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    MARKET EDGES

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THE HEDGEYE BREAKFAST MONITOR

MACRO NOTES

Comments from CEO Keith McCullough

US stocks continue to hang in at their YTD highs on really bad volume and skew signals:

  1. JAPAN – evidently the Bank of Japan agrees with us in that they could have liquidity issues come the ides of March (massive sov debt spike). Surprisingly, the BOJ announced another 10 TRILLION Yens (lots of Yens) in easing last night; this lifted stocks and debauched the Yen. We’re finally seeing the 1.30 TREND line of YEN/USD snap. Stay tuned…
  2. COPPER – the Doctor took a good look at his long-term TAIL of resistance ($3.98/lb) and not only backed off but is now breaking down through 3.87/lb immediate-term TRADE support. Watching that global growth signal closely as Hong Kong’s Finance Secretary warned of potentially seeing a down y/y Q111 GDP growth print.
  3. TREASURIES – the 10yr continues to trade between the rock (TRADE support = 1.96%) and the harder place (TREND resistance = 2.03%); still signaling a US Growth Slowdown in FEB (sequentially) as the Yield Spread (10/2s) compresses by 5bps day/day here…

Moodys, thanks for coming out.

KM

 

SUBSECTOR PERFORMANCE

THE HBM: DPZ, MCD, CMG, DRI, TXRH - stocks

 

QUICK SERVICE

DPZ: Domino’s Pizza was rated New Hold at Miller Tabek, price target $36.

MCD: McDonald’s said on Monday that it will work with its U.S. pork suppliers to phase out the use of gestation crates, the cramped stalls that millions of mother sows are confined to while they raise piglets, according to Reuters.

CMG: Chipotle’s first national TV ad, aired during the Grammy’s, overshadowed even Coldplay’s performance according to adage.com. 

NOTABLE PERFORMANCE ON ACCELERATING VOLUME:

PNRA: Panera Bread underperformed yesterday.  Earnings last Tuesday disappointed on the top line.

 

CASUAL DINING


DRI: Darden Restaurants is rated New Equalweight at Stephens.

TXRH: SAC Capital reported a passive stake in Texas Roadhouse equal to 5.4%.

NOTABLE PERFORMANCE ON ACCELERATING VOLUME:

Volume was low overall in the casual dining space yesterday.

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Howard Penney

Managing Director

Rory Green

Analyst