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Sellers return after market bounce

David Russell (david.russell@optionmonster.com)

Stocks are surrendering some of Friday's gains as attention returns to fiscal problems in the United States and Europe.

The S&P 500 is indicated to open lower by almost half a percent amid declines of a similar magnitude across the Atlantic. Asian markets were little-changed overnight.

Finance ministers in Europe continue to negotiate details of a bailout for debt-laden Greece after failing to reach an agreement last week. In Washington, lawmakers have yet to strike a deal needed to prevent taxes from increasing on Jan. 1 because of the so-called fiscal cliff. Worries on both fronts are offsetting a strong start to the holiday shopping season over the Thanksgiving weekend.

The economic calendar will remain focused on U.S. consumers and housing, which have been relative bright spots for the market. Tomorrow includes data on real-estate prices, followed by new home sales on Wednesday and monthly retail sales on Thursday. Political uncertainty, however, will hang over these events, with the potential to trigger fits of buying or selling.

The S&P 500 is also up more than 2 percent in the last week after hitting its lowest price in almost four months. It's now back to a consolidation area from late October, which could cause investors take profits and wait before committing new capital.

Foreign-exchange markets are also showing a modest pattern of risk aversion. The euro, Canadian dollar, and Australian dollar are all slightly lower against the U.S. currency, while the Japanese yen is stronger across the board. Oil is down by half a percent, but copper and silver are inching higher. Most agricultural foodstuffs are also positive.

In company-specific news, UnitedHealth may be active after it forecast 2013 earnings of $5.25 to $5.50 a share on revenue of $123 billion to $124 billion. The profit estimate was below the $5.58 consensus estimate, while the revenue number was higher than the $119 billion expected by analysts.

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