The Morning Hammer: Is Today a Big Day?

I thought yesterday would be a big down day for the market with yet another string of economic data misses, and I was wrong.

Equities were pretty strong yesterday, with nice action in biotech and large cap tech.

This morning is another story.

Deutsche Bank (DB) said the US Department of Justice is seeking $14 billion to settle its MBS probe. DB is not willing to pay that much and the stock is taking a bit hit.

That's helping push European banks down -2.4% in the early going, while the broader Euro Stoxx 50 is off -1.4%.

In analyst-land, Nicholas Smith of CLSA said he is “absolutely certain” that the Bank of Japan will stop buying Nikkei 225-based ETFs to boost equities. However, said the bank will not stop buying — they will simply shift their purchases to the Topix and JPX-400.

SPX futures are taking a -0.4% dip this morning, following Europe down.

Apple (AAPL) is up premarket as iPhone 7 goes on sale. Canaccord also raised its target price to $140 from $120.

However, the big news today is the CPI report which hits at 8:30 a.m. ET.

The market is split right down the middle on rate hikes. Fed funds futures imply a 50% chance of a December rate hike, down from 60% last week.

Economic data has been slipping hard since the July 29 GDP report, and it seems like traders just started paying attention to this important trend.

This CPI report will be the last major economic data release before the September 21 rate decision, so there's a chance we end the week with a bang.

The only problem is we can't figure out what kind of bang.

Yesterday, we got a huge batch of dove-supporting bad data and gold and US Treasuries still fell.

And equities seem to be reacting randomly to Fed chatter and data too.

So even if you gave me the numbers now, it still wouldn't be easy to trade this CPI report.

Near-term, I'd keep a very close eye on Apple (AAPL) and biotech because they've been holding up the market.

Apple's got a chance of a sell-the-news reaction today as we see 10 million news reports about iPhone sellouts.

Biotech's still a wild card because the whole sector is moving on takeover chatter surrounding individual companies.

Today is also quad-witching options expiration, so get ready to hear everyone's cockamamie theories on what it means for the action. (I think it's completely random)

I'd also keep an eye on oil.

Good luck out there!