The stock market is bouncing off its morning lows but gains are mild and stocks are mostly drifting sideways. Better retail sales data and initial weekly jobless claims are not having an impact as the world waits for tomorrow's jobs report. The U.S. dollar is seeing a minor bounce and commodities are producing a minor decline.

Asian stocks were down across the board. Japan was sinking on corporate news after Canon fell 2.5% on an analyst downgrade. Japan Airlines plunged more than 9% on news that the company would probably report a loss of $13.3 billion. The yen declined after Japan's finance minister issued public comments he favored a weaker yen to help exporters. Meanwhile Chinese stocks were sinking as investors reacted to fears that the government would curb liquidity. The Chinese government raised rates on their 3-month bond auction for the first time in more than a year. The Hong Kong Hang Seng fell 0.6% but the Chinese Shanghai index plunged 1.9%.

European markets were also weak but markets did pare their losses by the closing bell. Banks were some of the best performers but investors generally shrugged off news that the Bank of England is leaving interest rates unchanged at 0.5%. The BoE also left its debt purchase program unchanged at 200 billion pounds. The English FTSE almost made it back to unchanged with a 0.06% decline. The German DAX lost 0.25%.

Here at home in the U.S. traders were indifferent to generally better retail sales data and a weekly jobless claims that came in better than expected. Several retailers announced their sales data for December. Overall there was a big last minute push by consumers that "saved" the season. Nordstrom's, Neiman Marcus, TJX Cos., Aeropostale are some of the retailers that beat analysts' estimates for December. Macy's (M) sales came in just a hair under expectations. The RLX retail index initially spiked higher this morning but has since pared its gains to almost unchanged.

The weekly initial jobless claims came in at 434,000 versus last week's 433,000. Economists were expecting a rise to 439,000. The less volatile four-week moving average hits its lowest level since September 2008 with a drop to 450,250.

Stocks will most likely trade sideways into the closing bell as investors wait on the December non-farm payrolls report. I know we mention the jobs report ad nauseam so we'll just leave it at that. Although I will mention that the latest survey of economists now expect tomorrow's report to show zero job losses (unchanged) compared to previous estimates for -8,000. In the meantime the "scandal" of the day is news that the New York Federal Reserve told AIG to hide details about the company's bailout regarding payouts to Goldman Sachs and other big banks who got paid 100% for their credit swaps. At the time Timothy Geithner was in charge at the NY Fed so the news has become a political story in Washington.

Chart of the S&P 500:

Chart of the NASDAQ:

Chart of the Dow Industrials:

Chart of the Russell 2000 index:

Looking over the OptionInvestor.com play list I see that a handful of stocks are getting hit with some profit taking. IBM is trading under support near $130. INFY is off almost 3% and under the $55 level. Yet JPM, UNH, WHR, and PCP are all showing relative strength.