Bull Radar

Style Outperformer:

• Small-Cap Growth +.87%

Sector Outperformers: 

• 1) HMOs +3.16% 2) Hospitals +2.36% 3) Retail +1.89%

Stocks Rising on Unusual Volume: 

• MTCH, KBIO, HIBB, ANF, SRPT, WAIR, FL, INTU, ROST, VIPS, FRAN, NKE, GES, GPS, SRPT, SPWH, BURL, CAB, GPS and HABT

Stocks With Unusual Call Option Activity: 

• 1) BMRN 2) AMD 3) CL 4) TMUS 5) SRPT

Stocks With Most Positive News Mentions: 

• 1) NKE 2) ROST 3) DG 4) HIBB 5) INTU

Charts: 

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

Morning Market Internals

NYSE Composite Index:

• Volume Running +5.6% Above 100-Day Average
• 7 Sectors Rising, 3 Sectors Declining
• 63.5% of Issues Advancing, 33.6% Declining
• 60 New 52-Week Highs, 78 New Lows
• 34.8% of Issues Above 200-day Moving Average
• Average 14-Day RSI 42.8
• Vix 16.3
• Total Put/Call 1.09
• TRIN/Arms 1.21

Friday Watch

Evening Headlines
Bloomberg:

• France Scrutinizes EU's Terror Failings a Week After Attacks. (video) France took European allies to task after investigations exposed serious security flaws that may be partly to blame for the country’s worst attack on home soil since World War II. In a thinly-veiled jab at Belgium, whose intelligence services are under scrutiny after investigators found at least three Brussels residents took part in the carnage, French Interior Minister Bernard Cazeneuve said "it’s essential that Europe pulls itself together." "There needs to be a collective realization by all European ministers, we need to move quickly and forcefully," Cazeneuve said ahead of a meeting with European Union counterparts requested by France in the Belgian capital. An increasing body of evidence shows an intelligence breakdown may have allowed a well-flagged jihadi free to roam the continent. Cazeneuve highlighted how Abdelhamid Abaaoud, the suspected architect of the attacks killed in a police raid on Wednesday, had been implicated in four of six attacks foiled by French forces since January. He added that both international and European warrants had been issued for his arrest. At least four of the attackers were listed on a counter-terrorism database maintained by the U.S. intelligence community, with one or more on a U.S. no-fly list, Reuters reported, citing unidentified U.S. officials.
• The Politics Surrounding the Fight Against Islamic State. (video)
• Does China Have a $1.2 Trillion Ponzi Problem? (video) 
• BOJ Easing Seen as Blunt Tool by Invesco, Blowing Bubbles by TCW. TCW Group Inc. says the Bank of Japan has made a mistake and should exit quantitative easing as soon as possible. Invesco Ltd. says the only error was not starting sooner. The split in views at the funds, which manage a combined $971 billion, comes as BOJ Governor Haruhiko Kuroda kept monetary policy unchanged on Thursday and his board said inflation expectations seem to be rising. TCW is among critics that say easing has only served to artificially inflate asset prices above what is merited by the real economy, and the longer it continues, the bigger the eventual crash.
• Taiwan Tech Demise Shows Pain of Dependence on Desktop PCs. For a stark depiction of how Taiwan’s technology industry has been ravaged by the rise of the smartphone and the fall of the desktop computer, look at Asia’s stock market. The 10 worst performers in Morgan Stanley’s 106-member Asia-Pacific Infotech Index this year come from Taiwan, once the leader of computer innovation and a powerhouse in hardware and semiconductor manufacturing. The sagging companies include former PC giant Acer Inc. and its manufacturing spinoff Wistron Corp. -- both are down 40 percent -- and smartphone maker HTC Corp., once the biggest seller in the U.S.
• Deep Dive: Baltic Dry Index, Swiss Watchmakers. (video)
• Here's Why Consumption in Latin America's Biggest Economy Is Taking a Hit. Recession and inflation hobble growth and companies shed workers. When Brazil’s Dilma Rousseff was sworn in for her second presidential term in January, she proclaimed that maintaining jobs and raising salaries were her “greatest priority.” Months later, real wages are falling and — even with people leaving the workforce — unemployment has spiked to its highest in more than six years. How does all this look on the ground?  
• Asian Stocks Drop as U.S. Dollar Holds Biggest Slump in a Month. Asian equities pared their biggest weekly gain in six weeks as investors paused for breath after a rally fueled by optimism that the Federal Reserve’s pace of tightening will be gradual. The dollar held its biggest slump in a month, while oil languished near a three-month low. The MSCI Asia Pacific Index lost 0.3 percent as Japanese shares led declines, with exporters dragged lower by the yen’s advance.
• Are Energy Stocks Overvalued? (video)
• Fischer Says Fed Trying Not to Surprise Markets at Liftoff. Federal Reserve Vice Chairman Stanley Fischer said the central bank has done its best to prepare international markets for its first interest rate increase since 2006 and reiterated that no decision has been made yet about the precise timing of liftoff. "In the relatively near future probably some major central banks will begin gradually moving away from near-zero interest rates," Fischer on Thursday told the Asia Economic Policy Conference Thursday at the Federal Reserve Bank of San Francisco. "We have done everything we can to avoid surprising the markets and governments when we move, to the extent that several emerging market (and other) central bankers have, for some time, been telling the Fed to ’just do it.’”

Wall Street Journal:

• Islamic State Tactics Shift, Borrowing From al Qaeda. Extremists are engineering larger, more coordinated plots against the West. U.S. and European counterterrorism officials believe Islamic State has changed its operational tactics by borrowing from al Qaeda’s playbook, deploying trusted lieutenants to engineer larger, more coordinated plots against the West.
• Paris Attacks Shine Light on Europe’s Failing Border Policies. EU nations have been slow to improve their information-sharing practices. In the minds of many Europeans, last Friday’s attacks in Paris have merged terrorism with the continent’s refugee crisis. That was probably the idea. A forged Syrian passport found near the body of a suicide bomber outside the Stade de France sports stadium strongly suggests the perpetrators of the outrage wanted it that way. The attacks have provided ammunition for nationalist politicians in Poland, Italy and elsewhere to reinforce an anti-immigration narrative. But the links between the two biggest issues on the European agenda have been made by mainstream policy makers too.
• NYPD Commissioner Bratton: Homelessness in NYC Has ‘Exploded’ in Past Two Years. Bratton said he was ‘frustrated’ by the problem during a panel discussion on quality-of-life issues. Police Commissioner William Bratton said Thursday that homelessness in New York City had “exploded” over the past two years—including in his own Upper East Side neighborhood—and was posing a challenge to police.
• Uncertain Leadership in Perilous Times. Paris is different, but the president can’t seem to change.

Fox News:

• Islamic State terrorists determined to build chemical weapons, officials say. (video) The Islamic State group is aggressively pursuing development of chemical weapons, setting up a branch dedicated to research and experiments with the help of scientists from Iraq, Syria and elsewhere in the region, according to Iraqi and U.S. intelligence officials.

MarketWatch.com:

• UnitedHealth(UNH) suggests Obamacare is being gamed. 
• The countries where ISIS finds support, in two charts.

CNBC: 

• Ken Griffin warns art prices 'cause for concern'. (video)
• UnitedHealth(UNH) move a 'wake-up call' for the White House: Analyst. As UnitedHealth Group threatens to opt out of participating in Obamacare in 2017, one expert says no one should be surprised.

Zero Hedge:

• The Great Fall Of China Started At Least 4 Years Ago. (graph)
• China's "Minksy Moment" - $1.2 Trillion In Ponzi Financing. (graph)
• Subprime Auto Lending Soars As Fed Report Shows Spike In Loans To Underqualified Borrowers.
• The Beginning Of The End For The Affordable Care Act? Largest US Health Insurer May Exit ObamaCare.
• Hillary Clinton's Aides Demand Comedy Club Remove Video Making Fun Of Her.
• The Stunning Visualization Of The World's 3 Billion Barrel Oil Glut.
• 3 Things: Earnings, Profits, Rates. (graph)
• Bonds & Bullion Bid As Fed "Policy Error" Fears Spark Dollar Drop, Stock Slop. (graph)

Business Insider: 

• The Clintons have generated $3 billion. The Washington Post just unveiled a jaw-dropping tally of Clinton Inc. showing that over four decades Bill and Hillary Clinton have generated $3 billion in total contributions to their global charitable, education and health care work, presidential and Senate campaigns and personal fees and royalties.
• Terrorism cost the world $52.9 billion in 2014.
• Yahoo(YHOO) insiders say Marissa Mayer is an indecisive micromanager and may be looking to quit.
• The US consumer has borrowed over $1 trillion for cars.
• The short seller who called out Lumber Liquidators' formaldehyde problem is now targeting a furniture company.
• The retail business is warning of an imminent recession.
• Gap(GPS) slashes forecast for earnings, shares drop. 
• Nike(NKE) is buying back $12 billion of itself.
• Senator: 'Young people are being robbed by older generations'.

Reuters:

• Mutual fund investors drive money out of U.S. stock funds -Lipper.

Financial Times:

• Paris attacks: Intelligence agencies forced to rethink tracking of Isis. Western intelligence agencies were forced to rethink their operations and reassess their ability to track Isis on Thursday as French officials confirmed the organiser of Friday’s Paris attacks had been operating under their noses.

Focus:

• German Police Discover Suspected Munich Terrorist Cell. German police found terrorist group in Central Apart Hotel in Berg am Laim district late Thursday evening. Investigators found several gas canisters and German police uniforms in hotel room. Federal, state police searching for suspects.

Evening Recommendations 

• None of note

Night Trading 

• Asian equity indices are -.50% to +.25% on average.
• Asia Ex-Japan Investment Grade CDS Index 126.25 -.25 basis point.
• Asia Pacific Sovereign CDS Index 67.75 -.25 basis point.
• Bloomberg Emerging Markets Currency Index 71.12 +.09%.
• S&P 500 futures -.10%.
• NASDAQ 100 futures -.11%.

Morning Preview Links 

Earnings of Note 
Company/Estimate

• (ANF)/.22
• (FL)/.95
• (HIBB)/.68

Economic Releases
11:00 am EST

• The Kansas City Fed Manufacturing Activity Index for November is estimated to rise to 0.0 versus -1.0 in October.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Bullard speaking, German PPI report and the (K) analyst day could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by consumer and commodity shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower. The Portfolio is 25% net long heading into the day.

Stocks Slightly Lower into Final Hour on Earnings Outlook Fears, Rising US High-Yield Debt Angst, Oil Decline, Healthcare/Energy Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Mixed
  

• Volume: Slightly Below Average

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 17.09 +1.42%

• Euro/Yen Carry Return Index 137.77 +.11%

• Emerging Markets Currency Volatility(VXY) 10.33 -1.62%

• S&P 500 Implied Correlation 56.45 +3.11%

• ISE Sentiment Index 96.0 +3.23%

• Total Put/Call .89 -11.0%

• NYSE Arms 1.11 +197.94% 

Credit Investor Angst:

• North American Investment Grade CDS Index 84.20 +2.59%

• America Energy Sector High-Yield CDS Index 1,252.0 +.95%

• European Financial Sector CDS Index 70.50 +1.92%

• Western Europe Sovereign Debt CDS Index 19.36 -3.01%

• Asia Pacific Sovereign Debt CDS Index 67.44 -.80%

• Emerging Market CDS Index 314.94 -.61%
  

• iBoxx Offshore RMB China Corporate High Yield Index 124.0 +.02%

• 2-Year Swap Spread 5.75 -2.25 basis points

• TED Spread 24.5 +1.25 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -44.25 +.5 basis point

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 71.07 +.68%
• 3-Month T-Bill Yield .09% -3.0 basis points

• Yield Curve 135.0 -4.0 basis points

• China Import Iron Ore Spot $45.44/Metric Tonne -1.96%

• Citi US Economic Surprise Index -8.6 +.4 point

• Citi Eurozone Economic Surprise Index 24.6 -.4 points

• Citi Emerging Markets Economic Surprise Index 0.0 -1.4 points

• 10-Year TIPS Spread 1.61 +2.0 basis points
• # of Months to 1st Fed Rate Hike(Morgan Stanley) 2.70 -.22

Overseas Futures:

• Nikkei 225 Futures: Indicating +8 open in Japan 
• China A50 Futures: Indicating -50 open in China

• DAX Futures: Indicating -12 open in Germany

Portfolio: 

• Lower: On losses in my medical/biotech/retail sector longs and emerging market shorts

• Disclosed Trades: Added to my (IWM)/(QQQ) hedges

• Market Exposure: Moved to 25% Net Long

Today's Headlines

Bloomberg:

• Why ISIS Has All the Money It Needs. Weeks before the attacks that killed 129 people in Paris, U.S. warplanes resumed sorties above Syria and Iraq, targeting anew oil fields and other parts of a vast petroleum infrastructure that fuels—and funds—Islamic State, one of the richest terrorist armies the world has known. These airstrikes were launched not because U.S. officials were prescient. They came after the Obama administration found and quietly fixed a colossal miscalculation. U.S. intelligence had grossly overestimated the damage they’d inflicted during airstrikes on the militants’ oil production apparatus last year, while underestimating Islamic State’s oil revenue by $400 million. According to U.S. Department of the Treasury officials and data they released in the wake of the Paris mayhem, the terrorist group is actually taking in $500 million from oil a year. What’s more, just a few hours before the first Islamic State suicide bomber blew himself up outside the Stade de France on Nov. 13, U.S. Army Colonel Steve Warren conceded at a press briefing that some American airstrikes disrupted IS oil operations for no more than a day or two.
• More Terrorism `Likely' in Europe, Police Agency Director Says. Islamic State has built a “serious capability” to inflict terror and is bent on staging more attacks in Europe, possibly at several places simultaneously, the head of Europol said. After the Paris atrocities, it is reasonable to assume “without any recourse to exaggeration, that further attacks are likely,” Rob Wainwright, director of the European Union’s crime-fighting agency, said on Thursday in Brussels. He called Paris the first European instance of shootings and suicide bombings at several venues, similar to the four-day Mumbai rampage of 2008 at sites including a luxury hotel and Jewish community center.
• France Weighs Threat to Biggest Diplomatic Event Since 1948. As the police work to uncover the terrorist network that murdered 129 people in Paris, the French government is turning its attention toward how to maintain security at its biggest diplomatic gathering since 1948. Foreign Minister Laurent Fabius, who will preside over a two-week United Nations summit on global warming, told France Inter radio on Thursday that the country’s forces couldn’t guarantee the security of public demonstrations.
• Refugee Crisis Hits Sweden's Rich-Poor Divide Fueling Pay Debate. Sweden’s plan to absorb hundreds of thousands of Middle Eastern refugees looks set to widen the pay gap in one of the world’s most equal societies. Decades-old practices that have propped up wages and restricted hiring have so far stopped unskilled immigrants from joining the workforce. But with some 350,000 asylum seekers, mostly from Syria and Afghanistan, set to arrive in Sweden by the end of next year, keeping all those people on state handouts rather than letting them do low-paid jobs looks untenable.
• Spanish Bonds Increasingly at Risk as Catalonia Shapes Election. The risk of a political stalemate will drag down Spanish bonds as the country heads into an election with its biggest economic region agitating for independence, according to a poll of banks active in the debt market. Investors should apply a premium of 25 basis points to the nation’s bonds to account for the risk of a multi-party backed government after next month’s vote, based on the median estimate in a Bloomberg survey of 18 economists conducted between Nov. 6 and Nov. 13. Ten of the analysts said Catalonia’s move to set up a separate state are adding to the pressure on Spanish debt. With opinion polls showing Prime Minister Mariano Rajoy’s People’s Party may lose about a third of its seats on Dec. 20 while remaining the largest parliamentary group, the risk of legislative gridlock is mounting as Catalan separatists grow bolder. Their battle with officials in Madrid reached new levels of antipathy last week when regional lawmakers in Barcelona declared the start of the secession process.
• U.K. Manufacturers Offer Downbeat Outlook for Industry. U.K. manufacturers are feeling grim about the outlook for their business. For the first time in three years, factory executives expect output to drop over the coming three months, according to a monthly survey by the Confederation of British Industry published on Thursday. The report also showed continued weakness in foreign demand, with a gauge of export orders slipping to the lowest since early 2013. Exports have been called the “weak link” in the economy by the London-based lobby group as softer global demand drags on U.K. output. Cooling factory activity and easing overseas sales may undermine hopes of Bank of England officials that growth can become more balanced and less dependent on domestic consumer spending.
• China Has a $1.2 Trillion Ponzi Finance Problem. Chinese borrowers are taking on record amounts of debt to repay interest on their existing obligations, raising the risk of defaults and adding pressure on policy makers to keep financing costs low. The amount of loans, bonds and shadow finance arranged to cover interest payments will probably rise 5 percent this year to a record 7.6 trillion yuan ($1.2 trillion), according to Beijing-based Hua Chuang Securities Co., whose lead fixed-income analyst was top-ranked by China’s New Fortune magazine in 2012 and 2013. Dubbed “Ponzi finance” by Hyman Minsky, the use of borrowed funds to repay interest was seen by the late U.S. economist as an unsustainable form of credit growth that could precipitate financial crises.
• A Hard Landing in China Could 'Shake the World'. "A slowing China redistributes global economic activity through the commodity channel as much as dampening it". China's slowdown is already playing out across the world, dragging down commodity prices and weighing on trade partners. And that's while the economy is still growing at about 7 percent. So imagine what happens in a hard-landing scenario. The crew at Oxford Economics have done just that in a new report that makes stark reading for anyone with a stake in the global economy. China's economic boom of the past 30 years means it now accounts for 11 percent of world GDP and around 10 percent of world trade. For resources, it's an even bigger player, accounting for 11 percent of world oil demand and 40 to 70 percent of demand for other key commodities,  according to the Oxford Economics research. Its financial system is massive, with its broad money supply now larger than the U.S.'s and amounting to over 20 percent of the world's. So were China to sneeze, the world may well catch a cold.  
• How Chinese Slowdown Turned Rolls-Royce's Slump Into a Crisis. Rolls-Royce Holdings Plc’s revelation last week that a 350 million-pound ($533 million) earnings hit expected next year is in large part due to lower deployment of older wide-body planes surprised investors who had believed cheap oil would make such aircraft more popular. The reality, Chief Executive Officer Warren East said in an interview, is that models such as Airbus Group SE’s out-of-production A340 and older Boeing Co. 777s remain out of favor even with cheap fuel, as airlines add vast numbers of new jets in an Asian market feeling the strain of China’s economic slowdown. That’s weighing on maintenance revenue at London-based Rolls, which gets the bulk of income from overhaul work calculated according to hours flown.
• Brazil's Inflation Surpasses 10% for First Time in 12 Years. Brazil’s inflation exceeded 10 percent for the first time in 12 years, complicating President Dilma Rousseff’s efforts to revive an economy that is also battling higher-than-forecast unemployment. Consumer prices rose 0.85 percent from Oct. 15 to Nov. 12, pushing the 12-month inflation rate to 10.28 percent, the national statistics agency said Thursday. The monthly gain, the fastest since mid-June, compares with the median estimate of 0.86 percent in a Bloomberg survey of 44 analysts. As consumer prices in Latin America’s biggest economy continue to accelerate, Brazil’s central bank has delayed its plan of slowing inflation to its 4.5 percent target to 2017 from 2016. The bank has signaled it will keep rates on hold for a third consecutive meeting next week as it is caught between higher living costs and the deepest recession in 25 years.
• Petrobras's(PBR) Dangerous Debt Math: $24 Billion Owed in 24 Months. The debt clock is ticking down at Brazil’s troubled oil giant, Petrobras. Next up: $24 billion of repayments over 24 months. That’s a towering hurdle for a company that hasn’t generated free cash flow for eight years and whose borrowing rates are soaring. Annual debt servicing costs have doubled to 20.3 billion reais ($5.4 billion) in the past three years.
• Swiss Watch Exports Fall Most in Six Years on Hong Kong Drop. Swiss watch exports had their biggest decline in six years in October, led by a 39 percent slump in shipments to Hong Kong, the industry’s largest market. Shipments declined 12 percent to 2 billion Swiss francs ($2 billion), the Swiss customs office said in a statement Thursday. Adjusted for fewer working days, the drop was 7.6 percent. Exports to the U.S. dropped 12 percent. “2015 has been one to forget for the watchmakers,” said Jon Cox, an analyst
  at Kepler Cheuvreux in Zurich. 
• Top Goldman Trades See Dollar Rising With Inflation Outlook. In Goldman Sachs Group Inc.’s vision of 2016, the dollar climbs, U.S. inflation expectations pick up and the currencies of Mexico and Russia advance. The U.S. investment bank recommended buying the greenback against the euro and yen when it published its top trades for next year on Thursday. 
• European Stocks Climb to 3-Month High After Dovish Fed Minutes. (video) European stocks rose for the third time in four days, as minutes from the Federal Reserve’s last meeting reassured investors the world’s biggest economy can withstand higher borrowing costs. Optimism about global growth sent the Stoxx Europe 600 Index to its highest level in three months. The benchmark gauge added 0.4 percent at the close of trading. It pared an advance of as much as 1.2 percent after commodity producers gave up some gains. 
• Iron Ore Bludgeoned to Record Low in Asia on China Steel Concern. Iron ore contracts in Asia slumped to records amid speculation that mills in China are reining in steel production as they battle losses, slumping prices and tighter credit, hurting demand for the raw material that’s mainly shipped from Australia and Brazil. Futures sank 1.8 percent to 331 yuan ($51.89) a metric ton on the Dalian Commodity Exchange, the lowest close since trading started in October 2013, while the SGX AsiaClear contract in Singapore fell to a fresh low. Losses on markets in Asia can signal declines in the Metal Bulletin Ltd. price for 62 percent content spot ore in Qingdao, which is updated once a day. That was at $46.35 a dry ton on Wednesday from $45.58 a day earlier, a four-month low.
• Citigroup(C) Says Commodity Markets Yet to Price In Rate Hike. Think the global commodity markets have fully priced in prospects for higher U.S. interest rates this year? Think again, says Citigroup Inc., which says keep an eye out for payrolls numbers due next month and prospects for an even stronger dollar. “We’re fast approaching December: we very much expect the first rate hike to take place at that point,” Ivan Szpakowski, a commodities strategist at Citigroup, told a conference in Shanghai in Thursday. “We think the market is already pricing that to some degree for sure. It’s pricing it in also to a degree. But not the full extent, not to 100 percent.”
• Baltic Dry Shipping Index Drops to All-Time Low. The cost of shipping commodities fell to a record, amid signs that Chinese demand growth for iron ore and coal is slowing, hurting the industry’s biggest source of cargoes. The Baltic Dry Index, a measure of shipping rates for everything from coal to ore to grains, fell to 504 points on Thursday, the lowest data from the London-based Baltic Exchange going back to 1985. Among the causes of shipowners’ pain is slowing economic growth in China, which is translating into weakening demand for imported iron ore that’s used to make the steel. “The main issue is the lack of demand for iron ore from China,” Eirik Haavaldsen, a shipping analyst at Pareto Securities AS in Oslo, said by phone. “This market is looking like a disaster and the rates are a reflection of that. It is looking scary for the market and it doesn’t look like there is going to be any life in the market in the near term.” 
• Chesapeake Energy(CHK) Bonds Plunge to the Lowest Ever as Oil Falls. Debt of Chesapeake Energy Corp. tumbled to a record low on Thursday as the price of oil plunged. Nine of the energy producer’s unsecured notes plummeted, some losing more than 12 cents on the dollar, as it was the most actively traded company in the junk-debt market. Credit-default swaps, which are used by investors to protect against defaults, rose to the highest ever.
• Americans' Outlook for Economy Holds Close to a 13-Month Low. One in five Americans in November said the economy is improving, matching the smallest share in two years and keeping a monthly gauge of expectations close to a 13-month low. The measure tracking the economic outlook was little changed at 42.5 last month after October reading of 42, which was the lowest since September 2014, data from the Bloomberg Consumer Comfort Index showed Thursday. While 20 percent of respondents said the economy was getting better, 45 percent viewed it as staying the same, the largest share since February 2012.
• Large Cap Bias Masks Worst Year for Retail Stocks Since '08. Retail stocks are up. Or are they down? Depends where you look. While the Standard & Poor’s 500 Retailing Industry Index has gained 23 percent this year, making it the best performing of 24 industries in the benchmark gauge, Amazon.com Inc. has overshadowed broader weakness. But investors can’t trade that group without shelling out fees to recreate it. Instead, the most-actively traded exchange-traded fund of retail stocks paints a different picture. The SPDR S&P Retail ETF, which is based on an equal-weighted index, has tumbled almost 9.2 percent in 2015 and is on track for its worst year since 2008.
• Best Buy(BBY) Tumbles After Predicting Slow Holiday Season Sales. Best Buy Co. shares fell as much as 8.6 percent after the retailer’s sales missed estimates, raising doubts about its turnaround bid and the health of the broader electronics industry. Revenue slid 2.4 percent to $8.82 billion in the quarter that ended Oct. 31, the Richfield, Minnesota-based company said in a statement Thursday. Analysts had estimated $8.83 billion. For the current quarter, Best Buy expects revenue to decline at a low single-digit percentage rate, hurt in part by the closings of Canadian stores. The company sees U.S. consumer-electronics demand continuing to weaken, stoking fears about a category that used to be a solid performer during the holidays. Both Target Corp. and Wal-Mart Stores Inc. also reported disappointing sales of gadgets and other technology earlier this week. Demand for tablets -- a hot product in past years -- has been particularly weak. “From an industry standpoint, there was a significant decline in that,” Best Buy Chief Executive Officer Hubert Joly said on a conference call. 
• What Are the Concerns in the Credit Markets? (video)
• Central Banks Fight to Ensure Crisis Tools Become the Norm. Unconventional tools deployed by central bankers from Frankfurt to Washington to mitigate the economic fallout of the financial crisis may be conventional when the time comes to combat the next downturn. The Federal Open Market Committee is already discussing the issue while other central bankers and economists in developed nations debate whether to holster emergency policies -- bond buying, targeted credit programs and negative interest rates -- or make them part of their everyday armories.

 Fox News:

• Fed's Lockhart Supports Raising Rates 'Soon'.

CNBC:

• Cramer: UnitedHealth(UNH) move 'very damning' for ACA. (video)

Forbes:

• United's(UNH) Warning Shows How Medicaid Is Taking Over Obamacare. One of the untold elements of the rapid decay underway in the Obamacare exchanges is the massive shift toward the Medicaid managed care companies, and away from the traditional commercial insurers like United and Aetna.

Zero Hedge:

• "Devastated" Trader Crushed By Soaring Biotech, Starts Online Begging Campaign To Fund $106,000 Margin Call.
• House Approves Tougher Refugee Screening Bill As Majority Of Americans Oppose Obama's Syrian Resettlement Plan.
• The Fed Has Made A "Policy Mistake" And The Inevtiable Result Will Be A Recession, BNP Warns.
• Permabulls Whistling Past The Grave. (graph)
• Swap Spreads Just Hit A New Record Negative Low: Goldman's Explanation Why. (graph)
• House Passes Fed Transparency Bill; Obama Will Veto.
• "This Isn't Going To End Well" - Junk Bonds Under Pressure. (graph)
• For Caterpillar The Depression Has Never Been Worse... But It Has A Cunning Plan How To Deal With It. (graph)
• The Fed-Induced Farce. (graph)
• Consumer Sentiment Decouples From Stocks As Black Americans' Comfort Nears 2015 Lows. (graph)
• If The Economy Is Fine, Why Are So Many Hedge Funds, Energy Companies And Large Retailers Imploding? (graph)
• WTI Tumbles Back Below $40, Goldman Warns Risk Of "Sharp Leg Lower". (graph)
• Philly Fed Creeps Back Into Positive Despite Collapse In Prices Paid, Workweek. (graph)

Business Insider: 

• Democrats just delivered a stunning blow to Obama's Syrian refugee plan.
• GUNDLACH: This chart is one of 'the scariest indicators in the world'. (graph)

Financial Times: 

• Fed futures remain reluctant on US rates. Futures still pricing in just a 66% probability of a hike. The general consensus among analysts and investors after the latest Federal Reserve minutes is that a rate rise on December 16 is, all things remaining equal, even more likely. Yet, the federal funds futures markets appear reluctant to reflect this growing certainty: by mid-session on Thursday they were still pricing in just a 66 per cent probability of a hike.

sky NEWS: 

• IS Sets Up 'Chemical Weapons Research Unit'. (video) It would only take "a few competent scientists" to develop hazardous chemical weapons, a former US intelligence official warns.

Corriere della Sera:

• FBI Warns Italy on Terrorism Threats. FBI warned Italy about terrorism threats, saying that it received information about plans for attacks in Rome and other cities.

news.com.au:

• Islamic State operates a 24-hour help desk to train terrorists. IT HAS Facebook pages, Twitter accounts, online magazines and even an app, now it has emerged IS have another tool to assist in its global campaign of terror — a 24-hour help desk. As France and its allies try to piece together how eight jihadists managed to launch the orchestrated attacks on Paris last week, it now appears the militant group has a around-the-clock propaganda hotline. And its main purpose — to train terrorists.

Bear Radar

Style Underperformer:

• Small-Cap Growth -.67%

Sector Underperformers: 

• 1) Hospitals -6.69% 2) HMOs -5.71% 3) Oil Service -2.15%

Stocks Declining on Unusual Volume: 

• IRS, VLP, KIRK, CRESY, UVE, GEOS, BBY, BFAM, UNH, AET, JKS, AON, EQIX, ALOG, PFE, INGN, COLM, EVHC, AGN, HCA, NHTC, ANTM, VRTS, LPNT, THC, ZAYO and HI

Stocks With Unusual Put Option Activity: 

• 1) MBI 2) EWJ 3) ZTS 4) EWA 5) UNH

Stocks With Most Negative News Mentions: 

• 1) EAT 2) CAT 3) COLM 4) PTCT 5) UNP

Charts: 

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