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TODAY’S S&P 500 SET-UP – October 15, 2012


As we look at today’s set up for the S&P 500, the range is 26 points or -0.67% downside to 1419 and 1.15% upside to 1445. 

                                            

SECTOR AND GLOBAL PERFORMANCE


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EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: on 10/12 NYSE -830
    • Decrease versus the prior day’s trading of 909
  • VOLUME: on 10/12 NYSE 624.50
    • Decrease versus prior day’s trading of -3.43%
  • VIX:  as of 10/12 was at 16.14
    • Increase versus most recent day’s trading of 3.53%
    • Year-to-date decrease of -31.03%
  • SPX PUT/CALL RATIO: as of 10/12 closed at 2.13
    • Up from the day prior at 1.72

CREDIT/ECONOMIC MARKET LOOK:


BONDS – US Treasuries don’t care much for the up EuroStoxx, up SP Futures thing; 10yr yield hasn’t budged a beep this morning after falling back to 1.66% from 1.74% last week. Lower-highs US stocks as bonds make higher-lows. #GrowthSlowing, globally.

  • TED SPREAD: as of this morning 23.25
  • 3-MONTH T-BILL YIELD: as of this morning 0.10%
  • 10-Year: as of this morning 1.67%
    • Increase from prior day’s trading of 1.66%
  • YIELD CURVE: as of this morning 1.41
    • Up from prior day’s trading at 1.40

MACRO DATA POINTS (Bloomberg Estimates)

  • 8am: Fed’s Lacker at NABE in New York
  • 8:30am: Empire Manufacturing, Oct., est. -4.8 (prior -10.41)
  • 8:30am: Advance Retail Sales, Sept., est. 0.8% (prior 0.9%)
  • 8:30am: Retail Sales Ex-Autos, Sept., est. 0.6% (prior 0.8%)
  • 10am: Business Inventories, Aug., est. 0.5% (prior 0.8%)
  • 11am: Fed to buy $4.25b-$5.25b notes due 10/31/2018-8/15/2020
  • 11:30am: U.S. to sell $32b 3-month bills, $28b 6-month bills
  • 12:45pm: Fed’s Dudley in Virginia on economy
  • 1:10pm: Fed’s Bullard in St. Louis on economy
  • 8:30pm: Fed’s Williams in San Francisco on economy

 GOVERNMENT:

    • House, Senate not in session
    • Congressional candidates, political action committees file quarterly report to Federal Election Commission, as will Romney Victory, the joint fundraising committee for GOP nominee Mitt Romney, Republican National Committee, state parties
    • U.S. Chamber of Commerce unveils International Index of Energy Security Risk on global markets, 9am

WHAT TO WATCH:

  • Softbank agreed to pay $20.1b to buy a 70% stake in Sprint
  • U.S. retail sales probably rose in Sept. for a 3rd month
  • Greece’s 10-yr yield falls to lowest since debt restructuring
  • China’s exports, money supply grew more than est. in Sept.
  • Japan said to plan $2.5b Renesas bid as early as Nov.
  • Bank of Israel Governor Stanley Fischer said the world is “awfully close” to a recession
  • “Taken 2” top movie for 2nd weekend with sales of $22.5m
  • Douglas Holding receives $1.9b bid from Advent-controlled companies
  • Apple appeals Tokyo court ruling on Samsung patent case
  • Lifetech Scientific Investor sells 19% stake for HK361m
  • Credit card monthly charge-offs, delinquencies to be released
  • Verizon begins defense of $9.5b trial on Idearc spinoff
  • Nike, RadioShack, Anheuser-Busch Stand by Armstrong: FT

 EARNINGS:

    • Citigroup (C) 8am, $0.97 - Preview
    • Gannett (GCI) 8:30am, $0.53
    • Charles Schwab (SCHW) 8:45am, $0.17
    • Packaging Corp. of America (PKG) 5pm, $0.56
    • Valmont Industries (VMI) 5:30pm, $2.05
    • Brown & Brown (BRO) After-mkt, $0.35

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)    

  • Oil Trades Near Four-Day Low Amid Global Economic Growth Concern
  • Bullish Wagers Drop to Eight-Week Low Before Rally: Commodities
  • Copper Erases Decline as Buyers in Europe Take Advantage of Drop
  • European Naphtha Cargoes Shipped to Asia Set to Rise in October
  • Gold Declines With Commodities; Silver Falls to a One-Month Low
  • Soybeans Drop Below $15 for First Time Since July as Crops Slide
  • Cocoa Falls Before U.S., Europe Processing Data; Sugar Retreats
  • LME’s O’Hegarty Says a Lot of Regulation Happening in ‘Hurry’
  • U.S. Plunge in Gas Drilling Means $1 Billion Lost Profit: Energy
  • China Boosts Soybean Imports as Reduced Supplies Spur Purchases
  • Qatar Is Favorable to Glencore-Xstrata Deal, Prime Minister Says
  • Potash Inventory Up 50% in Brazil, 33% in India Through August
  • Silver to Extend Drop Before Rally Resumes: Technical Analysis
  • Tropical Storm Rafael Nears Hurricane Strength in Atlantic
  • LME’s Martin Abbott Expects Record Trading Volume This Year

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CURRENCIES

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EUROPEAN MARKETS


GERMANY – snapped TRADE line support of 7316 last wk and is struggling to get back above that this  morn despite the no-volume rally in European Equities to start the wk; EuroStoxx600 was -1.7% last wk and we’ve seen these Monday rallies in Europe fade in recent weeks, so watching levels here will be important.

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ASIAN MARKETS


KOSPI – continued to struggle overnight, down another –0.4% and at 1925 is now decisively below our 1976 TRADE line of resistance; like Tech (XLK), which is down -3.5% in the last mth, this is a new growth scare for what was working.

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MIDDLE EAST


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The Hedgeye Macro Team