TODAY’S S&P 500 SET-UP - August 17, 2011
As we look at today’s set up for the S&P 500, the range is 35 points or -1.83% downside to 1172 and 1.10% upside to 1207.
SECTOR AND GLOBAL PERFORMANCE
EQUITY SENTIMENT:
- ADVANCE/DECLINE LINE: +591 (-1525)
- VOLUME: NYSE 972.85 (-14.1%)
- VIX: 31.58 -3.9% YTD PERFORMANCE: +77.92%
- SPX PUT/CALL RATIO: 2.23 from 1.41 +58.16%
CREDIT/ECONOMIC MARKET LOOK:
FIXED INCOME: Yield Spread (UST) continues to compress this morn (10s-2s = 191bps) = explicit signal that US Growth is still slowing.
- TED SPREAD: 29.27
- 3-MONTH T-BILL YIELD: 0.01%
- 10-Year: 2.23 from 2.29
- YIELD CURVE: 2.09 from 2.17
MACRO DATA POINTS (Bloomberg Estimates):
- 8:30 a.m.: Consumer Price Index (MoM), Jul, est. 0.2%; prior -0.2%
- 8:30 a.m.: Initial Jobless Claims, Aug 13, est. 400k; prior 295k
- 9:45 a.m.: Bloomberg Consumer Comfort, Aug 14, prior -49.1
- 10:00 a.m.: Philadelphia Fed Business Outlook Survey, Aug, est. 2.0, prior 3.2
- 10:00 a.m.: Existing Home Sales, Jul, est. 4.9m; prior 4.77m
- 1:00 p.m.: U.S. to auction $12b 5-yr TIPS (reopening)
- 2:30 p.m.: Fed’s Dudley to tour Jersey City, NJ
WHAT TO WATCH:
- Morgan Stanley cut est. for global growth to 3.9% this year, down from 4.2%, while Deutsche Bank said China’s economy may expand less than 9% in 2011, 2012
- Rep. Barney Frank, D-Mass., asked Fed to extend examination of Capital One’s acquisition of ING Direct USA, in letter yesterday
- DOJ investigating whether S&P executives overruled when analysts wanted to give lower ratings on mortgage bonds: NYT
- Sen. Charles Grassley, R-Iowa, asked SEC to answer allegations agency destroyed files from initial investigations of firms including Goldman Sachs, SAC Capital, Bernard Madoff Investment
- Coca-Cola plans $4b in new spending in China over next 3 years: WSJ, citing CEO Muhtar Kent
- Pemex announces results of auctions for contracts to operate three Tabasco oil fields. Watch Schlumberger, Halliburton
- GE CEO Jeff Immelt speaks at Dartmouth in PM
- Dept. of Interior, Exxon said to be fighting over significant oil find in Gulf of Mexico which co. says may yield 1b bbl: WSJ
- Forest Labs hosts annual meeting, with Carl Icahn nominating 4 to the board
- Target hosts investor meeting, to lay some financial goals beyond this year
- MGM Resorts founder Kirk Kerkorian said to complete sale of 20m shares yesterday, cutting Tracinda stake to 22% from 27%: WSJ
- ArcelorMittal, Peabody send bidder’s statement to MacArthur Coal holders today; cos. call takeover offer “compelling”
- No IPOs expected to price today
COMMODITY/GROWTH EXPECTATION
MOST POPULAR COMMODITY HEADLINES FROM BLOOMBERG:
- Gold Futures Climb 1.5% to Record $1,819.90 an Ounce in New York
- Oil Falls in New York on Signs Slowing Economy May Curb Demand
- Copper Falls as Banks Reduce Global, Chinese Growth Estimates
- Corn Falls Most in More Than a Week as U.S. Rain May Aid Crops
- Sugar May Advance as Asia Boosts Purchases, Coffee Declines
- Gold Demand Falls 17% on Slower ETP Investment, Council Says
- China Gold Investment Demand Jumps 44% on Rising Inflation
- Chavez Orders $11 Billion of Gold Home as Metal Hits Record
- Debt Funds Dumped as Gold Flows Jump 74% in Crisis: India Credit
- Oil Refiners Delay Maintenance as Profits Surge: Energy Markets
- India Monsoon Rain Revival Lifts Rice, Cotton Crop Prospects
- JPMorgan Said to Move Global Agriculture Head to Singapore
- Sugar Sales in China Unlikely to Plug Shortfall as Imports Gain
- U.S. Commodities Day Ahead: Gold Rises Above $1,800 on Slowdown
- Venezuela Gold Move Shows Foreign-Storage Discomfort, UBS Says
- British Farmland Values Rise to a Record on Commodity Prices
CURRENCIES
EUROPEAN MARKETS
- Europe Stocks Drop as Officials Say Fed Shouldn’t Shield Market
- ECB Daren’t Blink as It Stares Down Bond Yields: Euro Credit
- Barclays Sees ‘Very Real Competition’ From Chinese Firms
- Europe Construction Output Falls on Declines in Germany, France
- Foster’s Says SABMiller $10 Billion Takeover Offer Too Low
- Denmark’s Regional Banks Dump Assets to Avoid Funding Wall
- Czech Koruna May Be Next Franc Before Euro QE, Record Plc Says
- Gilt Yields Drop to Record Low, Pound Slips on Retail Sales Data
- RTS Futures Fall as Growth Woes Trump Oil Gain: Russia Overnight
- Swiss Swap Rates Turn Negative on Franc Fight: Chart of the Day
- Financial Turmoil Adds to Allure of Europe’s Best Properties
- Maserati Made in Michigan Lets Chrysler Drive Luxury SUV: Cars
ASIAN MARKETS
- Biden Meets China’s Xi to Build ‘Personal Relationship’
MIDDLE EAST
Howard Penney
Managing Director
