TODAY’S S&P 500 SET-UP – March 28, 2012
As we look at today’s set up for the S&P 500, the range is 14 points or -0.60% downside to 1404 and 0.39% upside to 1418.
SECTOR AND GLOBAL PERFORMANCE
EQUITY SENTIMENT:
SENTIMENT – literally ever metric we track is bombing out the bears; hedge fund short interest hitting new lows, VIX 14, and now my Spread in the II Bull/Bear survey hits its widest to the bullish side since Q1 of last year at +2900 basis points wide! With only 22.6% admitting to be bearish (new low), we’re happy to go Lone Wolf.
- ADVANCE/DECLINE LINE: -507 (-2073)
- VOLUME: NYSE 730.24 (-3.27%)
- VIX: 15.59 9.33% YTD PERFORMANCE: -33.38%
- SPX PUT/CALL RATIO: 2.25 from 1.72 (30.81%)
CREDIT/ECONOMIC MARKET LOOK:
BOND YIELDS – the one bull case we could actually buy into is Strong Dollar + Rising Treasury Yields (at the same time); that would mean #GrowthSlowing is off the table. Not now, not at $106 oil. The US Dollar Index is down for the 3rd consecutive week thanks to daily talk show appearances from the Bernank and the 10yr failed, hard, at long-term TAIL resistance of 2.47%.
- TED SPREAD: 38.94
- 3-MONTH T-BILL YIELD: 0.08%
- 10-Year: 2.21 from 2.18
- YIELD CURVE: 1.88 from 1.86
MACRO DATA POINTS (Bloomberg Estimates):
- 7am: MBA Mortgage Applications, week of Mar. 23
- 8:30am: Durable Goods, Feb., est. 3.0% (prior -3.7% (revised))
- 10:30am: DOE inventories
- 1:00pm, U.S. to sell $35b 5-yr notes
GOVERNMENT:
- President Obama has meetings at White House
- House, Senate in session
- House Energy Committee holds hearing on rising gasoline prices, 9:30am
- Senate Judiciary Committee holds hearing on special counsel’s report on the prosecution of Senator Ted Stevens, 10am
- House Appropriations subcommittee hears from Treasury Secretary Tim Geithner on the agency’s budget, 10am
- House Armed Services Committee holds hearing on security in the Korean peninsula, 10am
- House Ways and Means Committee marks up Small Business Tax Cut Act
- House Financial Services subcommittee holds hearing on the MF Global collapse, 2pm
- Senate Appropriations subcommittee hears from Treasury Secretary Tim Geithner on the Treasury Department’s response to the foreclosure crisis and rising student debt, 2:30pm
WHAT TO WATCH:
- U.S. Supreme Court today will consider how much of Obama’s health-care law must be thrown out if justices decide Congress can’t require Americans to buy medical insurance
- Applied Materials hosts investor day; watch for any update to 2Q forecast, market conditions
- Archer-Daniels-Midland seeking acquisitions in Europe and India and plans to increase exports from South America
- MF Global fund transfers to be scrutinized at House Financial Services subcommittee
- Orders for U.S. durable goods probably rebounded in Feb., rising 3%, as aircraft demand surged, economists est.
- Bats said to delay discussing new IPO for at least a quarter as CEO cedes chairman role
- Nokia announces availability of Lumia 800C device in China with China Telecom from April
- California said to probe planned purchase of EMI Group by Vivendi’s Universal Music and investor group led by Sony/ATV Music Publishing
- FDA advisory panel begins 2-day meeting on studying heart risks with diet pills, with voting question tomorrow
- Magic Johnson group wins Dodgers auction with $2b bid
EARNINGS:
- Jos. A Bank (JOSB) 6am, $1.58
- AuRico Gold (AUQ CN) 7am, $0.14
- Family Dollar Stores (FDO) 7am, $1.13
- Huntington Ingalls Industries (HII) 7:15am, $0.94
- AGF Management Ltd (AGF/B CN) 8am, C$0.27
- Commercial Metals Co (CMC) 8am, $0.09
- Unifirst (UNF) 8am, $0.88
- Lindsay (LNN) 8am, $0.82
- Paychex (PAYX) 4:01pm, $0.37
- Red Hat (RHT) 4:05pm, $0.27
- Verint Systems (VRNT) 4:05pm, $0.68
- Mosaic Co. (MOS) 4:15pm, $0.69
- Progress Software (PRGS) 4:29pm, $0.25
- HB Fuller Co. (FUL) 5:30pm, $0.37
- Texas Industries (TXI) Post-Mkt, $(0.82)
COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)
- Rio, BHP Lose Faith in Diamonds Even as Prices Rise: Commodities
- Crude Oil Declines on Rising U.S. Supplies, Emergency Stocks
- Sugar Slides as Surplus May Be Nearer on India; Coffee Retreats
- Copper Declines on Indications Demand Is Slowing Down in China
- Soybeans Gain on U.S. Acreage Speculation, South America Drought
- Gold May Decline in London as U.S. Data Curbs Investor Demand
- Palm Oil Gains for Fourth Day on Concern Supplies May Decline
- BlackRock’s Raw Supports Glencore’s $35 Billion Xstrata Takeover
- Obama Power Plant Rule Seen Signaling Demise of ’Old King Coal’
- Goldman Reduces Three-Month Commodities Outlook to Neutral
- ADM Plans to Buy Oilseeds Capacity in Europe, India, S. America
- Transocean Biggest Winner From 28% Jump in Oil Rig Rates: Energy
- West African Cocoa Premiums Hold Steady Before Start of Harvest
- Oil Drops From One-Week High on Supplies
- Palm Oil Seen Climbing 23% on ‘Wedge’ Signal: Technical Analysis
- China Beats U.S. With Power From Coal Processing Trapping Carbon
- Glencore Sweetener Lures Xstrata-Wary Lenders: Corporate Finance
CURRENCIES
EUROPEAN MARKETS
ASIAN MARKETS
ASIA – oil up, growth slows – US Policy to Inflate continues to wreak havoc on the rest of the living world – while the SP500 hasn’t snapped yet, Asian stock markets are starting to (they stopped going up in Feb fyi); China down hard (-2.65%) last night and India down another -0.8%, taking its draw-down to -7.2% on the Sensex since Feb 21.
MIDDLE EAST
The Hedgeye Macro Team