TODAY’S S&P 500 SET-UP - November 1, 2010
As we look at today’s set up for the S&P 500, the range is 23 points or -1.21% downside to 1169 and 0.74% upside to 1192. Equity futures are trading above fair value in what is set to be a pivotal week for the markets with QE2, ISM, mid-term US elections and payrolls on the agenda. Strong Chinese manufacturing data is supporting Asian and European markets while the soft tone to the dollar has pushed commodity prices higher.
Today sees the release of Oct ISM data with StreetAccount forecasting a reading of 53.6 for Oct vs a prior 54.4
- Anworth Mortgage Asset Corp (ANH) 3Q core EPS missed ests.
- Avanir Pharmaceuticals (AVNR)’s Nuedexta (dextromethorphan hydrobromide/quinidine sulfate) approved by FDA for treatment of pseudobulbar affect (PBA)
- Forest Laboratories (FRX)’s Teflaro (ceftaroline fosamil) approved by FDA to treat community-acquired bacterial pneumonia, acute bacterial skin and skin structure Infections, including MRSA.
- Fortinet (FTNT) received a takeover approach from IBM, according to two people close to the situation
- GlaxoSmithKline (GSK) is voluntarily recalling Emo-Cort 2.5% Lotion in Canada, citing mold contamination
- Idenix Pharmaceuticals (IDIX) 3Q loss-shr 18c vs est. loss 22c
- Microsoft (MSFT): Barron’s Eric Savitz suggests Microsoft may be too cheap to ignore
- Northeast Utilities (NU) raises 2010 adj. EPS forecast
- Stryker (SYK) buys Porex Surgical, sees neutral to 2010, 2011 EPS, accretive after
- UIL (UIL) sees 2010 EPS $1.95-$2.05 vs prev. forecast $1.92-$2.07; est. $1.90.
- One day: Dow +0.04%, S&P (0.04%), Nasdaq (flat), Russell +0.33%
- Month/Quarter-to-date: Dow +3.06%, S&P +3.69%, Nasdaq +5.86%, Russell +4.02%.
- Year-to-date: Dow +6.62%, S&P +6.11%, Nasdaq +10.50%, Russell +12.47%
- Sector Performance: Materials +0.81%, Consumer Staples +0.35%, Utilities +0.16%, Industrials +0.16%, Energy +0.07%), Tech +0.16%, Consumer Discretionary (0.03%), Financials (0.11%), and Healthcare (0.42%)
- MARKET LEADING/LAGGING STOCKS YESTERDAY: Monster WW +25.5%, Estee Lauder +10.50% and US Steel +5.73%/Genworth Financial -9.86%, First Solar -8.91% and Sunoco -5.66%.
- ADVANCE/DECLINE LINE: 574 (+556)
- VOLUME: NYSE: 1036.73 (+3.36%)
- VIX: 21.20 +1.53% - YTD PERFORMANCE: (-2.21%) - THE VIX IS UP 12.9% LAST WEEK
- SPX PUT/CALL RATIO: 3.37 from 2.22 +51.85% - UP EVERY DAY LAST WEEK
CREDIT/ECONOMIC MARKET LOOK:
- TED SPREAD: 17.84 0.304 (1.735%)
- 3-MONTH T-BILL YIELD: 0.12% -0.01%
- YIELD CURVE: 2.29 from 2.32
- CRB: 300.67 +0.26%
- Oil: 81.43 -0.91% - BULLISH
- COPPER: 373.35 -1.43% - OVERBOUGHT
- GOLD: 1,357.88 +1.26% - BULLISH
- EURO: 1.3947 +0.18% - BULLISH
- DOLLAR: 77.266 -0.05% - BEARISH
- FTSE 100: +0.30%; DAX +0.35%; CAC 40 +0.03%
- Major indices are firmer in reaction to Chinese manufacturing data which shows manufacturing activity strengthened markedly in Oct. The upside move looks broad based with Basic Resources, Oil & Gas and Autos pacing gainers.
- While there has been little news flow across the continent so far, the week will be a busy one with central bank decisions on Thursday, plus the earnings season continues.
- Markets will take comfort from news that Portugal's minority Socialist government and opposition Social Democrats have been able to reach an agreement on the 2011 budget and averting a potential political crisis
- BHP Billiton is preparing to "sweeten" its $39B hostile takeover bid for Potash.
- Nikkei (0.52%); Hang Seng +2.39%; Shanghai Composite +2.52%
- Most markets closed higher although the strong yen knocked export orientated stocks in Tokyo.
- China and Hong Kong led the region on strong manufacturing data.
- South Korea rose, led by automakers who jumped on results
- China Oct PMI +54.7 vs prior +53.8, Oct HSBC PMI 54.8 vs prior 52.9
- Japan Oct domestic auto sales (26.7%) y/y