TODAY’S S&P 500 SET-UP – March 22, 2012
As we look at today’s set up for the S&P 500, the range is 16 points or -0.56% downside to 1395 and 0.58% upside to 1411.
SECTOR AND GLOBAL PERFORMANCE
EQUITY SENTIMENT:
- ADVANCE/DECLINE LINE: -32 (986)
- VOLUME: NYSE 726.47 (2.16%)
- VIX: 15.13 -2.89% YTD PERFORMANCE: -35.34%
- SPX PUT/CALL RATIO: 3.27 from 2.22 (47.30%)
CREDIT/ECONOMIC MARKET LOOK:
- TED SPREAD: 38.78
- 3-MONTH T-BILL YIELD: 0.08%
- 10-Year: 2.26 from 2.30
- YIELD CURVE: 1.89 from 1.93
MACRO DATA POINTS (Bloomberg Estimates):
- 8:30am: Jobless claims, week of Mar. 17, est. 350k (prior 351k)
- 9:45am, Bloomberg Consumer Comfort, week Mar. 18 (prior -33.7)
- 10am: House Price Index (M/m), Jan., est. 0.3% (prior 0.7%)
- 10am: Leading Indicators, Feb., est. 0.6% (prior 0.4%)
- 10am: Fed’s Tarullo testifies to Senate committee on regulation and Volcker rule
- 10am: Freddie Mac 30-yr mortgage
- 10:30am: EIA natural gas storage
- 12:45pm: Fed Chairman Bernanke lectures at George Washington U. (2 of 4)
- 1pm: U.S. to sell $13b 10-yr TIPS (reopen)
- 4pm: Fed’s Evans speaks on communication at Brookings
- 8pm: Fed’s Bullard speaks in Hong Kong
- U.S. Treasury announces 2-, 5-, 7-yr auction sizes
GOVERNMENT:
- President Barack Obama to speak on energy infrastructure in Oklahoma, 10:55am
- Obama attends event on energy-related research, development at Ohio State University, 4:30pm
- House, Senate in session:
- Senate Armed Services Committee holds hearing on the situation in Afghanistan, 9:30am
- House Ways and Means subcommittee hears from IRS Commissioner Doug Shulman on its operations and the tax filing season, 9:30am
- Senate Appropriations subcommittee hears from Commerce Secretary John Bryson on his agency’s proposed budget, 10am
- Senate Environment Committee hears from Environmental Protection Agency Administrator Lisa Jackson on the agency’s budget, 10am
- Senate Banking Committee hears from Treasury Undersecretary Lael Brainard, Fed member Daniel Tarullo and FDIC acting Chairman Martin Gruenberg on the Volcker rule, 10am
- House Appropriations subcommittee hears from acting Federal Aviation Administration chief Michael Huerta on the agency’s budget, 10am
- House Appropriations subcommittee hears from Commodity Futures Trading Commission Chairman Gary Gensler on the agency’s budget, 10:30am
WHAT TO WATCH:
- McDonald’s CEO Jim Skinner is retiring after almost 8 yrs at helm, to be succeeded by COO Don Thompson
- Bats Global Markets will seek more than $100m for owners today, plans to sell 6.3m shrs at $16-$18 each
- Abstracts for EASL’s International Liver Congress may be
- released on embargo
- Chinese manufacturing index indicated a worse contraction this month; prelim. 48.1 reading in a purchasing managers’ index is the lowest since Nov.
- Sony said to tap Studio Chief Lynton to oversee U.S. media units
- Former Fed Chairman Paul Volcker says U.S. needs reforms in financial sector, govt.
- Nomura said to be involved in Inpex insider-trading breach
- American Airlines said to plan to start a bankruptcy-court process for rejecting union contracts by next week
- Euro-area services, manufacturing output contracted more than economists forecast in March
- Hartford fails to satisfy holder John Paulson with plan to shrink insurer
- Vantiv raised $500m in IPO at mid-point of price range
EARNINGS:
- IHS (IHS) 6 a.m., $0.82
- Dollar General (DG) 7 a.m., $0.82
- Lululemon Athletica (LULU) 7:15 a.m., $0.49
- ConAgra Foods (CAG) 7:30 a.m., $0.48
- FedEx (FDX) 7:30 a.m., $1.35
- Signet Jewelers Ltd (SIG) 7:30 a.m., $1.77
- GameStop (GME) 8:30 a.m., $1.72
- Accenture (ACN) 4 p.m., $0.86
- Steelcase (SCS) 4:01 p.m., $0.14
- Micron Technology (MU) 4:04 p.m., $(0.19)
- Nike (NKE) 4:15 p.m., $1.17
- Silver Wheaton (SLW CN) 5 p.m., $0.40
COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)
OIL – probably the only good news this morning is that Oil stopped going up. We sold our long Oil position and took our asset allocation to Commodities to 0% because the US Dollar looks like it could put on a big move to the upside again. Immediate-term support lines that broke for WTIC and Brent are $106.79 and $124.89, respectively.
- Newedge Says Soy Beats Corn as Cekander Talks Seeds: Commodities
- Copper Reaches Two-Week Low as Chinese Manufacturing Contracts
- Gold Drops to Lowest Since January on Manufacturing, U.S. Dollar
- Crude Declines on Stockpile Release Speculation, China Slowdown
- Iran Seeking to Import Farm Commodities From India, Group Says
- Sugar Erases Gains in New York Trading After Rising 0.8%
- China Grain Output May Have Been Overstated, Imports to Rise
- England Tsunami Risk Swells Costs at EDF After 40% Slump: Energy
- Sinofert Has Been in Potash Acquisition Talks, CEO Feng Says
- Gold Tax Aids Rupee as Deficit Fight Spurs Strike: India Credit
- Vale, Rio, BHP to Join China’s Spot Iron Ore Platform
- Water Scarcity to Fuel Global Tensions, Intelligence Report Says
- BHP Leading Record Foreign-Currency Bond Sales: Australia Credit
- Crude Futures Decline on Stockpile Release
- European Crops Damaged by Winter Freeze Now Face Drought Risk
- H.K. Mercantile Bourse Plans RMB Gold, Silver, Copper Contracts
- Jewelers in North, East India Continue Strike Over Gold Tax
CURRENCIES
EUROPEAN MARKETS
SPAIN – Growth Slowing was the most obvious message for the PMI reports across Europe for the month of March. Central Planners can arrest stock market deflations in the short-term, but in the long-run, their ideas to stop economic gravity are dead. Spain’s IBEX remains bearish across all 3 of our risk management durations (down -1.5% this morn).
ASIAN MARKETS
INDIA – Energy stocks (XLE) stopped making higher-YTD-highs on Feb 24 and India stopped going up on Feb 21; this morning India’s Sensex was down another -1.8% on fundamentals (Growth Slowing As Inflation Accelerates) and is down over 6% from its YTD high. India’s Yield Curve has pancaked.
MIDDLE EAST
The Hedgeye Macro Team