TODAY’S S&P 500 SET-UP - September 21, 2011
As we look at today’s set up for the S&P 500, the range is 41 points or -1.17% downside to 1188 and 2.24% upside to 1229.
SECTOR AND GLOBAL PERFORMANCE
EQUITY SENTIMENT:
- ADVANCE/DECLINE LINE: -814 (+833)
- VOLUME: NYSE 926.25 (+1.97%)
- VIX: 32.86 -0.40% YTD PERFORMANCE: +85.13%
- SPX PUT/CALL RATIO: 1.91 from 2.33 (-17.87%)
CREDIT/ECONOMIC MARKET LOOK:
FIXED INCOME: UST Yields look like they want to make higher-lows on whatever Twizzler move Bernanke tries (or no move at all) this afternoon.
- TED SPREAD: 35.05
- 3-MONTH T-BILL YIELD: 0.01%
- 10-Year: 1.95 from 1.97
- YIELD CURVE: 1.77 from 1.81
MACRO DATA POINTS (Bloomberg Estimates):
- 7 a.m.: MBA Mortgage Applications
- 10 a.m.: Existing home sales, est. 4.75m (up 1.7% M/m)
- 10:30 a.m.: DoE inventories
- 2:15 p.m.: FOMC rate decision
WHAT TO WATCH:
- FOMC may decide to replace short-term Treasuries in its $1.65t portfolio with long-term bonds; Jefferies estimates $300b-sized action for “Operation Twist”
- European officials to return to Greece next week to complete review of economy; Greece to hold Cabinet meeting to discuss accelerating budget cuts
- SABMiller reached deal to buy Foster’s for A$5.10-shr
- Google faces Senate panel today on the “Power of Google”
- PepsiCo reaffirms 2011 guidance, forms global snacks group
- FDA briefing docs due for 9/23 advisory panel on Miltenyi Biotec’s CliniMACS CD34 Selection System
- Boeing is on schedule to deliver first 787 next week, CEO McNerney said at forum: WSJ
- Obama addresses U.N. General Assembly as Palestinians prepare to seek full membership at the Security Council and the U.S. promises a veto
COMMODITY/GROWTH EXPECTATION
COMMODITIES: Gold fails (again) at the Hedgeye TRADE line of resistance ($1820).
MOST POPULAR COMMODITY HEADLINES FROM BLOOMBERG:
- Bullion Vaults Run Out of Space as Gold Rallies: Commodities
- PepsiCo Poised for 49% Gain Imitating Kraft Breakup: Real M&A
- Wild West Comes to India Where Miners Defy Supreme Court Rule
- Lynas Slumps Most in Two Years on Rare Earths Price Drop
- Corn May Reach Record on Supply ‘Nervousness,’ Newedge Says
- Oil Drops in New York on Bets of Lower Demand, Higher Supplies
- BHP Says Global Imbalances, High Debt Creating Uncertainty
- Gold May Gain for Second Day on Growth Concerns, Fed Speculation
- European Naphtha Exports Sinking to Year’s Low: Energy Markets
- Rice to Drop as Indian Exports Intensify Export Competition
- Parrilla Hires Ex-CastleBay Manager for Commodity Hedge Fund
- Copper Climbs in New York on Speculation Fed Will Support Growth
- Copper Imports by China Climb for Third Month on Low Stocks
- Wheat Advances for a Second Day on Unfavorable Crop Conditions
- Global Sugar Market Will Be in Surplus in 2011-2012, Licht Says
- Copper Rises in London as Fed Meets to Boost Growth: LME Preview
CURRENCIES
EUROPEAN MARKETS
EUROPE: down, but not the disaster the shorts need here to keep getting paid (Italy is up small this morn and DAX sitting on TRADE line)
GERMANY: at 5514 DAX is still in crash mode (down -27% from May), but up +10% from the Sept12 capitulation low
ASIAN MARKETS
ASIA: bottoming process in the KOSPI (Korea) could be in motion w/ a TRADE line breakout back above the critical 1813 line; China up +2.7%
MIDDLE EAST
Howard Penney
Managing Director