The major indices are all still in the red, but way off the lows and the Dow has turned positive.  Energy, Financials and Industrials are strong today.  Speaking of financials, banks are on a tear. Decliners far outpace advancers on the NYSE 1789/1080 and 1543/1292 on the Nasdaq. 

News that China may no longer purchase U.S. debt has boosted Treasury yields. While the news may have spooked the stock market, the latest 10-year bond market auction was solid.  The 10-year now stands at 2.579%.   The greenback is also lower, but coming off a two-week high.

The latest update from the Energy Information Administration (EIA) showed a drop of 4.9 million barrels, compared to estimate of a 3.9 million decline.  Gasoline however had a build of 4.1 million barrels.  Overall production also dipped slightly to 9.5 million barrels per day.  WTI is up to $63.39 a barrel.  OPEC production cuts are also helping to boost energy with Brent trading around $69 a barrel.

On the economic front, import prices for December were up 0.1% in December, excluding fuel, it was down 0.1%.  Export prices, which declined 0.1%, but without agriculture, were flat.   Prices remain in an uptrend for both imports and exports, which brings inflation into question as the labor market tightens and growth is growing globally.

Highlights:

• Import prices +3.0% in 2017 compared to +1.9% in 2016
• Excluding fuel, import prices were +1.4% year-over-year versus +0.2% in 2016
• Export prices +2.6% in 2017, compared to +1.3% for 2016
• Excluding agriculture, export prices +2.7%
• Import and export prices with and without fuel and agriculture had the largest calendar year gain since 2011