Housing data released today shows sales for existing U.S. homes hit a two-and-a-half year low in November, as higher mortgage rates gripped the market. Existing home sales fell 7.7% to their lowest level since May 2020, according to the National Association of Realtors, resulting in 10-straight months of declining sales -- the longest such stretch since 1999.

This makes now a good time to keep an eye on homebuilding concern KB Home (NYSE:KBH), which is down 27.7% in the last 12 months. Though the shares were last seen 3.4% higher to trade at 32.41, they remain well below their May 2021, roughly 15-year high of $52.48. However, a recent study from Schaeffer's Senior Quantitative Analyst Rocky White shows that KBH could see some gains in the coming month.

Per White's data, the security is within one standard deviation of its 40-day moving average. Over the last three years, KB Home stock saw three similar signals, and one month after one of these signals, the equity was 4% higher on average. A move of this magnitude from KBH's current perch would place shares at $33.70.

An unwinding of options traders' pessimism could help add some additional tailwinds. KB Home stock's Schaeffer's put/call open interest ratio (SOIR) of 1.67 ranks in the 71st percentile of annual reading, suggesting short-term options traders are more put-biased than usual at the moment.

The shares of Starbucks Corporation (NASDAQ:SBUX) are down 1.1% at $96.97 this morning, following a downgrade from Jefferies to "hold" from "buy." The analyst also cut its U.S. same-store sales growth outlook, noting recession risk to investor spending. 

SBUX is having a rocky December, down 4.1% this month. Should this negative price action continue, the security could log its first monthly drop since August. Plus, the equity is looking to finish the year in the red, last seen with a more than 16% deficit, which would mark the equity's first annual decline since 2016. 

Earlier in the month, Deutsche Bank called out the $106 mark as a potential plateau point for Starbucks stock, and that prediction is playing out. The equity has seen several attempts to break north of this level in December without success. It looks like the general consensus among the brokerage bunch is SBUX won't see much more upside at the moment. The 12-month consensus price target of $99.51 is just a 1.5% premium to last night's close. Meanwhile, just three analysts considered the stock a "strong buy," coming into today, compared to eight "hold" or worse ratings. 

Puts have surpassed calls in terms of popularity. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) 1.36 puts have been exchanged for every call during the past 10 weeks. This ratio stands higher than 94% of readings from the past year, pointing to an unusually healthy appetite for these bearish bets of late. 

Earnings reports from a couple of Wall Street's heavy hitters are pushing stock futures higher this morning. More specifically, both Nike (NKE) and FedEx (FDX) shared strong results, boosting confidence that the earnings season could be better than anticipated, despite fears of a potential recession. At last check, futures on the Dow Jones Industrial Average (DJIA) are pointed 348 points higher, while S&P 500 Index (SPX) and Nasdaq-100 Index (NDX) futures also sit firmly above fair market value. 

Continue reading for more on today's market, including:

• Several Nasdaq-100 rejects for short-term traders to snag.
• What does Santa Claus have in store for this retail stock?
• Plus, 3 stocks making noteworthy post-earnings moves.

5 Things You Need to Know Today

1. The Cboe Options Exchange (CBOE) saw more than 1.1 million call contracts and 870,418 put contracts exchanged on Tuesday. The single-session equity put/call ratio and the 21-day moving average rose to 0.78 and 0.75, respectively.
2. Nike Inc (NYSE:NKE) sports an 11.8% premarket lead, amid a round of post-earnings bull notes. The athletic apparel maker -- which carries a roughly 38% year-to-date deficit -- reported fiscal second-quarter earnings and revenue that beat analysts' estimates, and hiked its revenue forecast. Nike's discounts over  the quarter helped the results.
3. Conversely, members of the brokerage bunch are slashing their price targets on FedEx Corporation (NYSE:FDX), even after the delivery name shared better-than-expected fiscal second-quarter earning . The company's revenue fell short of expectations, but investors seem encouraged by FedEx's pledge to continue cutting costs. Ahead of the open, FDX is 5.9% higher, and looking to cut into a 36.5% year-to-date deficit.
4. Rite Aid Corp (NYSE:RAD) saw a smaller-than-anticipated loss for its third quarter and a revenue win. Retail business sales growth boosted the results, but the drugstore operator lowered its full-year guidance due to multiple headwinds. Before the open, RAD is 3.4% higher, but down 70% in 2022.
5. The current account deficit is on tap today, as well as the consumer confidence index and existing home sales data.  
    

Higher Global Investor Sentiment Boosts European Stocks

Asian markets settled mixed on Wednesday as investors continue to weigh the implications of the Bank of Japan’s (BoJ) modified yield curve tolerance. Japan’s Nikkei dropped once more, this time shedding 0.7%, while the Shanghai Composite in China and the South Korean Kospi each lost 0.2%. Meanwhile, the Hong Kong Hang Seng added 0.3%, amid news that Chief Executive John Lee will visit Beijing with comments on the city’s current economic situation.

An upward swing in global investor sentiment is strengthening European markets. Investors kept an eye on U.K. retail sales, which showed a year-over-year rise, though they’re expected to drop once more in 2023. At last glance the London FTSE 100 is 1% higher, the French CAC 40 has tacked on 1.2%, and the German DAX is up 0.9%.

Though the Bank of Japan's (BoJ) decision to widen its cap on the 10-year Japanese government bond yield threw the U.S. market for a loop this morning, stocks managed gains by the end of the day.

All three major benchmarks snapped their four-day losing streaks, with the Dow finishing the day 92 points higher. The S&P 500 and Nasdaq logged more muted gains, settling just above breakeven, while the Cboe Volatility Index (VIX) fell for the third-straight day. 

Continue reading for more on today's market, including:

• Buy the dip on this restaurant stock.
• Stitch Fix stock hit record low after downgrade. 
• Plus, trouble brewing for General Mills; call traders play RKLB; and an EV stock off record lows. 

5 Things to Know Today 

1. Broadcom Inc.’s acquisition of VMware Inc. is being investigated by the European Union (EU) for anticompetitive concerns. (MarketWatch)
2. An earthquake in northern California has left thousands without power. (Reuters)
3. General Mills stock brushes off results as pet business disappoints. 
4. Rocket Lab USA has seen more calls than usual of late. 
5. See why Lucid Motors stock was trending today. 

There were no earnings of note today.

Oil, Gold Rise

Oil prices continued their rise despite surging Covid-19 cases in China. West Texas Intermediate (WTI) crude for January delivery added 90 cents, or 1.3%, to end at $76.19 a barrel.

Gold prices rose after the Bank of Japan's decision put pressure on the U.S. dollar. February-dated gold rose $27.70, or 1.5%, to finish at $1,825.40 per ounce. 

The holidays have been anything but jolly for struggling retail stock Kohl's Corporation (NYSE:KSS). The shares have already lost over 21% in December, with a breakout last month contained at their 140-day moving average. KSS is once again nearing its Sept. 30 annual low of $24.61, last seen down 2.1% at $25.01. However, amid all this downside, a historically bullish signal is flashing that could give the stock a short-term boost. 

According to Schaeffer's Quantitative Analyst Rocky White, these lows come amid historically low implied volatility. This has been a historically bullish combination for KSS in the past. White's data shows three other signals in the last five years when the security was trading within 2% of its 52-week low, while its Schaeffer's Volatility Index (SVI) stood in the 20th percentile of its annual range or lower. This is currently the case with Kohl's stock's SVI of 53%, which stands in the 19th percentile of its 12-month range. 

One month after these signals, KSS was higher 67% of the time, and averaged a 1.7% return. While this isn't much of a rally, it could be the difference between Kohl's hitting a fresh annual low and turning higher in the new year. 

Options players have been incredibly bearish on Kohl's stock. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity sports a 50-day put/call volume ratio of 1.42, which sits higher than all but 2% of annual readings. In other words, puts have rarely been more popular. 

What's more, KSS' Schaeffer's Volatility Scorecard (SVS) comes in at 9 out of 100. In other words, the retailer has consistently realized lower volatility than its options have priced in, making the stock a potential premium-selling candidate.

Olive Garden parent Darden Restaurants, Inc. (NYSE:DRI) reported better-than-expected fiscal-second quarter earnings and revenue on Dec. 16. Despite this, the shares fell to a roughly two-month low of $131.90, and slipped further below their year-to-date breakeven level. However, Darden Restaurants stock was last seen up 0.8% at $139.61, putting it on track to turn in its first winning session in five. Plus, DRI has come within striking distance of a historically bullish trendline.

Per a study from Schaeffer’s Senior Quantitative Analyst Rocky White, the security is within one standard deviation of its 80-day moving average for the sixth time in the last three years. One month after 67% of these signals, the equity was higher, averaging a 10.7% gain. A move of this magnitude from DRI's current perch would place shares at $154.54, just shy of their Jan. 5 annual high of $155.25.

While the majority of analysts are already bullish, there's still some room for pessimism to unwind. Specifically, 18 firms rate DRI a "buy" or better, while four still call it a tepid "hold."

General Mills Inc (NYSE:GIS) stock is sliding, despite its fiscal second-quarter earnings beat and raised forecast, as the company's comments cast a shadow. The retailer said its pet food business saw inventory reductions at some key retailers, and J.P. Morgan noted that "the quality of the quarter won't be considered great given that the highly valued pet business surprised so much to the downside." General Mills also pointed to higher raw material costs amid high inflation. At last glance, GIS was down 3.9% at $83.74. 

This negative price action has General Mills stock distancing itself from its Dec. 14 record high of $88.34. The equity's 40-day moving average seems to be keeping losses in check, however. Year-to-date, the equity is up 24.5%. 

Options traders are targeting GIS at six times the intraday average today, with 4,021 calls and 6,427 puts exchanged. The January 2023 85-strike put is the most active contract. 

The brokerage bunch leans bearish, with 10 of the 14 in coverage carrying a "hold" or worse rating. Plus, the 12-month consensus target price of $80.44 is a 4.3% discount to current levels.