Monday Morning Musings

The market is lower in early trading on very light volume. The newsflow and trading volume will likely be light all week as it typically the case for the Christmas week. Friday was options expiration, and there is often a post-options expiration hangover, which could be the case this morning.

In corporate news:

• Walgreens (WAG) missed profit expectations, and the stock is down -6%
• CVS Caremark (CVS) reaffirmed its 2008 outlook, but is slightly lower in sympathy with WAG
• Toyota (TM) warned of a loss for its fiscal year, which would be the company's first ever
• Canada will provide $3.3 billion in emergency loans to U.S. automakers' Canadian operations

In overseas news:

• Asian markets finished mixed overnight
• China's central bank cut interest rates and lowered the banks' reserve requirement ratio to stimulate economic activity
• Ireland will inject $7.7 billion into major Irish banks

Oil is trading lower, near $41.25. It was in the $30s last week, but that was for the old contract which expired last week, and the new front-month contract is priced in the 40s. The dollar is mixed, while the Yen is lower. And gold is higher, hovering below the $850 level.

The VIX is down another -4% today to 43.1. My colleague at TheStreet.com, Vince Farrell, wrote that in the almost 15,000 trading days since 1950 there have been about 66 days with a 4% move (up or down), and that almost 30 of them have occurred since September. That is a shocking statistic.

Trading comment: There doesn't seem to be much buying interest in the market this morning, but its still early. I did some buying last week, although I still have plenty of cash, as I continue to think this market has more upside in the near-term. I am looking for a bounce of at least SPX 1000 in the next few weeks/months. Engine room...more steam!