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  1. Phil

    Good morning!  

    AAPL $476 at the moment after bottoming at $457 overnight.  

    Nas futures right at 2,723 and still a good long over the 2,725 line.  

    Asia was mixed with the Nikkei up 1.3%, Hong Kong flat, Shanghai down 0.8%, India down 0.25% and Singapore up 0.5%.

    Europe opened flat but picked up nicely and, other than the Nasdaq, our Futures are holding up well so our biggest fear – that AAPL's earnings may be the straw that breaks the rally's back – is unfounded (so far).  

    3:55 AM European stocks are mostly lower as Apple's lackluster earnings – well it's all relative – cast a global shadow. "Despite the firm close in the U.S. and better-than-expected (PMI) data from China, European traders appear to be on a more cautious footing," says trader Jonathan Sudaria. "The after-hours release of Apple earnings have not been interpreted well." EU Stoxx 50 -0.3%, London +0.1%, Paris -0.1%, Frankfurt -0.3%, Milan -0.4%, Madrid +0.05%.

    4:32 AM Eurozone shares reverse course and turn solidly higher following improvements in German and eurozone PMI data, with even shares in France in the green despite the country's situation stayingrather depressing. EU Stoxx 50 +0.2%, London +0.2%, Paris +0.4%, Frankfurt +0.1%, Milan +0.2%, Madrid +0.3%.

    Profits at $1 Trillion Meet Valuations as S&P 500 Rallies (Bloomberg)

    Calling off the Recession?  Flash eurozone manufacturing PMI climbs to a 10-month high of 47.5 from 46.1 in December; manufacturing output 48 vs 46; services 48.3 vs 47.8; composite output 48.2 vs 47.2. The data "suggest that the eurozone economic downturn has eased," says Markit. "Forward-looking indicators…suggest that the rate of decline will continue to slow in the coming months, and a return to growth looks to be on the cards" in H1. (PR) 

    Flash German Manufacturing PMI rises to an 11-month high of 48.8 in January from 46 in December; manufacturing output 50.4 vs 47.1; services hits 19-month peak of 55.3 vs 52; composite output 53.6 vs 50.3. "Germany's private sector has kicked back into gear in January, as output rose at a pace that would deliver a swift recovery in GDP from the ground lost during (Q1)," says Markit. (PR)

    France still sucks:  Flash France Manufacturing PMI falls to 42.9 in January from 44.6 in December; manufacturing output 40.8 vs 43.3; services crashes to 46-month low of 43.6 from 45.2; composite output also hits a 46-month trough of 42.7 vs 44.6. "Sickly performances from both the manufacturing and service sectors resulted in the steepest drop in overall output for almost four years, while the…(speed) of job losses gathered pace," says Markit. (PR)

    Spanish 10-year bond yields may be only just above 5%, but the crisis in the real economy continued unabated in Q4, with unemployment rising to a record 26.02% from 25.01% in Q3. The number of people out of work reached 6M, or a third of the eurozone's jobless citizens. It was even worse for those under 25 as youth unemployment hit 60%. - On the bright side – 1/3 of Europe's unemployed are in Spain so, if we ignore them – things for the rest of the continent are looking up

    The euro turns positive against the dollar following Germany's decent PMI data and is +0.1% at $1.3321. Earlier, it hit a session low of $1.3288

    Almost flat earnings and a disappointing forecast from Apple (AAPL) leave a few casualties in Japanese trading today: Softbank (SFTBY.PK) – a Japanese carrier of the iPhone – is down 0.9%, Sharp (SHCAY.PK) and Foster Electric – both of which make parts for the phone – dropped 1.5% and 1%, respectively.

    Japanese exports fell a more than expected 5.8% in December, outpacing expectations for a 4.7% dip, as shipments to China slipped again and even U.S.-bound exports shrank. Imports rose 1.9%, sending the trade deficit to ¥641.5B ($7.24B), which was also wider than economists forecast of ¥548.5B. Exports to China have declined recently over political tensions between the two nations, fell 15.8% in December, while those to the U.S. slipped 0.8%, the first decline in nearly 14 months. Exports to Western Europe fell 12.3%.

     “These are bad numbers for the economy,” said Junko Nishioka, chief economist at RBS Securities Japan Ltd. and a former BOJ official. “The positive impact of the yen’s decline on exports has yet to be seen, but it is already boosting import values.”

    China's January HSBC Flash PMI rises to 51.9 from December's final read of 51.5. It's the 5th consecutive rise for the index which now stands at its highest level in 2 years. "Despite still-tepid external demand," says HSBC, "the domestic-driven restocking process is likely to add steam to China's ongoing recovery."

    China manufacturing capacity utilization in 2012 below 2008 level: UBSThe overcapacity problem in China created by booming economic growth in recent decades resulted in even lower utilization in the manufacturing sector in 2012 than during the global financial crisis in 2008.

    What Really Goes On In China.

    South Korea's Q4 GDP rises just 1.5% Y/Y, pulling growth for all of 2012 down to 2%, the weakest since 2009 and well below this summer's central bank forecast of 3%. The export-driven economy has been hit by the 1-2 punch of weak external demand and a strengthening won. The Kospi is down a fraction.

    More on Apple's (AAPL) FQ1 call: Tim Cook mentions over 2M Apple TVs were sold in the quarter, and asserts the TV is "an area of intense interest" (previous). The new iMac was also heavily supply-constrained during the quarter. The mix of current to prior-gen iPhone sales was similar to a year ago. CFO Peter Oppenheimer says new stock buybacks is something Apple continually assesses. This could be a good time for one. (live blog) (more on Apple) 

    Apple(AAPL) Sold More Than 2 Million Apple TVs Last Quarter, Tim Cook Dodges Question About Future TV Plans

    Boeing(BA) 787 to Stay Grounded as U.S. Can’t Explain FiresThe top two U.S. aviation regulators said they don’t know what led to battery flaws that prompted them to ground Boeing Co. (BA)’s 787, and defended their decision to not let the plane fly until the cause is found.

    And more oil:  Shale Oil Bonanza Reaches Australia With '$20 Trillion' Discovery. 

    Kashkari Resigns Amid 'Spotty' Fund Performance, Heads Back To Public Office.

    Is Contemporary Conservatism Just ‘Payola’? (Center for American Progress)

    The conservative movement is still an elaborate moneymaking venture (Salon)

    Dollar up and down but still around 80, oil $95.59, gold $1,681 with a lot of negative outlooks hitting them this morning, silver failed $32 ($31.975) so a good long over that line if the Dollar fails 80, copper down to $3.68 on China over-supply concerns (again).  Yes, it doesn't just magically go away…  Nat gas tested $3.50 and back to $3.58 but will suck for them when the cold snaps and gasoline refuses to lose at $2.85 but inventories today will be interesting.  Gasoline is a tempting but very dangerous short below the $2.85 line (/RB). 

    Notable earnings before Thursday’s open: ABCALK,ARGAVTBAXBMYBPOPCELGCYDOVEQTESIETN,FCS



    Notable earnings after Thursday’s close: CPHDCRUS,EDEGHTETFCFLEXINFAJBHTJNPRKLACMSFT


    Thursday's economic calendar:

    8:30 Initial Jobless Claims

    9:00 PMI Manufacturing Index Flash

    9:45 Bloomberg Consumer Comfort Index

    10:00 Leading Indicators

    10:30 EIA Natural Gas Inventory

    11:00 EIA Petroleum Inventories

    4:30 PM Money Supply

    4:30 PM Fed Balance Sheet

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We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

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This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible.  Feel free to contact me directly at with any questions.

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