THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP – July 20, 2012


As we look at today’s set up for the S&P 500, the range is 27 points or -1.64% downside to 1354 and 0.33% upside to 1381. 

                                            

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 07/19 NYSE 109
    • Down versus the prior day’s trading of 742
  • VOLUME: on 07/19 NYSE 756.55
    • Increase versus prior day’s trading of 4.00%
  • VIX:  as of 07/19 was at 15.45
    • Decrease versus most recent day’s trading of -4.39%
    • Year-to-date decrease of -33.97%
  • SPX PUT/CALL RATIO: as of 07/19 closed at 1.24
    • Down from the day prior at 1.32 

CREDIT/ECONOMIC MARKET LOOK:

  • TED SPREAD: as of this morning 38
  • 3-MONTH T-BILL YIELD: as of this morning 0.08%
  • 10-Year: as of this morning 1.48%
    • Decrease from prior day’s trading at 1.51%
  • YIELD CURVE: as of this morning 1.27
    • Down from prior day’s trading at 1.29 

MACRO DATA POINTS (Bloomberg Estimates): 

  • 11am: Fed to sell $7b to $8b notes maturing Sept. 15, 2014- April 30, 2015
  • 1pm: Baker Hughes rig count

GOVERNMENT:

    • House, Senate in session
    • House Financial Services panel holds hearing on impact of Dodd-Frank Act on municipal finance, 9:30am
    • House Armed Services panel meets on shipbuilding, defense industrial base amid fiscal uncertainty, 11am
    • House Natural Resources panel holds hearing on helium shortages, impact on defense, economy, 9:30am
    • House Energy and Commerce panel holds hearing Energy Dept.’s “Nuclear Weapons Complex,” 9:30am
    • House Armed Services panel meets on shipbuilding, defense industrial base amid fiscal uncertainty, 11am
    • Super-PACs, presidential campaigns required to report monthly fundraising, spending to Federal Election Commission by midnight
    • Effective date for final Fed rule on implementing section 618 of Dodd-Frank, Treasury’s assessment of fees on bank holding companies and non-bank financial firms supervised by Fed to cover costs of Financial Research Fund
    • Commerce Dept.’s Bureau of Industry and Security meets on export controls
    • FCC Open Internet Advisory Committee holds first meeting

WHAT TO WATCH: 

  • Google revenue surges on Motorola deal, growth in ad clicks
  • Microsoft unearned revenue tops estimates on upgrades
  • Yahoo discloses compensation for new CEO Mayer in filings
  • Heineken bids as much as $6b for Asia Pacific Breweries
  • Palo Alto, Kayak raise more than planned in IPOs
  • Citigroup sees significant charge after Smith Barney valuation
  • Vodafone sales trail ests as Spain, Italy spending sinks
  • Euro-area finance ministers hold conference call on Spain’s bailout; Spain insists $15b aid for regions won’t swell debt
  • Japan seeks to criminalize underwriters on insider breaches
  • U.S. GDP, Facebook Earnings, Olympics: Week Ahead July 21-28

EARNINGS:

    • SunTrust Banks (STI) 6am, $0.44
    • Baker Hughes (BHI) 6am, $0.77; Preview
    • Schlumberger (SLB) 6am, $1.00; Preview
    • General Electric (GE) 6:30am, $0.37; Preview
    • American Electric Power (AEP) 6:57am, $0.72
    • Ingersoll Rand (IR) 7am, $0.91
    • First Horizon National (FHN) 7am, $(0.49)
    • IDEXX Laboratories (IDXX) 7am, $0.90
    • Xerox (XRX) 7:15am, $0.26
    • Manpower (MAN) 7:30am, $0.71
    • Sensient Technologies (SXT) 7:57am, $0.71 

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)

 

OIL – we shorted Oil yesterday because it ran right back up to my intermediate-term TREND line ($108.79 Brent) and failed. We’re getting longer of USD and Treasury Flattener here. We know it’s the hardest thing to do at 15 VIX, and we like it.

 

THE HEDGEYE DAILY OUTLOOK - 4

 

 

CURRENCIES


THE HEDGEYE DAILY OUTLOOK - 5

 

 

EUROPEAN MARKETS


ITALY – after all the rumoring, the MIB Index is leading losers in Europe this morning and back in crash mode (-21% from March); a General Strike is finally pending and there is no functional bailout mechanism for the Italians until the Germans ratify whatever the bailout is supposed to look like on September 12th.

 

THE HEDGEYE DAILY OUTLOOK - 6

 

 

ASIAN MARKETS


JAPAN – the Nikkei (and Shanghai Comp) have been flashing the most glaring bearish divergences vs this no-volume squeeze in US equities all week. Post the US green close, Japanese stocks opened up, then closed down hard -1.4% as this Global Industrial slowdown accelerates on the downside (Nikkei draw-down = -15.4% since March, 5x that of the SPY here).

 

THE HEDGEYE DAILY OUTLOOK - 7

 

 

MIDDLE EAST

 

THE HEDGEYE DAILY OUTLOOK - 8

 

 

 

The Hedgeye Macro Team


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

A Sneak Peek At Hedgeye's 2017 GDP Estimates

Here's an inside look at our GDP estimates versus Wall Street consensus.

read more

Cartoon of the Day: Green Thumb

So far, 64 of 498 companies in the S&P 500 have reported aggregate sales and earnings growth of 6.1% and 16.8% respectively.

read more

Europe's Battles Against Apple, Google, Innovation & Jobs

"“I am very concerned the E.U. maintains a battle against the American giants while doing everything possible to sustain so-called national champions," writes economist Daniel Lacalle. "Attacking innovation doesn’t create jobs.”

read more

An Open Letter to Pandora Management...

"Please stop leaking information to the press," writes Hedgeye Internet & Media analyst Hesham Shaaban. "You are getting in your own way, and blowing up your shareholders in the process."

read more

A 'Toxic Cocktail' Brewing for A Best Idea Short

The first quarter earnings pre-announcement today is not the end of the story for Mednax (MD). Rising labor costs and slowing volume is a toxic cocktail...

read more

Energy Stocks: Time to Buy? Here's What You Need to Know

If you're heavily-invested in Energy stocks it's been a heck of a year. Energy is the worst-performing sector in the S&P 500 year-to-date and value investors are now hunting for bargains in the oil patch. Before you buy, here's what you need to know.

read more

McCullough: ‘My 1-Minute Summary of My Institutional Meetings in NYC Yesterday’

What are even some of the smartest investors in the world missing right now?

read more

Cartoon of the Day: Political Portfolio Positioning

Leave your politics out of your portfolio.

read more