Market Preview: Tough Times for Bears

In other words, the Fed's easing efforts in the wake of the financial crisis have juiced up the correlation -- when stocks go up, the dollar goes down and vice versa -- significantly.

According to the S&P data, the sectors least impacted by swings in the dollar over the past three years have been included airlines, retail, gold, residential real estate investment trusts and telecom services. Energy, health care and materials have been among the most sensitive.

As for Tuesday's scheduled news, FedEx (FDX) is the only big name opening its books. The Memphis, Tenn.-based package delivery giant already warned of a shortfall in its first-quarter results on Sept. 4 so the actual report is more about getting some more color on business conditions beyond the press release explanation that "weakness in the global economy constrained revenue growth at FedEx Express more than expected in the earlier guidance."

The average estimate of analysts polled by Thomson Reuters is for earnings of $1.40 a share on revenue of $10.7 billion from FedEx for the three months ended in August. When the company warned on Sept. 4, it forecast a profit of between $1.37 to $1.43 a share for the quarter, down from a prior projection for earnings of $1.45 to $1.60 a share.

FedEx shares took an initial hit after the warning but have since bounced back along with the broad market. As of Monday's close at $89.28, the stock is up nearly 8% so far in 2012 and trading above where it was prior to disclosing the lower outlook. With a forward price-to-earnings multiple of 10.8X, the shares are trading at a discount to the S&P 500's 14.1X multiple as of Friday's close.

The sell side is still pretty bullish on FedEx ahead of the report with 20 of the 28 analysts covering the stock at strong buy (11) or buy (9) and the remainder at hold. The median 12-month price target sits at $103, implying potential upside of more than 15% from current levels.

Tuesday's economic calendar includes the ICSC-Goldman Sachs weekly chain-store sales data at 7:45 a.m. ET; the federal government's current account balance data for the second quarter at 8:30 a.m. ET; the Treasury Department's international capital flow data at 9 a.m. ET; and the National Association of Home Builders's housing market index for September at 10 a.m. ET.

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