Data in Europe overnight have shares there down from their highs after yesterday’s holiday. The FTSE 100 has lost 0.7%, while the DAX and CAC 40 are at the flat line after opening over 1% higher. Data from Europe showing a downturn in Eurozone manufacturing activity in April is at the root of the sell-off, which has also sent EUR/USD to session lows. 

In the states, S&P front-month futures are down 3.5 to 1,397. Prices are struggling to stay above 1,400 – which could cause a further pull-back ahead of Friday’s numbers. DJIA and NASDAQ futures are experiencing similar dips ahead of the opening bell. 

At 10 a.m. ET, the Commerce Department will release data on Factory Orders. As this is a lagging indicator – data from March, not April – it does not typically impact markets too much.  Economists are looking for a 1.4% drop in factory orders. At 10:30 a.m. ET, the Department of Energy will release weekly petroleum inventory data. Crude Oil is down 0.4% on the session, but holding firm above $105 per barrel. 

The 30-year bond caught a bid this morning, rising 0.7%. The 10-year note is higher by 0.3%. The 30-year yields 3.11%, and the 10-year yields 1.92% at the moment.

– PF Chang’s (PFCB) downgraded to Hold from Buy: Miller Tabak

– TripAdvisor (TRIP) price target to $39 from $31: The Benchmark Company

– Open Table (OPEN) price target to $45 from $50: The Benchmark Company

Yes, we had a rally today, but what sparked it? Was it the belief off selling in May and going away. Or was it all about the average at best ISM reading this morning. I am using today’s high, 1411.75 in the ES futures as a gage or get short.

I continue to think that we are in a trading range, 1335-1420 and until we get that breakout, we will trade sideways. After the bell, we got mixed results as TRIP, Tripadvisor raged higher, but Opentable, OPEN, and BRCM were both off. Taking away that today was the first day of the month, I see more headwinds and think we head lower this month and then get a huge summer rally. Have a great night traders.

Break-even:  I breakeven on this trade if HLF closes at $60.70 by May 18, 2012.

Unprofitable: I lose money on this trade if HLF closes above $60.70 by May 18, 2012.  The most I can lose on this trade is the Price of the Spread can be worth $2.50 minus the Price I sold it for $.70 or a total of $1.80.

UPDATE 5.2.2012  With HLF selling off once again today, this spread is decreasing in value by the day.  It is currently worth $.40, but I will leave this trade on, because I do not think HLF can rally through the $60 level between now and May expiration.  

UPDATE 5.3.2012  With this spread currently worth $.10, I am trying to buy it back and take the trade off, because even though the stock is very weak I am not willing to risk $2.40 to make an extra trade for $.10.  Another winner at KOTM

UPDATE 5.4.2012  I closed this trade out this trade for $.10, another winner and time to move on to the next trade.

Read more about price by www.keeneonthemarket.com

– Targa Resources (TRGP) upgraded to Outperform from Neutral: Robert W. Baird

– Apollo Commercial Real Estate (ARI) downgraded to Hold from Buy: Stifel Nicolaus

– Herbalife (HLF) price target to $86 from $83: Caris & Company

– Simon Properties (SPG) price target to $162 from $152: Imperial Capital

On the flip side, Apple (AAPL) had a rough go, falling 3.15% to $584 per share. AAPL has fallen straight down since opening at $610 after reporting a tremendous quarter on the 24th. In premarket trade, AAPL is higher by 0.6%. 

Natural Gas has been on a tear since hitting lows around $1.910. Futures are currently trading at $2.301, up 0.7% on the session. UNG, an ETF that tracks Natural Gas, is up 9% over the past 5 days. But, UNG is down 8.7% over the past month, and down 36% year-to-date. I wouldn’t get too caught up in the current move – Nat Gas’ trend is definitely lower.

At 10 a.m. ET today, the ISM Manufacturing Index will be released. At 10:30 ET, data on Construction Spending will come out. This is all setting the market up for Friday’s payrolls report.