Market Recon Friday

Good Morning,
                       It’s back.  Just could not stay away for very long, could it?  Our old nemesis… the “Ugly Stick” is out and about.  Most Asian, and European equity market indices are having a rough final trading session today, capping off a volatile week.  Those markets have backed up something close to a percent and a half or so.  The real carnage is in the Oil market, where it appears that the $30 support level has been significantly breached, while Iranian officials talked up their future production.
                      This shift in the price of Crude, and liquidity concerns is what pushed the Shanghai Composite more than 3% lower, and is currently doing a number on US futures markets, though it is still early.  Shanghai, by the way, is now 20% lower than it was less than a month ago.  It is said that if you play dead, a bear simply walks away.  I can tell you that there is some truth to that (he does smell you, and push you around a bit), however… in the financial markets, that is not a plan.  You have to play defense.
                      Gang, we’ve got more macro, and more earnings releases from Financial firms than you can possibly shake a(n) (ugly) stick at.  That said, consensus views for nearly all of our higher profile macro today does have, or is close to having a contractionary minus sign in front of it.  An ugly minus sign.
                      OK, it is Friday you wonderful people.  Let’s tape on the foil, and get after it.  Old time Hockey.
.
Hordes of Data
.
08:30 ET
.
Empire State Manufacturing Index (January):  Can you feel the excitement?  Our very first look at manufacturing in calendar year 2016.  I can hardly contain myself.  As most of you know, American manufacturing has been in a full state of collapse for quite some time now, and the Empire State has taken it full on the chin.  In December, the district’s pace of decay actually slowed to -4.6.  Today, a sixth consecutive month spent in contraction is likely.  Consensus is for another -4 tag, which is smack dab in the middle of the range.
.
PPI (December):  Inflation, at least at the producer level did wake up in November.  After spending two month’s in contraction, we saw a surprisingly hot 0.3% monthly increase at both the Headline, and the Core.  That increase was obviously not fully passed on to the consumer.  (Thank goodness, says this consumer).  Most economists I see do not see November’s heat turning into a trend.  Today, we look for -0.2% m/m at the Headline thanks to energy, and a not so robust +0.1% m/m at the Core.
.
Retail Sales (December):  In a day full of high profile macro, this item is perhaps the most important to traders.  It is widely expected that cooling auto sales, and lower prices for gasoline will hurt headline Retail Sales.  That said, the headline print is projected to come in flat from November, though the range is slightly skewed into the negative.  Consensus for the Core number is for an increase of 0.2% m/m.  In each case, there is a slowing in the pace of growth here.  Not really what you want to see in December.
.
09:00 ET
.
Fed Speaker:  It’s been ages since we’ve heard from NY Fed Pres. “Wild Bill” Dudley, and that’s to his credit, because some of us (myself included) think that some of these guys talk way too much, and thus have outsized market impact.  The wild one will be in Somerset, New Jersey.
.
09:15 ET
..
Industrial Production (December):  This very important data point has shown contraction in eight of the eleven months reported so far for 2015.  Today, we look for a m/m print of -0.2%, which would make it nine.  There is however…some hope.  Consensus Range for this guy spans from -0.5% m/m to +0.5% m/m.  With manufacturing running out of room to the downside, this may be left up to the Utilities, and the Miners (uh oh).
.
Capacity Utilization (December):  Last month, the November release for Capacity Utilization came in at 77.0%, the worst print in that space since July of 2011.  Today, expectations are for a 76.8% print, which would be (let’s say it together, gang)… the worst print in this space since July of 2011.  Oh, Get some !!!
.
10:00 ET
.
U of M Consumer Sentiment (January [p]):  This data-point has shown slow and steady improvement since early Autumn.  I don’t know why they’re so optimistic, but who are we to discourage it ??…  so …. Rock on.  Expectations are for a 92.9 print today.  Hopes and dreams are for 93 plus.
.
Business Inventories (November):  Probably the least sexy number that we’ll see today, and it’s somewhat dated to boot.  We’re looking for a flat print here, just like we got last month, but after the week we’ve had, and the higher profile number that we will have already had, they could probably throw any number they want on the scoreboard for this one, and the market will not notice.
.
Friday’s Earnings Highlights
.
Note:  We’ve got a boatload of Financials reporting this morning.  JPM reported what looked like a pretty decent release yesterday morning, yet the sector still underperformed the general marketplace.
.
Before the Open:  BLK (4.84), C (1.12), PNC (1.78), USB (.79), WFC (1.03)
After the Close:  Hopefully something simultaneously disgusting and delicious.
.
Guidelines for Today, Tomorrow, and Forever
.
To always do the right thing, regardless of the circumstance I find myself in.  To choose the hard right, over the easy wrong.  If my mother could see me right now, would I be  embarrassed?  Carry on.