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THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP - October 19, 2011

Another day and another rumor that France and Germany has it all figured out.  We see bigger problems ahead.  As we posted yesterday, “FRANCE IS GOING TO GET DOWNGRADED and we continue to be Short EUR-USD (FXE).  France’s credit rating is going to get downgraded – now the question is when, and what becomes of the EFSF? 

As we look at today’s set up for the S&P 500, the range is 43 points or -2.40% downside to 1196 and 1.11% upside to 1239

SECTOR AND GLOBAL PERFORMANCE

THE HEDGEYE DAILY OUTLOOK - hrmsv

THE HEDGEYE DAILY OUTLOOK - bpgm1

THE HEDGEYE DAILY OUTLOOK - hrmsp

 

EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: +2074 (+3961) 
  • VOLUME: NYSE 1085.27 (+19.85%)
  • VIX:  31.56 -5.48% YTD PERFORMANCE: +77.80%
  • SPX PUT/CALL RATIO: 1.64 from 2.05 (-20.21%)

 

CREDIT/ECONOMIC MARKET LOOK:

 

  • TED SPREAD: 39.39
  • 3-MONTH T-BILL YIELD: 0.04%
  • 10-Year: 2.19 from 2.18     
  • YIELD CURVE: 1.91 from 1.90

 

MACRO DATA POINTS (Bloomberg Estimates):

  • 7 a.m.: MBA Mortgage, prior 1.3%
  • 8:30 a.m.: Consumer Price Index, M/m, est. 0.3%, prior 0.4%
  • 8:30 a.m.: Fed’s Rosengren speaks at Boston Fed conference
  • 8:30 a.m.: Housing starts, est. 590k, prior 571k
  • 8:30 a.m.: Building permits, est. 610k, down 2.4%
  • 9 a.m.: Fed’s Lockhart speaks on Latin America in Atlanta
  • 10:30 a.m.: DoE inventories
  • 2 p.m.: Fed Beige Book
  • 4:30 p.m.: Fed’s Lockhart speaks on leadership in Atlanta

WHAT TO WATCH:

  • Apple shares drop after missing 4Q sales, EPS est.; Apple says 1Q will be best yet for iPhone sales
  • Consumer prices probably climbed 0.3% in September, smallest gain in three months, economists est. ahead of today’s report
  • UAW ratified proposed contract with Ford, largest UAW-Ford Local 600 in Dearborn said last night
  • President Obama wraps up bus tour of North Carolina, Virginia
  • Day two of Western Republican Leadership Conference in Las Vegas, with Republican presidential candidates among speakers

COMMODITY/GROWTH EXPECTATION                                             

OIL: gets squeezed right back up to our intermediate-term TREND line of resistance of $89.12 WTIC.  

We shorted shorted OIL yesterday

THE HEDGEYE DAILY OUTLOOK - dcommv

 

MOST POPULAR COMMODITY HEADLINES FROM BLOOMBERG:

  • Nespresso Customers Cheat on Clooney in Coffee Wars: Retail
  • Most Accurate China Analyst Sees No Sudden Policy Easing
  • Sugar Shortages Pummel Europe as World Glut Grows: Commodities
  • Maersk Shareholders Suffering With Too Many Containers: Freight
  • Bakken Turns Oasis Into Target as Fracking Costs Slide: Real M&A
  • BNP Paribas Sued by U.S. Over Banker’s Alleged Role in Fraud
  • Oil Trades Near Highest in a Month as Goldman Sees ’Upside Risk’
  • Gold Falls for Third Day as Rescue-Fund Report Limits Demand
  • CFTC Votes 3-2 to Approve Limits on Commodity Speculation
  • Copper Drops for Third Day as Europe’s Crisis May Curb Demand
  • De Beers CEO Says Diamond Prices May ‘Stick’ After 35% Gain
  • Years of Wal-Mart Violations Forced China Action, Official Says
  • Soybean Imports by China May Jump 22%, Noble Group Says
  • Rice May Rally on Thai Floods, State Buying, Sumeth Says
  • Vale May Discuss Iron-Ore Price as Clients Seeks Better Deal
  • Singapore Exchange Iron-Ore Swaps Post Record Daily Volume
  • Oil Trades Near Highest in a Month as Goldman Sees ‘Upside Risk’
  • COMMODITIES DAYBOOK: Copper, Oil Fall on Global Growth Concern
  • Wheat Gains a Fourth Day as Cold Weather May Hurt Russian Crop
  • Copper Drops as China, Europe Dim Demand Outlook: LME Preview

CURRENCIES                                                        

THE HEDGEYE DAILY OUTLOOK - dcurrv

 

EUROPEAN MARKETS

EUROPE: continues to see support at the TRADE lines in the DAX, CAC, MIB, etc; people are scared to be short the bazooka, rightfully

THE HEDGEYE DAILY OUTLOOK - bpem1

 

ASIAN MARKETS

ASIA: mixed moves with HK recapturing its TRADE line of 18245 support as China continues to fall (down another -0.25%)

THE HEDGEYE DAILY OUTLOOK - bpam1

 

MIDDLE EAST

THE HEDGEYE DAILY OUTLOOK - me

The Hedgeye Macro Team

Howard Penney

Managing Director