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TODAY’S S&P 500 SET-UP - June 15, 2011

What's interesting about yesterday’s low-volume rally to lower-highs is that neither the volume nor the volatility signals confirmed anything but the same.  The Hedgeye S&P 500 Sector Risk Management Model continues to flash bullish on 0 of 9 Sectors.  As we look at today’s set up for the S&P 500, the range is 49 points or -2.01% downside to 1261 and 1.80% upside to 1311.

SECTOR AND GLOBAL PERFORMANCE

 

THE HEDGEYE DAILY OUTLOOK - daily sector view

THE HEDGEYE DAILY OUTLOOK - bpgm1

THE HEDGEYE DAILY OUTLOOK - WORST PERFORMING GLOBAL

 

EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: +1919 (+2463)  
  • VOLUME: NYSE 915.34 (+0.78%)
  • VIX:  18.26 -6.88% YTD PERFORMANCE: +2.87%
  • SPX PUT/CALL RATIO: 1.50 from 1.67 (-6.13%)

 

CREDIT/ECONOMIC MARKET LOOK:

  • TED SPREAD: 19.95
  • 3-MONTH T-BILL YIELD: 0.05%
  • 10-Year: 3.11 from 3.00
  • YIELD CURVE: 2.66 from 2.60 

 

MACRO DATA POINTS:

  • 7 a.m.: MBA Mortgage Applications, prior 0.4%
  • 8:30 a.m.: CPI, est. 0.1%, prior 0.4%
  • 8:30 a.m.: Empire Manufacturing, est. 12.00, prior 11.88
  • 9 a.m.: Total Net TIC Flows, prior $116.0b
  • 9:15 a.m.: Industrial production, est. 0.2%, prior 0.0%
  • 9:15 a.m.: Capacity utilization, est. 77.0%, prior 76.9%
  • 10 a.m.: NAHB Housing Market: est. 16, prior 16
  • 10:30 a.m.: DoE inventories

WHAT TO WATCH:

  • Euro-area finance chiefs emergency session fails to break deadlock on how to enroll investors in second Greek bailout
  • Bullish sentiment decreases to 37.0% from 40.9% in the latest US Investor's Intelligence poll; Bearish sentiment increases to 26.0% from 22.6% - those expecting a market correction increases to 37.0% from 36.5%
  • Federal Reserve deciding whether to set explicit inflation targets - Bloomberg
  • Consumers ditching cable for satellite, phone companies - LA Times
  • Conneticut AG asks Citi for data on its security after hacking attack - FT

COMMODITY/GROWTH EXPECTATION

THE HEDGEYE DAILY OUTLOOK - dcv

 

COMMODITY HEADLINES FROM BLOOMBERG:

  • Oil Declines as Concerns Over European Debt Counter U.S. Inventory Drop
  • Copper Falls in London Before Industrial Production Reports: LME Preview
  • Gold to Extend Gains as Buyers Seek ‘Safety’ Against Inflation, Fund Says
  • Wheat Harvest Forecast Increased by Australia as Rains Boost Crop Outlook
  • Natural Gas Production at Record as Shale Puzzle Solved: Energy Markets
  • Copper Users in China Plunder Stockpiles as Goldman Forecasts Record Rally
  • Canadian National Beating Canadian Pacific With Investors: Freight Markets
  • Gold May Slide as Strengthening Dollar Saps Alternative Investment Demand
  • Cotton Shortage in China May Worsen on Lack of Land, Increasing Imports
  • Cocoa Arrivals From Brazil’s Bahia Decline by 5.3%, Analyst Hartmann Says
  • Rio’s Hu May Get Chance to Exit China With Australia Plan for Jail Treaty
  • Rubber in Tokyo Climbs for First Day in Six as Oil Price, Yen Boost Appeal
  • European Commodity Day Ahead: Copper May Rally as China Stockpiles Plummet

CURRENCIES

THE HEDGEYE DAILY OUTLOOK - dcurrv

EUROPEAN MARKETS

  • EUROPE: no follow through across European stocks; Greece crashing again, down another -1.5%; Spain down -0.7%; Italy -1% - tick tock
  • Euro-area finance chiefs emergency session fails to break deadlock on how to enroll investors in second Greek bailout

THE HEDGEYE DAILY OUTLOOK - bpem1

THE HEDGEYE DAILY OUTLOOK - wpem1

ASIAN MARKETS

  • ASIA: no follow through to Chinese short covering-China down -0.9% and were long it yet; HK down another -.7%; India down -.9% to -11.5% YTD 

THE HEDGEYE DAILY OUTLOOK - bpam1

THE HEDGEYE DAILY OUTLOOK - wpam1

MIDDLE EAST

THE HEDGEYE DAILY OUTLOOK - me

Howard Penney

Managing Director