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Is there an underlying bid to the U.S. market? U.S. stocks turned positive in late morning, even as Europe stays down.

With the S&P 500 flat since Monday's close, Europe has been down three days in a row:

Spain -3.3%

Portugal -2.6%

Italy -2.5%

Germany -2.0%

The simple explanation, of course, is that the U.S. economy is expected to again outperform Europe in 2012. The EU this morning said they expect the eurozone economy to contract 0.3 percent in 2012. Few economists are expecting an outright recession in the U.S. in 2012.

Indeed, the trading community is expecting corporate profits to expand, albeit more modestly than in 2011.

Right now, analysts are expecting the S&P 500 to earn about $105 in 2012; if you apply a "normal" multiple of 15 to the S&P, you get about 1,575 on the S&P; 200 points above the current 1,360 level.

Yes, the analysts numbers are revised constantly, and yes the estimates could all go wrong, but right now the economic data — and analyst estimates — are continuing to support that underlying bid to the market.

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