For a second straight day, US indices gave back big morning gains and finished in the red on the day. This suggests that upward momentum is running out of gas and the bulls are losing conviction just as earnings season is getting started. Alcoa had beat the street but that wasn’t enough to help its cause as the shares had a bearish outside reversal day. The Dow really seesawed through the day finding itself up nearly 300 points and down nearly 100 points at different times. CSX earnings after the close were in-line indicating it may have been too soon for falling oil prices to really bring down fuel costs and boost earnings. Perhaps next quarter. WTI crude oil broke down through $45.00 briefly but then stabilized just above that level while Brent Crude came close to also testing that level as the spread between the two narrowed to almost zero. With Europe struggling more than North America and too much supply a bigger problem than too little, Brent could trade below WTI at some point. A small increase in the International Energy Agency’s crude oil demand forecast helped to offset comments from the UAE supporting OPEC’s decision to maintain production levels. Crude oil could be active again tomorrow around the US inventory numbers. Turmoil and uncertainty in the markets continues to drive some capital into defensive havens, particularly JPY, gold and silver which surged today. Gold also appears to be benefitting from speculation the ECB could get more serious about growing its balance sheet and money supply at its meeting next week, which has been dragging EUR down and supporting European indices today. Focus remains on earnings reports with JPMorganChase and Wells Fargo kicking off bank earnings tomorrow. Corporate News CSX Corp $0.49 in line, railroad expects 10%+ earnings growth in 2015 Gamestop holiday same store sales (3.1%) vs street (1.8%) total sales (6.7%) Software 5.8%, hardware (32.0%) Economic News Significant announcements released overnight include: China trade balance $49.6B vs street $49.0B China exports 9.7% vs street 6.0% China imports (2.4%) vs street 6.2% UK consumer prices 0.5% vs street 0.7% UK core CPI 1.3% as expected UK retail prices 1.6% vs previous 2.0% UK producer input prices (10.7%) vs street (11.5%) UK producer output prices (0.8%) vs street (0.4%) UK ONS house prices 10.0% vs street 9.8% UK same store sales (0.4%) vs street 1.0% Sweden unemployment rate 4.3% as expected Sweden consumer prices (0.3%) vs street (0.5%) Italy industrial production (1.8%) vs street (2.7%) Upcoming significant announcements include: 10:00 am AEDT NZ house prices previous 5.1% 7:45 am GMT France consumer prices street 0.0% 8:30 am EDT US retail sales street (0.1%) 8:30 am EDT US retail ex auto and gas street 0.5% 8:30 am EDT Canada house prices street 5.2% 10:30 am EDT US crude oil inventories street 1.75 mmbbls 10:30 am EDT US gasoline inventories street 3.75 mmbbls

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