TODAY’S S&P 500 SET-UP – May 9, 2012
As we look at today’s set up for the S&P 500, the range is 17 points or -1.08% downside to 1349 and 0.17% upside to 1366.
SECTOR AND GLOBAL PERFORMANCE
EQUITY SENTIMENT:
- ADVANCE/DECLINE LINE: on 5/08 NYSE -613
- Down from the prior day’s trading of 252
- VOLUME: on 5/08 NYSE 902.47
- Increase versus prior day’s trading of 19.64%
- VIX: as of 5/08 was at 19.05
- Increase versus most recent day’s trading of 0.58%
- Year-to-date decrease of -18.59%
- SPX PUT/CALL RATIO: as of 05/08 closed at 2.03
- Up from the day prior at 1.31
CREDIT/ECONOMIC MARKET LOOK:
- TED SPREAD: as of this morning 38
- 3-MONTH T-BILL YIELD: as of this morning 0.09%
- 10-Year: as of this morning 1.82
- Decrease from prior day’s trading at 1.84
- YIELD CURVE: as of this morning 1.57
- Down from prior day’s trading of 1.59
MACRO DATA POINTS (Bloomberg Estimates):
- 7am: MBA Mortgage Applications, week of May 4 (prior 0.1%)
- 10am: Wholesale Inventories, Mar., est. 0.6% (prior 0.9%)
- 10am: Fed’s Kocherlakota speaks in Minneapolis
- 10:30am: DoE inventories
- 10:45am: Fed’s Pianalto speaks in Lexington, Kentucky
- 12pm: Fed’s Plosser speaks in Philadelphia
- 1pm: U.S. to sell $24b 10-yr notes
GOVERNMENT:
- President Obama meets with NATO Secretary General Anders Fogh Rasmussen to finalize plans for NATO Summit in Chicago, 2:10pm
- Chamber of Commerce holds quarterly economic briefing, 8:45am
- Postal Service announces plan for smallest post offices, 10am
- House lawmakers hold news conference calling for a special prosecutor to investigate the collapse of MF Global, 11am
- House, Senate in session:
- House Judiciary holds hearing on FBI oversight, with testimony from Robert Mueller, 10am
- House Natural Resources hearing on offshore drilling, 10am
- House Armed Services marks up defense authorization bill, 10am
- House Financial Svcs subcommittee holds hearing on regulatory compliance costs for small financial institutions, 10am
- Senate Banking panel holds hearing on need for long-term reauthorization of national flood insurance program, 10am
- Former Fed Chairman Paul Volcker; FDIC member Thomas Hoenig testify before Senate Banking panel on limiting federal support for financial institutions, 2pm
- World Economic Forum takes place in Ethiopia
WHAT TO WATCH:
- S&P 500, Dow index futures lower; Dow has dropped the previous five sessions amid concerns of political wrangling in Europe
- Glaxo to begin hostile offer for Human Genome at $13/shr
- Toyota forecasts profit will double to highest in five years
- China passenger-vehicle sales rise 13%, exceeding estimates
- Confidence among U.S. CEOs in 1Q reaches highest level in 3 yrs
- Green Mountain Coffee removes chairman after stock sale
- Verizon Wireless Airwaves purchase said to raise U.S. concerns
- U.K. retail sales plunge by most in more than a year, BRC says
- Commerzbank exceeds capital target as profit misses estimates
- FDA advisory panel meets on PFE’s tofacitinib
- Disney profit rises 21% on theme parks, says there will be “Avengers” sequel
EARNINGS:
- Spectrum Brands Holdings (SPB) 6am, $0.31
- Quebecor Inc (QBR/B CN) 6am, C$0.68
- Dollar Thrifty Automotive Group (DTG) 6am, $1.35
- Agrium (AGU CN) 6:30am, $1.04
- Enbridge (ENB CN) 7am, C$0.48
- AOL (AOL) 7am, $0.17
- Tim Hortons (THI CN) 7:30am, C$0.59
- Dean Foods (DF) 7:35am, $0.21
- Ariad Pharmaceuticals (ARIA) 7:35am, $(0.25)
- Macy’s (M) 8am, $0.40; Preview
- Priceline.com (PCLN) 4pm, $3.95
- MEMC Electronic Materials (WFR) 4:01pm, $(0.26)
- News Corp (NWSA) 4:03pm, $0.31
- Live Nation Entertainment (LYV) 4:03pm, $(0.41)
- Cisco Systems (CSCO) 4:05pm, $0.47
- Universal Display (PANL) 4:05pm, $0.04
- Activision Blizzard (ATVI) 4:05pm, $0.04
- Alterra Capital Holdings (ALTE) 4:05pm, $0.62
- BMC Software (BMC) 4:05pm, $0.80
- Tesla Motors (TSLA) 4:10pm, $(0.70)
- Monster Beverage (MNST) 4:10pm, $0.38
- CenturyLink (CTL) 4:25pm, $0.58
- TELUS (T CN) post-mkt, C$1.04
COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)
GOLD – no iQe4 upgrade option = down Gold, or at least that’s how Gold acts; its immediate-term TRADE correlation to the USD is also -0.85, so with the USD up for 6 consecutive days, if you didn’t know about the Correlation Risk, now you know. Ron Paul saying abolish Bernanke in DC yesterday and Tea Party win vs Lugar – there’s an American Zeitgeist out there called The People.
- Silver Forecasters Bullish as Hedge Funds Retreat: Commodities
- Oil Falls Sixth Day in Longest Drop Since 2010; SocGen Says Buy
- India to Rival Vietnam, Dethrone Thailand as Top Rice Seller
- China Said to Plan Auction of 3 Million Tons of Soybean Reserves
- Ex-Deutsche Securities Banker Plans Commodities Hedge Fund
- Copper Declines for a Fifth Day as Euro Debt Crisis May Worsen
- Gold Drops to Four-Month Low in London on Concern Euro to Weaken
- Corn Drops as U.S. Planting Gains, Boosting Supply Prospects
- Palm Oil Declines to Two-Month Low on Greece Political Impasse
- Sugar Gains on Rising Thai Premiums, Ramadan Demand; Cocoa Falls
- Gold to Rebound to $1,700 an Ounce This Year: Technical Analysis
- Sino-Forest Debt Insurance Set to Pay Out 71 Cents per Dollar
- Thai Rice Output From Main Crop Set to Gain 21% on State Buying
- Gasoline Seen at Earliest Peak in U.S. Since ‘98: Energy Markets
- Ex-Deutsche Banker Plans Commodities Fund
- OPEC Crude Drops Below $110 for First Time Since January
- Glencore Says Commodity Demand ‘Healthy’ as Production Increases
CURRENCIES
EUROPEAN MARKETS
ITALY – we covered our short position in France yesterday; re-shorted Spain (down -2.3% this morning and continues to crash); and stayed short Italian stocks as we think they’ll be back in crash mode in no time (already down -18.9% from the YTD peak in March when most global Equity markets stopped going up, including the Russell2000).
ASIAN MARKETS
ASIA – you can blame Europe or Canada or whoever, but the fact of the matter is that we live in a globally interconnected economy that doesn’t “de-couple.” India moved to QE yesterday and the market there didn’t care; China finally had a down day of -1.6%; and Japan is getting wrecked, down -1.5% overnight (down 17 of the last 23 days during a 12% draw-down).
MIDDLE EAST
The Hedgeye Macro Team