TODAY’S S&P 500 SET-UP - October 24, 2011


President Obama embarks on 3-day western state swing, with visits to Nevada, California and Colorado and is supposed to talk on housing and other economic issues. This is evidently what the Keynesians are working Bernanke on as well behind the scenes.   Putting in more policies to slow gravity will be interesting to observe.   As we look at today’s set up for the S&P 500, the range is 19 points or -1.47% downside to 1220 and 0.06% upside to 1239. 






THE HEDGEYE DAILY OUTLOOK - daily sector performance


THE HEDGEYE DAILY OUTLOOK - global performance




  • ADVANCE/DECLINE LINE: 2239 (+1608) 
  • VOLUME: NYSE 1190.31 (+24.23%)
  • VIX:  31.32 -9.95% YTD PERFORMANCE: +76.45%
  • SPX PUT/CALL RATIO: 2.12 from 1.40 (+51.23%)



  • TED SPREAD: 40.31
  • 3-MONTH T-BILL YIELD: 0.02%
  • 10-Year: 2.23 from 2.20    
  • YIELD CURVE: 1.93 from 1.92


MACRO DATA POINTS (Bloomberg Estimates):

  • 8:30 a.m.: Chicago Fed Nat Index: est. -0.21, prior -0.43
  • 8:45 a.m.: Fed’s Dudley to speak in the Bronx on the economy
  • 9:00 a.m.: Fed’s Fisher speaks in Toronto on U.S. economy
  • 11:30 a.m.: U.S. to sell $56b 3-mo., $27b 6-mo. bills
  • 1:00 p.m.: Fed’s Dudley to speak to Bronx Chamber of Commerce


  • Mattel announces acquisition of HIT Entertainment
  • European leaders ruled out tapping ECB’s balance sheet to boost the region’s rescue fund; outlined plans to aid banks
  • Turkey officials fear as many as 1,000 people died in 7.2 earthquake yesterday, worst since 1999
  • China government official says CPI has reached turning point, will be under 5% in the next two months - Securities Times
  • Swiss banks will likely settle a sweeping U.S. probe of offshore tax evasion by paying billions of dollars and handing over names of thousands of Americans who have secret accounts, according to two people familiar with the matter

COMMODITY/GROWTH EXPECTATION                                             


COPPER – another mean reversion bounce off of an immediate-term TRADE oversold low; Copper would have to close > 3.49/lb to get above its TRADE line of resistance; TREND and TAIL for copper much higher at 3.94-4.13.


THE HEDGEYE DAILY OUTLOOK - daily commodity monitor




  • China Manufacturing Gauge Rises as Japanese Exports Advance
  • Hedge Funds Raise Bullish Bets Most in Two Months: Commodities
  • Thai Floods Spill Into Northern Bangkok After Levee Violence
  • Buffett-Backed Carmaker Comes Late With Fewer Jobs Than Promised
  • Sprott Buys Energy With Commodities at Recession Valuation
  • Saudi Crown Prince’s Death Raises Succession Questions
  • Roubini Sees 50% Chance of Recession in U.S., Eurozone, U.K.
  • Base Metals Extend Biggest Rally in Two Years on China Outlook
  • Gold Gains for a Second Day as Europe Debt Concerns Spur Demand
  • Oil Advances a Second Day on Asian Economic Growth, Europe Plan
  • Vale Losing to BHP on China Market-Share Concern: Brazil Credit
  • Hedge Funds Boost Oil Bets as Crude Prices Climb: Energy Markets
  • China Must Control Food Prices to Curb Inflation, Premier Says
  • China’s Steel Prices Decline Most Since 2008 Global Crisis
  • Floods in Southeast Asia May Cause Food Shortages, UN Says
  • Wal-Mart’s Rivals in China May Gain Ground After Pork Probe
  • Oil Advances a Second Day on Asian Economic Growth, Europe Plan
  • ABN Expands Energy, Commodities and Transportation Division
  • JSW Steel Said to Consider a Bid for Australian Miner New Hope




EURO – With the ECB backing off being a big part of the bazooka, I don’t think the media gets what that means – markets do; the Euro is backing off my TAIL zone of resistance 1.39-1.40 and every single market in Europe (stocks) has failed at my TREND lines of resistance again – Greece and Cyprus are crashing again, down -4.9% and -6.9% on the day, respectively.

THE HEDGEYE DAILY OUTLOOK - daily currency view





Eurozone Oct Manufacturing preliminary 47.3 PMI  vs consensus 48.0 and prior 48.5

Eurozone Aug Industrial new orders +6.2% y/y vs +5.7% consensus and prior revised to +8.9% from +8.4%; Eurozone Aug Industrial new orders +1.9% m/m vs consensus +0.2% and prior revised (1.6%) from (2.1%)

THE HEDGEYE DAILY OUTLOOK - euro performance





CHINA – the flash PMI print came in at 51.1 which means Asia could stop going down for the day; context: last week, Asian equity markets were down -1.2% week/week on a median basis.   Losses were led by China (-4.7%) and Thailand (-4.1%), as both struggled with heightening domestic risks. The Hang Seng closed back > its TRADE line of 18,344 on a +4.1% move.




THE HEDGEYE DAILY OUTLOOK - asia performance








The Hedgeye Macro Team

Howard Penney

Managing Director

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