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TODAY’S S&P 500 SET-UP – May 14, 2012


As we look at today’s set up for the S&P 500, the range is 33 points or -1.36% downside to 1335 and 1.08% upside to 1368. 

                                            

SECTOR AND GLOBAL PERFORMANCE

 

THE HEDGEYE DAILY OUTLOOK - 1

 

THE HEDGEYE DAILY OUTLOOK - 2

 

THE HEDGEYE DAILY OUTLOOK - 3

 

 

EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: on 5/11 NYSE -637
    • Down from the prior day’s trading of 717
  • VOLUME: on 5/11 NYSE 785.74
    • Increase versus prior day’s trading of 0.21%
  • VIX:  as of 5/11 was at 19.89
    • Increase versus most recent day’s trading of 5.63%
    • Year-to-date decrease of -15.00%
  • SPX PUT/CALL RATIO: as of 05/11 closed at 2.72
    • Up from the day prior at 1.60 

CREDIT/ECONOMIC MARKET LOOK:


TREASURIES – 10yr yields piking to 1.79% this morning and the Yield Spread (10s minus 2s) is hitting a fresh YTD low of 153bps wide (-24% from the mid-March peak when most stocks peaked). Falling rates and Yield Spread are bad for Financials on the margin – like they needed more to worry about… 

  • TED SPREAD: as of this morning 38
  • 3-MONTH T-BILL YIELD: as of this morning 0.09%
  • 10-Year: as of this morning 1.78
    • Decrease from prior day’s trading at 1.84
  • YIELD CURVE: as of this morning 1.52
    • Down from prior day’s trading of 1.58 

MACRO DATA POINTS (Bloomberg Estimates):

  • 11am: U.S. Fed to purchase $4.25-5b notes
  • 11:30am: U.S. to sell $30b 3-mo., $27b 6-mo. bills 

GOVERNMENT:

    • House not in session
    • Senate to consider motion to proceed to Export-Import Bank Reauthorization, 2pm
    • NRC discusses recommendations for containment-venting systems, rapid transfer of spent reactor fuel from pools to sealed storage casks, 9am
    • White House energy adviser Heather Zichal participates in API conference on hydraulic fracturing, 9am
    • Public comments due to CFTC on establishing minimum block sizes for certain kinds of swaps, block trades  

WHAT TO WATCH:

  • Yahoo! CEO Thompson steps down after inquiry into his academic credentials; Levinsohn is interim CEO
  • Chesapeake has 8:30am call; Co.’s $3b lifeline heaps pressure on CEO
  • Euro officials begin to consider Greek exit from currency
  • Avon says its board will respond to Coty’s offer within a week
  • LightSquared nearing bankruptcy protection filing; key creditor deadline: WSJ
  • China lowers banks’ reserve requirements to support growth
  • JPMorgan losses lead to moves in swaps indexes
  • JPMorgan executives are said to be preparing departures
  • Concho Resources to buy Permian Basin assets for $1b
  • Economy in U.S. buoyed with autos spurring glass-to-steel growth
  • Shale may double Australia’s nat-gas resources, report says
  • Disney’s “Avengers” sets second-weekend N.A. record with $103m
  • Merkel’s CDU suffers worst postwar result in biggest state
  • Quarterly deadline tomorrow for mutual, hedge funds to disclose holdings 

EARNINGS:

    • Silver Wheaton (SLW CN) 6:30am, $0.43
    • Eastern Platinum (ELR CN) 8am, ($0.01)
    • SouthGobi (SGQ CN) 8am, $0.00
    • Groupon (GRPN) 4pm, $0.01
    • Agilent (A) 4pm, $0.73
    • Air Lease (AL) 4:05pm, $0.28
    • Renren (RENN) post-mkt, $0.04 

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG) 

  • Bullish Wagers Plunge Most in 2012 on Greek Impasse: Commodities
  • Commodities Decline for Ninth Day on Greek Crisis, China Concern
  • Oil Falls to 2012 Low on Greek Debt, Saudi Call for Price Drop
  • Gold Erases This Year’s Gain as Europe Concern Boosts Dollar
  • Copper Reaches Four-Month Low Amid Greek Euro-Exit Speculation
  • Palm Oil Plunges Most in 14 Months as Europe Debt Crisis Deepens
  • Soybeans Drop to Six-Week Low as U.S. Planting Accelerates
  • Cocoa Falls in London on Increased Sales and Weakening Demand
  • Gold VIX Near 10-Month Low Amid Bets Against Stimulus: Options
  • Power Company Bond Risk Climbs on Nuclear Shutdown: Japan Credit
  • Hedge Funds Cut Bets on Oil Before Seaway Shift: Energy Markets
  • China Coal Prices Drop in May for First Time in Three Years
  • Argentina as No Claims-Nation Revealed in Repsol Losses: Energy
  • ICE Adding Grains to Lure Hedge Funds Chasing USDA Price Swings
  • Gold ETF Assets in India Top Record 100 Billion Rupees in April
  • Tanzania Considers Copper-Ore Export Ban to Focus on Processing 

THE HEDGEYE DAILY OUTLOOK - 4

CURRENCIES


THE HEDGEYE DAILY OUTLOOK - 5

EUROPEAN MARKETS


ITALY – stocks down another -3.2% this morning puts Italy back into crash mode (down -21% from its March top); Spain is down -24% from its March top and Spanish CDS +24bps to a new record high of +540 this morning. How’s that Keynesian experiment treating everyone out there so far?

THE HEDGEYE DAILY OUTLOOK - 6

 

ASIAN MARKETS


INDIA – something not so funny happened on the way to India immediately after Bernanke decided to push easy money out to 2014 (Jan 25th Policy To Inflate date) – India started importing more inflation and real growth slowed; Sensex stopped going up in Feb = down -12.1% since; this morning’s inflation report for April was not good at +7.2% vs 6.9% in March.

THE HEDGEYE DAILY OUTLOOK - 7

 

 

MIDDLE EAST


THE HEDGEYE DAILY OUTLOOK - 8

The Hedgeye Macro Team