THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP – July 31, 2012


As we look at today’s set up for the S&P 500, the range is 35 points or -1.61% downside to 1363 and 0.92% upside to 1398. 

                                            

SECTOR AND GLOBAL PERFORMANCE


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EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: on 07/30 NYSE -88
    • Down  versus the prior day’s trading of 2012
  • VOLUME: on 07/30 NYSE 658.58
    • Decrease versus prior day’s trading of -27.85%
  • VIX:  as of 07/30 was at 18.03
    • Increase versus most recent day’s trading of 7.96%
    • Year-to-date decrease of -22.95%
  • SPX PUT/CALL RATIO: as of 07/30 closed at 1.00
    • Down from the day prior at 1.26 

CREDIT/ECONOMIC MARKET LOOK:


10yr – both the US and German 10yr fall right back after testing immediate-term TRADE resistance (yields); immediate-term TRADE resistance for the UST 10yr = 1.59%, so we bought back our long-bond TLT position on that yesterday, taking our Fixed Income asset allocation back up to 21%; the bond market has been nailing #GrowthSlowing since March. 

  • TED SPREAD: as of this morning 34
  • 3-MONTH T-BILL YIELD: as of this morning 0.11%
  • 10-Year: as of this morning 1.49%
    • Decrease from prior day’s trading at 1.50%
  • YIELD CURVE: as of this morning 1.27
    • Down from prior day’s trading at 1.28 

MACRO DATA POINTS (Bloomberg Estimates):

  • 7:45am/8:55am: ICSC/Redbook retail sales
  • 8:30am: Annual Revisions: Personal Income and Spending
  • 8:30am: Employment Cost Index, 2Q, est. 0.5% (prior 0.4%)
  • 8:30am: Personal Income, June, est. 0.4% (prior 0.2%)
  • 8:30am: Personal Spending, June, est. 0.1% (prior 0.0%)
  • 8:30am: PCE Deflator M/m, June, est. 0.0% (prior -0.2%)
  • 8:30am: PCE Core M/m, June, est. 0.2% (prior 0.1%)
  • 9am: S&P/CS 20 City M/m, May, est. 0.4% (prior 0.7%)
  • 9am: S&P/CaseShiller Home Price Index, May, est. 137.55 (prior 135.8)
  • 9:45am: Chicago Purchasing Manager, July, est. 52.4 (prior 52.9)
  • 10am: Consumer Confidence, July, est. 61.5 (prior 62)
  • 11am: Fed to purchase $4.25b-$5b notes due July 31, 2018-May 15, 2020
  • 11:30am: U.S. to sell 4-wk bills
  • 2pm: Fed will release tentative outright Treasury operation schedule
  • 4:30pm: API Inventories 

GOVERNMENT/POLITICS:

    • House Energy and Commerce subcommittee holds forum to discuss state and federal cooperation on the Clean Air Act, 2pm
    • House Oversight Committee hearing on federal privacy and data security, 10am
    • Senate Committee on Commerce, Science Transportation markup to extend 2006 law to stop spam, spyware, fraud across borders; nomination of Michael Huerta, to be FAA admin., 2:30am
    • Treasury Secretary Timothy F. Geithner speaks to the Los Angeles World Affairs Council on U.S, and world economies, 3pm
    • David Cohen, Treasury’s undersecretary for terrorism and financial intelligence, speaks at department’s public hearing on plans to propose rules on customer due diligence requirements for financial institutions, 9:30am
    • Senate Appropriations defense subcommittee drafts its version of the annual defense spending bill, 10:30am
    • Air Force holds press briefing at Pentagon on latest assessment of oxygen-deficiency symptoms that have affected pilots flying Lockheed Martin’s F-22 Raptor, 3pm
    • FERC Chairman Jon Wellinghoff discusses reliability of electric grid, EPA regulations, climate change in appearance at Platts Energy Podium, 1pm
    • ITC hears evidence in a microprocessors patent-infringement case brought against Apple by Taiwan-based VIA Technologies, which is affiliated with HTC, 9am

WHAT TO WATCH:  

  • Federal Open Markets Committee begins 2-day meeting
  • Euro-area unemployment rate reaches record 11.2%
  • Apple said to prepare iPhone redesign for Sept. 12 release
  • Yahoo Interim CEO Ross Levinsohn departs after Marissa Mayer gets CEO job
  • BP 2Q net loss $1.39b vs net income $5.72b Y/y
  • Cantor placed on review for cut by Moody’s amid trading weakness
  • Japan’s unexpected drop in unemployment helps sustain growth
  • UBS, Deutsche Bank profits decline, missing ests.
  • Panasonic 1Q net income 12.8b yen, analyst est. 9.2b yen
  • Honda 1Q net 131.7b yen, est. 150.7b yen
  • Manchester United seeks as much as $333m in U.S. IPO
  • Sanofi’s Genzyme unit sued by Teva over worker-raiding claims
  • RealD fell as much as 21% after missing ests. due to costs to supply theaters with new eyeglasses
  • Humana cuts profit forecast as rising Medicare costs surprise
  • Lehman raises $4.7b in 2Q toward creditor payments
  • Boeing 787’s debris-spewing GE engine to be dismantled in probe
  • Ex-UBS Officers “lied and cheated’ on muni bond deals, U.S. says

EARNINGS:

    • Yandex (YNDX) 6am, $0.16
    • Tyco (TYC) 6am, $0.93; Preview
    • Aetna (AET) 6am, $1.25
    • NiSource (NI) 6:30am, $0.20
    • Harris (HRS) 6:30am, $1.41
    • Goodyear Tire & Rubber (GT) 6:30am, $0.45
    • Cobalt International Energy (CIE) 6:40am, $(0.09)
    • Foster Wheeler (FWLT) 6:45am, $0.43
    • Delphi Automotive (DLPH) 7am, $0.92
    • Thomson Reuters (TRI CN) 7am, $0.50
    • Pfizer (PFE) 7am, $0.54; Preview
    • Dentsply International (XRAY) 7am, $0.56
    • Coach (COH) 7am, $0.85
    • TRW Automotive Holdings (TRW) 7am, $1.55
    • Archer-Daniels-Midland Co (ADM) 7am, $0.58
    • Entergy (ETR) 7am, $1.41
    • Discovery Communications (DISCA) 7am, $0.70
    • United States Steel (X) 7:05am, $0.49
    • Marathon Petroleum (MPC) 7:06am, $2.51; Preview
    • Public Service Enterprise Group (PEG) 7:30am, $0.45
    • Revlon (REV) 7:30am, $0.32
    • Cummins (CMI) 7:30am, $2.28
    • Valero Energy (VLO) 7:30am, $1.43; Preview
    • HCP (HCP) 7:45am, $0.68
    • Louisiana-Pacific (LPX) 8am, $0.05
    • George Weston (WN CN) 8am, C$0.96
    • Martin Marietta Materials (MLM) 8:05am, $1.01
    • Ecolab (ECL) 8:25am, $0.72
    • TransAlta (TA CN) 8:50am, C$(0.03)
    • Toromont Industries (TIH CN) 11:13am, C$0.36
    • Saputo (SAP CN) 11:58am, C$0.66
    • Edison International (EIX) 4pm, $0.32
    • WebMd (WBMD) 4pm, $0.123
    • Electronic Arts (EA) 4:01pm, $(0.42)
    • DreamWorks Animation SKG (DWA) 4:01pm, $0.25
    • Solar Capital (SLRC) 4:01pm, $0.58
    • Axis Capital Holdings (AXS) 4:01pm, $0.93
    • Life Technologies (LIFE) 4:01pm, $0.97
    • BMC Software (BMC) 4:05pm, $0.75
    • Take-Two Interactive (TTWO) 4:05pm, $(0.66)
    • ONEOK (OKE) 4:05pm, $0.33
    • ONEOK Partners (OKS) 4:05pm, $0.70
    • Allstate (ALL) 4:05pm, $0.52
    • QEP Resources (QEP) 4:05pm, $0.33
    • Genworth Financial (GNW) 4:07pm, $0.18
    • Arthur J Gallagher (AJG) 4:09pm, $0.56
    • Kimco Realty (KIM) 4:09pm, $0.31
    • Verisk Analytics (VRSK) 4:10pm, $0.47
    • Frontier Communications (FTR) 4:11pm, $0.05
    • RenaissanceRe Holdings (RNR) 4:22pm, $2.48
    • FMC (FMC) 4:30pm, $0.91
    • Jones Lang LaSalle (JLL) 4:30pm, $1.24
    • BRE Properties (BRE) 4:30pm, $0.58
    • DDR (DDR) 5pm, $0.25 

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)

 

GOLD – the #BailoutBulls are going for gold here into this week’s central planning events; TRADE resistance now support at $1606; long term-TAIL risk line up at $1679. Be careful what you beg for; another Qe will cut whatever is left of the US consumption growth phalanx to shreds. 

  • Most-Accurate Gold Forecasters Splitting After Rout: Commodities
  • Oil Supplies Decline in Survey on Refining High: Energy Markets
  • Grain Cargoes Seen Slowing Most in 19 Years on Drought: Freight
  • Corn Climbs to Record as Futures Head for Best Month Since 1988
  • Weak India Rains to Spur Record Cooking-Oil, Lentil Imports
  • Rubber Demand in China to Contract 5% as Truck Sales Tumble
  • Palm-Oil Shipments From Indonesia Set to Gain on Lower Duty
  • WTI Crude May Slump to $83 Fibonacci Level: Technical Analysis
  • Copper Rises as China Increases Spending on Railroad Network
  • Gold Seen Extending Monthly Gain on Monetary Easing Stimulus
  • Australia Wins as Buyers Shift to Wheat From Corn on Drought
  • Rice Stockpiles in Japan Seen Declining, Boosting Prices
  • Iron Ore Price Decline in China Seen by Arctic as Import Spur
  • Gold-Backed Loans to Climb at Indonesian Banks: Islamic Finance
  • Chinese Steelmakers Profit Tumbles 96% on Lower Demand, Prices
  • Oil Rises, Set for First Monthly Gain in Three on Stimulus Talk

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CURRENCIES

 

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EUROPEAN MARKETS

 

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ASIAN MARKETS


CHINA – last day of the month, so why not throw some Chinese rumoring on top of the markup pile? Regardless, Chinese stocks make fresh new lows, down another -0.3% (down -14.5% since May); we do not think they cut rates w/ $106/barrel Brent Oil.

 

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MIDDLE EAST

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The Hedgeye Macro Team