THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP - May 10, 2011

Yesterday, we saw the USD down to start the week (down for the 15th week of the last 20), which had CRB Index ripping yesterday (+2.1%) after getting crushed last week (down -8.9% for the wk).  Oil moved back above our intermediate-term TREND line of support = $98.63 and Gold continues to look better than almost everything that’s big and liquid other than maybe the German DAX. As we look at today’s set up for the S&P 500, the range is 17 points or -0.99% downside to 1334 and 0.35% upside to 1351.

SECTOR AND GLOBAL PERFORMANCE

The Hedgeye models now have 7 of 9 S&P Sectors bullish TRADE and 8 of 9 bearish TREND.  The XLF is the only sector broken on both durations. 

THE HEDGEYE DAILY OUTLOOK - levels 510

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: +1181 (+188)  
  • VOLUME: NYSE 778.48 (-24.18%)
  • VIX:  17.16 -6.47% YTD PERFORMANCE: -3.32%
  • SPX PUT/CALL RATIO: 1.94 from 1.85 (+4.61%)

 

CREDIT/ECONOMIC MARKET LOOK:

  • TED SPREAD: 24.55 -1.521 (-5.834%)
  • 3-MONTH T-BILL YIELD: 0.03% +0.01%
  • 10-Year: 3.17 from 3.19
  • YIELD CURVE: 2.60 from 2.62 

 

MACRO DATA POINTS:

  • 7:30 a.m.: NFIB Small Business, est. 91.8, prior 91.9
  • 7:45 a.m.: ICSC-Goldman weekly retail sales
  • 8:30 a.m.: Import price, est. 1.8% (M/m), prior 2.7%
  • 9:30 a.m.: Fed’s Duke speaks in St. Louis
  • 10 a.m.: Wholesale inventories, est. 1.0%, prior 1.0%
  • 11:30 a.m.: U.S. to sell $28b 4-wk bills
  • 12 noon: DoE short-term energy outlook
  • 12:45 a.m.: Fed’s Lacker speaks on Arlington, Vir.
  • 1 p.m.: U.S. to sell $32b in 3-yr notes
  • 4:30 p.m.: API inventories

WHAT TO WATCH:

  • China’s April inflation data due out tomorrow.
  • Microsoft close to completing $7B for Skype - WSJ
  • Google online music service to probably be announced tomorrow at Google I/O developers conference - WSJ

COMMODITY/GROWTH EXPECTATION

THE HEDGEYE DAILY OUTLOOK - daily commodity view

 

COMMODITY HEADLINES FROM BLOOMBERG:

  • Crop Weather Damage Grows as Europe Drought, Canada Rain Boost Grain Costs
  • Oil Inventories Increase to Near a Two-Year High in Survey: Energy Markets
  • Sugar Rises Most in Six Weeks as Imports Into China May Jump; Cocoa Gains
  • Wheat Gains for Third Day as Adverse Weather Threatens Harvests Worldwide
  • Copper Climbs for a Third Day Before Release of Figures on China Inflation
  • Copper Imports by China Decline on Ample Supplies, Higher Overseas Prices
  • Gold May Advance as Sovereign-Finance Concern Stokes Demand; Silver Gains
  • Malaysia Smelting Climbs to Three-Month High as Tin Prices Produce Profit
  • Mississippi Flooding Threatens Cropland, Refineries and Shipping Traffic
  • Soybean Imports by China Tumble on Canceled Orders as Stockpiles Stay High
  • Palm Oil Stockpiles, Output Reach Six-Month High in Malaysia on Weather

 

CURRENCIES

THE HEDGEYE DAILY OUTLOOK - daily currency view

EUROPEAN MARKETS

  • Greek banks jump on talk country to avoid debt restructuring.  But…
  • Greece denies report it is discussing new aid package -- Reuters, citing Greek Finance Minister
  • France Mar Industrial output (0.9%) m/m vs consensus +0.4% 

THE HEDGEYE DAILY OUTLOOK - BEST PERFORMING EURO

THE HEDGEYE DAILY OUTLOOK - WORST PERFORMING EURO

ASIAN MARKETS

  • Most Asian markets that were open today ended a higher
  • Hong Kong was closed for Buddha’s Birthday.
  • South Korea was closed for Sukka Tansin II.
  • China April trade surplus $11.4B vs consensus $1-3B. Australia March trade balance A$1.74B vs consensus A$500M.

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