Democratic Underground - 9:35 EST markets are open and pre-opening blather

Dow 10,863.42 +29.69 (+0.27%)
Nasdaq 2,237.83 +6.17 (+0.28%)
S&P 500 1,265.38 +2.59 (+0.21%)
10-Yr Bond 4.456 -0.30 (-0.67%)

NYSE Volume 48,724,000
Nasdaq Volume 53,662,000

9:26AM: S&P futures vs fair value: +2.9. Nasdaq futures vs fair value: +1.5. Correction: We reported earlier that the Santa Claus rally begins today. In fact it begins tomorrow Dec. 23 and we have corrected the prior entry to reflect that.

9:16AM: S&P futures vs fair value: +3.0. Nasdaq futures vs fair value: +2.5. Futures indications continue to strengthen heading into the opening bell which could in fact translate into a higher open for the indices. Initial reports that a resolution to the N.Y. transit strike was imminent provided somewhat of a lift to sentiment, but now it remains uncertain if such a settlement will be reached as early as previously anticipated.

9:00AM: S&P futures vs fair value: +2.1. Nasdaq futures vs fair value: +1.0. Futures indications are at their best levels of the morning amid tame inflation data but still provide little conviction as to whether stocks will open higher or lower. Meanwhile, the traditional year-end Santa Claus rally officially begins today and does have an enviable record of success; however, since its track record isn't perfect, more portfolio rebalancing amid an anticipated light volume day may do more harm than good.

8:34AM : S&P futures vs fair value: +1.0. Nasdaq futures vs fair value: -0.5. Futures trade improves slightly heading into economic data but reaction is somewhat subdued, still indicating a mixed open for the indices. Nov. personal income rose 0.3%, matching forecasts, while personal spending rose 0.3%, near expectations of 0.4%. More notably, the core PCE deflator came in at 0.1%, matching last month's 0.1% read to leave a 1.8% year-over-year rate, suggesting inflation remains under control; initial claims fell 13K to 318K (consensus 325K). Bonds have held onto early gains as the 10-yr note is up 6 ticks to yield 4.46%.

8:00AM : S&P futures vs fair value: +0.3. Nasdaq futures vs fair value: -2.0. Futures market versus fair value suggesting a mixed open for the cash market as rising oil prices and reports of Albertsons (ABS) unexpectedly rejecting a $9.6 bln takeover bid offset an otherwise upbeat batch of earnings reports and stall yesterday's recovery efforts. Perhaps setting a more positive tone to trading will be the upcoming release of Nov. personal income and spending, with particular attention being paid on the core-PCE reading as a telling inflation gauge.

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