TODAY’S S&P 500 SET-UP – February 2, 2012

As we look at today’s set up for the S&P 500, the range is 9 points or -0.54% downside to 1317 and 0.14% upside to 1326. 











  • ADVANCE/DECLINE LINE: 1973 (1456) 
  • VOLUME: NYSE 892.64 (-13.69%)
  • VIX:  18.55 -4.58% YTD PERFORMANCE: -20.73%
  • SPX PUT/CALL RATIO: 1.68 from 1.56 (7.69%)



TREASURIES – if you only bet with the bond market for the last year on its implied growth slowing/accelerating signals, you’d have not been sucked into any of the lower-highs in US Equities (FEB 2011, APR 2011, JAN 2012). We bought the long-bond back yesterday as the 10yr yield looks like it wants to make lower-lows for the YTD.

  • TED SPREAD: 48.12
  • 3-MONTH T-BILL YIELD: 0.06%
  • 10-Year: 1.83 from 1.83
  • YIELD CURVE: 1.61 from 1.60

MACRO DATA POINTS (Bloomberg Estimates):

  • 7:30am: Challenger Job Cuts (Y/y), Jan.
  • 8:30am: Nonfarm Productivity (4Q P), est. 0.8% (prior 2.3%)
  • 8:30am: Jobless Claims, wk of Jan. 28, est. 370k (prior 377k)
  • 9am: Fed’s Evans speaks to reporters in Chicago
  • 9:45am: Bloomberg Consumer Comfort, week of Jan. 29
  • 10am: Fed’s Bernanke testifies before House Budget Committee
  • 7:15pm: Fed’s Fisher speaks in Austin, Texas


  • President Obama attends 60th National Prayer Breakfast, 7:30am
  • Fed Chairman Ben Bernanke testifies on U.S. economy before House Budget Cmte., 10am
  • Fannie Mae Chief Economist Douglas Duncan gives outlook for housing market to National Economists Club, noon
  • House transportation committee considers 5-yr, $260b highway construction bill
  • House, Senate in session:
    • House Energy and Commerce subcommittee receives report of blue-ribbon commission on America’s nuclear future, 9:30am (Will hear from FDA Commissioner Margaret Hamburg on reauthorization of the prescription drug user fee act) 10am
    • House-Senate payroll tax cut conference committee meets, 10am
    • House Budget Committee hears from CBO Director Doug Elmendorf on the economic outlook, 10am


  • ECB is likely to refuse to show its hand on how it will help cut Greece’s debt burden until investors and the govt. have agreed to a deal, economists said
  • U.S. retailers inc. Macy’s, Gap report Jan. comp sales; Retail Metrics est. 2% gain, would be weakest monthly sales growth since Oct. 2010
  • Glencore offered to buy outstanding $35b stake Xstrata that it doesn’t already own
  • Facebook filed to raise $5b in largest Internet IPO on record
  • IPO may value Mark Zuckerberg’s stake at $28.4b
  • MF Global risk chief switch stalled euro debt cut by 6 mos.
  • Ex-Credit Suisse CDO chief charged in scheme to boost bonuses
  • Deutsche Bank reported 76% drop in 4Q profit as sovereign debt crisis curbed trading
  • Sony Corp. more than doubled its annual loss forecast to $2.9b
  • AstraZeneca to cut 7,300 jobs
  • Deadline for states whether to join a proposed nationwide foreclosure settlement with banks to Feb. 6 from Feb. 3, Iowa’s Attorney General said


    • Cigna (CI) 6 a.m., $1.19
    • Diamond Offshore Drilling (DO) 6 a.m., $0.99
    • Starwood Hotels & Resorts Worldwide (HOT) 6 a.m., $0.57
    • Dow Chemical Co/The (DOW) 6:30 a.m., $0.31
    • PulteGroup (PHM) 6:30 a.m., $0.07
    • Roper Industries (ROP) 6:30 a.m., $1.21
    • Spectra Energy (SE) 6:30 a.m., $0.49
    • Boston Scientific (BSX) 7 a.m., $0.08
    • Cardinal Health (CAH) 7 a.m., $0.76
    • CME Group (CME) 7 a.m., $3.64
    • International Paper Co (IP) 7 a.m., $0.61
    • Merck & Co (MRK) 7 a.m., $0.95
    • National Oilwell Varco (NOV) 7 a.m., $1.30
    • Snap-on (SNA) 7 a.m., $1.18
    • Viacom (VIAB) 7 a.m., $1.05
    • Wisconsin Energy (WEC) 7 a.m., $0.47
    • Xcel Energy (XEL) 7 a.m., $0.30
    • Alliance Data Systems (ADS) 7 a.m., $1.49
    • Elizabeth Arden (RDEN) 7:04 a.m., $1.39
    • Goodrich (GR) 7:25 a.m., $1.57
    • Cummins (CMI) 7:30 a.m., $2.24
    • Sara Lee (SLE) 7:30 a.m., $0.25
    • TECO Energy (TE) 7:30 a.m., $0.28
    • Ryder System (R) 7:55 a.m., $0.97
    • Kellogg Co (K) 8 a.m., $0.62
    • Mastercard (MA) 8 a.m., $3.91
    • Cameron International (CAM) 8:15 a.m., $0.76
    • Blackstone Group (BX) 8:30 a.m., $0.40
    • New York Times (NYT) 8:30 a.m., $0.42
    • Royal Caribbean Cruises Ltd (RCL) 8:32 a.m., $0.16
    • Allergan (AGN) 9 a.m., $1.00
    • CareFusion (CFN) 4 p.m., $0.44
    • Edwards Lifesciences (EW) 4 p.m., $0.59
    • Principal Financial Group (PFG) 4 p.m., $0.75
    • Wynn Resorts Ltd (WYNN) 4 p.m., $1.29
    • Trimble Navigation Ltd (TRMB) 4 p.m., $0.48
    • Vertex Pharmaceuticals (VRTX) 4 p.m., $0.72
    • Fiserv (FISV) 4:01 p.m., $1.27
    • Sunoco (SUN) 4:01 p.m., $(0.29)
    • Stericycle (SRCL) 4:02 p.m., $0.74
    • Novellus Systems (NVLS) 4:04 p.m., $0.45
    • Con-way (CNW) 4:05 p.m., $0.36
    • Gilead Sciences (GILD) 4:05 p.m., $1.05
    • PerkinElmer (PKI) 4:05 p.m., $0.51
    • Take-Two Interactive Software (TTWO) 4:05 p.m., $0.23
    • Genworth MI Canada (MIC CN) 4:07 p.m., $0.78
    • Genworth Financial (GNW) 4:10 p.m., $0.19
    • Validus Holdings Ltd (VR) 4:15 p.m., $0.78



COPPER – the Doctor finally breaking its most immediate-term price momentum level of support of $3.83/lb this morning at the same time that Singaporean Stocks back off and moved red into the close. Stealth signals, but they’re leading ones that matter in our model. Copper’s long-term TAIL of 3.98/lb resistance intact – lower-highs.

  • Copper Falls on Signals Demand May Be Poised to Slow in China
  • Oil Falls to Six-Week Low as Stockpiles Rise, Fuel Demand Slips
  • Gold May Advance as European Debt Crisis Concerns Spur Demand
  • Glencore Makes Approach for Remaining $35 Billion Xstrata Stake
  • Colombia Drug Lords’ Cattle Theft Rob Rally Benefit: Commodities
  • Wheat Falls as Rain in U.S. Boosts Crop Prospects; Corn Drops
  • Coffee Falls for Sixth Session on Ample Supplies; Sugar Retreats
  • North Sea Oil Exports to Asia at 8-Year High: Energy Markets
  • Impala Fires 17,200 Workers at World’s Biggest Platinum Mine
  • Kinder Morgan Lapping Enbridge in Canadian Pipeline Race: Energy
  • Rail Bottlenecks Thwart India Efforts to End Blackouts: Freight
  • YPF Nationalization Concern Spurs Bond Plunge: Argentina Credit
  • Emerging Nations’ Buying to Drive Gold to Record, JPMorgan Says
  • Gold at Eight-Week High on Output, Dollar
  • Shell to Boost Dividend for First Time Since 2009 on Projects
  • EU Biofuels Targets to Cost Consumers $166 Billion, Study Says













CHINA – all of the high-frequency economic data (inflation accel, growth decel) looks primed to slow in FEB as both the Shanghai Comp (+2% last night) and the Hang Seng (+12.5% YTD!) move to immediate-term TRADE overbought signals. Plenty of Johnny come lately pundits, who we didn’t hear a peep from when we bought China in DEC, going bullish.










The Hedgeye Macro Team


Did the US Economy Just “Collapse”? "Worst Personal Spending Since 2009"?

This is a brief note written by Hedgeye U.S. Macro analyst Christian Drake on 4/28 dispelling media reporting that “US GDP collapses to 0.7%, the lowest number in three years with the worst personal spending since 2009.”

read more

7 Tweets Summing Up What You Need to Know About Today's GDP Report

"There's a tremendous opportunity to educate people in our profession on how GDP is stated and projected," Hedgeye CEO Keith McCullough wrote today. Here's everything you need to know about today's GDP report.

read more

Cartoon of the Day: Crash Test Bear

In the past six months, U.S. stock indices are up between +12% and +18%.

read more

GOLD: A Deep Dive on What’s Next with a Top Commodities Strategist

“If you saved in gold over the past 20 to 25 years rather than any currency anywhere in the world, gold has outperformed all these currencies,” says Stefan Wieler, Vice President of Goldmoney in this edition of Real Conversations.

read more

Exact Sciences Up +24% This Week... What's Next? | $EXAS

We remain long Exact Sciences in the Hedgeye Healthcare Position Monitor.

read more

Inside the Atlanta Fed's Flawed GDP Tracker

"The Atlanta Fed’s GDPNowcast model, while useful at amalgamating investor consensus on one singular GDP estimate for any given quarter, is certainly not the end-all-be-all of forecasting U.S. GDP," writes Hedgeye Senior Macro analyst Darius Dale.

read more

Cartoon of the Day: Acrophobia

"Most people who are making a ton of money right now are focused on growth companies seeing accelerations," Hedgeye CEO Keith McCullough wrote in today's Early Look. "That’s what happens in Quad 1."

read more

People's Bank of China Spins China’s Bad-Loan Data

PBoC Deputy Governor Yi says China's non-performing loan problem has “pretty much stabilized." "Yi is spinning. China’s bad-debt problem remains serious," write Benn Steil and Emma Smith, Council on Foreign Relations.

read more

UnderArmour: 'I Am Much More Bearish Than I Was 3 Hours Ago'

“The consumer has a short memory.” Yes, Plank actually said this," writes Hedgeye Retail analyst Brian McGough. "Last time I heard such arrogance was Ron Johnson."

read more

Buffalo Wild Wings: Complacency & Lack of Leadership (by Howard Penney)

"Buffalo Wild Wings has been plagued by complacency and a continued lack of adequate leadership," writes Hedgeye Restaurants analyst Howard Penney.

read more

Todd Jordan on Las Vegas Sands Earnings

"The quarter actually beat lowered expectations. Overall, the mass segment performed well although base mass lagging is a concern," writes Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan on Las Vegas Sands.

read more

An Update on Defense Spending by Lt. Gen Emo Gardner

"Congress' FY17 omnibus appropriation will fully fund the Pentagon's original budget request plus $15B of its $30B supplemental request," writes Hedgeye Potomac Defense Policy analyst Lt. Gen Emerson "Emo" Gardner USMC Ret.

read more