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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

 

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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 

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CURRENCIES

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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.

 

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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).

 

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MIDDLE EAST


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The Hedgeye Macro Team