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THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP - October 17, 2011

It should be as hard to sell/short this morning as it was to buy/cover on October 4th– every market (countries, currencies, commodities, etc) in Global Macro is now bullish TRADE; bearish TREND, making this a very tough spot not to cover.  Coming out of the G20 meetings this weekend, they loosely set everyone up for a bazooka event being timed for the October 23rdEU Summit meeting (Asia ripped last night on this and it’s been the #1 headline on Bloomberg since), but…

As we look at today’s set up for the S&P 500, the range is 63 points or -3.72% downside to 1179 and 1.42% upside to 1242

SECTOR AND GLOBAL PERFORMANCE

THE HEDGEYE DAILY OUTLOOK - levels 1017

THE HEDGEYE DAILY OUTLOOK - daily sector view

THE HEDGEYE DAILY OUTLOOK - global performance

 

EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: 2306 (+2703) 
  • VOLUME: NYSE 847.19 (-5.71%)
  • VIX:  28.24 -8.01% YTD PERFORMANCE: +59.10%
  • SPX PUT/CALL RATIO: 1.71 from 1.40 (+22.22%)

CREDIT/ECONOMIC MARKET LOOK:

  • TED SPREAD: 38.95
  • 3-MONTH T-BILL YIELD: 0.02%
  • 10-Year: 2.26 from 2.19     
  • YIELD CURVE: 1.98 from 1.90

 

MACRO DATA POINTS (Bloomberg Estimates):

  • 8:30 a.m.: Empire Manufacturing, est. (-4.00)
  • 9:15 a.m.: Industrial production, est. 0.2%
  • 9:15 a.m.: Capacity utilization, est. 77.5%
  • 11:30 a.m.: U.S. to sell $29b 3-mo., $27b 6-mo. bills
  • 7:30 p.m.: Fed’s Lacker speak on economy in Maryland
  • 8 p.m.: Fed’s Evans speaks in Detroit

WHAT TO WATCH:

  • Kinder Morgan agreed to purchase El Paso in a $21b cash-and- stock deal; watch other natural gas cos.
  • BP reached settlement with Anadarko Petroleum on all claims related to Deepwater Horizon accident in Gulf of Mexico
  • EU Economic and Monetary Affairs Commissioner Olli Rehn said clarity on plan to contain region’s debt crisis will emerge in “coming days”
  • Sales data for Apple’s iPhone 4S possible; note Apple will release quarterly earnings tomorrow

COMMODITY/GROWTH EXPECTATION                                                                    

THE HEDGEYE DAILY OUTLOOK - daily commodity view

MOST POPULAR COMMODITY HEADLINES FROM BLOOMBERG:

  • BP Says Anadarko to Pay $4 Billion to Settle Gulf Spill Claims
  • Hedge Funds Add to Wagers in Biggest Rally of 2011: Commodities
  • China Growth May Top 9% as Global Slump Poses ‘Biggest Risk’
  • Rio Tinto to Sell 13 Aluminum Assets in Australia, U.S., Europe
  • Oil Gains After Europe Pledges Debt Strategy; Bullish Bets Rise
  • Hedge Funds Raise Bullish Bets as Oil Rises $10: Energy Markets
  • Gold May Climb for Second Day With Equities on Europe Optimism
  • Copper Rises for Second Day as European Crisis May Be Contained
  • Fortescue Boosts Ore Shipments 21% to Meet Chinese Demand
  • Freeport Shuts Grasberg Mine After Blockade, Fatal Shooting
  • China Steel Prices, at 10-Month Low, May Trigger Output Cuts
  • Oil Trades Near Highest in a Month on Europe Debt Rescue Efforts
  • Gold Gains to 3-Week High on Europe Concern, Commodities Rally
  • Corn, Wheat Rise for Second Day on Stronger U.S. Export Sales
  • Copper Drops in London, Reversing Earlier Gains
  • Palm Oil Advances to Three-Week High as Europe May Avert Crisis
  • Rubber Climbs to Three-Week High After G-20, Thai Flood Concerns
  •  Floods May Damage 3.5 Million Tons of Thai Rice, Group Says

CURRENCIES                                                                             

THE HEDGEYE DAILY OUTLOOK - daily currency view

EUROPEAN MARKETS

GERMANY – Schaeuble (Finance Minister of Germany who carries the big stick) just hit the wires saying he doesn’t expect to have a bazooka solution by the 23rd – that’s a big timing problem – and one that I think will be ongoing (can send you replay/podcast if the call we did on this Friday if you need details). Timing matters, big time; especially with TREND lines broken

THE HEDGEYE DAILY OUTLOOK - euro performance

ASIAN MARKETS

SINGAPORE – stealth number that the manic media hasn’t even mentioned this morning, but Singapore put up a bomb of an export (non-oil) number for SEP at down -4.5% y/y (vs +3.9% in AUG, which was too low to begin with). Singapore is the trusted Chinese advisor and all market signals are saying China’s SEP numbers (tonight) could be bad

THE HEDGEYE DAILY OUTLOOK - asia performance

 

MIDDLE EAST

THE HEDGEYE DAILY OUTLOOK - MIDEAST PERFORMANCE

Howard Penney

Managing Director