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TODAY’S S&P 500 SET-UP - May 9, 2011

Plenty of talk this morning about what’s not new news to European bond/equity/FX market prices: (1) Greek Bond yields have been pricing in restructuring/default for 6 weeks (10s at 15.65% this morn) and (2) Greek Stocks (ATG Index) have been crashing since FEB (down -0.87% this morn; down -20.8% since February 18th).  As we look at today’s set up for the S&P 500, the range is 18 points or -0.54% downside to 1333 and 0.81% upside to 1351.

SECTOR AND GLOBAL PERFORMANCE

The Hedgeye models now have 6 of 9 S&P Sectors bullish TRADE and 7 of 9 bearish TREND.  The XLE and XLF are broken on both durations.

THE HEDGEYE DAILY OUTLOOK - levels 59

THE HEDGEYE DAILY OUTLOOK - daily sector view

THE HEDGEYE DAILY OUTLOOK - BEST PERFORMING GLOBAL

THE HEDGEYE DAILY OUTLOOK - WORST PERFORMING GLOBAL

 

EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: +993 (+1731)  
  • VOLUME: NYSE 1026.81 (-7.78%)
  • VIX:  18.20 +6.56% YTD PERFORMANCE: +2.54%
  • SPX PUT/CALL RATIO: 1.85 from 1.94 (-4.41%)

 

CREDIT/ECONOMIC MARKET LOOK:

  • TED SPREAD: 26.19
  • 3-MONTH T-BILL YIELD: 0.02%
  • 10-Year: 3.19 from 3.18
  • YIELD CURVE: 2.62 from 2.60 

 

MACRO DATA POINTS:

  • 11:30 a.m.: U.S. to sell $29b 3-mo., $27b 6-mo. bills
  • 4 p.m.: Crop progress (winter wheat, cotton, corn, soybean)

WHAT TO WATCH:

  • Hertz makes hostile cash & stock bid for Dollar Thrifty, offering $72-shr; $57.60 in cash, 0.8546-shr equal to $14.40. Offer is 3.3% premium over DTG’s Friday close $69.69.
  • Greece wants reduced interest rate on the aid it received from the IMF and the EU -- Reuters
  • Marriott increases quarterly dividend by 14.3% to $0.10 from $0.0875; increases stock repurchase program by 25M shares

COMMODITY/GROWTH EXPECTATION

THE HEDGEYE DAILY OUTLOOK - daily commodity view

 

COMMODITY HEADLINES FROM BLOOMBERG:

  • Commodities Rebound From Worst Week Since 2008 as Crude Oil, Silver Climb
  • Crude in New York Rebounds to $100 After Biggest Weekly Decline Since 2008
  • Copper Climbs on Speculation Biggest Weekly Drop Since March Was Overdone
  • Wheat, Soybeans Gain Second Day as Commodities Slump, Weather Lure Buyers
  • Silver Futures Rally From Worst Weekly Loss Since 1975 as Investors Return
  • Sugar Rises as Brazil Production May Miss Estimates; Coffee Prices Climb
  • Palm Oil Climbs First Time in Four Days as Commodities Rebound from Slump
  • Coal Prices Rise for Sixth Week to Two-Year High in China as Demand Surges
  • Mississippi to Crest Tomorrow in Memphis as Floods Expected to Move South

 

CURRENCIES

THE HEDGEYE DAILY OUTLOOK - daily currency view

EUROPEAN MARKETS

  • Eurozone May Sentix Index 10.9 vs consensus 12.0
  • UK Halifax Apr House price index (3.7%) y/y vs consensus (2.9%)
  • The periphery is dragging down the region on newspaper reports that Greece wants reduced interest rate on the aid it received from the IMF/EU

THE HEDGEYE DAILY OUTLOOK - BEST PERFORMING EURO

THE HEDGEYE DAILY OUTLOOK - WORST PERFORMING EURO

ASIAN MARKETS

  • Most Asian markets rose today on the back of positive US employment data.

THE HEDGEYE DAILY OUTLOOK - BEST PERFORMING ASIA

THE HEDGEYE DAILY OUTLOOK - WORST PERFORMING ASIA

MIDDLE EAST

THE HEDGEYE DAILY OUTLOOK - MIDEAST PERFORMANCE

Howard Penney

Managing Director