TODAY’S S&P 500 SET-UP – May 3, 2012
As we look at today’s set up for the S&P 500, the range is 24 points or -0.81% downside to 1391 and 0.90% upside to 1415.
SECTOR AND GLOBAL PERFORMANCE
EQUITY SENTIMENT:
- ADVANCE/DECLINE LINE: on 5/02 NYSE -377
- Down from the prior day’s trading of 908
- VOLUME: on 5/02 NYSE 780.19
- Increase versus prior day’s trading of 1.13%
- VIX: as of 5/02 was at 16.88
- Increase versus most recent day’s trading of 1.69%
- Year-to-date decrease of -27.86%
- SPX PUT/CALL RATIO: as of 05/02 closed at 2.69
- Up from the day prior at 1.74
CREDIT/ECONOMIC MARKET LOOK:
- TED SPREAD: as of this morning 39
- 3-MONTH T-BILL YIELD: as of this morning 0.08%
- 10-Year: as of this morning 1.93
- Unchanged from prior day’s trading
- YIELD CURVE: as of this morning 1.67
- Unchanged from prior day’s trading
MACRO DATA POINTS (Bloomberg Estimates):
- 7:30am: Challenger Job Cuts (Y/y), Apr.
- 7:45am: ECB rate decision
- 8:30am: Nonfarm Productivity, 1Q P, est. -0.6% (prior 0.9%)
- 8:30am: Unit Labor Costs, 1Q P, est. 2.8% (prior 2.8%)
- 8:30am: Jobless Claims, week of Apr. 28, est. 379k (prior 388k)
- 9:45am: Bloomberg Consumer Comfort, week of Apr. 29
- 10:00am: ISM Non-Manf., Apr., est. 55.3 (prior 56)
- 11:00am: Fed’s Williams speaks on economy in Santa Barbara, CA
- 1:00pm: Fed’s Lockhart speaks on economy in Santa Barbara, CA * 1:30pm: Fed’s Plosser speaks on economy in Santa Barbara, CA
GOVERNMENT:
- U.S. Treasury Secretary Tim Geithner, Secretary of State Hillary Clinton attend opening session U.S.-China Strategic and Economic Dialogue in Beijing
- President Obama hosts Cinco de Mayo reception
- House, Senate not in session
- Quinnipiac University officials discuss latest poll of “swing state” voters in Florida, Ohio and Pennsylvania, 10am
WHAT TO WATCH:
- April retail sales expected to gain 1.5%: Retail Metrics
- European Central Bank may leave benchmark interest rate at record low 1%, economists est. Rate decision at 7:45am, press conference 45 minutes later
- JPMorgan to take stake of almost 30% in France’s Technicolor, in move supported by Technicolor management: Les Echos
- U.K.’s Sage said to be in talks on putting its accounting software for small businesses on Microsoft’s Azure cloud platform: FT
- ISM’s index of non-manufacturing industries probably cooled to 4-month low of 55.3 from 56 in March, economists est.
- Nexon said to be in talks to distribute Electronics Arts’s next “FIFA Online” title in Asia rather than buy the company
- Carlyle sold 30.5m shrs at $22 each, less than $23-$25 range
- Temasek selling $2.4b in BOC, China Construction Bank
- CME raises margins for non-hedged accounts to meet CFTC rule
- BP wins tentative approval for $7.8 billion oil-spill pact
- Billionaire James Packer may sell his investment in Foxtel, held through his control of Consolidated Media Holdings, to help fund bid for Echo Entertainment: Daily Telegraph
- Philip N. Duff, founder of FrontPoint Partners, said to be struggling to attract assets for his latest money-management venture
- Lockheed Martin won’t lead a team to compete against Hewlett-Packard for $4.5b Navy network deal; may increase chances HP will hold onto its biggest U.S. govt. contract
- One of Edvard Munch’s four versions of “The Scream” set record for work of art at auction when it sold at Sotheby’s last night for $119.9m
EARNINGS:
- Lamar Advertising (LAMR) 6am, $(0.14)
- Cimarex Energy (XEC) 6am, $1.27
- Cigna (CI) 6:30am, $1.30
- Fortress Investment Group (FIG) 6:30am, $0.10
- Gildan Activewear (GIL CN) 6:33am, C$0.21
- NRG Energy (NRG) 6:45am, $(0.08)
- Teradata (TDC) 6:55am, $0.56
- American Tower (AMT) 7am, $0.74
- Alpha Natural Resources (ANR) 7am, $(0.06)
- BCE (BCE CN) 7am, C$0.73
- Cardinal Health (CAH) 7am, $0.88; Preview
- Apartment Investment & Management (AIV) 7am, $0.37
- HCA Holdings (HCA) 7am, $0.98
- Lear (LEA) 7am, $1.20
- GE Energy (OGE) 7am, $0.33
- Jean Coutu Group PJC (PJC/A CN) 7am, C$0.24
- Plains Exploration & Production (PXP) 7am, $0.62
- Elizabeth Arden (RDEN) 7am, $0.04
- Viacom (VIAB) 7am, $0.89
- Xylem (XYL) 7am, $0.36
- Beam (BEAM) 7:01am, $0.47
- ANSYS (ANSS) 7:03am, $0.66
- WPX Energy (WPX) 7:15am, $(0.02)
- SCANA (SCG) 7:22am, $1.03
- El Paso (EP) 7:29am, $0.28
- Airgas (ARG) 7:30am, $1.07
- General Motors (GM) 7:30am, $0.85; Preview
- Hyatt Hotels (H) 7:30am, $0.09
- Progress Energy (PGN) 7:30am, $0.65
- Sealed Air (SEE) 7:30am, $0.21
- Scripps Networks Interactive (SNI) 7:30am, $0.60
- Sara Lee (SLE) 7:30am, $0.25; Preview
- El Paso Pipeline Partners (EPB) 7:44am, $0.61
- Apache (APA) 8am, $3.07
- Level 3 Communications (LVLT) 8am, $(0.52)
- Pinnacle West Capital (PNW) 8am, $(0.07)
- Valeant Pharmaceuticals International (VRX CN) 8am, $0.97
- CenterPoint Energy (CNP) 8:15am, $0.33
- Cablevision Systems (CVC) 8:15am, $0.18
- Manulife Financial (MFC CN) 8:22am, C$0.37
- Denbury Resources (DNR) 8:30am, $0.38
- MGM Resorts International (MGM) 8:30am, $(0.16)
- Sempra Energy (SRE) 9am, $0.98
- SNC-Lavalin Group (SNC CN) 9:05am, C$0.52
- Great-West Lifeco (GWO CN) 12:38pm, C$0.52
- CareFusion (CFN) 4pm, $0.45
- Mohawk Industries (MHK) 4:01pm, $0.55
- LinkedIn (LNKD) 4:02pm, $0.09
- First Solar (FSLR) 4:04pm, $0.48
- Fluor (FLR) 4:05pm, $0.87
- Kraft Foods (KFT) 4:05pm, $0.56
- SandRidge Energy (SD) 4:05pm, $0.02
- American International Group (AIG) 4:15pm, $1.13
- Northeast Utilities (NU) 4:15pm, $0.67
- CF Industries Holdings (CF) 4:18pm, $4.95
- Southwestern Energy (SWN) 5pm, $0.32
- Public Storage (PSA) 5:03pm, $1.42
- Eldorado Gold (ELD CN) 5:41pm, C$0.17
- Pembina Pipeline (PPL CN) 6:12pm, C$0.25
COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)
OIL – most important Global Macro move of the week right now is Brent Oil snapping my intermediate-term TREND support line of $119.17; Oil has been the big holdout of the major commodities deflating; if this holds, its bullish on the margin for Consumers (and Consumption Equities). The Divergence their yesterday (XLE -1.6% vs XLY up agrees).
- Crude Oil Extends Biggest Decline in Two Weeks on Jobs, Supplies
- Iran Embargo Impossible to Meet as Ships Depend on Blended Fuel
- Chesapeake Alone on Wall Street in Gas-Rally Bailout: Energy
- Barrick Gold Spending Faster Than Earnings Rise: Commodities
- CME Raises Margins for Non-Hedged Accounts to Meet CFTC Rule
- Gold Declines on Concern Slowing European Growth to Boost Dollar
- Copper Falls for Second Day as Slowing Economies May Curb Demand
- World Food Prices Fell in April as Cost of Dairy, Grain Declined
- Corn Set to Gain on Speculation China May Boost U.S. Purchases
- Shanghai Exchange to Start Silver Futures Trading From May 10
- Palm Oil Slumps to Six-Week Low as Weather May Aid U.S. Soybeans
- Real Yields Topping Asia as Rains to Cool Prices: India Credit
- New Europe Ports Seen Unprofitable With Slump Deepening: Freight
- Indonesia Ban on Unprocessed-Metal Exports to Proceed as Planned
- Sugar Falls to 19-Month Low on India’s Exports; Coffee Declines
- Proposed Rule Would Weaken Mad Cow Protections, Ranch Groups Say
CURRENCIES
US DOLLAR – Strong Dollar = Stronger Consumption, globally; that’s the only way out of this mess and it doesn’t take much. Yesterday’s +0.35% move in the USD Index was more of an arrest of its decline (down -6 of the last 7 wks) than a rip higher. If you see a sustainable breakout > $80 USD Index, Oil is going to come down a lot faster.
EUROPEAN MARKETS
SPAIN – we learn a lot more about bear markets on the bounces than on the declines; the 2012 crash/decline in Spain’s IBEX is trivial to consider in the rear-view mirror (down -23% from YTD peak yesterday, making a fresh crisis low which matters vs 2011); the bounce would have to get > 7498 for us to change our view from bearish to bullish.
ASIAN MARKETS
MIDDLE EAST
The Hedgeye Macro Team
