THE HEDGEYE DAILY OUTLOOK
TODAY’S S&P 500 SET-UP - August 31, 2011
Despite a significant downturn in equity prices during August, the S&P 500 is now 10% “off the lows” into month-end. The market faces a difficult macro calendar in September including another attempt from the Obama administration to jump-start the economy. As we look at today’s set up for the S&P 500, the range is 62 points or -3.95% downside to 1165 and 1.16% upside to 1227.
SECTOR AND GLOBAL PERFORMANCE
EQUITY SENTIMENT:
- ADVANCE/DECLINE LINE: +762 (-1722)
- VOLUME: NYSE 1017.24 (+11.51%)
- VIX: 32.89 +1.89% YTD PERFORMANCE: +85.30%
- SPX PUT/CALL RATIO: 1.84 from 2.26 -18.61%
CREDIT/ECONOMIC MARKET LOOK:
- TED SPREAD: 32.05
- 3-MONTH T-BILL YIELD: 0.01% -0.01%
- 10-Year: 2.19 from 2.28
- YIELD CURVE: 1.99 from 2.08
MACRO DATA POINTS (Bloomberg Estimates):
- 7 a.m.: MBA Mortgage Applications, prior (-2.4%)
- 7:30 a.m.: Challenger Job Cuts, prior 59.4%
- 8:15 a.m.: ADP Employment, est. 100k, prior 114k
- 9:45 a.m.: Chicago Purchasing, est. 53.3, prior 58.8
- 10 a.m.: Factory orders, est. 2%, prior (-0.8%)
- 10 a.m.: NAPM Milwaukee, est. 52.7, prior 57.6
- 10:30 a.m.: DoE inventories
- 12:30 p.m.: Fed’s Lockhart speaks on economy in Lafayette, La.
WHAT TO WATCH:
- Tropical Storm Katia may become hurricane later today, National Hurricane Center says; path uncertain
- Lions Gate (LGF): Carl Icahn agreed to sell his Lions Gate shares for $7 each to end battle for control over the studio. Parties agreed to end all litigation
COMMODITY/GROWTH EXPECTATION
MOST POPULAR COMMODITY HEADLINES FROM BLOOMBERG:
- Containers Slump to 50-Year Low as Sales Slow: Freight Markets
- Mongolia Said to Plan Three-City IPO for Tolgoi Next Year
- Oil Heads for Monthly Decline as Slower Growth Curbs Demand
- Coal Discount Shrinking in Asia on Japan Rebound: Energy Markets
- Copper Set for First Monthly Drop in Three on Growth Concern
- Colombia Raises Gold Reserves by 2.3 Tons in July, IMF Data Show
- Oil at 4-Week High as Stimulus Speculation Counters Supply Gain
- Chan Exits Sino-Forest 22 Years After Tiananmen ‘Nightmare’
- Oil Rises to Highest Level in Almost Four Weeks as Fuels Climb
- Vietnam Coffee Said to Be Trading at Discount on Record Harvest
- U.S. Natural Gas Output Rises to Highest Since January 2005
- Gold Rises in New York on Expectations Fed Will Continue to Ease
- Sugar to Drop as Europe, India Boost Supplies, Kingsman Says
- Commodity Shipping Costs Fall as China Ore Stockpiles at Record
- Coffee Rallies as World Supply May Tighten; Cocoa, Sugar Decline
- Rubber Drops From Three-Week High on Concern Economy to Slow
- Wheat Drops on Speculation Demand for U.S. Exports May Shrink
- Copper Rises to Three-Week High on U.S. Economic-Growth Outlook.
CURRENCIES
EUROPEAN MARKETS
- Germany Jul retail sales (1.6%) y/y vs consensus (1.9%), prior revised (2.1%) from (1.0%)
- Germany Aug unemployment change (8K) vs consensus (10K), unemployment rate +7.0% vs consensus +7.0%
- Greece is burning down 4%
ASIAN MARKETS
- Most Asian markets traded higher this morning despite weak US consumer confidence; China’s performance was uninspiring +0.03%
MIDDLE EAST
Howard Penney
Managing Director