TODAY’S S&P 500 SET-UP – October 11, 2012
As we look at today’s set up for the S&P 500, the range is 19 points or -0.25% downside to 1429 and 1.08% upside to 1448.
SECTOR AND GLOBAL PERFORMANCE
EQUITY SENTIMENT:
- ADVANCE/DECLINE LINE: on 10/10 NYSE -737
- Increase versus the prior day’s trading of -1639
- VOLUME: on 10/10 NYSE 590.82
- Decrease versus prior day’s trading of -3.54%
- VIX: as of 10/10 was at 16.29
- Decrease versus most recent day’s trading of -0.49%
- Year-to-date decrease of -30.38%
- SPX PUT/CALL RATIO: as of 10/10 closed at 1.67
- Down from the day prior at 2.35
CREDIT/ECONOMIC MARKET LOOK:
- TED SPREAD: as of this morning 24.62
- 3-MONTH T-BILL YIELD: as of this morning 0.09%
- 10-Year: as of this morning 1.69%
- Increase from prior day’s trading of 1.67%
- YIELD CURVE: as of this morning 1.43
- Up from prior day’s trading at 1.41
MACRO DATA POINTS (Bloomberg Estimates)
- 8:30am: Import Price Index M/m, Sept., est. 0.7%
- 8:30am: Trade Deficit, Aug. est. -$44b (prior -$42b)
- 8:30am: Initial Jobless Claims, Oct. 6 est. 370k
- 8:30am: WASDE crop statistics
- 9:45am: Bloomberg Consumer Comfort, Oct. 7 (prior -36.9)
- 10am: Bloomberg U.S. Economic Survey for Oct.
- 10am: Fed’s Stein speaks on monetary policy in Washington
- 10am: Freddie Mac mortgage rates
- 10:30am: EIA natural gas storage change
- 11am: DoE energy inventory statistics
- 11am: Fed to buy $750m-$1.25b notes due 1/15/2019-2/15/2042
- 11am: U.S. announces plans for 30-yr TIPS auction
- 11:15am: Fed’s Raskin speaks on gender equality panel in France
- 12:30pm: Fed’s Plosser speaks on economy in Pennsylvania
- 1pm: U.S. to sell $13b 30-yr bonds in reopening
- 2pm: Tentative release time for budget statement for end of fiscal 2012
- 6pm: Fed’s Bullard meets with reporters in St. Louis
GOVERNMENT:
- SEC holds a closed meeting in enforcement matters, 2pm
- U.S.-China Economic and Security Review Commission begin two-day meeting to prepare 2012 annual report to Congress. Agenda includes: trade and economic relationship, 9am
- Commerce Dept., International Trade Administration meet to discuss environmental technologies trade policies, 9am
- Former Treasury Secretary Lawrence Summers speaks at Center for American Progress, 1:30pm
- Energy and Cleantech Conference, with speakers including Green Mountain Energy Co. CEO James Steffes, 9:30am
- NASA conference call w/ Curiosity updates, 2pm
WHAT TO WATCH:
- Spain debt is downgraded to one level above junk by S&P
- U.S. trade gap probably widened in Aug. on higher crude prices
- Korea joins Brazil cutting interest rates as global economic growth slows
- AIA to buy ING’s Malaysian insurance unit for $1.73b cash
- Japan machinery orders slide 3.3% as economy risks shrinking
- Treasuries hold gains before U.S. trade data, 30y debt auction
- JPMorgan CFO Braunstein said to weigh return to investment bank
- United Tech unit says orders for new turbo-fan engine may double
- Hewlett-Packard overtaken by Lenovo as world’s top PC maker
- Chamber, 2 oil trade groups sue SEC over foreign payment rule
- Apollo’s Realogy IPO raises $1.08b pricing at top end
- Telsa gets $10m California grant for electric SUV project
- Goldman doesn’t need more deposit funding: COO Cohn
EARNINGS:
- Fastenal (FAST) 7am, $0.37 - Preview
- Safeway (SWY) 9am, $0.43 - Preview
- Novagold (NG CN) Before-mkt, C$(0.06)
- JB Hunt Transportation Services (JBHT) 4pm, $0.66
- Bank of the Ozarks (OZRK) 6pm, $0.55
COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)
GOLD – bought it yesterday as the USD (up on Romney mo and Europe slow) is immediate-term TRADE overbought; any let down in USD strength gets the momentum trade back into commodities and stocks. Correlations are surreal. Risk range in Gold is now 1.
- Oil Rises as Mideast Tensions Outweigh Forecast of Rising Supply
- Lead Tops Metal Returns as Shortages Set to Emerge: Commodities
- Bakries Offer to End Rothschild Bumi Dispute by Acquiring Assets
- Gold Gains on Renewed Europe Debt Concern After Spain Downgrade
- Copper Advances as Brazil and South Korea Cut Interest Rates
- Soybeans May Climb 10% on Rising Trendline: Technical Analysis
- Robusta Coffee Extends Rally Before Options Expiry; Sugar Drops
- Record Gas Switching Cuts Glut as Mizuho Sees $4: Energy Markets
- Iron-Ore Swaps Extend Decline as Chinese Buying Seen Weakening
- Food Industry Vulnerable to Future Corn, Rice Supply Disruptions
- Aluminum Stockpiles in Japan Expand to 8-Month High in September
- Commodity Head and Shoulders Means 13% Drop: Technical Analysis
- Disputed Islands With 45 Years of Oil Split China, Japan: Energy
- Soybeans Climb on Signs Demand Is Building as U.S. Supply Gains
CURRENCIES
EUROPEAN MARKETS
SPAIN – finally getting an immediate-term TRADE oversold signal on the IBEX here this morn at 7609 on a very newsy Spanish downgrade; all this means is that they ask for the bailout sooner; sadly, that’s a bullish short-term catalyst, so just keep that in mind as EUR/USD holds $1.28 TRADE support.
ASIAN MARKETS
KOSPI – down another -0.8% overnight and broken on our TRADE duration isn’t new news this morning – it’s a leading indicator; South Korea cutting rates by another 25bps to 2.75% and the market not going up is new; you can have 10,000 global easings but, at a pt, the earnings cycle trumps the funny money – just like Q407-Q308.
MIDDLE EAST
The Hedgeye Macro Team