THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP – November 09, 2012

As we look at today's setup for the S&P 500, the range is 46 points or 0.98% downside to 1364 and 2.36% upside to 1410

SECTOR AND GLOBAL PERFORMANCE

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EQUITY SENTIMENT:

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CREDIT/ECONOMIC MARKET LOOK:

YIELD CURVE – as of this morning 1.34 decreased from prior day's trading at 1.36 


BONDS – We’ve gone back and forth with clients on this one all yr and maintained that the most obvious bull market remains in bonds, provided that we remain right on both US/Global Growth surprising on the downside; at 1.61% on the 10yr, UST’s finally give us the immediate-term TRADE overbought bond signal here (German and Belgian Bonds overbought as well).

 

MACRO DATA POINTS (Bloomberg Estimates):

  • 8:30am: Import Price Index M/m, Oct. est. 0.0% (prior 1.1%)
  • 8:30am: WASDE agricultural data
  • 9:55am: U. of Michigan Conf., Nov. est. 83.0 (prior 82.6)
  • 10am: Wholesale Inventories, Sept. est. 0.4% (prior 0.5%)
  • 10am: Fed’s Duke speaks in Chicago
  • 11am: Fed to buy $1b-$1.5b TIPS due 1/15/19-2/15/42
  • 1pm: Baker Hughes rig count

GOVERNMENT:

  • SEC Enforcement Director Robert Khuzami speaks in N.Y., 9am
  • National Committee to Preserve Social Security & Medicare holds conference call briefing on proposed benefit cuts, with Sen. Bernie Sanders, I-Vt, 11am
  • IRS holds a public forum on proposed regulations relating to branded prescription drug fee imposed by Affordable Care Act

WHAT TO WATCH: 

  • CME Group sued CFTC, challenging cleared-swaps reporting requirements imposed under Dodd-Frank legislation
  • President Obama expected to issue statement today on his plan for spurring economic growth, reducing deficit
  • To hold first post-election news conference early next week
  • NY federal judge to consider arguments today over whether to give Visa, MasterCard’s proposed $7.25b settlement of merchant fee price-fixing case prelim. approval
  • BP, plaintiffs ask judge to approve $7.8b spill accord
  • BofA’s Merrill Lynch unit must face lawsuit by FHFA over mortgage-backed securities sold by the bank
  • Whistle-blower helping U.S. mount $1b fraud lawsuit against BofA accused of fraud by investor in financing co. he co-founded
  • BNY Mellon reached deal to end lawsuit accusing it of defrauding state pension funds through forex transactions
  • China passenger-vehicle sales rose in Oct., beat est.
  • Lockheed’s F-35 jets may cost $1.26b for fixes
  • U.S. Fiscal Cliff, China Exports, Cisco: Week Ahead Nov. 10-17

EARNINGS

    • Alliant Energy (LNT) 6:00am, $1.30
    • Enerplus (ERF CN) 6:00am, C$0.06
    • TMX Group (X CN) 6:00am, C$0.74
    • Covidien (COV) 6:00am, $1
    • GMP Capital (GMP CN) 6:00am, $(0.03)
    • JC Penney (JCP) 6:00am, $(0.07)
    • HeartWare (HTWR) 6:30am, $(1.52)
    • Foster Wheeler (FWLT) 6:45am, $0.45
    • Stella-Jones (SJ CN) 7:00am, $1.26
    • GenOn Energy (GEN) 7:00am, $0.03
    • MGIC Investment (MTG) 7:00am, $(0.74)
    • Warner Chilcott (WCRX) 7:00am, $0.79
    • Apollo Global Management (APO) 7:08am, $0.76
    • Laredo Petroleum Holdings (LPI) 7:26am, $0.13
    • EW Scripps (SSP) 7:30am, $0.11
    • Brookfield Asset Management (BAM/A CN) 8:00am, $0.30
    • Telus (T CN) 8:01am, C$1.07
    • Ameren (AEE) 8:15am, $1.41
    • Emera (EMA CN) 9:48am, C$0.36
    • Medivation (MDVN) 4:09pm, $(0.10)

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)

  • Gold Set for Best Week Since January on Stimulus Prospects, ETPs
  • Gold Traders More Bullish After Obama’s Re-Election: Commodities
  • Sugar Declines in London on Brazilian Supplies; Cocoa Rises
  • Gold Demand in India Seen Rebounding on Festivals, Price Decline
  • Copper Heads for Fifth Weekly Decline on European Growth Concern
  • Corn Top Commodity Pick at Morgan Stanley as U.S. Supply Shrinks
  • Rubber Gains, Paring Weekly Loss, on Signs of Economic Recovery
  • Indonesia Palm Oil Group Wants Tax Changes to Counter Malaysia
  • Oil Trades Near Four-Month Low on Demand Concern, Supply Growth
  • Copper Inventories in Shanghai Climb to Highest Since April
  • Canada’s New Corn Belt Attracts Hot Money to Bargain Farmland
  • California Carbon ‘Crippled’ by Buyer Hesitation: Energy Markets
  • China’s High-Cost Aluminum Producers Limit Output Declines
  • Gold Traders More Bullish After Obama’s Win
  • Sugar Fee for Thailand Climbing as Futures Slump to Two-Year Low

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CURRENCIES


EURO – euro $1.27 is ugly, but also immediate-term TRADE oversold; get the EUR/USD right, you get a lot of things big beta right; so today’s currency signal, like our bond signal, says buy stocks that can deliver on the numbers (yes, there are far fewer of those today than 2 months ago). Top 3 Ideas from here: IGT, SBUX, FDX (long).

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EUROPEAN MARKETS


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ASIAN MARKETS


CHINA – unfortunately, for team “China has bottomed”, China is not the reason for us being more bullish than we have in 2 months this morn – everything has a time and price, but Chinese stocks were down for the 5th consecutive day and remain in a Bearish Formation as China refuses to deliver the Western hope for stimuli.

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MIDDLE EAST


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The Hedgeye Macro Team