THE HEDGEYE DAILY OUTLOOK

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


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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

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CURRENCIES

 

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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.

 

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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.

 

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MIDDLE EAST


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The Hedgeye Macro Team

 

 

 

 

 


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