THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP – May 7, 2012


As we look at today’s set up for the S&P 500, the range is 25 points or -0.37% downside to 1364 and 1.45% upside to 1389. 

                                            

SECTOR AND GLOBAL PERFORMANCE

THE HEDGEYE DAILY OUTLOOK - 1

 

THE HEDGEYE DAILY OUTLOOK - 1A

 

THE HEDGEYE DAILY OUTLOOK - 3

 

EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: on 5/04 NYSE -1545
    • Down from the prior day’s trading of -1194
  • VOLUME: on 5/04 NYSE 825.24
    • Decrease versus prior day’s trading of -2.24%
  • VIX:  as of 5/04 was at 19.16
    • Increase versus most recent day’s trading of 9.11%
    • Year-to-date decrease of -18.12%
  • SPX PUT/CALL RATIO: as of 05/04 closed at 1.42
    • Down from the day prior at 1.57 

CREDIT/ECONOMIC MARKET LOOK:

  • TED SPREAD: as of this morning 40
  • 3-MONTH T-BILL YIELD: as of this morning 0.08%
  • 10-Year: as of this morning 1.85
    • Decrease from prior day’s trading at 1.88
  • YIELD CURVE: as of this morning 1.60
    • Down from prior day’s trading of 1.63 

MACRO DATA POINTS (Bloomberg Estimates):

  • 11:30am: U.S. to sell $30b 3-mo, $28b 6-mo bills
  • 3pm: Consumer Credit, Mar., est. $9.75b (prior $8.735b)
  • 7:15pm: Fed’s Lacker speaks in Greensboro, North Carolina 

GOVERNMENT:

  • President Obama officially started his re-election bid yesterday in the swing states of Ohio and Virginia
  • Presidential nominee Mitt Romney campaigns in Cleveland
  • House, Senate in session:
    • House Budget Committee holds markup of sequester legislation. 2 p.m.     

WHAT TO WATCH: 

  • Treasury Department to sell $5b of AIG stock at $30.5-shr
  • Yahoo under pressure from Third Point to dismiss CEO
  • Facebook gets first buy recommendation from Wedbush Securities
  • Microsoft to claim Motorola is unfairly demanding $4b/year in patent royalties in federal court in Seattle today
  • Avengers has record $200.3m in opening-wknd ticket sales
  • Voters in France, Greece challenge austerity plans
  • Falcone’s LightSquared gets another week from creditors
  • Micron to invest 300b yen in Japan’s Elpida, Nikkei says
  • Buffett says he’s focusing more on Asia to boost sales
  • MLM blocked for 4 months from making hostile bid for rival Vulcan by judge ruling
  • Preview of week’s U.S. economic reports 

EARNINGS:

    • Cognizant Technology Solutions (CTSH) 6 a.m., $0.79
    • Dish Network (DISH) 6 a.m., $0.70
    • EchoStar (SATS) 6 a.m., $0.02
    • Towers Watson & Co (TW) 6 a.m., $1.35
    • Cinemark Holdings (CNK) 6:36 a.m., $0.35
    • Frontier Communications (FTR) 7 a.m., $0.06
    • HollyFrontier (HFC) 7 a.m., $1.21
    • Tyson Foods (TSN) 7:30 a.m., $0.39
    • Louisiana-Pacific (LPX) 8 a.m., $(0.15)
    • Sysco (SYY) 8 a.m., $0.43
    • Coeur d’Alene Mines (CDE) 8 a.m., $0.43
    • Dendreon (DNDN) 4 p.m., $(0.64)
    • Rackspace Hosting (RAX) 4 p.m., $0.17
    • Wesco Aircraft Holdings (WAIR) 4 p.m., $0.26
    • Electronic Arts (EA) 4:01 p.m., $0.16
    • Pitney Bowes (PBI) 4:01 p.m., $0.50
    • Vivus (VVUS) 4:01 p.m., $(0.13)
    • Clean Energy Fuels (CLNE) 4:05 p.m., $(0.18)
    • ProAssurance (PRA) 4:05 p.m., $1.41
    • Wynn Resorts (WYNN) 4:05 p.m., $1.41
    • Plains All American Pipeline (PAA) 4:06 p.m., $1.51
    • Dun & Bradstreet /The (DNB) 4:14 p.m., $1.32
    • Avis Budget Group (CAR) 4:15 p.m., $(0.01)
    • Hillenbrand (HI) 4:20 p.m., $0.50
    • Federal Realty Investment Trust (FRT) 4:30 p.m., $1.02
    • Vornado Realty Trust (VNO) 4:55 p.m., $1.77
    • Uranium One (UUU CN) 5:01 p.m., $0.02  

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)

  • Hedge Funds Bet Wrong Before Biggest Slump in 2012: Commodities
  • Copper Declines on French Election Outcome, U.S. Payroll Figures
  • Malaysian Palm-Oil Output Probably Rose Most in Seven Months
  • Commodities Close to Erasing 2012’s Gains on Europe, U.S. Data
  • Corn Buying by China Seen Rising 35% on Chicken, Pork Demand
  • Soybeans Decline on Forecast U.S. Farmers May Expand Planting
  • Gold Imports by China From Hong Kong Post Increase in March
  • China Needs U.S. Corn to Meet Rising Shortage, Shanghai JC Says
  • Dalian Commodity Exchange Starts Options Trading Simulation
  • Gold Declines as French, Greek Election Results Weaken the Euro
  • Record Gas Use by U.S. Utilities Fails to Drive Up Price: Energy
  • Oil Slumps to Four-Month Low on European Elections, U.S. Jobs
  • NYSE Euronext Said Willing to Maintain LME Ring in Takeover Bid
  • UN Sees Risk of Unrest From Food Costs Above 10-Year Average
  • Malaysia Seen Countering Indonesia’s Palm-Oil Export Tax Reform
  • South African Gold Mine Deaths Fall to a Record Low in April

THE HEDGEYE DAILY OUTLOOK - 4

CURRENCIES


US DOLLAR – get the USD and the slope of US Growth (slowing) right, and you’ll get a lot of other things right. USD up for the 4th consecutive day on Friday and the SP500 fell for its 3rd consecutive day. The immediate-term Correlation Risk to Strong Dollar vs SPX remains north of -0.8, so that has left a mark. Ultimately its take down oil prices, which is bullish for Consumers, globally.

THE HEDGEYE DAILY OUTLOOK - 5

EUROPEAN MARKETS


FRANCE – no need for a consensus check here; France down another -1.3% this morning isn’t as much the story as the CAC being down -13% now from its YTD high on March 16th. Mean reversion matters, and now you’re seeing Spain, France, and Greece drag German stocks down with them (DAX down -10% from the same March 16th high; Spain and Greece crashing, again).

THE HEDGEYE DAILY OUTLOOK - 6

 

ASIAN MARKETS


JAPAN – Japanese stocks continue to get rocked, down hard last night (-2.8%) and down for the 16th trading day out of the last 21. The interconnected risk associated with Japan’s fiscal/debt crisis remains well under the consensus radar.

THE HEDGEYE DAILY OUTLOOK - 7

 

 

MIDDLE EAST


THE HEDGEYE DAILY OUTLOOK - 8

 

The Hedgeye Macro Team