Trade the News Market Internals Update at 12:00ET

Dow +101 S&P +13.5 NASDAQ +31.2

***Economic Data***

– (IS) Israel Sept Consumer Prices M/M: -0.2% v 0.0%e; Y/Y: +2.9% v +3.1%e
– (PD) Poland Sept M3 Money Supply M/M: +1.6% v +0.9%e
– (CA) Canada Aug Manufacturing Sales M/M: +1.4% v +0.5%e
– (US) Sept Import Price Index M/M: -0.4%e v -0.4% prior; Y/Y: 12.4%e v 13.0% prior
– (US) Sept Advance Retail Sales: +1.1% v 0.7%e; Retail Sales Less Autos: +0.6 v +0.3%e; Retail Sales Ex Auto & Gas: +0.5% v +0.4%e
– (US) Oct Preliminary University of Michigan Confidence: 57.5 v 60.2e
– (US) Aug Business Inventories: +0.5% v +0.4%e
– (MX) Mexico Central Bank leaves the Overnight Rate unchanged at 4.50%

– US equity markets retraced most of their losses from yesterday’s session in the pre-market this morning, thanks to some strong earnings out of Google and renewed optimism that Europe will get its act together to cope with the debt crisis. In Europe, G20 finance ministers are meeting in Paris this morning to discuss coordinated efforts to rescue Europe, including higher bank capital levels and increased firepower for the IMF. Underscoring the need for urgency, S&P cut Spain’s credit rating last night for the third time in as many years and Fitch downgraded UBS and put ratings of other European banks on credit watch negative. Traders are trying to reconcile two contradictory US data points this morning. On the one hand, there has been some optimism about the unexpectedly stronger Sept retail sales data, while on the other preliminary Oct University of Michigan consumer confidence survey declined from September levels. Government bond yields are rising on both sides of the Atlantic: the US 10-year yield is back to 2.25% while the French 10-year yield has climbed back above 3%.

– Google comfortably beat expectations in its Q3 report yesterday evening, based on strong growth in paid clicks and nearly 40% y/y growth in ad revenue. Executives also highlighted robust demand from emerging markets and strength in mobile and display advertising. Google also disclosed that it is planning to launch an MP3 music retailing store. GOOG is up 6% this morning. Two more semi names offered preliminary quarterly guidance. Microchip warned that its Q2 results would be a bit lower than the firm’s prior view, warning that there has been no seasonal Christmas build among customers. Germany’s Infineon’s Q4 guidance was only a little bit soft, and less bad than recent guidance cuts among competitors. MCHP is down nearly 5%. The Sony Ericsson joint venture beat Q3 consensus estimates, although units shipped in the quarter fell on a y/y basis, with margins down sharply. US-listed ADRs of Ericsson are up 4%, but off their best levels, SNE is flat. Note also that the owners of Hulu have cancelled the sale of the online video site.

– In other earnings, JB Hunt reported higher quarterly profit that slightly beat estimates, driven by double-digit revenue growth in three of its four divisions. JBHT is up 7%. Mattel only just met expectations, and also boosted its share buyback program by an additional $500M. Note that Mattel’s profit margins sank considerably on a y/y basis. MAT is down 2%. Plastics manufacturer A. Schulman disclosed FY11 net income that was well ahead of the firm’s prior outlook, thanks to strong volumes and better margins. Schulman raised its dividend as a result. SHLM rose 4% in the premarket and then gave back most of those gains.

***Looking Ahead***

– 15:00 (AR) Argentina Sept Consumer Price Index M/M: 0.8%e v 0.8% prior; Y/Y: 9.8%e v 9.8% prior
– 15:00 (AR) Argentina Sept Wholesale Price Index M/M: No est v 0.9% prior; Y/Y: No est v 12.5% prior

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