The futures for the major indices aren't signaling a decidedly higher start, but that's not the story. The story is that there is an absence of sellers.
This stock market keeps pressing higher, bolstered at times by broad-based participation and at other times by opportunistic sector rotation where the losses in one area are offset by the gains in another. Basically, it has been near impossible to knock this market down by any meaningful degree and to keep it down for long.
The latter has been the story of 2017. That story has a few weeks left to tell, too, and an important chapter (i.e. tax reform) that is still incomplete.
Market participants, however, have acted as if the story will have a happy ending; hence, the Dow Jones Industrial Average and S&P 500 logged new record highs on Monday while the other indices held close to their own.
Today's story seems likely to start on an unexciting note. The S&P futures are up three points, the Nasdaq 100 futures are down one point, and the Dow Jones Industrial Average futures are up 73 points. Those indications have the three major indices trading in-line with, or slightly above, fair value.
Boeing (BA) has provided the gas for the Dow futures. It is up 1.9% in pre-market trading after the company announced a 20% increase in its quarterly dividend and a new $18 billion share repurchase program.
The fact that those increases came in front of any actual tax cut or reduced repatriation tax has underscored for many investors that similar announcements from other multinational companies are destined to be heard in the months ahead. If the tax cuts are approved and signed into law, those reductions should help boost earnings and cash flow, which are the fuel for dividend payments and share repurchases.
The latter understanding has provided an added element of support for the stock market into year end.
There isn't much other corporate news with market-moving influence this morning as most of it is stock and/or industry specific.
There is some economic news that is drawing some increased attention. Earlier this morning, it was reported that consumer inflation in the UK was up 3.1% year-over-year in November, which is a five-year high; and just a short time ago, it was reported that producer prices in the U.S. were also up 3.1% year-over-year in November, marking the largest 12-month advance since January 2012.
The PPI increase was literally fueled by a 0.4% increase in the index for final demand (Briefing.com consensus +0.4%), three-fourths of which was attributed to a 1.0% increase in the prices for final demand goods that was led mostly by a 15.8% jump in gasoline prices.
Core PPI, which excludes food and energy in the index for final demand, rose 0.3% (Briefing.com consensus +0.2%), leaving that index up 2.4% year-over-year, unchanged from October.
The key takeaway from the PPI report is that producer prices are rising and will create some profit margin pressures if the higher prices are not passed through to consumers.
The Federal Reserve, which starts its two-day FOMC meeting today, will take note of the PPI data as it assesses its economic outlook and interest rate projections. The Consumer Price Index for November will be released tomorrow -- or just hours in front of the FOMC decision.
Separately, today is decision day in the Alabama Senator's race, which pits Republican Roy Moore against Democrat Doug Jones. The outcome of that vote could have some very important implications for the legislative process in 2018, which is why it will be watched closely by market participants.
(Editor's note: An earlier version incorrectly said the Alabama governor's race when it should have read Alabama Senator's race. The article has been corrected)