Odd Flat Finish on Quadruple Witching Day

Four times a year, the markets encounter what are known as quadruple witching days, in which all four varieties of futures and options expire on a single day, normally the third Friday of the month, as today.

On those usually-volatile sessions, there's usually a good chance that stocks will finish strongly to the positive or the negative, so it was a bit of keeping with the current theme that stocks finished the week flat, though on higher volume than has been seen lately.

It's on these quiet days that, somewhat counter-intuitively, investors can find real diamonds in the rough, but, since many hedge funds have already closed their books for the year, and, taking into account the continuing crisis in Europe and the slow pace in the US, traders were focused more on catching the quickest train out of town for the weekend rather than researching or taking positions in fresh equities.

News flow was also quite on the light side, though Fitch Ratings did its best to unnerve already-skittish investors by lowering France's AAA credit outlook from stable to negative and placing six European nations - Belgium, Spain, Slovenia, Italy, Ireland and Cyprus - on ratings watch negative, putting the six on a heightened probability of downgrade once the company completes its review by the end of January 2012.

The economic data on Friday was also not inspiring to either bulls nor bears, as CPI for November was flat with the core CPI - excluding food and energy - was up 0.2%. More than likely, if one is to believe the government bean-counters, this is indicative of a slow economy leaving companies without much pricing power, and, intuitively, a harbinger of another small wave of deflation in the near term.

Thus, stocks ended the week with their first loss in the last three, though the vast majority of the damage was done on Tuesday, the other sessions more or less range-bound.

With just ten trading days remaining in the year, traders are keeping a sharp eye out for Santa Calus and his rally hat, though there have been no sightings of the jolly fat man nor of any catalyst to spark a significant year-end rally.

In the immortal words of George W. Bush, "go shopping."

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