THE HEDGEYE DAILY OUTLOOK

THE HEDGEYE DAILY OUTLOOK

 

TODAY’S S&P 500 SET-UP - July 29, 2011

 

As we see it the Debt Ceiling Debate = political drama; that’s it – it’s not being priced into either A) a US currency crash or B) US Treasury Yield credit risk. Sure, it’s being priced into US stocks, but I think what people are missing is that so are A) Europig problems and B) EPS expectations.  As we look at today’s set up for the S&P 500, the range is 24 points or -0.67% downside to 1292 and 1.18% upside to 1316.

 

SECTOR AND GLOBAL PERFORMANCE

 

THE HEDGEYE DAILY OUTLOOK - levels 729

 

THE HEDGEYE DAILY OUTLOOK - Global

 

THE HEDGEYE DAILY OUTLOOK - daily sector view

 

 

EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: -725 (+1836)  
  • VOLUME: NYSE 986.85 (-10.22%)
  • VIX:  23.74 +3.31% YTD PERFORMANCE: +33.75%
  • SPX PUT/CALL RATIO: 1.60 from 2.92 (-45.29%)

CREDIT/ECONOMIC MARKET LOOK:

  • TED SPREAD: 18.28
  • 3-MONTH T-BILL YIELD: 0.07% -0.01%
  • 10-Year: 2.98 from 3.01   
  • YIELD CURVE: 2.56 from 2.57

MACRO DATA POINTS:

  • 8:30 a.m.: GDP, QoQ Annualized: est. 1.8%, prior 1.9%
  • 8:30 a.m.: Personal consumption, est. 0.8%, prior 2.2%
  • 9:45 a.m.: Chicago Purchasing Manager, est. 60.0, prior 61.1
  • 9:55 a.m.: UMich Confidence, July final, est. 64.0, prior 63.8
  • 10 a.m.: NAPM Milwaukee, est. 56.9, prior 59.3
  • 1 p.m.: Baker Hughes rig count
  • 3:15 p.m.: Fed’s Bullard, Lockhart discuss monetary policy in Wyoming

WHAT TO WATCH:

  • Treasury contingency plan on debt is said to give priority to bondholders. Obama officials said to release plan no earlier than after the close of markets today.
  • Spain faces Moody’s rating reduction from Aa2 

COMMODITY/GROWTH EXPECTATION

 

THE HEDGEYE DAILY OUTLOOK - daily commodity view

 

 

COMMODITY HEADLINES FROM BLOOMBERG:

  • Sugar Exports From India at Four-Year High May Cool Prices
  • Sugar Falls as Surplus May Become Available; Coffee Advances
  • Gold May Fall in London as Rally to Record Spurs Investor Sales
  • Copper May Fall on Concern About Potential U.S. Debt Default
  • Nickel Surplus to Narrow on China’s Demand, Sumitomo Says
  • Gold May Repeat 1970-80 Bull Market on Europe Debt, U.S : Citi
  • China May Boost Corn Imports to Record on Re-Stocking, Hog Herds
  • Coffee May Decline 15% to Fibonacci Level: Technical Analysis
  • BHP Chile Workers Vow to Prolong Strike at Biggest Copper Mine
  • Gasoline Profit Doubling Cuts Naphtha to Asia: Energy Markets
  • Vale Plans $3 Billion Dividend as Net Income Misses Estimates
  • Gold May Decline as Rally to Record Spurs Sales, Survey Shows
  • China Gold Demand May Surpass India This Year, Goldcorp Says
  • Radiation-Free Food Bolsters South Korea’s Exports to Japan

CURRENCIES

 

THE HEDGEYE DAILY OUTLOOK - daily currency view

 

 

EUROPEAN MARKETS

  •  EUROPE: ring the gong; this Europig mess has nothing to do w/ Congress; straight down this wk across Europe b/c debt maturities ramp in AUG
  • UK Jul house prices (0.4%) y/y vs consensus (0.9%) andn prior (1.1%)
  • Germany June retail sales (1.0%) y/y vs consensus (1.8%), prior revised +3.1% from +2.2%
  • France June consumer spending +1.2% vs consensus +0.5%, prior revised (0.3%) from (0.8%)
  • France June producer prices (0.1%) vs consensus +0.1%and prior (0.5%)
  • UK Jun mortgage approvals 48.4k vs consensus 46.0K
  • EuroZone July flash CPI +2.5% vs consensus +2.7%

THE HEDGEYE DAILY OUTLOOK - Europe

 

 

ASIAN MARKETS

  • ASIA ugly overnight with Taiwan down the most on a slowing economy and the TSMC miss
  • Japan June core CPI +0.4% y/y vs cons +0.5%; overall household spending (4.2%) y/y vs cons (2.3%).

THE HEDGEYE DAILY OUTLOOK - Asia Pacific

 

 

MIDDLE EAST

 

THE HEDGEYE DAILY OUTLOOK - Middle East

 

 

 

Howard Penney

Managing Director


Cartoon of the Day: Hard-Headed Bears

How's this for "hard data"? So far, 107 of 497 S&P 500 companies have reported aggregate sales and earnings growth of 4.4% and 13.2% respectively.

read more

Premium insight

McCullough [Uncensored]: When People Say ‘Everyone is Bullish, That’s Bulls@#t’

“You wonder why the performance of the hedge fund indices is so horrendous,” says Hedgeye CEO Keith McCullough, “they’re all doing the same thing, after the market moves. You shouldn’t be paid for that.”

read more

SECTOR SPOTLIGHT Replay | Healthcare Analyst Tom Tobin Today at 2:30PM ET

Tune in to this edition of Sector Spotlight with Healthcare analyst Tom Tobin and Healthcare Policy analyst Emily Evans.

read more

Ouchy!! Wall Street Consensus Hit By Epic Short Squeeze

In the latest example of what not to do with your portfolio, we have Wall Street consensus positioning...

read more

Cartoon of the Day: Bulls Leading the People

Investors rejoiced as centrist Emmanuel Macron edged out far-right Marine Le Pen in France's election day voting. European equities were up as much as 4.7% on the news.

read more

McCullough: ‘This Crazy Stat Drives Stock Market Bears Nuts’

If you’re short the stock market today, and your boss asks why is the Nasdaq at an all-time high, here’s the only honest answer: So far, Nasdaq company earnings are up 46% year-over-year.

read more

Who's Right? The Stock Market or the Bond Market?

"As I see it, bonds look like they have further to fall, while stocks look tenuous at these levels," writes Peter Atwater, founder of Financial Insyghts.

read more

Poll of the Day: If You Could Have Lunch with One Fed Chair...

What do you think? Cast your vote. Let us know.

read more

Are Millennials Actually Lazy, Narcissists? An Interview with Neil Howe (Part 2)

An interview with Neil Howe on why Boomers and Xers get it all wrong.

read more

6 Charts: The French Election, Nasdaq All-Time Highs & An Earnings Scorecard

We've been telling investors for some time that global growth is picking up, get long stocks.

read more

Another French Revolution?

"Don't be complacent," writes Hedgeye Managing Director Neil Howe. "Tectonic shifts are underway in France. Is there the prospect of the new Sixth Republic? C'est vraiment possible."

read more

Cartoon of the Day: The Trend is Your Friend

"All of the key trending macro data suggests the U.S. economy is accelerating," Hedgeye CEO Keith McCullough says.

read more