The price action remained on the painful side in NY trading as another day devoid of major economic news made for some range-bound markets. The under the radar releases included the NFIB small business optimism index which rose modestly to 89.1 in October from 88.8 prior. The reading is still extremely dismal and well below the 100 historical average. The IBD/TIPP economic optimism index was also out and it sank to 47.9 in November from a 48.7 read the previous month. The market was looking for an increase. The personal finances component slipped to 52.5 from 54.2 last month and 57.0 in September. This deterioration in personal balance sheets is occurring just in time for the holidays and points to some disappointment in store for the retail sector.

There were plenty of Fed speakers on the tapes today and, in a nutshell, it was more of the same. Commercial real estate continues to be a concern and Lacker called it a drag on growth. The consumer picture remains tenuous at best and spending was again highlighted as expected to remain modest. With all the de-leveraging still to do on the consumer balance sheet, we would tend to agree with that assessment. Anyone looking for clarity on the timing of exit strategies was once again left disappointed. The Fed officials kept it as opaque as possible noting that the stimulus will be unwound when the time comes †right.

Equities were mixed and closed FLAT in broad terms. The correlation between EUR/USD and stocks was back in full force. As we write the pair is sitting near the 1.4980/90 NY open. Firm resistance remains ahead of the 1.5000 area while support rests near 1.4940 in the short-term. Cable recovered after getting a bloody nose overnight. The pair closed the session near 1.6740/45 after opening near 1.6645/50. The Canadian dollar was the star of the session and much of the gains were tied to oil testing the air above $80. USD/CAD knifed down from a 1.0580/85 NY open and is pivoting around 1.0500 at the moment †has potential to 1.0450 while below.