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THE M3: CRA FINES; JULY VISITATION; CHANGI JULY TRAFFIC

The Macau Metro Monitor, August 22, 2012

 

 

MBS AND RWS FINED FOR BREACHING SOCIAL SAFEGUARDS TodayOnline

Casino Regulatory Authority of Singapore (CRA) has fined MBS and RWS S$357,500 and S$140,000 respectively for breaking social safeguard requirements, such as letting Singaporeans and Permanent Residents enter without paying the S$100 entry levies.  The breaches took place between May and October 2011. In addition, RWS has been censured for three cases of similar breaches during the period and MBS censured for failing to display appropriate message on its progressive jackpot system on Oct 18, 2011.

 

VISITOR ARRIVALS FOR JULY 2012 DSEC

Visitor arrivals decreased by 4.2% YoY to 2,444,264 in July 2012.  The average length of stay of visitors stood at 1.0 day, down by 0.1 day YoY.  Visitors from Mainland China decreased slightly by 0.3% YoY to 1,456,351, coming mostly from Guangdong Province (683,285), Fujian Province (70,439) and Zhejiang Province (56,937); Mainland visitors traveling under the Individual Visit Scheme rose by 4.1% to 643,147.  Visitors from the Republic of Korea (36,030) and Japan (35,132) increased by 2.0% and 20.1% YoY respectively, while those from Hong Kong (639,580) and Taiwan (112,263) both registered a decrease of 11.1%.

 

THE M3:  CRA FINES;  JULY VISITATION; CHANGI JULY TRAFFIC - MACAU1

 

CHANGI AIRPORT PASSENGER TRAFFIC UP 4.5% IN JULY Strait Times

Passenger traffic at Changi Airport grew by 4.5% in July to hit 4.36 million.  Changi Airport Group said that traffic to and from the Middle East, Southwest Pacific and the Americas remained strong and witnessed double-digit growth.  However, the growth in Southeast Asia and Northeast Asia traffic was weaker and in the low single digits. These two regions account for about 70% of total passenger traffic at Changi.

 

THE M3:  CRA FINES;  JULY VISITATION; CHANGI JULY TRAFFIC - changi

 



THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP – August 22, 2012


As we look at today’s set up for the S&P 500, the range is 10 points or -0.30% downside to 1409 and 0.41% upside to 1419. 

                                            

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 08/21 NYSE -344
    • Decrease versus the prior day’s trading of -343
  • VOLUME: on 08/21 NYSE 640.96
    • Increase versus prior day’s trading of 16.39%
  • VIX:  as of 08/21 was at 15.02
    • Increase versus most recent day’s trading of 7.13%
    • Year-to-date decrease of -35.81%
  • SPX PUT/CALL RATIO: as of 08/21 closed at 1.10
    • Down from the day prior at 2.44

CREDIT/ECONOMIC MARKET LOOK:

  • TED SPREAD: as of this morning 33
  • 3-MONTH T-BILL YIELD: as of this morning 0.10%
  • 10-Year: as of this morning 1.78%
    • Decrease from prior day’s trading of 1.80%
  • YIELD CURVE: as of this morning 1.50
    • Down from prior day’s trading of 1.51

MACRO DATA POINTS (Bloomberg Estimates)

  • 7am: MBA Mortgage Applications, Aug. 17 (prior -4.5%)
  • 10am: Existing Home Sales, July, est. 4.51m (prior 4.37m)
  • 10am: Existing Home Sales, July, est. 3.2% M/m (prior -5.4%)
  • 10:30am: DoE Inventories
  • 2pm: FOMC Meeting Minutes

GOVERNMENT:

    • House, Senate not in session
    • SEC holds meeting on disclosure rules regarding conflict minerals, payments to governments made by resource extraction issuers, 10am
    • Federal Reserve Bank of Chicago President Charles Evans holds press briefing at U.S. embassy in Beijing, 11:30pm
    • U.S. Census Bureau holds webinar on foreign trade rules, with ombudsman Omari Wooden, 1pm
    • Commerce Dept.’s National Telecommunications and Information Administration meets on consumer data privacy codes of conduct concerning mobile application transparency, 9:30am
    • NRC, FEMA hold conference call to discuss emergency preparedness plans at U.S. nuclear power plants, 2pm

WHAT TO WATCH: 

  • Verizon Wireless said to be planning to sell Nokia with Microsoft’s Windows 8 software this year
  • UPS extends offer period for TNT to Nov. 9 from Aug. 31
  • Dell says PC business deteriorated more than expected
  • RBS said to be probed by U.S. over Iranian sanctions
  • Carl Icahn withdraws offer to take CVR Energy private
  • Jury in Apple, Samsung patent trial begin deliberations
  • ATP wins prelim. approval for bankruptcy financing
  • Sales of existing U.S. homes probably climbed 3.2% in July
  • Exxon, BHP, other energy, mining firms may need to report what they pay each country they tap resources from under rule SEC has votes to adopt
  • BHP delays $68b of project approvals, profit plunges
  • Sirius directors sued by investors for failing to defend co. from potential takeover by Liberty Media
  • IAC/InterActiveCorp said to have offered more than $300m to buy About.com, topping bid from Answers Corp.
  • Allianz trims asset-mgmt unit targets on Europe debt crisis
  • Microsoft, Samsung may face greater scrutiny of labor practices as Apple’s biggest supplier improves conditions at its Chinese plants
  • Japan swings to trade deficit as Europe drags down exports
  • Wet Seal hired financial advisers, adopted poison pill
  • SEC should approve Nasdaq’s proposal to pay firms $62m for losses suffered in Facebook’s IPO, Citadel said
  • Electronic Arts’s PopCap Games fired ~10% of staff

EARNINGS:

    • Express (EXPR) 7am, $0.17
    • Chico’s FAS (CHS) 7:15am, $0.30
    • American Eagle Outfitters (AEO) 8am, $0.21
    • Eaton Vance (EV) 8:40am, $0.47
    • International Rectifier (IRF) 4pm, $(0.15)
    • Kayak Software (KYAK) 4pm, $0.24
    • Hain Celestial (HAIN) 4pm, $0.45
    • Synopsys (SNPS) 4:05pm, $0.50
    • Prospect Capital (PSEC) 4:05pm, $0.40
    • Guess? (GES) 4:05pm, $0.51
    • Hewlett-Packard (HPQ) 4:05pm, $0.98
    • Semtech (SMTC) 4:30pm, $0.41
    • Heico (HEI) 4:40pm, $0.41

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)

 

THE HEDGEYE DAILY OUTLOOK - 4

 

 

CURRENCIES

 

THE HEDGEYE DAILY OUTLOOK - 5

 

 

EUROPEAN MARKETS

 

THE HEDGEYE DAILY OUTLOOK - 6

 

 

ASIAN MARKETS

 

THE HEDGEYE DAILY OUTLOOK - 7

 

 

MIDDLE EAST


THE HEDGEYE DAILY OUTLOOK - 8

 

 

 

The Hedgeye Macro Team


CHART DU JOUR: IGT BUYBACK

A pictorial view

 

  • IGT bought back 110 million shares over the past 8 years, or almost 30% of the outstanding shares
  • The buyback has been very accretive to EPS but hasn’t done much for the stock.  The stock is at the low end of its 8 year range and 76% off its high in early 2008
  • Nevertheless, we are currently projecting almost 25% EPS growth in FY2013 which, if achieved, would likely result in significant share appreciation – the one advantage of low expectations

 

CHART DU JOUR: IGT BUYBACK - IGT


investing ideas

Risk Managed Long Term Investing for Pros

Hedgeye CEO Keith McCullough handpicks the “best of the best” long and short ideas delivered to him by our team of over 30 research analysts across myriad sectors.

The Reversal: SP500 Levels, Refreshed

Takeaway: With global growth slowing, this isn’t the place to chase low volume equity rallies.

POSITIONS: Long Healthcare (XLV), US Dollar (UUP), Flattner (FLAT), Longer Term Treasury Bond (TLT), Short Euro (FXE), France (EWQ) and SPY

 

Midmorning today, it looked like the bulls were once again fully in charge of the SP500.  The index traded through 1,425 and appeared to be on pace to close at a new yearly high . . . and then we reversed.  From the highs of the day, the SP500 is now off 0.85%.

 

In our models, this type of a move is significant.  It is called an “outside day” and occurs when the market tests the prior closing high, fails, and then closes below the prior closing high.  In this case, that prior closing high is 1,419.

 

In the chart below, we’ve highlighted our current risk management levels.  The sell TRADE line is at 1,419, the buy TRADE lines is 1,410, and the buy TREND line is down at 1,384.  In essence, if 1,410 doesn’t hold . . . look out below.

 

We’ve been clear on our view that with global growth slowing, this isn’t the place to chase low volume equity rallies.  In particular, chasing equities at a time when the VIX is sub 15 has been exactly the wrong call over the last three years.  Currently, the VIX is up 7.4% on the day to 15.07.

 

For those looking to add some short exposure to your portfolios, we are currently short these individual stock names in the Virtual Portfolio:

 

  • Freeport-McMoran Copper and Gold (FCX);
  • Caterpillar (CAT);
  • United Airlines (UAL);
  • Dominoes Pizza (DPZ);
  • American Express (AXP);
  • MGM Resorts (MGM); and
  • Morgan Stanley (MS).

Ping if you want to talk to one of our Sector Heads on these names. 

 

Daryl G. Jones

Director of Research

 

The Reversal: SP500 Levels, Refreshed - SPX


Saving Europe

SAVING EUROPE

 

 

CLIENT TALKING POINTS

 

SAVING EUROPE

Tons of rumors coming out of Europe this morning. But that’s really all you need is one good, juicy rumor to save the day. In this case, it’s that Germany will go out buying unlimited peripheral debt in order to stabilize the Eurozone. Der Spiegel also reported that Germany was looking for way to cap yields on Spanish and Italian debt. This is all pretty ridiculous. Let’s sit back and see what happens. Without a doubt, US equities will respond positively to the news.

 

 

BUBBLING CRUDE

WTI crude futures are up on the NYMEX – more than 1.6% as of writing sending oil to $97.60 a barrel. The race to drive oil prices back up is upon us apparently. We never understood the hysteria surrounding why traders and investors want higher food and fuel prices. But one thing is certain: if you get the dollar right, you get a lot of other things right. And with the dollar down this morning, this move in oil makes sense and will continue higher should the dollar drop further.

 

_______________________________________________________

 

ASSET ALLOCATION

 

Cash:                  Flat   

 

U.S. Equities:   Flat   

 

Int'l Equities:   Flat   

 

Commodities: Flat

 

Fixed Income:  Flat

 

Int'l Currencies: UP   

 

 

_______________________________________________________

 

TOP LONG IDEAS

 

NIKE INC (NKE)

Nike’s challenges are well-telegraphed. But the reality is that its top line is extremely strong, and the Olympics has just given Nike all the ammo it needs to marry product with marketing and grow in the 10% range for the next 2 years. With margin pressures easing, and Cole Haan and Umbro soon to be divested, the model is getting more focused and profitable.

  • TRADE:  LONG
  • TREND:  LONG
  • TAIL:      LONG            

 

FIFTH & PACIFIC COMPANIES (FNP)

The former Liz Claiborne (LIZ) is on the path to prosperity. There’s a fantastic growth story with FNP. The Kate Spade brand is growing at an almost unprecedented clip. Save for Juicy Couture, the company has brands performing strongly throughout its entire portfolio. We’re bullish on FNP for all three durations: TRADE, TREND and TAIL.

  • TRADE:  LONG
  • TREND:  LONG
  • TAIL:      LONG

 

LAS VEGAS SANDS (LVS)

LVS finally reached and has maintained its 20% Macau gaming share, thanks to Sands Cotai Central (SCC). With SCC continuing to ramp up, we expect that level to hold and maybe, even improve. Macau sentiment has reached a yearly low but we see improvement ahead.

  • TRADE:  LONG
  • TREND:  NEUTRAL
  • TAIL:      NEUTRAL

  

_______________________________________________________

 

THREE FOR THE ROAD

 

TWEET OF THE DAY

“We're about due for a $GS super-spike oil note up here.. $255 Brent here we come” -@HedgeyeENERGY

 

 

QUOTE OF THE DAY

“It's all right letting yourself go as long as you can let yourself back.” – Mick Jagger

                   

 

STAT OF THE DAY

$17. The record price of soy beans per bushel as commodity prices shoot higher.

 



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