OVERNIGHT MARKETS AND NEWS

Mar E-mini S&Ps (ESH17 +0.37%) are up +0.28% and European stocks are up +0.89% at an 11-1/4 month high. A rally in Italian bank stocks is leading European equities higher after UniCredit SpA, Italy's biggest bank, climbed over 7% when it said it plans to raise 13 billion-euros ($13.8 billion) in a rights offer, sell off its bad loans, and cut 6.500 more jobs in an attempt to boost profits. A +0.74% gain in Jan WTI crude oil (CLF17 +0.78%) is also giving energy producing stocks a lift as well after the IEA predicted that the global energy market will move from surplus into deficit in the first half of 2017 if OPEC and other producers follow through on their agreement to cut production. The IEA had previously predicted that the global oil market would be in surplus until the end of 2017. Asian stocks settled mostly higher: Japan +0.50%, Hong Kong +0.06%, China +0.07%, Taiwan +0.34%, Australia -0.32, Singapore +0.10%, South Korea +0.35%, India +0.69%. China's Shanghai Composite rebounded from a 1-month low and closed higher after consumer staple companies rallied when data showed China Nov retail sales posted their biggest gain in 11 months.

The dollar index (DXY00 +0.03%) is up +0.10%. EUR/USD (^EURUSD) is down -0.22%. USD/JPY (^USDJPY) is up +0.29%.

Mar 10-year T-note prices (ZNH17 +0.15%) are up +3.5 ticks.

The German Dec ZEW survey expectations of economic growth was unchanged at 13.8, weaker than expectations of +0.2 to 14.0.

China Nov retail sales rose +10.8% y/y, stronger than expectations of +10.2% y/y and the biggest increase in 11 months.

China Nov industrial production rose +6.2% y/y, stronger than expectations of +6.1% y/y.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) Nov import price index (expected -0.4% m/m and unch y/y, Oct +0.5% m/m and -0.2%y/y), (2) FOMC begins 2-day policy meeting, and (3) the Treasury auctions $12 billion of 30-year T-bonds.

Russell 1000 earnings reports today include: Nordstrom (consensus $1.24), HEICO Corp (0.62).

U.S. IPO's scheduled to price today: Wildhorse Resource Development Corp (WRD)

Equity conferences this week include: Guggenheim Securities Boston Healthcare Conference on Tue, Bank of America Merrill Lynch SMID Cap Technology Conference on Wed, BMO Capital Markets Prescriptions for Success Healthcare Conference on Wed, RBC Capital Markets' Healthcare Investor Day on Thu.

OVERNIGHT U.S. STOCK MOVERS

Boeing (BA +0.43%) climbed nearly 2% in after-hours trading after it raised its dividend to $1.42 a share, higher than consensus of $1.25, and then announced a $14 billion share buyback program

VeriFone Systems (PAY -0.12%) declined over 2% in after-hours trading after it said it sees fiscal 2017 adjusted EPS of $1.35-$1.39, well below consensus of $1.59.

Michaels Cos. (MIK -3.70%) fell 2% in after-hours trading after it announced a secondary offering of 12 million shares of common stock.

National Storage Affiliates Trust (NSA +0.36%) slid over 3% in after-hours trading after it announced a public offering of 4.5 million shares of common stock.

Apollo Commercial Real Estate Finance (ARI -1.05%) dropped 3% in after-hours trading after it announced a public offering of 10.5 million shares of common stock.

Novocure LTD (NVCR -1.10%) rose almost 2% in after-hours trading after it said a Phase 2 "Innovate" trial suggest tumor treating fields plus weekly paclitaxel may improve overall survival in recurrent ovarian cancer.

Hancock Holding (HBHC -2.87%) fell 3% in after-hours trading after it announced a public offering of 5 million shares of common stock.

JetBlue Airways (JBLU -1.28%) gained almost 1% in after-hours trading after it reported Nov traffic up +7.1% and Nov capacity up +5.2%.

Univar (UNVR -0.95%) slipped almost 2% in after-hours trading after it announced a sale of 12.5 million shares by holders.

Inovalon Holdings (INOV -1.33%) plunged over 30% in after-hours trading after it lowered guidance on 2016 adjusted EPS to 32 cents-33 cents from a prior view of 39 cents-46 cents, citing inability to enter into an expected collaboration agreement because of "unforeseen circumstances impacting counter-party."

MARKET COMMENTS

Mar E-mini S&Ps (ESH17 +0.37%) this morning are up +6.25 points (+0.28%). Monday's closes: S&P 500 -0.11%, Dow Jones +0.20%, Nasdaq -0.44%. The S&P 500 on Monday retreated from a new record high and slightly closed lower. Stocks were undercut by negative carry-over from the -2.47% slide in the Shanghai Composite to a 1-month low and by interest rate concerns after the 10-year T-note yield rose to a 2-year high of 2.52%.

Mar 10-year T-notes (ZNH17 +0.15%) this morning are up +3.5 ticks. Monday's closes: TYH7 -1.00, FVH7 +0500. Mar 10-year T-notes on Monday fell to a new contract low and closed lower. T-note prices were undercut by the rally in crude oil to a 17-month high, which boosted inflation expectations as the 10-year T-note breakeven inflation rate rose to a 2-year high. There were also supply pressures as the Treasury auctioned $44 billion of 3-year and 10-year T-notes on Monday.

The dollar index (DXY00 +0.03%) this morning is up +0.100 (+0.10%). EUR/USD (^EURUSD) is down -0.0023 (-0.22%). USD/JPY (^USDJPY) is up +0.33 (+0.29%). Monday's closes: Dollar index -0.660 (-0.65%), EUR/USD +0.0074 (+0.70%), USD/JPY -0.30 (-0.26%). The dollar index on Monday closed lower on weak foreign demand for the Treasury's 3-year and 10-year T-note auctions on Monday after the percentage of indirect bidders for the auctions were below average, which signals reduced foreign demand for dollars. The dollar was also undercut by a rally in the currencies of the energy producing countries of Canada and Russia against the dollar after crude oil surged to a 17-month high.

Jan WTI crude oil (CLF17 +0.78%) prices this morning are up +39 cents (+0.74%) and Jan gasoline (RBF17 +1.67%) is +0.0194 (+1.26%). Monday's closes: Jan crude +0.95 (+1.83%), Jan gasoline +0.0309 (+2.05%). Jan crude oil and gasoline prices on Monday rallied sharply with Jan crude at a 17-month high and Jan gasoline at a 1-1/4 month high. Crude oil prices were boosted by the agreement by non-OPEC oil producers at Saturday's meeting in Vienna to cut crude production by 558,000 bpd and by Saudi Arabian Oil Minister Khalid Al-Falih's comment that Saudi Arabia's oil production will be "cut substantially below" the 10.06 million bpd level that it had agreed to cut to at the OPEC meeting last month.