Market Talk

A very quiet day. US stocks little changed on the day, with the blue chips easing while the broader indexes see slight gains, even with a lot of options contracts expiring, which usually drives up volume and sometimes volatility. But volatility was nowhere to be seen, even with the euro getting jerked around, as it seems most people must be out buying Christmas presents and not equities.

DJIA slips 7 to 11493, S&P 500 adds 1 to 1244, Nasdaq Comp rises 6 to 2643. For most of the day, you needed an EKG machine to get the market’s pulse.

Moody’s slashes Ireland debt rating, but IMF warning that a “disorderly eruption” (is there another kind?) in Ireland could spread to other nations, like the US and the UK, gets investors’ attention. That drives down the euro, which slips under $1.32, and helps Treasurys; 10-year yield falls to 3.33%.

It hasn’t been the flashiest week for US stock markets, with the Dow Industrials sport a roughly 114-point range from week’s high to low, but they’ve been able to churn upward, with DJIA closing at its highest level since early September 2008.

Early complexion this morning suggests the staid activity will continue, with markets generally flat in Asia overnight, and Europe currently just edging slightly lower. With only November LEI on the economic data calendar (at 10:00 a.m. ET), the main influence for US stocks may come the direction of the euro, which has eased this morning.

EUR/USD currently 1.3255 after earlier being well above 1.33. S&P futures off 0.70, DJ futures up 1. Ten-year yield down to 3.37%.

US stocks skid into the close, with a late sell-off sapping equities of their strength, albeit the blue chips hold up better than the rest of the market, as the euro rises sharply on hopes leadership on the Continent has a plan.

DJIA, up as much as 70 in the afternoon, finishes up just 18 to 11428, S&P 500 adds 0.08 point to 1240, Nasdaq Comp drops 13 to 2625. Treasurys rally, meanwhile, halting last week’s severe slide.

The only thing you had to watch today was the euro. Forget the FOMC meeting tomorrow, the tax-cut fight, all the other noise. When it crossed $1.34, you saw stocks pick up sharply; when it eased back under that level, stocks followed suit, and the level seems to have been today’s pivot point.

It’ll be very interesting to see how the Euroheads pull this one off, especially considering the Eurozone countries have to turn over more debt next year than at any time since the introduction of the single currency. Especially as more cold water is being poured on the common eurobond solution.

US stock futures show a positive bias premarket, after markets were mostly higher in Asia overnight and European stocks currently mixed to slightly higher. Euro’s down a little, recently holding above $1.32, while USD index edges higher.

Not much on the economic data calendar — weekly jobless claims at 8:30am ET, and October wholesale trade figures due at 10:00am. Inventories expected to be up 0.9%, but we have a hunch they may come in a little higher than expected. They surged 1.5% in Sept, and makes us wonder if some of that was unintentional.

S&P futures up 4.30. Treasurys look generally flat, 10-yr note’s yield at 3.23%.

Okay, that’s an exaggeration, but not by much.

Heady rally for US stocks in the morning comes almost totally unglued in the afternoon, as the euphoria over the tax-cut deal fades quickly, and even as the Irish approve their harsh budget.

Stocks jumped early, as did euro, as did gold, amid Treasurys sell-off. But the risk trade unwinds itself in the afternoon. We figure the main pivot is the euro, which steadily weakened all day, despite the Irish vote. Seems there’s still a few concerned investors out there.

DJIA dips 3 to 11359, after jumping as much as 89 this morning; S&P 500 adds 1 to 1224, Nasdaq Comp rises 4 to 2598. It’s the Dow’s second consecutive down day; notably, it’s the dollar’s second consecutive rising session. Still, Dow’s still up 3.2% on the month so far, and up 8.9% on the year.

Euro fades after rising sharply in the morning. Gold set an intraday record, but then faded as well. Treasurys got hammered early, and while they recouped a little ground, it was nothing like the turnaround in the risk assets.

Is it us, or did Obama sound particularly defensive in his press conference? He may have gotten what he wanted, and the GOP may have gotten what it wanted, in this tax-cut deal. But both sides have to know, in their hearts of hearts, that what they did today will only cause more problems down the road.

Take a look at the details of Ireland’s budget. It’s brutal. It’s absolutely brutal on every front. I’m not even sure it wouldn’t be better for the Irish to bolt the eurozone and just deal with their problems on their own. But nobody can say they didn’t face up to a hard choice.

That’s about all you can say with our hackneyed political class. Look, I’m not totally nuts, I’ll be as happy as the next guy to see my tax rate stable and even get a little extra jingle in my paycheck, courtesy of that payroll tax-cut. But once all that money’s gone, spent or saved or whatever, the nation’s fiscal problems will still be there, like that pusher on the street corner come to collect his bill.

This morning’s smart rally is already showing some signs of flagging. Gold, up sharply earlier, has slipped into the red. Stocks are higher, but have given away some strength. Treasurys continue to sell-off, though. The fact is, this rally may have a short shelf-life, because in the end it’s not about much.

US stocks looking weak, even though the Wall Street spin on Friday’s jobs report — that it would spark a deal on the Bush tax cuts — seems to be playing out quickly.

Word out of DC is a deal is close that would extend the cuts for everybody, and also extend jobless bennies for an unspecified amount of time. Meanwhile, Bernanke suggested on “60 Minutes” last night that he could expand QE2, “if needed,” and Europe’s leaders are getting together to discuss expanding their bailout fund.

Is there any “austerity” in there, anywhere? Bueller? Bueller? Are the only people sharing the sacrifices the common schlubs in Greece and Ireland?

S&P futures down 3.80, DJ futures down 18. Ten-year yield down to 2.97%. Euro down sharply, lately at $1.3269.

The ECB disappointed the market with what it said, but it encouraged the market with what it did. We explain.

US stocks prepared for launch, ready to chase a vigorous rebound in European stocks and euro. London, Paris and Frankfurt all up more than 1%, euro above $1.31 after falling below $1.30 yesterday.

Dramatic change in Europe’s menacing debt backdrop? Not quite, just some better UK manufacturing data, we hear, but both stocks and euro were due to bounce, and common to see such buoyant action in early days of fresh month.

Sounds simplistic? That’s how it is sometimes. Bears had stamina issues in prior two sessions, will bulls hold up better?

ADP’s November private payrolls estimate at 8:15 a.m. ET; 3Q productivity, ULC at 8:30 a.m.; October construction spending, November ISM manufacturing at 10:00 a.m.; and Fed’s Beige Book at 2:00 p.m.

S&P futures up 13.60, DJIA up 118. Ten-year tanks, yield at 2.87%. Euro currently at $1.3099.

US stocks looking weak with November winding down, as the general fear that’s gripped the market continues to hold sway.

That is especially evident in the euro, which slipped below $1.30 earlier, and is teetering over that line currently. Debt yields for Spain, Italy and Belgium rising. Investors apparently don’t like this proposed permanent bailout fund, and the idea of creditors being forced to take losses. Seems about right to us.

Here in the US, lot of second-tier data today, with Case-Shiller headlining. Google working on a $5.3B deal for Groupon, reportedly.

S&P futures down 6.30, DJ futures down 50. Ten-year yield down to 2.78%.