U.S. Equity markets treaded water most of the session after a firm opening. Once again a gap-higher opening during the day session in the stock indices failed to attract strong buying interest. This was no surprise, however, as traders have backed away many times from chasing this market during its nine-month rally. The December E-mini S&P 500 stopped at 1118.00, just short of the high for the month at 1119.00 and below a major 50% price at 1122.00. A break under 1108.00 will indicate developing weakness.
Today’s failure to rally to a new high for the year on good news indicates that investors are uncertain about the Fed’s statement later this week.
Treasury futures traded flat most of the day. The Abu Dhabi bailout of Dubai helped to alleviate the pressure to increase yields as concerns over credit rating downgrades subsided.