TODAY’S S&P 500 SET-UP - January 7, 2011
As we look at today’s set up for the S&P 500, the range is 16 points or -0.77% downside to 1264 and 0.48% upside to 1280. Equity futures are trading below fair value in a continuation of Thursday's retreat prompted by disappointing Dec retail sales data and ahead of today's employment data and Bernanke testimony to the Senate Budget Committee.
MACRO DATA POINTS:
- 8.30am, Payroll figures: Change in nonfarm payrolls, est. 150k, prior 39k Change in private payrolls, est. 175k, prior 50k Change in manufacturing payrolls, est. 5k, prior (-13k)
- Unemployment rate, est. 9.7%, prior 9.8%
- 9.15am, NY Fed’s Tracy to speak in Hartford, Conn.
- 9.30am, Fed’s Bernanke to Testify Before Senate Budget Panel
- 11am, Fed to purchase $6b-$8b notes/bonds
- 3pm, Consumer Credit, Nov., est. $0.5b
- 4.30pm, Fed’s Evans Speaks on Monetary Policy in Denver
- 4.30pm, NY Fed’s McAndrews Speaks on Panel in Denver
TODAY’S WHAT TO WATCH:
- Best Buy will offer its take on the holiday season with a sales release pre-mkt
- Blackstone in exclusive talks to buy London’s Chiswick Park office complex for ~$740m including debt, the Financial Times reports, without saying where it got the information
- Obama names William Daley as his White House chief of staff as part of a series of moves to keep the administration’s focus on the economy, improve relations with business and deal with a divided government.
- Today Obama will name Gene Sperling to lead National Economic Council.
- KB Home will provide a window into the housing market as it reports 4Q results.
- Amgen (AMGN) and Xencor will collaborate to develop an
- autoimmune disease antibody
- Borders Group (BGP) US in talks with Jefferies on restructuring, CNBC says, citing WSJ
- Immucor (BLUD) 2Q profit, rev. beat ests
- Liz Claiborne (LIZ) preliminary 2H profit missed goal
- Schnitzer Steel Industries Inc. (SCHN) 1Q rev. missed est.
- Shaw Group (SHAW) 1Q rev. missed est.
- Volcano (VOLC) rated new outperform at William Blair
- Volterra Semiconductor (VLTR) preliminary 4Q EPS below ests., forecast, est. -131
PERFORMANCE: ALL 9 SECTORS BULLISH ON TRADE & TREND
- One day: Dow (0.22%), S&P (0.21%), Nasdaq +0.28%, Russell 2000 (0.46%)
- Last Week: Dow +0.03%, S&P +0.07%, Nasdaq (-0.48%), Russell (-0.67%)
- Month/Quarter/Year-to-date: Dow +1.03%, S&P +1.29%, Nasdaq +2.15%, Russell +0.99%
- Sector Performance - BEARISH (Only 3 sectors positive) - Energy (0.95%), Cons. Disc (0.61%), Financials (0.66%), Materials (0.52%), Cons. Spls (0.34%), Industrials (0.17%), Utilities +0.10%, Healthcare +0.41%, Tech +0.58%
EQUITY SENTIMENT: MIXED
- ADVANCE/DECLINE LINE: -657 (-1283)
- VOLUME: NYSE 1093.30 (+4.83%)
- VIX: 17.40 +2.23% YTD PERFORMANCE: -1.97%
- SPX PUT/CALL RATIO: 0.86 from 1.81 (-52.57%)
CREDIT/ECONOMIC MARKET LOOK:
Treasuries were stronger yesterday
- TED SPREAD: 16.62 0.304 (1.866%)
- 3-MONTH T-BILL YIELD: 0.15% +.01%
- YIELD CURVE: 2.76 from 2.79
COMMODITY/GROWTH EXPECTATION:
- CRB: 325.07 -1.25%
- Oil: 88.38 -2.13% - trading +0.37% in the AM
- In early trading crude oil rebounds from lowest in three weeks
- COPPER: 432.95 -1.78% - trading -1.49% in the AM
- copper falls in London on speculation of more tightening
- GOLD: 1,373.15 -0.22% - trading -1.1% in the AM
- Gold is right down to our intermediate term TREND line of support this morning
OTHER COMMODITY NEWS:
- India to Boost Oil-Palm Plantation Area to Reduce $8.4 Billion Import Bill
- Gold in Euros to Outperform Gold in Dollars, ABN Says: Technical Analysis
- Queensland Towns Watch Rivers Rise as Waters Threaten Livestock, Property
- Wheat Heads for Weekly Drop on Speculation USDA May Lower Exports Estimate
- Germany Blocks Farms' Meat, Egg Sales After Finding Dioxin in Animal Feed
- Hainan Rubber Doubles in Shanghai Debut on Strong Demand, Growth Outlook
- Palm Oil Declines as Rally to 34-Month High Increases Soybean Oil Appeal
- Japan Minister Urges Lower Rice Tariff, Free Trade, Talks With North Korea
- Cotton Output in Australia May Be Cut 500,000 Bales on Flood, FCStone Says
- Copper Stockpiles in Shanghai Advance to Six-Month High; Zinc at Record
- Sugar May Rise Next Week on Speculation Demand Will Increase, Survey Shows
CURRENCIES:
- EURO: 1.3028 -1.18% - trading -0.38% in the AM
- DOLLAR: 80.847 +0.73% - trading +0.17% in the AM
EUROPEAN MARKETS:
- European Markets: FTSE 100: (0.29%); DAX: 0.17%; CAC 40: (0.43%)
- European markets mainly trade lower with major indices reversing modest opening gains as investors focus on US Dec nonfarm payrolls data due later in the session.
- Peripheral European debt worries persist and weighed on bond spreads and the euro. Spain and Portugal down 1.30% and 1.14%, respectively
- Declining sectors lead advancers 16-2 with oil & gas and banks leading fallers down close to (1%) and auto's up +0.3%, leading gainers.
- Germany Nov preliminary retail sales +2.0% y/y vs consensus +3.2%, (2.4%) m/m vs consensus +0.1%
- UK SMMT Dec new car registrations (18.0%) y/y, to 123,817 units, forecasts market to decline by (5%) in 2011 to 1.93M units
- Eurozone Q3 GDP 1.9% y/y vs consensus 1.9% and prior 1.9% Eurozone Q3 GDP 0.3% q/q vs consensus 0.4% and prior 0.4%
- Germany Nov Industrial Output (0.7%) m/m vs consensus (0.2%) and prior revised +3.0%
- Eurozone Nov Unemployment 10.1% vs consensus 10.1% and prior 10.1%
ASIAN MARKTES:
- Asian Markets: Nikkei +0.1%; Hang Seng (0.4%); Shanghai Composite +0.52%
- More Asian markets fell than rose today as investors awaited US non-farms payrolls data coming later.
- Banks led China up 0.52%, though it finished well of its intraday high. But metals stocks fell late in the day on renewed tightening fears.
- South Korea rose 0.41%, but Samsung Electronics lost 1% on saying its Q4 profit probably fell.
- Japan +0.11 traded in a very tight range all day. Carmakers rose on recovering sales in the US and a weaker yen.
- Australia declined -0.42%, with miners and banks going down, partially offset by higher industrial and consumer issues.
- Hong Kong traded -0.42%.
- Indonesia’s stocks fell 2.81%, driving the benchmark index to its biggest two-day loss in more than seven months. Concerns the central bank has fallen behind regional neighbors in taking action to curb inflation.
- India down 2.44%
