Signs that the recent crash in copper and energy prices is starting to impact the wider economy has sent US indices in a tailspin this morning. Last night, soft guidance out of Microsoft capped a market advance, while this morning, big misses on earnings and/or guidance from Caterpillar, copper miner Freeport, and DuPont all indicate that the commodity price drop has really started to bite. CAT could see a particularly hard hit this year as capital budget cuts impact demand for heavy equipment. European indices also are in decline. Although the dance which has started between Greece’s new Syriza led government and the EU continues to make headlines, the market reaction remains muted. Treasury yields remain low with Italy and Spain down near 1.5% and Greece remains below 10%, while EUR is up a bit today. This suggests that stocks today are more focused on earnings prospects in a slow economy than political problems. We are seeing a bit of a defensive trade going on today with JPY and gold up and US treasury yields down. CAD and NOK are falling again even though crude oil prices continue to bounce around between $45 and $50. Later today, earnings from Apple and Yahoo! are due along with a few secondary US economic indicators, so reaction to corporate news may continue to dominate focus through the day. Corporate News Caterpillar $1.35 vs street $1.55, guides 2015 year $4.60-$4.75 way below street $6.68, guides 2015 sales to $50B below street $54.8B Freeport McMoRan $0.25 vs street $0.34, cutting 2015 capex budget by $2B, deferring capital projects, looking for a partner for oil and gas ventures MicroSoft $0.73 vs street $0.71, DuPont $0.71 in line, guides 2015 year to $4.00-$4.20 below street $4.49 3M $1.81 vs street $1.80 Metro $1.35 vs street $1.31, 16% dividend increase, 3 for 1 stock split Economic News US durable goods orders (3.4%) vs street 0.3% US durables ex transport (0.8%) vs street 0.6% UK GDP 2.7% vs street 2.8% Economic reports due later today include: 9:45 am EST US flash service PMI street 53.8 10:00 am EST US new home sales street 450K 10:00 am EST US consumer confidence street 95.5 10:00 am EST US Richmond Fed street 5