THE HEDGEYE DAILY OUTLOOK
TODAY’S S&P 500 SET-UP - November 14, 2011
Super Mario II not having the impact some hoped he might...
As we look at today’s set up for the S&P 500, the range is 21 points or -1.25% downside to 1248 and 0.41% upside to 1269.
SECTOR AND GLOBAL PERFORMANCE
EQUITY SENTIMENT:
- ADVANCE/DECLINE LINE: +2177 (+1016)
- VOLUME: NYSE 762.30 (-15.31%)
- VIX: +30.04 -8.44 YTD PERFORMANCE: +69.24%
- SPX PUT/CALL RATIO: 1.48 from 1.96 (-24.55%)
CREDIT/ECONOMIC MARKET LOOK:
BOND YIELDS – Italy issued another roll of piig paper at 6.29% (5yr!), so the bond market continues to have European Stagflation right as the US Treasury market has Growth Slowing (Q4 vs Q3) right; immediate-term TRADE line of resistance for UST 10yr yields = 2.13%.
- TED SPREAD: 45.22
- 3-MONTH T-BILL YIELD: 0.01%
- 10-Year: 2.04 from 2.00
- YIELD CURVE: 1.80 from 1.76
MACRO DATA POINTS (Bloomberg Estimates):
- 8:30am: NOPA monthly oil stocks
- 11am: Weekly export inspections: corn, soybeans, wheat
- 11:30am: U.S. to sell $29b 3-mo., $27b 6-mo. bills
- 4pm: Weekly crop conditions
WHAT TO WATCH:
- Banks adding fees under the radar – NYT
- Mitsubishi UFJ Morgan Stanley Securities to privately place ¥40-50B of shares this month – Nikkei
- AMAZON.com willing to lose hundreds of millions of dollars annually on Amazon Prime – WSJ
- Iraq threatens to kick Exxon Mobil out of country - Independent on Sunday
- Former EU Competition Commissioner Mario Monti will head a new Italian govt after Prime Minister Silvio Berlusconi resigned.
- German Chancellor Angela Merkel said EU must forge closer union to send a message to bondholders that leaders are serious about ending the sovereign debt crisis
COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)
- Hu Pledges More China Imports as IMF’s Zhu Sees ‘Soft Landing’
- Oil Trades Near Highest Since July as Italy Rebuilds Government
- Wheat Shippers Fight for Sales as Grain Glut Grows: Commodities
- Ethanol Futures at Records as U.S. Ousts Brazil: Energy Markets
- Gold May Gain as New European Leadership Limits Dollar Demand
- Iron Ore Seen Extending Advance on Chinese Steelmaker Demand
- Sugar Harvest in India Seen Missing Forecast as Yields Drop
- Copper Extends Gains on New European Leadership, Stockpile Drop
- Rusal’s Third-Quarter Net Jumps 15-Fold, Beating Estimates
- Nickel Surplus May Jump to Most in Four Years on Slow Demand
- Palm Oil May Advance to 4,000 Ringgit by June, Mistry Says
- Codelco Said to Offer Copper Premium at $110 to China Buyers
- Copper Jumps Most in Two Weeks on Japan’s Growth: LME Preview
- MF Trustee Fires Entire Broker-Dealer Workforce of 1,066
- Rubber Jumps Most in 8 Months as Car Output Resumes After Flood
- Aditya Birla Group Said to Make Bid for Aquila’s Washpool Mine
- Goldman Sees Commodity Prices Rising 15% in Next 12 Months
- Gold May Decline in London on Reduced European Debt Concern
CURRENCIES
EURO – Goldman made the call to buy the Euro on Friday, so we shorted it. We’re long the US Dollar and looking forward to Super Mario I (Draghi) being politicized to cut rates to zero = bad for the Euro, as is failing at this 1.37-1.38 TRADE zone of resistance
EUROPEAN MARKETS
CAC – France is where we want to be focusing our positioning as the media focuses where we’d been. Italy still matters obviously, but the French banks are in a much more precarious position. CAC fails, again, at the only line of support it had left (3169 TRADE line) as the MIB index does the same (fails at 15988 TRADE resist)
ASIAN MARKETS
MIDDLE EAST
POPULAR MIDDLE EAST HEADLINES FROM BLOOMBERG
- Boeing’s Record Emirates Deal Cements Wide-Body Lead Over Airbus
- Jibril Turns Against Foreign Powers That Aided Qaddafi Overthrow
- Syria Calls for Summit Meeting After Arab League Suspension
- Republican Answers on Iran Nukes Face Same Reality as Obama’s
- Dubai Sukuk Yield Rises to Month High on Europe: Islamic Finance
- Dana Gas Working With Banks on Refinancing $1 Billion Sukuk
- Airbus to Sign Qatar Airways Order Worth $6.5B, La Tribune Says
- Abu Dhabi Commercial Bank Said to Plan U.S. Dollar Sukuk Sale
- Dana Gas Net Quadruples to 143 Million Dirhams on Oil Prices
- Iraq to Recognize Kurdish Oil Deals With Foreign Explorers
- Yemen Seeks $4 Billion as Recession Worsens Crisis: Arab Credit
- Afren Rises After Completing Nigerian Oil Asset Purchase
- Iran Rejects Bahrain's Claim of Terror Cell Links
- Marfin Invest, Abu Dhabi Mar Reach Agreement on Investments
- Orascom Telecom Reports Third-Quarter Loss of $975,000
- Iraq Government Says Accord Made With Kurds on Oil Contracts
- Gulf Keystone Plans to Ship 20,000 Barrels a Day From Kurdistan
The Hedgeye Macro Team
Howard Penney
Managing Director
