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THE HEDGEYE BREAKFAST MONITOR

MACRO NOTES

Comments from CEO Keith McCullough

Got Growth Slowing? The #1 Most Read finally has nothing to do w/ Greece or Apple – it’s all China this morning:

  1. CHINA – Growth Slowing has been plainly obvious in just about every high frequency economic data point in Jan-Feb – plenty shrugged that off as being all about the Lunar calendar, but this morning’s Services PMI print out of China is a 48 and that’s more inline w/ what Wen’s guiding to in a 7.5% GDP Growth rate (vs the 9-12% China has been tracking since 2009)
  2. YEN – President of Japan’s Credit Rating Agency Inc said the BOJ is “damned if they do, damned if they don’t” (buy bonds) w/ this massive debt maturity spike in 2012. Them be fighting words in Japan as the Yen continues to be in a Bearish Formation (bearish TRADE, TREND, and TAIL) w/ an immediate-term oversold level of $81.96 USD/JPY.
  3. USD – after a +1.3% week, finally attempting to stabilize above critical $79.03 support – Romney solidifying the Republican base has had a high correlation to a more stable dollar than the Newt/Santorum thing. Super Tuesday could be another bullish USD catalyst inasmuch as winning Michigan was.

Dollar up would Deflate The Inflation and get me more bullish on Equities broadly (again). But there’s a time/price bridge to pass over called beta in between these Growth Slowing Expectations falling and stocks addicted to down dollar doing the same.

KM

SUBSECTOR PERFORMANCE

THE HBM: SBUX, DNKN, CMG, PZZA - subsector

 

QUICK SERVICE

SBUX: Starbucks topped the Restaurant Social Media Index for 4Q11 once again.  The complete rankings are below.

THE HBM: SBUX, DNKN, CMG, PZZA - restaurant social media index

DNKN: Dunkin’ Brands is planning to open another 100 stores in China over the next two to three years and will use LeBron James to promote its image in Asia, having announced a multi-year marketing agreement with the NBA star today.

CMG: During the month of March, Chipotle is offering a free order of chips and salsa to entrée-purchasing customers that “check in” at Chipotle on foursquare.

PZZA: Papa John’s has been holding the line on discounting, instead sticking with its long-held premium-products-at-premium-prices message, according to a story on adage.com

THI, YUM, DPZ, CMG, WEN, SONC, JACK: All speaking at conferences this week.

NOTABLE PERFORMANCE ON ACCELERATING VOLUME:

BAGL: Einstein Noah traded higher on accelerating volume following stronger-than-expected earnings.

 

CASUAL DINING

DIN, TXRH, RRGB, CAKE, RUTH, EAT, PFCB, RT, BOBE: All speaking at conferences this week.

 

NOTABLE PERFORMANCE ON ACCELERATING VOLUME:

DIN: Dine Equity traded down -5.6% on accelerating volume Friday following disappointing earnings.  

THE HBM: SBUX, DNKN, CMG, PZZA - stocks

Howard Penney

Managing Director

Rory Green

Analyst