THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP – March 7, 2012


As we look at today’s set up for the S&P 500, the range is 23 points or -0.55% downside to 1336 and 1.16% upside to 1359. 

 

SECTOR AND GLOBAL PERFORMANCE

 

THE HEDGEYE DAILY OUTLOOK - 1

 

 

THE HEDGEYE DAILY OUTLOOK - 2

 

 

THE HEDGEYE DAILY OUTLOOK - 3

 

 

EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: -2509 (-1923) 
  • VOLUME: NYSE 877.82 (24.29%)
  • VIX:  20.87 15.62% YTD PERFORMANCE: -10.81%
  • SPX PUT/CALL RATIO: 1.63 from 2.04 (-20.10%)

CREDIT/ECONOMIC MARKET LOOK:


USD – this is not a political comment, it’s a correlation one – Romney’s momentum rising/falling is starting to track the US Dollar Index and our new Hedgeye Election Index (Obama at 58.4% before Super Tuesday results). The back-test is meaningful – send us a note if you want the data series. US Dollar Index = +2% since Romney won Michigan/Arizona and you see what happened to inflation in the face of that (deflated, fast). 

  • TED SPREAD: 40.85
  • 3-MONTH T-BILL YIELD: 0.07%
  • 10-Year: 1.96 from 1.94
  • YIELD CURVE: 1.68 from 1.67 

MACRO DATA POINTS (Bloomberg Estimates):

  • 7:00am: MBA Mortgage Apps, week of Mar. 2 (prior -0.3%)
  • 8:15am: ADP Employment Change, Feb., est. 215k (prior 170k)
  • 8:30am: Nonfarm Productivity 4Q F, est. 0.8% (prior 0.7%)
  • 10:30am: DOE inventories
  • 3:00pm: Consumer Credit, Jan., est. $10.45b (prior $19.308b) 

GOVERNMENT:

  • President Barack Obama visits Daimler truck manufacturing plant in Mt. Holly, N.C., delivers remarks on economy, 12:45pm
  • House, Senate in session:
    • House Financial Services subcommittee holds hearing on modernizing Securities Investor Protection Corp., 9:30am
    • Senate Agriculture holds hearing on healthy food, nutrition as part of farm bill drafting, 9:30am
    • House Energy and Commerce hearing on gasoline prices, 10:30am
    • Congressional Progressive Caucus holds news conference on home foreclosures, 12:15pm 

WHAT TO WATCH:

  • Apple to host iPad event; watch for details on processing speed, display, pricing, effect on potential suppliers, 1pm
  • Mitt Romney won 6 states including Ohio; Rick Santorum captured 3, signaling fight for Republican delegates may last months
  • SocGen, Generali, UniCredit joined firms saying they would participate in Greece’s debt swap
  • Sprint said to plan end to network-sharing deal with Falcone’s LightSquared
  • Netflix explores putting film streaming service on cable systems
  • JHL Capital Group says subsidiary of Clear Channel Communications Inc. improperly moved $656m to its parent
  • Freddie Mac faulted with FHFA for oversight of loan servicers
  • Calpers may cut assumed rate of return for 1st time since 2004
  • Delphi investors can’t block Tokio Marine offer, judge ruled yesterday 

EARNINGS:

    • Fresh Market (TFM) 6 a.m., $0.38
    • Children’s Place (PLCE) 6:30 a.m., $0.90
    • Ciena (CIEN) 7 a.m., $(0.04)
    • Brown-Forman (BF/B) 7:30 a.m., $1.01
    • American Eagle Outfitters (AEO) 8 a.m., $0.35
    • Laurentian Bank of Canada (LB CN) 8:54 a.m., C$1.26
    • Hot Topic (HOTT) 4 p.m., $0.20
    • Men’s Wearhouse (MW) 4:01 p.m., $(0.13)
    • Express (EXPR) 4:01 p.m., $0.68
    • H&R Block (HRB) 4:03 p.m., $0.07
    • Semtech (SMTC) 4:30 p.m., $0.31
    • Pall (PLL) 5:01 p.m., $0.74
    • Canadian Western Bank (CWB CN) 7 p.m., C$0.55
    • HudBay Minerals (HBM CN) Post-Mkt, C$0.15 

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)


OIL  - both Brent and WTIC continue to hold all 3 durations of support  (TRADE, TREND, TAIL) in our model with Brent Oil’s refreshed risk management range = $120.83-123.98. It would have to break $118 (and WTIC break $102) for us to consider this a tailwind of Deflating The Inflation for the benefit of US Consumption. 

  • Boar Hunter Sets Sights on China After MF Global: Commodities
  • Oil Rises on Forecast of U.S. Fuel Supply Drop, Jobs Increase
  • Copper Swings Between Gains, Losses on Stocks, Slowdown Signals
  • Soybeans Climb for Second Day as Chinese Demand May Strengthen
  • Gold Gains in London as Drop to Six-Week Low Attracts Buyers
  • Robusta Coffee Falls as Supplies May Increase; Cocoa Advances
  • Palm Oil Seen Rallying 24% as World Cooking-Oil Supply Drops
  • Australian Beef to Compete With Brazil, India as Demand Surges
  • Jinchuan Plans to Raise Nickel Output, Look for Mines Abroad
  • Goldman Takes Lead in M&A List Spurred by Natural-Resource Deals
  • New Iraq Oil Terminal Starts Pumping Today, Minister Says
  • California Nuclear Backlash Mounts After Japan Meltdown: Energy
  • Netanyahu Sees Red Sea-Negev Rail Spurring China Trade: Freight
  • China to Buy Corn If Prices Are Right, Reserve Chief Says
  • India’s Singh Demands Urgent Review of Cotton-Export Ban
  • Australian Wool May Tumble 8% as Slowing Economy Hurts Demand
  • Copper Demand to Grow At Least 6% This Year, Tongling’s Wei Says 

THE HEDGEYE DAILY OUTLOOK - 4

 

 

CURRENCIES


THE HEDGEYE DAILY OUTLOOK - 5

 

 

EUROPEAN MARKETS


SPAIN – never mind Greece, pull up a chart of the IBEX = straight down and, more importantly, this is the 1st major European stock market to snap its intermediate term TREND line (8499). Spanish Equities are down -4% all of a sudden YTD. Debt structurally impairs growth – these economies and markets are stagflating, big time – and even a Keynesian can’t stop gravity in perpetuity.

 

THE HEDGEYE DAILY OUTLOOK - 6

 

 

ASIAN MARKETS

 

THE HEDGEYE DAILY OUTLOOK - 7

 

 

MIDDLE EAST


THE HEDGEYE DAILY OUTLOOK - 8

 

 

 

The Hedgeye Macro Team

 


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