THE HEDGEYE DAILY OUTLOOK

THE HEDGEYE DAILY OUTLOOK


TODAY’S S&P 500 SET-UP - November 29, 2011


We are once again seeing the “fun and games with month-end markups” on no volume.   Buyers beware of the US economic data Wednesday-Friday - expectations are too high.  If you want to get bulled up on something into the start of the new month, go with US Dollar (UUP) or Long-Bond (TLT) on red today.

 

As we look at today’s set up for the S&P 500, the range is 32 points or -1.81% downside to 1171 and 0.88% upside to 1203. 


 

SECTOR AND GLOBAL PERFORMANCE

 

THE HEDGEYE DAILY OUTLOOK - levels andtrends1128

 

THE HEDGEYE DAILY OUTLOOK - daily sector view

 

THE HEDGEYE DAILY OUTLOOK - global performance

 

 

EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: +2044 (+2429) 
  • VOLUME: NYSE 958.60 (+116.99%)
  • VIX:  +33.13 -6.79% YTD PERFORMANCE: +81.01%
  • SPX PUT/CALL RATIO: 2.71 from 1.88 (+44.21%)

 

CREDIT/ECONOMIC MARKET LOOK:

  • TED SPREAD: 50.66
  • 3-MONTH T-BILL YIELD: 0.03%
  • 10-Year: 1.97 from 1.97   
  • YIELD CURVE: 1.71 from 1.69

 

MACRO DATA POINTS (Bloomberg Estimates):

  • 7:45am/8:55am: ICSC/Redbook comp sales
  • 9am: S&P Case-Shiller, est. -.10% M/M, -3% Y/y
  • 10am: Consumer Confidence, est. 44.0 (prior 39.8)
  • 10am: Home price index (prior -0.6%)
  • 11:30am: Fed’s Yellen speaks on global recovery in SF
  • 11:30am: U.S. to sell $35b 4-wk bills
  • 12:15pm: Fed’s Raskin moderates panels in SF
  • 12:27pm: Fed’s Lockhart to speak on U.S. economy in Atlanta
  • 12:30pm: IMF publishes paper on capital flows
  • 4:30pm: Fed’s Williams speaks to reporters in SF
  • 4:30pm: API inventories
  • 7:30pm: ECB’s Stark speaks in Dallas
  • 8pm: Fed’s Kocherlakota speaks to reporters in Calif.

 

WHAT TO WATCH: 

  • Facebook said to consider raising ~$10b in IPO that would value it at more than $100b
  • Italy sold 6% 2014 bonds to yield 7.89%, up from 4.93% at Oct. 28 auction for 4.25% 2014 bonds; Italian-German 10-year yield spread shrinks 6 bps to 493 bps after auction
  • S&P may revise bank credit ratings within next week
  • Silver Lake said to be working with Microsoft to bid for minority stake in Yahoo!; Andreessen Horowitz also weighing possible bid
  • President Obama in Washington, meets with Dutch PM Mark Rutte
  • Secretary of State Clinton traveling to South Korea, Myanmar
  • House, Senate in session
  • Supreme Court in session, hearing arguments at 11am in case involving securities suits

 

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)

  • Speculators Cut Holdings to Lowest Since July 2009: Commodities
  • Stocks, Commodities Advance on Europe Outlook, U.S. Retail Sales
  • Oil Drops From One-Week High on Forecast U.S. Stockpiles Rose
  • Stopping Turkey Tails at the Border Pits Trade Against Health
  • Japan Extends Rice-Shipment Ban After Sales of Tainted Grain
  • Gold May Climb for Second Day With Equities Before European Meet
  • Chemicals Seen Boosting Odfjell as Demand Swamps Fleet: Freight
  • Copper Drops as Moody’s Considers Downgrading European Bank Debt
  • Oil Rises a Third Day as Euro, Stocks Signal European Confidence
  • Copper Mining ‘Issues’ Support Shortage Outlook, Citigroup Says
  • Thai Sugar Production to Reach Record as Floods Spare Crops
  • Copper Falls as Moody’s May Downgrade Europe Banks: LME Preview
  • Rio Wins Battle for Hathor as Cameco Says It Won’t Raise Bid
  • Oil Pares Decline Before European Debt-Crisis Talks; Brent Gains
  • Palm Oil Has Longest Losing Streak in Two Years on Europe Crisis
  • Icahn Bids for Commercial Metals in Deal Worth $1.73 Billion
  • Freeport Cerro Verde Workers Vote to End Two-Month Strike
  • Copper May Gain in London on Speculation About Supply Shortfall

 

THE HEDGEYE DAILY OUTLOOK - daily commodity view

 

 

CURRENCIES

 

EURO – another day, another hope that a USD selloff and a Euro rally is real. Unfortunately, the math is getting in the way of that; EUR/USD has an important short-term line of resistance that it’s been fighting for 48 hrs at 1.34; ultimately, the bigger lines that matter are TRADE and TAIL resistance of 1.36 and 1.40, respectively.

 

THE HEDGEYE DAILY OUTLOOK - daily currency view

 

 

EUROPEAN MARKETS

 

ITALY - On its shortest duration (the 2014 bonds) Italy Sells another €3.5B at 7.89%; a few months ago 6% was the "critical" line, then 7%, now I guess its 8%? C’mon. Let’s get as serious as Spread Risk is telling you to be here – Italian stocks are barely up this morning – and more importantly, down -37% since FEB (crashing) – no support for the MIB Index to 13,422

  • Eurozone Economic sentiment 93.7 vs consensus 94.00 and prior revised to 94.8 from 94.8
  • Eurozone Business Climate (0.44) vs consensus (0.30) and prior revised to (0.19) from (0.18)
  • Eurozone Industrial Sentiment (7.3) vs consensus (7.6) and prior revised to (6.5) from (6.6)
  • Eurozone Consumer Sentiment (20.4) vs consensus (20.4) and prior revised to (19.9) from (19.9)

THE HEDGEYE DAILY OUTLOOK - euro performance

 

 

ASIAN MARKETS

 

INDIA – stocks decided a 1-day rally to a lower-high was enough. Inflation isn’t going away on EUR/USD up days because Oil prices aren’t going down (Brent $110/barrel last), and Indian stocks don’t like sticky stagflation – down -1% overnight, taking the Sensex to 16,002 (down -22% for 2011 YTD).

 

THE HEDGEYE DAILY OUTLOOK - asia performance

 

 

MIDDLE EAST

  • Broad, Gagosian, Qatar Sheikha, Ai Weiwei Make Art Power List
  • Bangladesh Bank Rules Lure Standard Chartered: Islamic Finance
  • U.A.E. Starts Investing in U.S. Treasuries With Better Rates
  • Heroin Hidden in Raisins From Iran Seized in Sydney, Police Say
  • Syria Says Sanctions Are ‘Economic War’ as UN Reports Abuses
  • Iran Blast Reports in Nuclear Province Fuels Sabotage Suspicion
  • First Gulf Bank of Abu Dhabi Raises Foreign Ownership to 25%
  • Qatar Shares Climbs to One-Week High Before Europe Debt Meeting
  • GCC Banks Aim to Focus on SMEs, Youth and Women, Accenture Says
  • Hindustan Times: Iran threatens to bomb Turkey if US or Israel attack
  • Narrow-Body Engines Roar at Dubai Airshow, Led by CFM
  • Saudi Cable Won Orders Valued at 1.1 Billion Riyals This Month
  • Qatar Said to Sell Dollar Bonds Maturing in January 2017, 2022
  • Abu Dhabi Maintains Cuts in January Supply of Murban Crude
  • Kuwait Government Resigns Amid Growing Opposition Protests
  • Balfour Beatty Unit Wins GBP104m 5-Yr Qatar Consultancy Contract
  • OPEC Likely to Cut Output in December
  • First Gulf Gains Most in 2 Weeks on Foreign Ownership Limit

THE HEDGEYE DAILY OUTLOOK - MIDEAST PERFORMANCE

 

 

The Hedgeye Macro Team

Howard Penney

Managing Director


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