Equity markets rebounded on Wednesday to add about 1.5% to the S&P 500. The driver was better than expected earnings from Nike that have enriched hopes that Q4 earnings reporting season won't be as bad as feared. As it is, the market is expecting about a 2.5% decline in S&P 500 earnings and the consensus is falling. The takeaway for investors is that results may be enough to keep the bulls interested and the S&P 500 bobbing sideways within its current range.

The big news this week will come out tomorrow with the PCE price index. The index is expected to subside on a YOY basis at the core level which is what the market needs to see. If the index confirms expectations there is a very good chance Santa Clause will bring a rally next week.