Santa Claus is cutting it close: after stocks closed down yesterday, and just fractionally red for the year, the jolly old gift-giver (who now has activist investors breathing down his neck) has just three trading days to push if not stocks then the market into the green for the year. And so far, so good, with US equity futures rising by 8 points or 0.4%, on the back of some modest renewed Dollar strength but mostly on oil, which after yesterday's big slide, has managed to stem the decline and is up fractionally, just under $37, along with other commodities if not copper, which falls for second day.

Alas, it may be too late for the MSCI All Country world index, which unlike US futures needs an insurmountable surge in the last 3 days to get anywhere close to breakeven for the year, despite Europe being one of the best performing markets in the world in 2015.

Here is where we stand now:

• S&P 500 futures up 0.4% to 2057
• Stoxx 600 up 0.8% to 368
• FTSE 100 up 0.3% to 6273
• DAX up 1.4% to 10808
• German 10Yr yield up 3bps to 0.59%
• Italian 10Yr yield down less than 1bp to 1.61%
• Spanish 10Yr yield down 1bp to 1.79%
• MSCI Asia Pacific up 0.4% to 132
• Nikkei 225 up 0.6% to 18982
• Hang Seng up 0.4% to 22000
• Shanghai Composite up 0.8% to 3564
• S&P/ASX 200 up 1.1% to 5267
• US 10-yr yield up less than 1bp to 2.24%
• Dollar Index up less than 0.01% to 97.93
• WTI Crude futures up 0.4% to $36.96
• Brent Futures up 0.5% to $36.79
• Gold spot up 0.5% to $1,075
• Silver spot up 0.5% to $14.01

So in less than 72 hours before the clock runs out on 2015, should one expect a major rally? "We didn’t think at the peak of the selloff yesterday that it was entirely justified, so a bit of a recovery from that makes sense,” Otto Waser, chief investment officer at R&A Research & Asset Management in Zurich told Bloomberg. “Seasonally, it’s positive, but on balance it’s difficult to expect a big move ahead of year-end without any fresh news. Most people see relatively modest gains, if at all, for next year so we have few fresh solid buyers except in strong setbacks."

Considering the "market's" upside is a function of just 10 stocks, with 490 of the S&P names solidly in the red, and considering the "market" has been reacting to news inversely for the past 7 years, it is not clear just where this desire for rationality and logic comes from.

Regionally, Asian stocks rise for second day with Australian, Japanese, Chinese equtities outperforming, although the lack of discernable momentum has kept the trend-followers, pardon, smartest people in the room on the sidelines: "Investors are on the sidelines towards the end of the year,” said Wang Zheng, CIO at Jingxi Investment Management Co. “We still like new-economy stocks that fit well with the theme of China’s economic transformation.” 7 out of 10 sectors rise in the MSCI Asia Pacific Index with health care, consumer staples outperforming and energy, materials underperforming.

• New World China Sells Projects to Evergrande for $1.1 Billion: Developer raised money from Cheng-controlled cos.
• Hanergy Stake Sale Implies Almost $20 Billion in Value Wiped Out: Li Hejun to sell 2.5b shrs
• Asian Wealthy Advised to Prepare for Dollar Rally’s End in 2016: UBS tells wealthy clients dollar’s gain will be limited
• Landmark Japan-South Korea Deal Backs Obama’s Asia Rebalance: Stronger ties will help U.S. respond to China, N. Korea
• Australia’s Turnbull Loses Ministers 3 Months After Taking Over: Jamie Briggs, responsible for devt of cities, quit and Special Minister of State Mal Brough temporarily stood aside

A quick look at European markets shows stocks rising broadly across the continent while Irish markets reopen after holiday; German, Italian bourses outperform most. Still, despite the Stoxx600 being up nearly 1% some wantedmoar: "I’ll be happy to see a rally today and tomorrow -- that would certainly help sentiment,” said Teis Knuthsen, CIO at Saxo Bank’s private-banking unit. “I did think that the final couple of weeks would end on a more upbeat note. Financial markets have had a tendency this year to focus on only one thing at a time, and at the moment it’s oil.” 18 out of 19 Stoxx 600 sectors rise with autos, chemicals outperforming and basic resources underperforming. 87% of Stoxx 600 members gain, 11% decline.

Top European News:

• Pound Outlook Darkens on Referendum With BOE Stuck on Launchpad: Options traders are the most bearish on the pound in more than 6 months.
• Abengoa Creditors Seek Banks for Future Liquidity Needs: Cinco: Santander, Bankia, CaixaBank, Popular, Sabadell, Credit Agricole, HSBC want other banks to participate in future liquidity transactions.
• Swedish Mortgage Lending Shows Signs of Cooling Off: Danske Bank: Lending from mortgage institutions appears to be leveling out at 7.6% y/y over past 4 months.
• Euro to Fall About 4% Against Dollar in 2016: Consensus: 2 of the biggest participants in the market expect it to drop through parity with dollar.

In commodities, oil has seen a modest bid despite as previously reported Saudi Arabia cutting its dependence on oil revenue amid slump in prices. Iran assumes oil price of $40 in budget draft for yr starting March 2016, IRNA reports, citing Iran Oil Minister Bijan Namdar Zanganeh. As Bloomberg notes, Iran adding to oil glut dims hopes for recovery next year, although right now that is next year's business.

However, the biggest commodity story right now is not oil but nat gas, whose futures, which expire Tuesday, rose as much as 1.7% to $2.266/mmBtu on Nymex, to trade at $2.250 at 7:46am in London, poised for highest settlement since Nov. 19.Gas futures surged 22% from mid-month to Monday, biggest rally ever for the period in Nymex data going back to 1990, on the back of a return of cold weather and a dramatic short squeeze.

It's another quiet day on the docket with only skeleton crews present in the final days of the year. On the US event docket we have the Advance Goods Trade Balance (est. -$60.87b, prior -$58.411b), the Case-Shiller housing index, and the latest read of Consumer Confidence expected to rise to 93.8 from 90.4.

Top Global News

• Bridgestone to Respond Within Days as Icahn Boosts Pep Boys Bid: Icahn raises bid to >$1b; Bridgestone to decide by end of 2015. Pep Boys (PBY) Says Icahn’s Increased $18.50/Shr Bid Is Superior
• FedEx (FDX) Ties Holiday Delay to ‘Unprecedented’ E-Commerce Surge: Co. attributed failure to deliver some Christmas packages to volumes that “far exceeded all previous records”; warned last week that bad weather may cause late delivery of some gifts.
• Whitebox to Liquidate Its Mutual Funds as Redemptions Rise: $3.85b investment firm, whose equity head Jason Cross resigned this month, plans to liquidate its 3 mutual funds on Jan. 19 after losses, redemptions in 2015.
• Freeport’s (FCX) Moffett Departs With $83.3m Payday Amid Rout: Exiting chairman will take away $63.3m in cash retirement plans, $16.1m in severance; balance is performance-related stock awards: government filing.
• Whole Foods (WFM) to Pay $500k to End NYC Pricing Investigation: Co. to settle an investigation that it overcharged customers for prepackaged food in New York City.
• Willis (WSH) Climbs as Broker Named to Replace Fossil in S&P 500: Fossil will replace Towers Watson in S&P MidCap 400 after close Jan. 4.
• Cisco (CSCO) Says Assessing Implications of China Anti-Terrorism Law: Co. assessing impact on business and customers in China.
• Amazon (AMZN) to Expand U.K. Grocery Delivery Service in 2016: Telegraph: Co. to expand Pantry unit, its U.K. delivery service for household goods, groceries.

Bulletin Headline Summary from Bloomberg

• Treasuries drift lower led by shorter maturities as week’s auctions continue with $35b 5Y notes; WI 1.750%, highest since Sept. 2014 after 1.67% award in November.
• While China’s leaders are striving to cut debt and shift growth toward services and consumption, things could go awry if there’s an acceleration of capital outflows, corporate defaults or increased turbulence in the shadow banking industry
• ECB’s Mersh said the central bank’s QE will run “as long as necessary”: “We can add-on any time, should this be necessary. We still have ammunition and firepower”
• Marc Faber recommends Treasuries and says the U.S. is at the start of a recession, clashing with Yellen’s view that things are improving
• Saudi Arabia released a more tightfisted budget for 2016, reflecting scaled-back revenue expectations and lower spending on subsidies because of sinking oil prices and its involvement in the war in neighboring Yemen
• Riyal forwards used to bet whether Saudi Arabia will abandon its peg to USD climbed by the most in eight years
• Turkish President Recep Tayyip Erdogan accused the leader of the country’s pro-Kurdish party of being a traitor and vowed to crush its separatist aims
• Donald Trump sounded an urgent new note in New Hampshire, urging an audience at a Nashua middle school to take their enthusiasm for his candidacy into the voting booth. “If you vote, we win,” he said
• Sovereign 10Y bond yields mostly higher. Asian and European stocks gain, U.S. equity-index futures drop. Crude oil rises, gold little changed, copper falls

US Event Calendar

• 8:30am: Advance Goods Trade Balance, Nov, est. -$60.87b (prior -$58.411b)
• 9am: S&P/Case-Shiller 20 City, m/m, Oct., est. 0.6% (prior 0.61%)
  • S&P/CS 20, y/y, Oct., est. 5.6% (prior 5.45%)
  • S&P/CS 20 NSA, Oct., est. 183.28 (prior 182.91)
  • S&P/CS U.S. HPI, m/m, Oct. (prior 0.83%)
  • S&P/CS U.S. HPI, y/y, Oct. (prior 4.86%)
  • S&P/CS U.S. HPI NSA, Oct. (prior 175.51)
• 10am: Consumer Confidence Index, Dec., est. 93.8 (prior 90.4