THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP – July 12, 2012


As we look at today’s set up for the S&P 500, the range is 21 points or -0.63% downside to 1333 and 0.94% upside to 1354. 

                                            

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 07/11 NYSE 75
    • Up versus the prior day’s trading of -955
  • VOLUME: on 07/11 NYSE 767.99
    • Increase versus prior day’s trading of 5.55%
  • VIX:  as of 07/11 was at 17.95
    • Decrease versus most recent day’s trading of -4.11%
    • Year-to-date decrease of -23.29%
  • SPX PUT/CALL RATIO: as of 07/11 closed at 1.10
    • Down from the day prior at 1.69 

CREDIT/ECONOMIC MARKET LOOK:


10YR – fresh new #GrowthSlowing lows for the 10yr yield at 1.49% this morning and that’s really bad for the Financials, as the Yield Spread (10s/2s) also hits new lows at +123bps wide; not clear if Dimon’s fireside chat w/ the sell side’s finest tomorrow will change the economic gravity of the matter – the Yield Spread has never not gone back to flat in a big cycle (see 60yr chart from our deck yesterday). 

  • TED SPREAD: as of this morning 36
  • 3-MONTH T-BILL YIELD: as of this morning 0.09%
  • 10-Year: as of this morning 1.48%
    • Decrease from prior day’s trading at 1.52%
  • YIELD CURVE: as of this morning 1.23
    • Down from prior day’s trading at 1.26 

MACRO DATA POINTS (Bloomberg Estimates): 

  • 8:30am: Import Price Index M/m, June, est. -1.8% (prior -1%)
  • 8:30am: Initial Jobless Claims, July 7, est. 370k (prior 374k)
  • 9:45am: Bloomberg Consumer Comfort, July 8 (prior -37.5)
  • 10am: Freddie Mac mortgage rates
  • 10:30am: EIA natural-gas change
  • 11am: Fed to sell $7b-$8b coupon securities in 7/15/2013 to 1/31/2014 range
  • 1pm: U.S. to sell $13b 30-yr bonds (reopening)
  • 2pm: Monthly Budget Stmt, June, est. $60b (prior $43.1b)
  • 2pm: NAHB midyear forecast
  • 3:40pm: Fed’s Williams speaks in Portland, Ore. 

GOVERNMENT:

    • House, Senate in session
    • Senate Energy meets to review progress on eliminating environmental hazards at abandoned National Petroleum Reserve oil wells in Alaska, 9:30am
    • House Energy panel holds hearing on proposed legislation to limit government programs backing alternative energy, 9:15am
    • House Science panel holds hearing on spurring economic growth through NASA-derived technologies, 10am
    • Dept. of Labor to announce settlement with BP regarding 2005 explosion at Texas City refinery, 11am

WHAT TO WATCH: 

  • Yahoo! holds annual meeting today
  • Yahoo! expected to name Levinsohn CEO: LA Times
  • Blackstone teams up with investors for ING Asia insurance bid
  • Supervalu sinks on strategic review, dividend suspension
  • Peregrine customers’ claims priced at 25 cents on dollar
  • ECB says overnight deposits fall to lowest in 7 mos.
  • Maple, TMX Group obtain recognition orders from BCSC, ASC
  • Dentsu buys Aegis in $4.9b deal to create global media, marketing network
  • Peugeot shuts France plant, cuts extra 8,000 jobs; GM owns 7% of Peugeot
  • JPMorgan is No. 1 stock picker in buy-side survey
  • CFTC poised to adopt client-fund safeguards after MF Global
  • DirecTV, Viacom talks continue as channels stay dark 

EARNINGS:

    • Cogeco Cable (CCA CN) 6am, C$1.06
    • Cogeco (CGO CN) 6am, C$0.99
    • Corus Entertainment (CJR/B CN) 7am, C$0.49
    • Fastenal (FAST) 7am, $0.37
    • Astral Media (ACM/A CN) 7:55am, C$1.01
    • Progressive (PGR) 8:30am, $0.27
    • Commerce Bancshares (CBSH) 9am, $0.72
    • Novagold (NG CN) 9:15am, $(0.06)
    • Resources Connection (RECN) 4pm, $0.72
    • Bank of the Ozarks (OZRK) 6pm, $0.52 

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG) 

  • Gold 22% Rally to Record Seen by Sprott Amid Debt: Commodities
  • Refineries Doubling Shutdowns Signals Oil Slide: Energy Markets
  • Oil Falls on Signs Faltering Economy Is Eroding Fuel Consumption
  • Cocoa Declines After Drop in European Cocoa Grind; Sugar Gains
  • Goldman Lifts Grain-Price Forecasts as Drought Withers Fields
  • Gold Retreats as Fed’s Minutes Lack Additional Stimulus Signal
  • South African Platinum Output Falls for 11th Month on Prices
  • Aid Welcomed by Drought-Stricken States as Losses Seen Worsening
  • China Crushers Buy More Local Soybeans as Cost of Imports Jumps
  • Cooking-Oil Imports by India Fall as Rupee Drop Deter Buyers
  • Palm Oil Drops for a Third Day on Concern Slowdown Curbs Demand
  • Sandfire Proves Cheapest Copper Target on First Profit: Real M&A
  • Russia’s Stavropol Region Is Seen Reaping 40% to 45% Less Grain
  • IEA Sees Global Oil Demand Growth Pickup in 2013 on Economy
  • Copper Seen Falling Amid Further Signs of Worldwide Slowdown
  • Corn Advances After USDA Cuts Outlook on U.S., World Harvests 

THE HEDGEYE DAILY OUTLOOK - 4

 

 

CURRENCIES

 

THE HEDGEYE DAILY OUTLOOK - 5

 

 

EUROPEAN MARKETS


ITALY – Mario wasn’t kidding; it’s time to get out – the MIB Index -1.1% leads losers this morning and moves right back into crash mode (> 20% peak/trough decline YTD); Italy looks more suspect here than Spain – we went through why its size concerns us on our Q3 Macro Themes Call yesterday – email us if you missed the call and want the replay/slides.

 

THE HEDGEYE DAILY OUTLOOK - 6

 

 

ASIAN MARKETS


KOSPI – continues to be one of our most stealth leading indicators for Global Growth (particularly for Industrials and Tech), and apparently the South Koreans agree w/ us – they cut rates for the 1st time in 3yrs last night – and, contrary to popular #BailoutBull beliefs, that was not good for Asian stocks; KOSPI down hard on that -2.3% (Bearish Formation).

 

THE HEDGEYE DAILY OUTLOOK - 7

 

 

MIDDLE EAST


THE HEDGEYE DAILY OUTLOOK - 8

 

 

 

The Hedgeye Macro Team


Cartoon of the Day: Hard-Headed Bears

How's this for "hard data"? So far, 107 of 497 S&P 500 companies have reported aggregate sales and earnings growth of 4.4% and 13.2% respectively.

read more

Premium insight

McCullough [Uncensored]: When People Say ‘Everyone is Bullish, That’s Bulls@#t’

“You wonder why the performance of the hedge fund indices is so horrendous,” says Hedgeye CEO Keith McCullough, “they’re all doing the same thing, after the market moves. You shouldn’t be paid for that.”

read more

SECTOR SPOTLIGHT Replay | Healthcare Analyst Tom Tobin Today at 2:30PM ET

Tune in to this edition of Sector Spotlight with Healthcare analyst Tom Tobin and Healthcare Policy analyst Emily Evans.

read more

Ouchy!! Wall Street Consensus Hit By Epic Short Squeeze

In the latest example of what not to do with your portfolio, we have Wall Street consensus positioning...

read more

Cartoon of the Day: Bulls Leading the People

Investors rejoiced as centrist Emmanuel Macron edged out far-right Marine Le Pen in France's election day voting. European equities were up as much as 4.7% on the news.

read more

McCullough: ‘This Crazy Stat Drives Stock Market Bears Nuts’

If you’re short the stock market today, and your boss asks why is the Nasdaq at an all-time high, here’s the only honest answer: So far, Nasdaq company earnings are up 46% year-over-year.

read more

Who's Right? The Stock Market or the Bond Market?

"As I see it, bonds look like they have further to fall, while stocks look tenuous at these levels," writes Peter Atwater, founder of Financial Insyghts.

read more

Poll of the Day: If You Could Have Lunch with One Fed Chair...

What do you think? Cast your vote. Let us know.

read more

Are Millennials Actually Lazy, Narcissists? An Interview with Neil Howe (Part 2)

An interview with Neil Howe on why Boomers and Xers get it all wrong.

read more

6 Charts: The French Election, Nasdaq All-Time Highs & An Earnings Scorecard

We've been telling investors for some time that global growth is picking up, get long stocks.

read more

Another French Revolution?

"Don't be complacent," writes Hedgeye Managing Director Neil Howe. "Tectonic shifts are underway in France. Is there the prospect of the new Sixth Republic? C'est vraiment possible."

read more

Cartoon of the Day: The Trend is Your Friend

"All of the key trending macro data suggests the U.S. economy is accelerating," Hedgeye CEO Keith McCullough says.

read more