TODAY’S S&P 500 SET-UP - July 18, 2011
Ugly morning! Asia wasn't the problem either (China up 2x vs the SP500 from the June low). The problem remains the Fiat Fools and their impact on markets (shortening economic cycles and amplifying market volatility). As we look at today’s set up for the S&P 500, the range is 30 points or -1.45% downside to 1297 and 0.83% upside to 1327.
SECTOR AND GLOBAL PERFORMANCE
EQUITY SENTIMENT:
- ADVANCE/DECLINE LINE: +650 (+2382)
- VOLUME: NYSE 1073.50 (+16.05%)
- VIX: 19.53 -6.11% YTD PERFORMANCE: +10.03%
- SPX PUT/CALL RATIO: 2.48 from 2.00 (+23.98%)
CREDIT/ECONOMIC MARKET LOOK:
- TED SPREAD: 24.47
- 3-MONTH T-BILL YIELD: 0.02%
- 10-Year: 2.94 from 2.98
- YIELD CURVE: 2.57 from 2.60
MACRO DATA POINTS:
- 9 a.m.: TIC Flows, est. $40.0b, prior 30.6b
- 10 a.m.: NAHB Housing Market Index, July, est. 14, prior 13
- 11 a.m.: Export inspections (corn, soybeans, wheat)
- 11:30 a.m.: U.S. to sell $27b 3-mo., $24b 6-mo. bills
- 4 p.m.: Crop conditions
WHAT TO WATCH:
- Senate leaders plan to push a revised budget this week aimed at allowing a debt-limit increase needed to avoid a government default as President Obama presses for action in time for Aug. 2 deadline
COMMODITY/GROWTH EXPECTATION
COMMODITY HEADLINES FROM BLOOMBERG:
- Gold Advances Above Record $1,600 on U.S., Europe Sovereign-Debt Concerns
- Pork Prices Tumble From Record Highs as Corn Bust Spurs Jump in Hog Herds
- Brent Crude Oil Falls on Concern Europe Debt Crisis Will Slow Fuel Demand
- Wheat Drops for a Third Day as Importers May Favor Cheaper Russian Grain
- Coffee Falls as Sovereign-Debt Crisis May Threaten Demand; Sugar Declines
- Investors Boost Bullish Commodity Bets as Gold Demand Jumps on Debt Crisis
- Copper May Advance on Speculation Supply Gap Will Keep Supporting Prices
- China Removes Limits on Prices of Edible Oils, Quanzhou Evening News Says
- Copper May Rally to a Record $12,000 on Higher Chinese Demand, Maike Says
- Gold May Reach $5,000 by 2020 on China’s Demand, Standard Chartered Says
- Brent Crude May Exceed $123 a Barrel on ‘Swing Highs’: Technical Analysis
- Posco Said Barred From Exporting Iron Ore From $12 Billion Mine Project
- Cotton Yarn Exports From India May Rebound From September on Mill Demand
- China Soy Imports May Fall to 51 Million Tons in First Decline Since 2004
CURRENCIES
EUROPEAN MARKETS
- EUROPE: Italy is a train wreck - MIB down another full 1% (crash since FEB) and Italian CDS zooming above the Lehman Line to 325bps
ASIAN MARKETS
- ASIA: down across the board, but not nearly as bad as Europe; China down a whole +12 beeps (UP +7.4% vs June low, double the return of the S&P 500
MIDDLE EAST
Howard Penney
Managing Director
