As mentioned earlier I will be travelling today and hence not in the chat-room until 3pm et or so.
First, the bank downgrade after the bell yesterday took the futures down about 7 handles immediately but that was about it…so all in all not a huge event as of the time I am writing this.
Let us keep in mind the chart of the dollar index, which late last week bumped up against its early October lows and now looks to pull back some until it later possibly makes another run for it and may make a move up to the low 80s. That of course would be inversely correlated to equities. The question is in what time-frame do we see the dollar make another leg higher. It all depends on headlines…will Germany give in to Eurobonds? If some major positive headline out of Europe shows up the 'santa' rally could spark in a second and that would take the dollar lower. In absence of that we may well slip lower into year-end and that would lead the dollar to move higher.
There's lots of domestic economic news to focus on the rest of this week. Today we have nonfarm productivity and chicago purchasing managers and the fed's beige book. Friday of course is the big November jobs report.