NEW YORK (
) -- If one bailout fund is a good idea for Europe, it stands to reason that
That's oversimplifying things, of course, and U.S. stocks evidently weren't so sure about what the establishment of such a facility would mean as the
Dow Jones Industrial Average
initial report through the close.
What seems odd is that the structure of whatever ends up on the table when Europe's leaders get down to brass tacks on Friday is still so mushy. It's almost as if someone at the latest brainstorming session sheepishly raised their hand when the efforts to build a bigger and better bazooka reached a stalemate and said
how about two funds?
That's kind of unsettling.
The market is in a holding pattern until events across the pond shake out at week's end. Aside from what seems like almost
fate and seesaw sentiment on the banks, there's a lack of scheduled news on the U.S. front.
Meanwhile, the European Central Bank is slated to render a policy decision on Thursday with
so Wednesday is likely to be dominated by more speculation about what the ECB may do and what the final plan for the region going to look like.
Despite the tentative advance in the Dow and
over the last few days, there has been
plenty of commentary
about how vulnerable Europe remains and the
has continued to inch up towards 30, which is seen as indicative of an elevated level of fear, rising both days this week.
Traders and investors alike have headline fatigue at this point so it's probably best to just focus on the bottom line: Since last week's coordinated action by the world's central banks to safeguard liquidity, the drumbeat has only gotten louder for a big bold move to bulwark Europe once and for all, and if a satisfactory plan doesn't arrive on Friday, expect yet another spike, this one right back down.
As for Wednesday, the earnings calendar is light with
Pacific Sunwear of California
among the few names slated to report.
It's also another slow day for economic data with just the Mortgage Bankers Association's weekly mortgage activity index at 7 a.m. ET, crude inventories for last week at 10:30 a.m. ET, and consumer credit for October at 3 p.m. ET.
could grab some spotlight on Wednesday as the Dow component is holding its annual shareholders meeting. The networking equipment giant has shown signs of life over the past few months, bouncing more than 40% since hitting a 52-week low of $13.30 in early August. Cisco is coming off a strong earnings report and guidance in November so the meeting should be a bit more festive than it was last year.
The sell side has come around to some extent too. At present, 25 of the 44 analysts covering the stock are at either strong buy or buy, compared to only 19 two months ago. The current median 12-month price target is $21, implying potential upside of 12%-plus from Tuesday's close at $18.73.
Other companies likely to see news-driven trading on Wednesday include
, which announced
, which has received a $3 per share buyout offer from Sycamore Partners; and
, whose shares jumped in after-hours action following an above-consensus earnings report.
Written by Michael Baron in New York.
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