Morning Report: December 30, 2011

Ahead of the Bell: Dow futures are trading up 12 points and S&P futures are trading up 2.50 points  as investors gear up for the final trading day of the year. Markets may have a little bit of a muted reaction today after yesterday’s triple digit rally and a lack of data expected today. Statistically the S&P 500 has closed higher only 32% of the time on last trading day of the year.

  • There are no economic reports scheduled for today. The dollar is currently down against the Euro, British Pound, and Japanese Yen. Crude oil is currently trading at about $99.91 per barrel. Gold is currently trading at $1,573.
  • European banks borrowed €17.3 billion overnight, the highest amount since February. The figure is markedly higher than the €4.321 billion borrowed on Wednesday.
  • Hungary is expected to adopt a new central bank law today, going against the objections of the International Monetary Fund and European Union’s objections. The objections relate to two provisions in the bill that relate to boosting the ranks of the rate-setting monetary council and the number of deputy governors.
  • The HSBC Purchasing Managers’ Index reported Chinese factory production rose to a reading of 48.7 in December, up from November’s reading of 47.7. November’s reading was the lowest in 32 months. A reading below 50 indicates contraction.
  • This morning on CNBC Edward Yardeni, Chief Investment Strategist at Yardeni Research, Inc., appeared and spoke about his view on the European situation. Yardeni acknowledged that we are “past the point of no return” because governments have been too reckless with fiscal policy and we are no relying on central banks to apply quantitative easing policies. Yardeni does believe that we can muddle through the situation as he expects liquidity injections in February from the ECB to European banks, which his likened to the Fed’s QE policy of buying government debt.
  • Have a great weekend and a happy and healthy new year!

Thursday’s Close

DJIA up 135.63 pts/+1.12%/12,287.04

S&P up 13.38 pts/+1.07%/1,263.02

Nasdaq up 23.76 pts/+0.92%/2,613.74

Friday’s Futures

Dow Futures up 12 pts/+0.409%

S&P Futures up 2.50 pts/+0.02%

Nasdaq Futures up 3.25 pts/+0.14%

Overseas Markets

FTSE +0.17%

CAC 40 +0.16%

NIKKEI 225 +0.67%

HANG SENG +0.20%

Overseas:  World markets are trading slightly higher following yesterday’s triple digit rally and the news that Chinese manufacturing contracted less than the previous month.

Economic Reports:  None

Top Headlines:    

  • Verizon Wireless announced that effective January 15th it will apply a $2 fee for one-time telephone and online-bill payments. 
  • Workers at Freeport McMoRan’s Indonesia operations are expected to return to the mine on Monday, ending a three-month strike after the workers’ union made a deal with local contractor PT Kuala Pelabuhan Indonesia to rehire 700 striking workers without sanctions.
  • The Justice Department announced that the health equipment unit of General Electric agreed to pay $30 million to settle allegations that Amersham Health Inc., acquired by GE in 2004, provided false information to overcharge Medicare for a drug used to diagnose heart disease.
  • Sources indicate that Morgan Stanley and Goldman Sachs are the front-runners to underwrite Facebook’s IPO, which is expected in 2012.

Commodities/Currency:

Gold:up $32.20 to $1,573.20

Oil:up $0.26 to $99.91

EUR/USD 1.2934 -0.0024

USD/JPY 77.34 -0.23

GBP/USD 1.5459 +0.0051

Volatility Index (VIX): As of the close of business Thursday, December 30th, the VIX is down 0.85 to 22.67

Companies Reporting Quarterly Earnings: None

Today’s Opening and Closing Bells:

The Kids Food Festival visits the NYSE to celebrate the launch of their new company "Kids Food Festival, LLC".The Kids Food Festival helps in the fight against childhood obesity through fun and flavorful activities about balanced food & lifestyle choices. In honor of the occasion, Cricket Azima, Co-Founder of the Kids Food Festival, rings The Opening BellSM.

BELVEDERE Vodka visits the NYSE, spreading cheer and partnering with (RED)TM to celebrate (BELVEDERE) RED the fund-raising Special Edition for the 2011 holiday season. In honor of the occasion, representatives from Belvedere Vodka ring The Closing BellSM.