angst:

• North American Investment Grade CDS Index 74.23 +2.25% 

• America Energy Sector High-Yield CDS Index 660.0 +1.10%

• European Financial Sector CDS Index 70.91 +9.59%

• Western Europe Sovereign Debt CDS Index 31.67 +1.10%

• Asia Pacific Sovereign Debt CDS Index 74.50 -.33%

• Emerging Market CDS Index 416.86 +7.61%

• China Blended Corporate Spread Index 345.18 +3.51%

• 2-Year Swap Spread 23.75 -.25 basis point

• TED Spread 22.75 +.75 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -9.0 -1.0 basis point

Economic Gauges:

• 3-Month T-Bill Yield .01% -1.0 basis point

• Yield Curve 153.0 -2.0 basis points

• China Import Iron Ore Spot $69.06/Metric Tonne +.10%

• Citi US Economic Surprise Index 34.40 +4.8 points

• Citi Eurozone Economic Surprise Index -19.60 +.7 point

• Citi Emerging Markets Economic Surprise Index -15.20 +.3 point

• 10-Year TIPS Spread 1.62 -1.0 basis point

Overseas Futures:

• Nikkei Futures: Indicating -314 open in Japan

• DAX Futures: Indicating +21 open in Germany

Portfolio: 

• Slightly Higher: On gains in my retail sector longs, index hedges and emerging markets shorts

• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges, then added them back

• Market Exposure: 25% Net Long

Today's Headlines

Bloomberg:

• Russia, Venezuela Rekindle Memories of 1998 Emerging-Market Rout. Emerging markets are ending the year much like how they began it -- in freefall. From Russia to Venezuela, Thailand to Brazil, stocks, bonds and currencies across the developing world are plunging. The Russian ruble tumbled past 60 for the first time on record today while Venezuelan dollar bonds sank below 40 cents on the dollar and Thai stocks fell the most in 11 months. Brazil’s corporate debt market is reeling as a graft probe of state oil producer Petroleo Brasileiro SA infects the market. All of this has something of a familiar feel to it, dating back to 1998, when, just like now, oil was tumbling and driving crude exporters Russia and Venezuela into financial crisis. While lots has changed in emerging markets since then -- perhaps most importantly, countries have higher foreign reserves and more flexible exchange rates -- the signs of contagion are mounting.

• Russian Industrial Output Unexpectedly Drops Amid Ruble Debacle. (video) Russian industrial output unexpectedly shrank for the first time in 10 months as the country’s biggest currency crisis since 1998 spilled over to manufacturing. Output at factories, mines and utilities fell 0.4 percent in November from a year earlier after a 2.9 percent increase in October, the Federal Statistics Service in Moscow said today in an e-mailed statement. The median estimate of 21 economists in a Bloomberg survey was for a 1.2 percent gain. The contagion from the collapse of the ruble is spreading to manufacturing, dealing another blow to an economy on the brink of its first recession since 2009.

• Ruble Tumbles Most Since 1998 as Traders Pressure Central Bank. The ruble tumbled the most since 1998, sliding past 60 for the first time, as traders tested Russia’s willingness to defend the currency amid an oil slump that’s pushing the economy toward recession. The ruble weakened 9.1 percent to 64.0005 per dollar at 7:57 p.m. in Moscow, the steepest slide on a closing basis since the year Russia defaulted on local-currency debt. The 10-year government bond yield rose 23 basis points to 13.23 percent. Three-month implied volatility for the ruble climbed to a six-year high as the rout triggered the Bank of Russia to sell foreign exchange, according to BCS Financial Group and MDM Bank. 

• Russia Sees GDP Shrinking at Least 4.5% in 2015 With $60 Oil. (video) Russia’s economy may shrink the most next year since 2009 if oil averages $60 a barrel under a “stress scenario,” the central bank said, underscoring the toll exacted by plunging crude prices.

• Indonesia Rupiah Sinks to 16-Year Low as Bonds Slide on Outflows. Indonesia’s rupiah tumbled to the lowest level since the Asian financial crisis as an uptick in dollar buying by local companies before the year-end coincided with a rout in the sovereign bond market. The currency slid 1.9 percent to 12,698 per dollar in Jakarta, the lowest close since August 1998, prices from local banks show. That was the biggest drop since Aug. 1. In the offshore market, one-month non-deliverable forwards declined 1.4 percent to 12,919, according to data compiled by Bloomberg. Overseas investors have pulled 10.09 trillion rupiah ($795 million) from local-currency sovereign bonds this month through Dec. 11, finance ministry data show, as the prospect of U.S. interest-rate increases damped demand for emerging-market assets. 

• Forget the Toaster. Chinese Bank Offers Mercedes to Get Deposits. Chinese banks, desperate to attract customers who are finding alternatives for their savings, are turning to giveaways. On offer at one branch in Beijing: an iPhone 6 Plus or a Mercedes-Benz. Cash rebates, trips abroad, interest rates at the highest premium ever over the official benchmark rate, even free vegetables are among other goodies banks are dangling to get Chinese savers to deposit their yuan in savings accounts. The competition is expensive. “Chinese banks are hemorrhaging their deposits,” said Rainy Yuan, a Shanghai-based analyst at brokerage Masterlink Securities Corp. “There is no fix for this. All the efforts they made to win savers back will only push up the costs, so it’s a losing battle to fight.”

• Emerging-Market Stocks Fall to 10-Month Low as Currencies Plunge. Emerging-market stocks declined, with the benchmark index set for a 10-month low, as the ruble slid beyond 60 against the dollar for the first time ever and Indonesia’s rupiah sank to the weakest level in 16 years. PTT Pcl, a Bangkok-based oil company, slumped 4.9 percent, dragging Thailand’s stock gauge down the most since January. China Mobile Ltd. fell to a seven-week low in Hong Kong. The Ibovespa slid 3.1 percent as a report signaled that Brazil’s economy unexpectedly contracted in October. The ruble plunged to 63.5 per dollar before Russia’s central bank holds a long-term auction to provide rubles to banks. Indonesia’s rupiah depreciated 2 percent. A Bloomberg gauge tracking 20 developing-economy currencies declined 1.3 percent. The MSCI Emerging Markets Index lost 1.6 percent to 923.58 at 11:24 a.m. in New York.

• European Stocks Erase 2014 Gain as Miners, Energy Shares Tumble. European stocks reversed an earlier advance, posting their biggest six-day slump since August 2011, after data showed a decline in manufacturing for the New York area and oil prices resumed a decline. With today’s 2.2 percent slump to 323.29, the Stoxx Europe 600 Index has erased its annual increase, closing at its lowest level since Oct. 20. The gauge reversed an advance of as much as 0.8 percent today as the Federal Reserve Bank of New York’s Empire State Index unexpectedly dropped this month and oil prices erased gains. Stoxx 600 energy and commodity producers slid at least 2.9 percent. 

• Oil Falls; UAE Says OPEC Won’t Cut Output to Boost Price. (video) West Texas Intermediate for January delivery declined $1.32, or 2.3 percent, to $56.49 a barrel at 1:36 p.m. on the New York Mercantile Exchange. Futures touched $55.87, the lowest since May 2009. Total volume was 51 percent above the 100-day average for the time of day. It’s dropped 43 percent this year.

• Oil-Bust Vets Brace for Storm Unseen by Shale-Boom Neophytes. The West Texas wildcatter, 76, has weathered four such cycles in his 52 years draining crude from the Permian basin, still the most prolific U.S. oilfield. Though the collapse in prices since June doesn’t yet have him in a panic, Stephens recognizes the signs of another downturn on the horizon. And like many bust-hardened veterans in this region -- which has made and broken the fortunes of thousands -- he’s talking about it like a gathering storm. The ups and downs of oil are a way of life in Midland and Odessa, Texas, dating all the way back to the Great Depression. It’s as much a part of the culture as Gulf Coast hurricanes, and residents often prepare accordingly.

• Copper Drops on ‘Mixed’ U.S. Reports on Homes, Industrial Output. Copper futures for March delivery fell 1.7 percent to $2.8835 a pound at 11:49 a.m. on the Comex in New York. A close at that price would mark the biggest drop for a most-active contract since Nov. 28. Trading was 30 percent below the 100-day average for this time, data compiled by Bloomberg show.

Wall Street Journal:

• Sydney Cafe Siege: Three Dead in Standoff. Lone Gunman Identified as Man Haron Monis Pronounced Dead at Hospital, Along With Two Unnamed Hostage. A siege that shut down a large part of central Sydney for more than 16 hours ended in bloodshed early Tuesday, after two hostages and their armed captor were killed when police stormed the cafe behind volleys of bullets. New South Wales police said the lone gunman—identified as 50-year-old self-proclaimed cleric Man Haron Monis —was pronounced dead in hospital following the shootout at the Lindt Chocolate Café in Martin Place around 2:10 a.m. The two unnamed hostages, a 34-year-old man and a 38-year-old woman, also died following the confrontation between the gunman and police.

• Investors Fear Industry Is at ‘Top of the Cycle'. Investors are worried that the private equity market is at the “top of the cycle” and there is too much money chasing deals, according to a survey released this week. The survey of 90 global institutional investors by placement agent Probitas Partners found that the top concern for investors was that “too much money is pursuing too few attractive opportunities,” with 55% of respondents saying this was something that kept them up at night.

• UAW Chief Aims to Eliminate Two-Tier Wage. Union President Says Battling Right-to-Work Not Among Top Priorities. United Auto Workers President Dennis Williams said on Monday the lower wage scale for newer auto workers make is unacceptable, and the roughly $19.50 hourly wage new hires earn should only be seen as a “good starting point” or negotiations with Detroit auto makers next year. 

• Junk-Bond Worries Spread Beyond Oil. A Pullback From Junk Bonds Can Be Harbinger That Risk Is Being Reassessed.

MarketWatch.com: 

• Carl Icahn says oil’s woes may be proof of a junk-bond bubble. Billionaire investor Carl Icahn says high-yield corporate debt may be in bubble territory and that a recent hiccup in the market, as a result of plunging oil prices, support his suspicions.

CNBC:

• Now is not the time to play the market: McNamee. (video) There are times you just do not want to play the market, and this is one of them, Elevation Partners co-founder Roger McNamee told CNBC's "Squawk Alley" on Monday.

ZeroHedge: 

• That Escalated Quickly: Europe Goes From Up 7% To Down 1.5% For 2014 In Under A Week. (graph)

• WTI Crude Craters To $55 Handle, High-Yield Credit Crashing-er. (graph)

• Goldman Pours More Crude On The Fire: "Oil Prices Can Go Lower For Longer".

• Taper Tantrum 2.0: Emerging Currencies Are Crashing. (graph)

• Today's Market Contagion: Energy High-Yield Credit Spreads Blow Above 1000bps For First Time Ever. (graph)

• Industrial Production Surges Most Since May 2010 Thanks To Subprime Auto Loans & Polar Vortex 2.0. (graph)

• Empire Fed Crashes To Almost 2-Year Lows, Biggest Miss In 4 Years. (graph)

• Oil Volatility Is Exploding (And It's Spreading). (graph)

Business Insider:

• The Ex-Goldman Trader Who Correctly Shorted Subprime Mortgages During The Financial Crisis Has Made A New Bet. Now he's betting against something else: high-yield bonds.

• Incredibly Dramatic Photos Of The Hostage Crisis In Sydney.

• Mutual Funds Haven't Performed This Crappily Since 1997.

• The Reported Sydney Hostage-Taker Is A 'Spiritual Healer' With A Long Rap Sheet.

• DEUTSCHE BANK: The 10-Year Yield Is Going Under 2%.

Telegraph:

• Coal prices tumble on China slowdown. Coal prices have fallen sharply this year as China slowdown hits demand, writes Andrew Critchlow.

Handelsblatt:

• German Stability Council Sees Growth Goal Too High. The German stability council says 4 German states need to cut spending further, citing a paper due to be published today.

RIA Novosti:

• Russia to Send 10th Aid Convoy to Ukraine Soon. Russia's Emergencies Ministry organizing convoy, which will deliver New Year's presents to Donetsk, Luhansk regions, citing ministry spokesman.

meps:

• EU Steel Prices Fall in Line with Drop in Input Costs - to 58-Month Low.

Bear Radar

Style Underperformer:

• Small-Cap Growth -.94%

Sector Underperformers:

• 1) Gold & Silver -2.72% 2) Biotech -2.51% 3) Restaurants -1.63%

Stocks Falling on Unusual Volume:

• SWZ, CALA, EDF, ANFI, LINE, KYN, SNAK, CLMT, VIIX, PAH, WLL, GLP, BLUE, KITE, SNY, RDUS, LGCY, AMPH, FMX, FIZZ, KEP, OVAS, BDSI, BPT, VNR, FRGI, VDSI, ADBE, KYN, MEI, WLL, CVRR, BLUE, HCT, AGIO, MEMP, AMRI, ISIS, TGTX, CONN, VNR, LGCY, SGMO and INFI

Stocks With Unusual Put Option Activity:

• 1) EPI 2) CNX 3) XLK 4) XLB 5) KMX

Stocks With Most Negative News Mentions:

• 1) RMD 2) F 3) GM 4) PBR 5) F
  

Charts:

• ETFs Falling on Unusual Volume

• Stocks Falling on Unusual Volume

Bull Radar

Style Outperformer:

• Large-Cap Growth -.51%

Sector Outperformers:

• 1) Oil Service +.36% 2) Software +.11% 3) Retail +.03%
  

Stocks Rising on Unusual Volume:

• RVBD, CRUS, RBC, RRC and PETM

Stocks With Unusual Call Option Activity:

• 1) CRUS 2) RVBD 3) PETM 4) DRI 5) AVP
  

Stocks With Most Positive News Mentions:

• 1) LMT 2) ROK 3) RVBD 4) NDAQ 5) APC
  

Charts:

• ETFs Rising on Unusual Volume 

• Stocks Rising on Unusual Volume

Monday Watch

Weekend Headlines 
Bloomberg:

• Crimea Ignores Economic Pain to Embrace Putin in New Russia Era. In the Crimean resort town of Alushta, realtor Janna Voitenko is doing all she can to welcome the region’s new overseers. A Russian flag hangs outside her office and a portrait of President Vladimir Putin is in the entry. It hasn’t offset an economy that’s dead in the water. She spends her days waiting for customers to come in. With revenue at her real estate agency down 90 percent, Voitenko is turning to family and friends to help pay the office rent. Even if anyone did want to buy a flat, she’d have a hard time finding a listing for them: the property database was only just reopened after being closed since March, when Ukraine cut access to the records after Russia annexed Crimea.

• Congress Passes Tougher Russia Sanctions But Gives Obama Leeway. The U.S. Congress has voted for tougher sanctions to punish Russia for its intervention in Ukraine, moving beyond steps the White House and European Union have been willing to take while giving President Barack Obama leeway in applying most of the provisions.

• Japan’s Manufacturers’ Sentiment Sags in Challenge for Abe. Confidence of Japan’s large manufacturers declined in the fourth quarter as a recession offset a boost from a weaker yen, underlining the economic challenges facing Prime Minister Shinzo Abe after his election win. The Tankan’s big manufacturer index slipped to 12 in December from 13 in September, the Bank of Japan said today, lower than the median estimate of 13 in a Bloomberg News survey of economists. The index is forecast to drop to 9 in March.

• How China’s Interest-Rate Cut Raised Borrowing Costs. What if a central bank cut interest rates and borrowing costs rose? Since the People’s Bank of China surprised markets with the first benchmark rate reduction in two years on Nov. 21, the five-year sovereign bond yield climbed 15 basis points, that for similar AAA corporate notes surged 37 and AA debt yields jumped 76. While finance companies did start charging less for mortgages, their funding costs rose as the one-week Shanghai interbank lending rate added 37 basis points. 

• Australia’s Budget Deficit Widens to A$40.4 Billion on Iron Ore. Australia’s government forecast a wider budget gap this year as falling iron ore prices reduce revenue and spending cuts are held up by parliament. The underlying cash deficit will deteriorate to A$40.4 billion ($33.2 billion) in the fiscal year ending June 30, 2015 from a May estimate of A$29.8 billion, Treasurer Joe Hockey said in the mid-year economic and fiscal outlook today. The government forecast unemployment to climb to 6.5 percent in the second quarter, higher than its May projection of 6.25 percent.

• Petrobras Said to Delay Results on Graft Writedowns. Disagreement at Petroleo Brasileiro SA (PETR4)’s board led the state-run oil producer at the center of a corruption scandal to delay releasing full financial results, a person with direct knowledge of the issue said. 

• Qatar Stocks Enter Bear Market as Dubai Erases 2014 Gains on Oil. Shares in Qatar plunged, becoming the fifth gauge in the oil-rich Gulf Cooperation Council to enter a bear market, as crude prices dropped to the lowest level since July 2009. Dubai’s gauge wiped out this year’s advances. Qatar’s QE Index (DSM) lost 5.9 percent to 11,114.43 at the close in Doha, bringing its decline since September’s record high to 23 percent. Dubai’s DFM General Index (DFMGI) lost 7.6 percent, the most since October 2008. The shares have retreated 34 percent this quarter, turning one of the world’s best gains in 2014 into a 1.4 percent loss. The measure, along with indexes in Saudi Arabia, Kuwait and Oman fell into a bear market in the past three weeks. 

• China Stocks Fall on Growth Concern as Financial Companies Slump. China’s stocks fell, led by financial companies, amid concern the slowdown in the world’s second-largest economy is deepening. China Construction Bank Corp., the second-biggest lender, dropped 2.2 percent after saying it plans to raise as much as 80 billion yuan ($12.9 billion) by selling preferred stock. China Vanke Co. and Poly Real Estate Co., the largest developers, slumped more than 3 percent after an economist for the central bank said a slowdown in real estate investment in 2015 will drag down economic growth. Agile Property Holdings Ltd. jumped 6.9 percent in Hong Kong after the developer said its chairman was released from house arrest in China. The Shanghai Composite Index decreased 1 percent to 2,908.02 at 9:44 a.m.

• Oil Rout Drags Stocks Lower on Growth Concern; JGBs Gain. Oil slumped with Asian stocks and commodity-producer currencies as concern that the global economic outlook is worsening pushed credit risk higher and drove Japanese bond yields to a 20-month low. West Texas Intermediate oil sank 0.8 percent to $57.34 a barrel by 11:26 a.m. in Tokyo, taking losses to more than 46 percent since a June 20 high. The MSCI Asia Pacific Index retreated 1.2 percent as a gauge of emerging-market stocks slid to a 10-month low. Australia’s dollar weakened 0.3 percent, while Indonesia’s rupiah tumbled 1.1 percent.

• Oil Trades Near $60 a Barrel as OPEC Seen Resisting Cuts. Oil traded near $60 a barrel in London as the United Arab Emirates said OPEC will refrain from cutting output even if prices slumped to as low as $40. U.S. benchmark crude extended its drop from a five-year low. Brent futures were little changed after dropping 2.9 percent on Dec. 12. 

• Oil Slump Blindsides Bulls That Wagered on Rout Ending: Energy. Speculators added to wagers that the slump in oil futures, the worst since the global recession, is ending. Prices kept falling anyway. Money managers raised their net-long position in U.S. crude to the highest in two months in the week ended Dec. 9, U.S. government data show. Most of the change came from short holdings contracting to the lowest level since August.

• Australia Sees Iron-Ore at $60 as Commodities Hit Budget. Australia cut its iron-ore price forecast to about $60 a metric ton as a commodity slump deepens the budget deficit more than previously estimated. Prices for the material dropped from the government’s initial estimate of $92 a ton for the budget, Treasurer Joe Hockey said in a televised press conference from Sydney today. Australia’s terms of trade have seen the biggest decline since records were first kept in 1959, he said. “That more than 30 percent fall in iron ore prices has had a big impact on the budget, as had a 15 percent fall in thermal coal and 20 percent fall in wheat prices since the budget,” Hockey said. The price of iron ore will “remain around $60 a ton for the foreseeable future,” he said.

• Fossil-Fuel Limits Everywhere Closer After UN Climate Deal. After two weeks of discussions in Peru organized by the United Nations, the diplomats agreed on the detail of pledges from all nations on curbing greenhouse gases. Richer countries gave an assurance they’re on track to mobilize $100 billion a year in climate aid by 2020. The decision sets the framework for a landmark agreement the UN intends to adopt in December 2015 in Paris that will rein in the emissions damaging the atmosphere. It included last- minute concessions to some of the poorest nations in the world, who are concerned the system will impose costly and painful changes on their economies. 

Wall Street Journal:

• Sydney Cafe Siege Sparks Terror Fears. TV Showing Cafe’s Customers With Hands Up; Islamic Flag Displayed. Armed police shut down central Sydney after a suspected gunman and possibly accomplices took several people hostage in a cafe and placed an Islamic flag in the window, sparking concerns a terrorist attack was under way. Authorities sealed off surrounding streets, evacuated people from buildings, and suspended rail services following the incident at the Lindt Chocolate Café in Martin Place, in the heart of the city’s business district.

• PetSmart to Be Acquired by BC Partners Group. Investor Group to Pay About $8.25 Billion in Largest Private-Equity Buyout of Year.

• China Steps Up Scrutiny of Margin Trading. Move Comes After Volatility in Chinese Stocks. China’s securities watchdog said it would conduct spot checks on some brokerages’ margin trading business, signaling regulators’ growing concerns about the risky investment practice that has contributed to a recent rally in the country’s stock market.

Zero Hedge:

• Crude Carnage Contagion: Biggest Stock Bloodbath In 3 Years, Credit Crashes. (graph)

• "This $550 Billion Mania Ends Badly," Energy Companies Are "Shut Out Of The Credit Market". (graph)

• Paying Down The Debt Is Now Almost Mathematically Impossible.

• It's Different This Time: The Economy Matters Edition. (graph)

• Peak Idiocy: CNN Urges Students Not To Pay Down Student Loans, Buy Stocks Instead.

• 5 Things To Ponder: Crude Oppositeness. (graph)

• The Crude Crash Comes To Wall Street: Counterparty Risks Rear Their Ugly Heads Again. (graph)

• The Curse Of Keynesian Dogma: Japan’s Lemmings March Toward The Cliff Chanting “Abenomics”. (graph)

• Japan's Abe Wins In Landslide Victory, LDP To Have Supermajority According To Exit Polls.

• Senate Passes The Cromnibus: Here Is Who Voted "No" And What It Actually Contains.

• The Carnage Continues - Middle East Stock Markets Are Bloodbath-ing. (graph)

• Crude Crash Set To Continue After Arab Emirates Hint $40 Oil Coming Next.

• Citi's 12 Charts Of Christmas. (graph)

• Fed Vice Chairman Shocked At Wall Street Influence After Jamie Dimon "Whips" Cromnibus Votes.

• Mario Draghi: Goodbye ECB, Hello Italian Presidency?

• Up To 40 Hostages In Sydney Financial District Coffee Shop, Jihadists Suspected; US Consulate Evacuated - Live Feed.

Business Insider:

• Facebook(FB) Dumps Microsoft(MSFT).

• Brazil Is Experiencing Its Final Reckoning.

• This Week Was A Stark Reminder Of How Fast Good Stock Markets Can Turn Bad.

• Russia Vows To Strike Back If US Imposes New Sanctions.

• Banks Are Firmly On A Multi-Year Path Towards Becoming Utilities.

• Food Prices Surge As Panicked Russians Empty Their Bank Machines Of Cash.

• Putin Is Infiltrating European Politics With Shocking Effectiveness.

• OPEC Is Not In Control.

• Barron's Couldn't Find One Person To Say Stocks Would Fall In 2015.

• Here's What Will Happen If Russia's Economy Keeps Tanking.

• The Future Of The Euro Could See Trouble This Week.

Night Trading

• Asian indices are -1.0% to -.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 112.0 +6.0 basis points.

• Asia Pacific Sovereign CDS Index 74.75 +8.25 basis points.

• S&P 500 futures +.46%.

• NASDAQ 100 futures +.44%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (PAY)/.41

• (HGR)/.44

Economic Releases
8:30 am EST

• Empire Manufacturing for December is estimated to rise to 12.0 versus 10.16 in November.  

9:15 am EST

• Industrial Production for November is estimated to rise +.7% versus a -.1% decline in October.

• Capacity Utilization for November is estimated to rise to 79.4% versus 78.9% in October.

• Manufacturing Production for November is estimated to rise +.7% versus a +.2% gain in October.
  

10:00 am EST

• The NAHB Housing Market Index for December is estimated to rise to 59 versus a reading of 58 in November.

4:00 pm EST

• Net Long-Term TIC Flows for October.

Upcoming Splits

• None of note

Other Potential Market Movers

• The China HSBC Manufacturing PMI, (HON) Outlook Conference Call, (HPQ) business update and the (AGCO) analyst meeting could also impact trading today.

BOTTOM LINE: Asian indices are lower, weighed down by industrial and technology shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed. The Portfolio is 25% net long heading into the week.

Weekly Outlook

Week Ahead by Bloomberg. 
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 growing global growth worries, rising European/Emerging Markets/US High-Yield debt angst and earnings concerns offset central bank hopes, seasonal strength and bargain-hunting. My intermediate-term trading indicators are giving neutral signals and the Portfolio is 25% net long heading into the week.