Art Cashin: Euro Zone Fears May Cap Santa Claus Rally

Stocks were mixed Thursday despite a batch of relatively positive economic news. Art Cashin, director of floor operations at UBS Financial Services shared his market outlook.

“Things are still looking shaky in Europe, which might put a cap on the Santa Claus rally,” Cashin told CNBC.

Meanwhile, the 10-year treasury yieldtouched a session high of 3.54 percent, up from 3.52 percent late on Wednesday.

“If rates are going to move up from 3.5 to 4, then I think that might cause a bit of trouble—That’s what happened before,” Cashin explained. “There was an article that said [Pimco’s founder Bill] Gross put $17 million of his own money into bond funds over the last week, so he’s betting that rates aren’t going to go higher.”

“So you could get a spurt when the house passes on the tax compromise, but you’ve got to keep your eye on the dollar, mainly.”

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Scorecard—What He Said:

• Cashin's Previous Appearance on CNBC (Dec. 14, 2010)

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More Market Intelligence:

• Me, Worry? Investors Surprisingly Bullish on Stocks

• Stocks Likely to See 8-12% Upside Next Year: Chief Investor
• Strategist's 'Ron Paul' Trade: Avoid Stocks, Stay Long US Dollar

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CNBC Data Pages:

• Dow 30 Stocks—In Real Time
• Oil, Gold, Natural Gas Prices Now
• Where's the US Dollar Today?

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CNBC Slideshows:

• America’s Most Stressful Jobs

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Thursday's Dow Laggards (As of Mid-Morning):

American Express

Boeing

3M

Procter & Gamble

Microsoft

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Disclosures:

No immediate information was available for Cashin or his firm.

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