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TODAY’S S&P 500 SET-UP - December 3, 2010

As we look at today’s set up for the S&P 500, the range is 26 points or -2.01% downside to 1197 and 0.12% upside to 1223.  The unemployment rate edged up to 9.8 percent in November, and nonfarm payroll employment was little changed (+39,000), the U.S. Bureau of Labor Statistics reported today. S&P 500 futures dropped sharply on the number. 

  • Coldwater Creek (CWTR) 3Q loss-shr narrower than est.
  • Emergency Medical Services (EMS) bought Milford Anesthesia
  • Novell (NOVL) 4Q rev. beat est.
  • Phillips-Van Heusen (PVH) forecast 4Q EPS below est.
  • Sunoco (SUN) agreed to sell Toledo, Ohio, refinery to Toledo Refining for $400m
  • Ulta Salon Cosmetics & Fragrance (ULTA) sees 4Q rev. inline with est.
  • VeriFone Systems (PAY) Sees FY2011 adj. EPS, sales above est.

 PERFORMANCE

  • One day: Dow +0.95%, S&P +1.28%, Nasdaq +1.17%, Russell 2000 +1.08%
  • Month-to-date: Dow +3.24%, S&P +3.47%, Nasdaq +3.25%, Russell +3.33%
  • Quarter-to-date: Dow +5.32%, S&P +7.04%, Nasdaq +8.90%, Russell +11.10%
  • Year-to-date: Dow +7.94%, S&P +9.54%, Nasdaq +13.67%, Russell +20.12%
  • Sector Performance: Financials +2.56%, Materials +1.52%, Industrials +1.55%, Energy +1.49%, Consumer Disc +1.30%, Tech +1.19%, Healthcare +0.78%, Utilities +0.29%, Consumer Spls +0.07%

 EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: 1270 (-416)  
  • VOLUME: NYSE - 1115.48 (-0.28%)
  • VIX:  19.39 -9.22% - YTD PERFORMANCE: -10.56%
  • SPX PUT/CALL RATIO: 1.58 from 1.67 -5.45%  

CREDIT/ECONOMIC MARKET LOOK:

  • TED SPREAD: 15.74 -0.101 (-0.640%)
  • 3-MONTH T-BILL YIELD: 0.16%
  • YIELD CURVE: 2.46 from 2.44

COMMODITY/GROWTH EXPECTATION:

  • CRB: 312.10 +1.03%
  • Oil: 88.00 +1.44%
  • COPPER: 397.90 +0.80%
  • GOLD: 1,386.95 -0.28%

CURRENCIES:

  • EURO: 1.3204 +0.57%
  • DOLLAR: 80.303 -0.51%

OVERSEAS MARKETS:

EUROPEAN MARKETS:

  • FTSE 100: 0.00%; DAX (0.08%); CAC 40 +0.34%
  • Markets are mixed to unchanged in light trading following strong gains seen in the previous two sessions as investors rediscover an appetite for risk.
  • ECB bond purchases during the previous session threw down the gauntlet to euro skeptics who doubted the bank's resolve to back up its rhetoric with decisive action.
  • Strong headline economic data and the fact that equities currently offer investors better returns than government or corporate bonds are also factors underpinning sentiment in the asset class.
  • Last night, S&P warned it could cut Greece's BB-plus credit rating if it becomes clear that the proposed European Stability Mechanism will favor public creditors to the detriment of private bond holders
  • EU Commission makes unannounced inspections in pharmaceutical sector
  • Eurozone Nov Final Services PMI 55.4 vs prelim 55.2
  • Eurozone Oct Retail Sales +1.8% y/y vs cons +1.0%
  • Germany Nov Final Services PMI 59.2 vs prelim 58.6
  • France Nov Final Services PMI 55.0 vs prelim 55.7
  • UK Nov Services PMI 53.0 vs cons 53.0

ASIAN MARKTES:

  • Nikkei +0.10%; Hang Seng (0.55%); Shanghai Composite (0.04%)
  • Closed mixed with Shanghai and Hong Kong lower on nagging fears China may take more steps to rein in inflation.
  • Investors are starting to price in another increase in banks' required reserve ratios and a rate rise by the end of the year.
  • Gold miners fell on profit-taking, and coal miners declined on a report that Beijing has frozen prices for next year in a bid to control inflation.
  • The Nikkei ended marginally higher having earlier hit a 6-month intraday high, lifted by stronger than expected US economic data and on talk of ECB activity in bond markets  

Howard Penney
Managing Director