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TODAY’S S&P 500 SET-UP – September 13, 2012

As we look at today’s set up for the S&P 500, the range is 32 points or -1.22% downside to 1419 and 1.01% upside to 1451. 

                                            

SECTOR AND GLOBAL PERFORMANCE


THE HEDGEYE DAILY OUTLOOK - 1A

 

THE HEDGEYE DAILY OUTLOOK - 2

 

THE HEDGEYE DAILY OUTLOOK - 3

EQUITY SENTIMENT: 

  • ADVANCE/DECLINE LINE: on 09/12 NYSE 778
    • Decrease versus the prior day’s trading of 1030
  • VOLUME: on 09/12 NYSE 663.83
    • Decrease versus prior day’s trading of -0.47%
  • VIX:  as of 09/12 was at 15.80
    • Decrease versus most recent day’s trading of -3.72%
    • Year-to-date decrease of -32.48%
  • SPX PUT/CALL RATIO: as of 09/12 closed at 1.12
    • Down  from the day prior at 1.64

CREDIT/ECONOMIC MARKET LOOK:


QE4 – pushing the goal posts out a full year to 2014 on January 25th was Qe3. That, in turn, slowed growth (oil up). Now the question is will Bernanke push out investor duration by 12 months at a time every 3-6 months? Just pull forward all the yield and performance chasing into 2012 and hope for the best. US Dollar is the biggest ball under water trade I have seen in a very long time into a very big event.

  • TED SPREAD: as of this morning 29.77
  • 3-MONTH T-BILL YIELD: as of this morning 0.10%
  • 10-Year: as of this morning 1.74%
    • Decrease from prior day’s trading of 1.76%
  • YIELD CURVE: as of this morning 1.51
    • Down from prior day’s trading at 1.52 

MACRO DATA POINTS (Bloomberg Estimates)

  • 8am: RBC Consumer Outlook Index, Sept. (prior 46.4)
  • 8:30am: Producer Price Index M/m, Aug. est. 1.2% (prior 0.3%)
  • 8:30am: Initial Jobless Claims, Sept. 8, est. 370k (prior 365k)
  • 8:30am: Continuing Claims, Sept. 1 est. 3.318m (prior 3.322m)
  • 9:45am: Bloomberg Consumer Comfort, Sept. 9 (prior -46.5)
  • 10am: Freddie Mac mortgage rates
  • 10:30am: EIA natural-gas change
  • 11am: U.S. to announce plans for 10-yr TIPS auction on Sept. 20
  • 12:30pm: FOMC rate decision
  • 1pm: U.S. sells $13b 30-yr bonds
  • 2pm: Fed to release projections of economy, interest rates
  • 2pm: Monthly Budget Statement, Aug. est. -$170.0b (prior - $134.1b)
  • 2:15pm: Fed’s Bernanke holds news conference

 GOVERNMENT:

    • Obama administration may detail sequestration cuts
    • House, Senate in session
    • House Armed Services panel holds hearing on F-22 pilot physiological issues, 10am
    • House Oversight panel meets on spending for reconstruction in Afghanistan, 10am
    • Interior Dept. officials testify on land, minerals management at House Natural Resources hearing, 10am
    • House Energy panel holds hearing on U.S. energy independence, with Daniel Ahn, chief commodity economist for Citi; John Freeman, managing director of Raymond James; John Purcell, vice president for wind Energy at Leeco Steel, 10am
    • Senate Banking hears from Consumer Financial Protection Bureau Director Richard Cordray on agency operation, 10am
    • House Financial Services, Government Reform panels hold joint hearing on implementation of Jumpstart Our Business Startups Act, known as the JOBS Act, passed in April, 10am
    • House Financial Services panel holds hearing on “Examining the Uses of Consumer Credit Data,” 2pm
    • Senate Judiciary considers amending US law to clarify video tape service providers’ consent policies, 10am
    • House Intelligence holds hearing on “National Security Threats Posed by Chinese Telecom Companies Working in the U.S.,” with representatives from Huawei, ZTE, 10am
    • House Energy panel holds hearing on “Creating Opportunities through Improved Government Spectrum Efficiency,” with Steve Sharkey of T-Mobile USA, 10:15am
    • House Transportation panel holds hearing on effectiveness of DOT’s truck and bus safety program, with Scott Mugno, vice president at FedEx Ground, 10am 

WHAT TO WATCH:

  • U.S. investors betting central bank will keep rate near zero
  • Possible EADS, BAE merger may generate FY sales of ~$100b
  • ECB member says central bank may never need to buy bonds
  • SNB to maintain FX ceiling at 1.2 francs per euro
  • Freddie Mac may get additional $3.4b in mortgage buybacks
  • Moore Capital said to cut jobs in team restructuring
  • Itochu in talks with Dole to buy packaged-food unit, Asian fruit & vegetable business
  • Nomura’s Americas equities chief O’Kelly leaving amid overhaul
  • Manhattan apartment vacancy rate rises as rents reach record
  • U.S. embassy compound in Yemen stormed as film protests spread 

EARNINGS: (All times ET, with Bloomberg est.)

    • Pier 1 Imports (PIR) 6am, $0.19
    • Empire (EMP/A CN) Pre-mkt, C$1.40

 COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)

  • Soy Rally Pushes Amazon Growers to Sow Record Crop: Commodities
  • Chesapeake’s McClendon Taps Expanding Shale Oil Demand: Energy
  • Gold Seen Falling Before Federal Reserve; Palladium Extends Gain
  • Oil Trades Near Three-Week High on Mideast Protests, Fed Meeting
  • Copper Swings Between Gains and Drops Before Fed Policy Decision
  • Sugar Rises a Second Day as Brazil Rains May Return; Cocoa Gains
  • Wheat Futures Climb as Importers Including Egypt Seek Supplies
  • Indonesian Tin Smelters Resume Output After Metal Rallies
  • Aluminum Stockpiles Climb the Most This Year on Detroit Jump
  • LNG Shortage in Japan Spurring Record Expansion: Energy Markets
  • Rebars Poised for First Weekly Gain in Five on Baoshan Pricing
  • Cocoa Shipments From Indonesia Seen Declining on Local Grinding
  • ‘Tomato Trade War’ Seen Sparking Broader U.S.-Mexico Food Fight
  • Rubber Drops From Eight-Week High Ahead of Fed Stimulus Decision
  • Palm Oil Declines as Stockpiles Set to Climb on Output Increase
  • Thai Government May Buy 300,000 Tons of Rubber to Bolster Prices

THE HEDGEYE DAILY OUTLOOK - 4

CURRENCIES


THE HEDGEYE DAILY OUTLOOK - 5

EUROPEAN MARKETS


EUROPE – with the exception of Germany (making higher-highs vs March), all European Equity Indices are making lower-highs again this morning; stagflation is ultimately what Europe has to deal with now at $116 Brent Oil. 1970s stagflation kept US Equities at 7-8x earnings don’t forget. Short-term market moves do not represent economic realities.

THE HEDGEYE DAILY OUTLOOK - 6

 

ASIAN MARKETS


CHINA – We know, it’s weird, but after 6wks of rumors about the stimuli coming out of China, reality is there has been none – the Chinese do not appreciate the food/oil inflation Bernanke is perpetuating; Chinese stocks down -0.8% before his un-elected lordship provides causality and correlation to commodity markets.

THE HEDGEYE DAILY OUTLOOK - 7

 

 

MIDDLE EAST


THE HEDGEYE DAILY OUTLOOK - 8

The Hedgeye Macro Team