Morning Note...

Futures flat this morning as markets digest the recent Dubai World debt issues.  For the most part, exposure seems to be contained, although markets in the Middle East opened limit down and are facing an extended holiday during which time new news may be released.  Geopolitics comes to the fore this holiday season, as Iran saber-rattles about nuclear expansion, Obama is set to announce U.S.-Afghan plans, the U.A.E. loosens lending rates and “stands behind” Dubai’s debt, and Greece remains on proverbial thin ice financially.  Sovereign Wealth or Public debt risk (depending on the country) may be the theme of 2010 and beyond, as 2008 & 2009 marked a massive shift in debt responsibility from private to public sectors across the world.  Plenty of data on tap for this week… tonight we’ll get China PMI, official jobless claims and unemployment in the US comes Friday, November Auto Sales will be reported Tuesday, November Retail Sales (including Black Friday and today, Cyber Monday) will be reported Thursday morning, the ECB announces a rate decision Thursday, and the Fed’s Beige Book is reported Wednesday.  In other news, the Senate begins the Health Care debate today, and the Bernanke confirmation hearings start Thursday.  Also, the White House “jobs forum” begins Thursday, and it will be interesting to see if Obama previews the Friday jobs data as he did a couple months back…

Note that today marks month-end, and that recent month-ends have not gone so well – August, September, and October month-end trading was all to the downside (profit-taking?).  Early Black Friday indications are that spending is up 0.5% from one year ago.  Overseas, Asia markets rebounded from Friday’s weakness, as the Dubai situation appears to stabilize.  On the other hand, Europe is down across the board, perhaps on concerns over Greece in addition to the general fears over Dubai.  Interesting to note the flight-to-quality in the USD late last week when Dubai concerns drove markets.  While debt-to-GDP levels may indicate that our nation’s fiat currency is due for a long and steady decline in the mid- to long-term, it’s tough to be short the dollar in the near-term given the potential for any global nervousness. 

AEO upped at LAZA.  CSFB ups AFL.  IRE/AIB to complete transfer of loans to the gov’t bad bank by middle 2010.  GSCO ups AKS tgt.  GSK to cut drug prices in developing countries.  GSCO ups X. DBAB cuts LYG tgt.  Citi ups GENZ, Goldman Sachs ups BBD, Morgan Stanley ups SWY, RW Baird ups EDR & USB, Wells Fargo ups RCRC, Bernstein cuts BIDU, Goldman Sachs cuts CIB, Morgan Stanley cuts SVU.

Asia up roughly 3% overnight.  Europe down 75bps on average.  USD -7bps.  Oil -90bps.  Gold -35bps. 

Brightpoint News: 

Brightpoint PreMarket (yest close/premkt/% change/volume):

S&P 500 PreMarket (last/% change prior close/volume): 

AK STEEL HLDG              20.27    +3.68% 80233

US STEEL CORP             44.60    +3.6 %  188619

AMERICAN INTERNA       32.17    -3.39%  231737

OFFICE DEPOT INC         6.08      -3.18%  1990

AFLAC INC                     44.89    +2.84% 49409

NUCOR CORP                 42.90    +2.61% 9428

DEERE & CO                  53.69    +2.54% 13442

FANNIE MAE                  .962      +2.34% 292812

SUPERVALU INC             14.09    -2.29%  1094

PRUDENTL FINL              49.29    +2.26% 100

ARCHER-DANIELS           30.00    -2.12%  1000

Today’s Trivia:  Name the only country whose name begins with “A” but does not end in “A.”

Yesterday's Answer:  A “tael” is a unit of weight in the Far East that generally relates to precious metals http://en.wikipedia.org/wiki/Tael

Best Quotes:  “Good Morning -  Who had the worst Thanksgiving?   Dubai, Retailers, or Tiger Woods?   My vote is for Tiger.   To me the Dubai situation is troubling.  The markets seem to be discounting the ripple effects.   Is this much different than what we witnessed in the sub-prime market?   In the simplest terms credit has to tighten as a result.  Black Friday numbers seem to be ok, but comps are pretty easy.  Personally I have a problem listening to all the woes of this country, and I see lines of people at Walmart with 50 inch flat screens.   Tiger, we all know.   I'm a seller of the Rallies.  1103 is Wed low.   1095 was last weeks low.  1112.25 is the year high.”    –BofAMLCO note