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An early carving up of some well-prepped bull has given way to a turkey trot style spread, courtesy of a feast of mixed market catalysts. As of 10:55 ET the Diamonds (DIA) and “SPYder” (SPY) are mixed fractionally from -.25% to .25% on equally unexciting levels of investor satisfaction.

What’s driving investors this Wednesday—other than the majority found making a mad dash for places other than Wall Street? Initially weighing in on investors before the tryptophan works its magic, overseas markets struggled on Wednesday. Concerns over the cost of the global economic stimulus packages were digested further with the ECB considering an additional 130.0B Euro plan following Tuesday’s fresh $800B stateside effort.

Separately, “spot on and when she talks, people do more than listen” Meredith Whitney of Oppenheimer dropped her latest bomb on the financials (XLF). Today’s news flash finds the celebrated analyst stating US banks will write-down about $44B in Q4, with a large portion of the TARP funds used for ‘plugging holes in the balance sheets’ of those companies and not providing meaningful growth for the industry.

News of Toyota Motors (TM) having its top notch ratings cut was another early point of contention for market bulls. Fitch Ratings reduced the company’s long-term foreign and local debt ratings to AA from AAA. Simultaneously, the analysts also warned that its global investments, product mix and speed of expansion all need to be addressed according to Reuters. Shares of TM are off 2 points at 63.75 but finding a slight lift off session lows courtesy of the broader market’s turkey trot.

Retailer Tiffany (TIF) helped produce similar worry lines out-the-gate Wednesday. The bauble giant slashed its guidance below Street views. While the easily anticipated outlook shift should come as no real surprise, given the historical precedent of late—investors did see fit to slice about 10% off shares before enticing their bargain-hunting cohorts to snap up shares back near the unchanged level. Intraday, shares of TIF are off just 0.32 at 20.49.

In other corporate findings worthy of “bulldozing”, machinery goliath Deere (DE) provided a catalyst for tearing down some fast market gains of the past two sessions and one final and most important hour on Friday. The company missed by $0.18 on earnings of $0.81, delivered a now standard release statement warning of “Given the sudden, sharp downturn in global blah, blah, blah” and saw a slug of analysts downgrading shares. Intraday shares are off .93 at 32.17 after providing a ‘near’ triple bottom test of prior lows near 28.50.

In other intertwined markets purported to make equity investors tick, Black Gold and the Yellow Metal (GLD) are finding mixed reactions in volatile up and down conditions. Overseas, weaker crude prices were used as a scapegoat for profit-taking in equities. The price action was interpreted as supporting a less “Obamaistic” outlook regarding the stimulus packages and a quick fix for economies across the globe.

Intraday, the storyline has changed. Prices in the US Oil Fund (USO) proxy are now higher by 2% at 42.15 after, ironically enough, weekly oil inventory levels rose by a larger than expected 7.3M barrels versus estimates of 1.0M and indicating weak demand. Adding to the potential mystery, if one is inclined to associate every price wiggle with cookie cutter catalysts made to order—the US Dollar (UUP) is aggressively higher and making the product less attractive for foreign-based accounts.

Elsewhere, a flurry of officially-sanctioned economic data painted an overall and not-so-shocking weak picture of the US; which traders have systematically opted to discount or kinda disregard in front of the holiday after the “Opening Hell” festivities. Spending data matched estimates with a 1.0% decline, but set the stage for Q4 earnings revisions to the downside per Briefing. New home sales dropped below estimates [433K vs 441K est.] and to levels not seen since 1991. At the same time, inventories suggest a long recovery process.

Separately, weekly claims dropped by 14K to 529K and slightly better than Street views of 535K, but still indicative of a weak jobs situation. Durable goods plunged and missed estimates, the Chicago PMI now sports its worst levels since 1982 and folks in Michigan are still going “BOOyah!” according to a 28 year and not-too-cheery low found courtesy of consumer confidence.

Did someone say turkey trot? Working our way through the lunchtime hour and most all of the market fixings supplied above for investors to nosh on, have been put under the table and left for the dogs of the Dow to chew on. Instead, the holiday spirit and hitting the tarmac early has gotten into places like General Motors (GM). Shares are up 50% near 5.35 with the only news out this morning being Suzuki Motor’s CEO stating that a bankruptcy at the American auto giant is “100% impossible.”

And finally, intraday the Cubes (QQQQ) are leading the market with its gainer of 2.35%, which takes back in full, Tuesday’s relative weakness on concerns of no handheld devices or other gadgets (AAPL, RIMM, HPQ) under the Christmas tree this year. What’s changed? Not likely a whole lot, if we still can appreciate that discretionary and still expensive electronics will be more than challenged this holiday season. However, from an investing standpoint, things do get discounted and in this situation, that can be a good thing ultimately. And of course, an even higher, lower high is sure made easier when only the borgs are left manning the switches in front of the unofficial, but well-taken four and one-half day holiday period.  

Chris Tyler
Staff Writer & Options Strategist
Optionetics.com ~ Your Options Education Site
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The information offered here is based upon Christopher Tyler’s observations and strictly intended for educational purposes only, the use of which is the responsibility of the individual. 

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