TODAY’S S&P 500 SET-UP - July 25, 2011
Newsy morning on the Debt Ceiling, but where it would really matter (US Treasury rates) if these professional politicians were not going to get something done within the next week, nothing is being priced in. As we look at today’s set up for the S&P 500, the range is 27 points or -1.71% downside to 1322 and 0.30% upside to 1349.
SECTOR AND GLOBAL PERFORMANCE
EQUITY SENTIMENT:
- ADVANCE/DECLINE LINE: -145 (-2000)
- VOLUME: NYSE 738.24 (-23.832%)
- VIX: 17.52 -0.23% YTD PERFORMANCE: -1.30%
- SPX PUT/CALL RATIO: 1.58 from 1.16 (-35.41%)
CREDIT/ECONOMIC MARKET LOOK:
- TED SPREAD: 21.75
- 3-MONTH T-BILL YIELD: 0.05%
- 10-Year: 2,99 from 3.03
- YIELD CURVE: 2.59 from 2.63
MACRO DATA POINTS:
- 8:30 a.m.: Chicago Fed: est. (-0.40), prior (-0.37)
- 10:30 a.m.: Dallas Fed Manufacturing: est. (-5.2), prior (-17.5)
- 11 a.m.: Export inspections: corn, wheat, soybeans
- 11:30 a.m.: U.S. to sell $27b 3-mo., $24b 6-mo. bills
- 4 p.m.: Crop conditions, corn, cotton, soybeans, winter wheat
- 6 p.m.: Greece Finance Minister Venizelos speaks at Peterson Institute
WHAT TO WATCH:
- Greece’s credit rating was cut three steps by Moody’s following EU support plan
- E*Trade Financial Corp. (ETFC) is hiring Morgan Stanley to explore a sale following criticism from holder Citadel
- Google (GOOG) may be the best stock pick on the outlook for mobile computing and social networking, Barron’s reported.
COMMODITY/GROWTH EXPECTATION
- GOLD – and Silver are busting a big move to the upside on a newsy morning where people who don’t do markets (politicians) are running their mouths; we’re long both but would be selling gross exposure on this move; Gold immediate-term TRADE overbought
COMMODITY HEADLINES FROM BLOOMBERG:
- Oil Declines After U.S. Lawmakers Fail to Agree on Debt Ceiling
- Wheat Slumps as Russian Exports Erode Demand for U.S., EU Grain
- Sugar Rises to Five-Month High on Tight Supply; Coffee Advances
- Copper May Drop for Fourth Day on Concern About a U.S. Default
- North Dakota Soggy Wheat Fields Dimming Prospects for Harvest
- Gold at $1,600 ‘Fundamentally Justified,’ Franklin’s Land Says
- Food Prices to Stay High on Underinvestment, Climate, IFAD Says
- BHP Miners Extend Strike at World’s Biggest Copper Mine
- Food Costs Rising as Coke, Chipotle Pass on Commodity Increases
- Cotton Output May Climb in India as Farmers Boost Plantings
- Corn, Soybeans May Rise as Hot Weather Threatens U.S. Yields
- Gold Advances to Record as U.S. Debt Deadlock Boosts Demand
- Japan’s Food Chain Threat Multiplies as Radiation Spreads
- India Lifts 2010-11 Cotton Output Estimate to 32.5 Million Bales
CURRENCIES
EUROPEAN MARKETS
- EUROPE: Italy and Spain fail right where they should have post last week's squeeze to lower-highs; Italy down another -0.9% = bearish TREND
ASIAN MARKETS
- ASIA: China got rocked (down -3%) and the rest of Asia was weak w/ exception of India +1%.
- CHINA – the most concerning move from overnight, with Chinese stocks getting rocked for a -2.96% loss after a tragic rail accident. Higher lows for the Shanghai Comp, but tomorrow will be important to watch on follow through. Copper down -0.4%.
MIDDLE EAST
Howard Penney
Managing Director
