THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP – December 10, 2012


As we look at today's setup for the S&P 500, the range is 16 points or 0.96% downside to 1405 and 0.17% upside to 1421.    

                                                                                                                                                           

SECTOR AND GLOBAL PERFORMANCE

 

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EQUITY SENTIMENT:


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CREDIT/ECONOMIC MARKET LOOK:

  • YIELD CURVE: 1.40 from 1.38
  • VIX closed at 16.05 1 day percent change of 0.94%

MACRO DATA POINTS (Bloomberg Estimates):

 

EARNINGS:

  • Dollar General (DG) 7am, $0.60
  • Hudson’s Bay (HBC CN) Pre-mkt
  • Fed’s 2-day meeting begins
  • 7:30am: NFIB Small Business Optimism, Nov. (prior 92.5)
  • 7:45am/8:55am: ICSC/Redbook weekly retail sales
  • 8:30am: Trade Deficit, Oct., est. -$42.6b (prior -$41.5b)
  • 8:30am: Wasde report on agricultural commodities
  • 10am: Wholesale Inventories, Oct., est. 0.4% (prior 1.1%)
  • 10am: IBD/TIPP Economic Optimism, Dec. est., 50.0 (prior 48.6)
  • 10am: JOLTs Job Openings, Oct. (prior 3.561m)
  • 11am: Fed to buy $1b-$1.5b notes due 1/15/19-2/15/42
  • 1:30am: U.S. Treasury to sell 4W, $25b 52W bills
  • 1pm: U.S. Treasury to sell $32b 3Y notes
  • 4:30pm: API inventories

GOVERNMENT:

    • House, Senate in session
    • Bunge CEO Alberto Weisser speaks at Johns Hopkins Univ. on global issues in agriculture, Noon
    • Weekly release of FDA warning letters
    • ITC issues final ruling on whether to uphold penalties on imports of washing machines from Korea, Mexico, 9:30am
    • Global Intellectual Property Center hosts U.S. Patent and Trademark Office intellectual property attaches from around world to discuss enforcement of IP rights outside U.S., 9:30am

WHAT TO WATCH

  • Fed seen expanding assets to $4t with Treasury buying
  • U.S. fiscal dispute shows sign of thaw before year-end deadline
  • U.S. Treasury to sell last 234.2m shares in AIG at sixth offering
  • Blackstone said to seek over $2b for Asia property
  • BofA gets judge’s approval to proceed with Taylor Bean fraud suit
  • HSBC to pay $1.92b to settle U.S. probes of laundering
  • ThyssenKrupp scraps dividend after $4.7b writedown at Americas unit
  • Diageo ends talks with Jb Y Compania, Lanceros on Cuervo brand
  • AMR’s Horton open to private-equity funding for bankruptcy exit
  • Spain borrowing costs fall as Treasury boosts 2013 prefunding
  • Texas Instruments sees 4Q sales in line with estimates

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)


OIL – Bernanke’s Bubbles look like bubbles in the rear view mirror more and more by the day; CRB Index is down -8.7% from the Bernanke Top (SEP14) and Oil continues in a Bearish Formation as food prices deflate as well. All very good developments for global consumption.

  • Oil Rebounds From One-Month Low on German Investor Confidence
  • Tightest Corn Crop Since ‘74 as Goldman Sees Rally: Commodities
  • Contango in Gasoil Reaches Longest in 16 Months: Energy Markets
  • Wheat Reaches 8-Week Low on Signs of Waning U.S. Export Demand
  • Gold Halts Three-Day Advance as Investors Await Fed Meeting
  • Copper Slides as Investors Await Fed’s U.S. Economic Forecasts
  • Sugar Rises on Signs of Processor Demand in Brazil; Cocoa Falls
  • OPEC November Crude Output at Lowest in One Year as Saudis Cut
  • Russia Cuts Grain Exports, Seen by SovEcon Raising 2013 Imports
  • Iron Ore Climbs to Four-Month High as China Growth Boosts Demand
  • ThyssenKrupp Cancels Dividend After $4.7 Billion Writedown
  • Scorpio Seen Rising as Tanker Rates Gain Most Since ’08: Freight
  • Cooking Oil Imports by India Seen Dropping on Reserves, New Crop
  • Angola Says Only Iraq, Saudi Arabia in Race for Top OPEC Job

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CURRENCIES


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EUROPEAN MARKETS


GERMANY – impressive is as impressive does; the DAX shrugged off the Italians yesterday and has held its ahead above the SEP closing highs (7451); that level was resistance – now its support, as the DAX crushes the Dow for 2012 YTD.


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ASIAN MARKETS


CHINA – Shanghai Comp failed to follow through 2095 TREND resistance overnight after Chinese Yuan based loans continued to surprise on the downside (523B in loans for NOV = down -7% y/y); don’t expect them to do what we do – reflating the credit bubble not in their plan, yet.

 

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MIDDLE EAST


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The Hedgeye Macro Team