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The Dow closed 20 points shy of 12,000 on the strength of materials and tech stocks and as investors awaited a slew of major earnings later this week. The session was pretty quiet even though a lot a lot of the underlying themes remain in place.

There was more uncertainty on the sovereign debt front, but the euro continues to climb in response to hawkish central bank comments. Emerging market central banks continue to tighten policy, while the U.S. Fed is expected to stand its ground on QE2 during its meeting this Tuesday and Wednesday. On the earnings front, this will be the busiest week of earnings for the Q4 season.

The Dow Jones Industrial Average ended up 108.638 points, or 0.92%, to close at 11,980. The S&P 500 rose 7.49 points, or 0.58%, to close at 1290, and the NASDAQ was up 28.01 points, or 1.04%, to finish at 2717. Among key S&P 500 sectors, technology, industrials and materials advanced.

The CBOE Volatility Index (VIX) closed down 4.44%, at 17.65, on 77,000 put contracts compared to 145,000 call contracts, with February 17 puts as the most active series. 60 and 90-day volatility is trading at 73 and 66, respectively, indicating decreasing price movement in the outer months.

SPDR S&P 500 ETF (SPY) volatility remains low as the market continues to trend higher. SPY closed up $0.73, at $129.10, on 758,000 put contracts compared to 456,000 call contracts, with February 132 calls as the most active series. 60 and 90-day volatility is trading at 16 and 17, respectively, suggesting little price movement.

The PowerShares QQQ Trust (QQQQ) finished higher by $0.77, at $56.45. February 55 and 56 puts were the most active series on put volume of 217,000 contracts compared to 141,000 call contracts. 60 and 90-day volatility are trading at 18, indicating narrow price movement.

J.C. Penney (JCP) puts were more active than calls with low volatility on strategic actions. The stock traded 4.1x its average daily volume to close up $2.18, at $32.52, after announcing a series of actions designed to build on its accomplishments in 2010 and allow it to focus on its highest potential growth opportunities by reducing investment in areas of the business that no longer contribute meaningfully to its financial performance. February 30 and February 33 puts are active on total put volume of 26,000 contracts compared to 15,000 call contracts. 60 and 90-day volatility is trading at 37 and 36, respectively, suggesting tight price movement.

Events for the week of January 24:

¿ Tuesday: November Case-Shiller 20-city Index, January Consumer Confidence, November FHFA Housing Price Index

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¿ Wednesday: MBA Mortgage Purchase Index, December New Home Sales, Crude Inventories, January FOMC Rate Decision

¿ Thursday: Initial Claims, December Durable Orders, November Pending Home Sales

¿ Friday: Q4 GDP-Adv, Q4 Chain Deflator-Adv, Q4 Employment Cost Index, January Michigan Sentiment - Final

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