THE HEDGEYE DAILY OUTLOOK

02/17/12 07:35AM EST

TODAY’S S&P 500 SET-UP – February 17, 2012


As we look at today’s set up for the S&P 500, the range is 11 points or -0.74% downside to 1348 and 0.07% upside to 1359. 

 

SECTOR AND GLOBAL PERFORMANCE

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EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: 1541 (2009) 
  • VOLUME: NYSE 805.81 (-0.07%)
  • VIX:  19.22 -9.08% YTD PERFORMANCE: -17.86%
  • SPX PUT/CALL RATIO: 1.45 from 2.40 (-39.58%)

CREDIT/ECONOMIC MARKET LOOK:

  • TED SPREAD: 39.65
  • 3-MONTH T-BILL YIELD: 0.09%
  • 10-Year: 2.00 from 1.98
  • YIELD CURVE: 1.71 from 1.69 

MACRO DATA POINTS (Bloomberg Estimates):

  • 8:30am: CPI, M/m, Jan., est. 0.3% (prior 0.0%)
  • 10am: Leading Indicators, Jan., est. 0.5% (prior 0.4%)
  • 10am: API monthly report
  • 1pm: Baker Hughes rig count 

GOVERNMENT:

  • President Obama talks about U.S. manufacturing at Boeing plant in Everett, Wash. 11:25am
  • CFTC holds closed hearing on enforcement matters, 10am
  • Mitt Romney, Ron Paul make campaign appearances in Idaho; Rick Santorum visits Michigan; Newt Gingrich speaks in Georgia
  • House Energy meets to mark up resolution authorizing issuance of subpoenas in probe of federal loans to Solyndra. 9:45am
  • House Appropriations subcommittee hears from Agriculture Secretary Tom Vilsack on the agency’s budget. 10am
  • House Armed Services Committee hears from Army Secretary John McHugh, Army Chief of Staff Raymond Odierno on the budget request. 10am 

WHAT TO WATCH:  

  • Germany said to want euro-area finance chiefs to avoid two- step vote on EU130b Greek rescue and a bond swap to cut the nation’s debt load at a meeting next week
  • CME Group has made bid for London Metal Exchange; NYSE Euronext said to also be interested
  • Cost of living in the U.S. may have gained 0.3% in Jan. on higher prices for food and energy, economists est.
  • Networker John Kinnucan arrested by FBI in trading probe
  • CVR Energy said it will review Carl Icahn’s offer of at least $30-shr
  • Alibaba Group Holding said to plan to privatize its Alibaba.com unit close to its IPO price
  • U.S. ITC may rule on whether Apple infringed on a patent owned by smartphone maker HTC
  • U.K. Jan. retail sales rose 0.9%; median forecast 0.3% decline
  • German President Christian Wulff resigned amid the threat of a legal probe into corruption allegations 

 EARNINGS:

    • Amerigroup (AGP) 6:00am, $0.62
    • Encana (ECA CN) 6:00am, $0.10
    • Barnes Group (B) 6:30am, $0.32
    • HJ Heinz (HNZ) 7:00am, $0.85
    • Digital Realty Trust (DLR) 7:00am, $1.01
    • Enbridge (ENB CN) 7:00am, C$0.39
    • LifePoint Hospitals (LPNT) 7:00am, $0.76
    • Pilgrim’s Pride (PPC) 7:00am, $(0.30)
    • Ventas (VTR) 7:01am, $0.89
    • Campbell Soup (CPB) 7:30am, $0.62
    • HMS Holdings (HMSY) 7:30am, $0.15
    • Brookfield Asset Management (BAM/A CN) 8:00am, $0.51
    • Lincoln Electric Holdings (LECO) 8:06am, $0.63 

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)


OIL – never has Oil trading > $100/barrel not slowed both US and Global Consumption Growth. Maybe this time is different. Maybe it isn’t. Brent Oil busting to new highs this morning on a weak US Dollar and institutional performance chasing squarely focused on buying inflation protection. 

  • Gold Bulls Expand as Billionaire Paulson Says Buy: Commodities
  • CME Group Said to Submit Bid to Buy London Metal Exchange
  • Copper Trims Weekly Drop on U.S. Economy, Greece Bailout Outlook
  • Oil Set for Biggest 2012 Weekly Gain on U.S. Economy, Greek Aid
  • Shanghai Copper Stockpiles Rise to Record 217,142 Tons
  • Uganda Coffee Exports May Climb 3.1% as Nation’s Crop Expands
  • Wheat Advances as Egypt Buys From U.S.; Corn, Soybeans Gain
  • Cocoa Falls as Exporters Agree to Ivorian Sales; Coffee Declines
  • Palm Oil Advances to Three-Month High on Optimism Over Recovery
  • World’s Biggest Platinum Mine Under Police Control After Riots
  • Small Hedge Funds Draw Money as Their Bigger Rivals Stumble
  • Timchenko’s Kolmar to Boost Coal Output Fivefold, Eyes Seaport
  • Tullow Seen Beating Peers With $30 Billion Africa Find: Energy
  • Midwest Farmland Prices Rise at Fastest Pace Since ’76, Fed Says
  • Oil Set for Biggest Weekly Gain This Year
  • Copper Climbs Before U.S. Leading Indicators Report: LME Preview
  • Gold May Gain on Speculation Greece Bailout Will Weaken Dollar 

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CURRENCIES


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EUROPEAN MARKETS


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ASIAN MARKETS


SINGAPORE – when the Prime Minister of Singapore warned of a “rough landing” in China last week, our research team was buzzing about it – they should have been; Singapore is a leading indicator for Global Growth – and Singapore’s Exports for JAN just dropped to negative y/y! (-2.1% vs +9.0% DEC). Chinese Growth is slowing – We sold our China Equities (CAF) long (bought it in DEC) yesterday.

JAPANESE YEN – biggest currency drop not discussed by consensus media, maybe ever – and ever, as you know, is a long time. The Yen is literally straight down for the month of FEB. Down 4% is a monster move for a major currency. We think this is front-running the Sovereign Debt Maturity spike that’s pending in March. When we were saying this about the Euro breaking down hard in April 2011, that was the early signal too…

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MIDDLE EAST


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The Hedgeye Macro Team

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