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TODAY’S S&P 500 SET-UP – November 28, 2012


As we look at today's setup for the S&P 500, the range is 36 points or 1.14% downside to 1383 and 1.43% upside to 1419.        

SECTOR AND GLOBAL PERFORMANCE

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EQUITY SENTIMENT:


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CREDIT/ECONOMIC MARKET LOOK:

  • YIELD CURVE: 1.35 from 1.38
  • BONDS – you can love to hate them on “valuation”, or just buy them on dips and smile into yr end; UST 10yr yield makes another lower-high last wk, dropping to 1.62% (from 1.69% at the start of the wk); no support to 1.55%.

MACRO DATA POINTS (Bloomberg Estimates):

  • 7am: MBA Mortgage Applications, Nov. 23 (prior -2.2%)
  • 10am: New Home Sales, Oct. est. 390k (prior 389k)
  • 10:30am: DoE inventories
  • 11am: Fed to buy $1.75b-$2.25b notes due 2/15/36-11/15/42
  • 12:15pm: Fed’s Tarullo speaks in New Haven
  • 1pm: U.S. to sell $35b 5Y notes
  • 2pm: Fed’s Beige Book Economic Survey

GOVERNMENT:

    • House, Senate in session
    • President Barack Obama, House Speaker John Boehner hold meetings with Goldman Sachs CEO Lloyd Blankfein, other business leaders to discuss fiscal cliff
    • Pandora CEO Joseph Kennedy to testify at music-licensing hearing by House subcommittee
    • U.S. will auction ~3.8k blocks covering about 20.5m acres off Texas coast in western Gulf of Mexico, first sale of oil, gas exploration leases under Obama administration’s five-year plan for developing Outer Continental Shelf
    • Ex-BP Plc vice president, two former well-site supervisors arraigned on criminal charges for actions after 2010 oil spill
    • Treasury holds meeting of President’s Advisory Council on Financial Capability, with Undersecretary for Domestic Finance Mary Miller, 8am
    • House Energy and Commerce panel holds hearing on waste, fraud and abuse in Medicare, 10am

WHAT TO WATCH

  • Fed said to weigh forcing foreign banks to boost capital in U.S.
  • Goldman’s Blankfein among 13 CEOs meeting with Obama today
  • Groupon board said to consider CEO change amid growth slowdown
  • Costco to pay out $3b with $7/shr special cash div.
  • Smith & Nephew buys assets of Healthpoint Bio for $782m cash
  • Google said to oppose consent decree in any FTC antitrust deal
  • Samsung says IPhone relies on patented technology in U.K. trial
  • BP seen paying billions more in oil spill claims after deal
  • Hewlett-Packard’s war of words escalates with Autonomy’s founder
  • Tobacco companies must admit lying on products, U.S. judge rules
  • Obama urged to declare emergency as Mississippi water levels ebb
  • Fiscal-cliff pressure is on for cuts to entitlement programs

EARNINGS:

    • Fresh Market (TFM) 6am, $0.26
    • Jos A Bank Clothiers (JOSB) 6am, $0.56
    • Yingli Green (YGE) 6:07am, $(0.61)
    • CGI Group (GIB/A CN) 6:30am, C$0.42
    • JA Solar (JASO) 6:33am, $(0.21)
    • Express (EXPR) 7am, $0.17
    • Suburban Propane Partners (SPH) 7:30am, $(0.91)
    • ANN (ANN) 8am, $0.74
    • American Eagle Outfitters (AEO) 8am, $0.39
    • Golar LNG Partners (GMLP) 8:30am, $0.56
    • TiVo (TIVO) 4pm, $(0.24)
    • Aeropostale (ARO) 4:01pm, $0.29
    • Guess? (GES) 4:03pm, $0.44
    • Semtech (SMTC) 4:30pm, $0.43
    • Pall (PLL) 5pm, $0.66
    • Workday (WDAY) Aft-mkt, $(0.49)
    • Post Holdings (POST) Aft-mkt, $0.35

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)

  • Oil Trades Near One-Week Low on Supply Gain, U.S. Budget Concern
  • DuPont Sends in Former Cops to Enforce Seed Patents: Commodities
  • Gold Declines for a Third Day in London on Improving U.S. Data
  • Olam Says No Insolvency Risk as It Rebuts Muddy Waters Claims
  • Copper Declines on Concern About Progress of Fiscal-Cliff Talks
  • U.S. May Double Soybean Exports to Russia After Obama Signs Law
  • Soybeans Drop From Two-Week High as South American Concern Eases
  • Sugar Falls as Harvesting Progresses in Brazil; Cocoa Declines
  • Copper Demand in China to Improve Next Year, Aurubis Says
  • India Iron Ore Dilemma May Reshape Seaborne Market: Outlook
  • Coal Heads for Best Quarter Since 2010 on Cold: Energy Markets
  • Larger Gold Miners Outperform Metal; Smaller Rivals Trail
  • Copper Faces Resistance in London at $7,865: Technical Analysis
  • Iranian Tanker Leaving Greek Island After Cargo Investigation

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CURRENCIES


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EUROPEAN MARKET


RUSSIA – the RTSI is beating the Chinese to the crash table this morning, down -1.2%, breaking the -20% barrier again for the 2nd time since September; Oil (Brent) failed at our long-term TAIL line of $111.48 resistance and there’s a commodity bubble unwinding.


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ASIAN MARKETS


CHINA – moves to within a hair of crash mode overnight (Shanghai Comp down another -0.9% to 1973 = -19.9% from its March #GrowthSlowing top); remember our baseline 3-factor model on global growth: China/Copper/BondYields.

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MIDDLE EAST


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The Hedgeye Macro Team