TODAY’S S&P 500 SET-UP – January 9, 2013
As we look at today's setup for the S&P 500, the range is 46 points or 1.11% downside to 1441 and 2.05% upside to 1487.
SECTOR AND GLOBAL PERFORMANCE
EQUITY SENTIMENT:
CREDIT/ECONOMIC MARKET LOOK:
- YIELD CURVE: 1.61 from 1.62
- VIX closed at 13.62 1 day percent change of -1.23%
MACRO DATA POINTS (Bloomberg Estimates):
- 7am: MBA mortgage applications (prior -10.4%)
- 10:30am: DoE Inventory reports
- 11am: Fed to buy $1.25b-$1.75b in 2036-2042 sector
- 1pm: U.S. to sell $21b 10-yr notes reopening
GOVERNMENT:
- House, Senate not in session
- FCC Chairman Julius Genachowski speaks at CES, 4:30pm.
- Israel’s Ehud Barak visits Leon Panetta, 6:45pm
- SEC holds pre-hearing conference in matter of Deloitte Touche Tohmatsu CPAs, BDO China Dahua CPA Co., 9:30am
WHAT TO WATCH
- Clearwire gets unsolicited Dish counterbid to Sprint offer
- SAC Capital said to raise hedge fund bonuses amid probe
- AMR sees reasonable possibility of recovery for shrholders
- Goldman said to be part of Fed-led foreclosure settlement
- ITC judge may say next steps on Apple/Samsung ruling
- Blackstone said to seek doubling of credit line to $1.2b
- China-Japan dispute takes rising toll on top Asian economies
- First Quantum takes C$5.1b bid for Inmet Mining hostile
- Apple CEO returns to China amid falling phone market share
- BOJ to work more closely with Abe at regular policy meetings
- UBS client pleads guilty in offshore tax case
- U.S. shopping center demand slows amid sluggish job growth
- Shell’s mishaps in Artic drilling prompt U.S. govt. review
EARNINGS:
- Helen of Troy (HELE) 7:30am, $1.14
- Constellation Brands (STZ) 7:30am, $0.55
- Shaw Communications (SJR/B CN) 8am, C$0.46
- Pricesmart (PSMT) 4pm, $0.62
- Ruby Tuesday (RT) 4:02pm, $(0.06)
- Texas Industries (TXI) 6pm, $(0.31)
COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)
COMMODITIES – with the exception of Oil (which is a big exception as it will, at some pt, slow growth), Bernanke’s Commodity Bubble continues to deflate; Corn making a lower-low this morning and Gold is failing at its TAIL risk line of $1671 again; we covered gold so that we can re-short it on this bounce; manage the risk of the range proactively.
- Brent Crude Halts Two-Day Gain as U.S. Oil Inventories Increase
- Alcoa Sees Aluminum Use Climbing on China Recovery: Commodities
- Gold Trades Little Changed at $1,659.31 an Ounce in London
- Wheat Rises on Outlook for Lower 2013 Stockpiles; Corn Steady
- Copper Rises on Speculation About Revivals in Biggest Consumers
- Robusta Coffee Rebounds as Roasters, Investors Buy; Cocoa Falls
- Cold Weather to Aid India Wheat Crop to Record for Seventh Year
- Iron Ore Seen Set for Bear Market After Restocking Rally Fades
- Rubber Advances for Second Day as China May Step Up Purchases
- Lead Premium Paid in Europe Said to Almost Double for This Year
- EU Carbon May Decline to Record as Glut Expands: Energy Markets
- Chinese Bauxite Production Holds Key for Aluminum Markets
- China Said to Plan Sale of Government Cotton Stockpiles
- U.S. Drought Persisting Seen as Threat to Corn, Soybean Supplies
CURRENCIES
EUROPEAN MARKETS
EUROPE – the short squeeze to higher-highs in European stocks continues; Italy’s MIB Index leading the charge this wk, up another +1.1% this morning crossing the 17,000 line and making a higher-high; remember that, unlike the USA, European corporates aren’t comping all-time peak margins; most of their stock markets are cheaper on a cyclically adjusted basis too.
ASIAN MARKETS
ASIA – the Shanghai Composite corrected a whole 3 basis pts overnight and both the Nikkei and Hang Seng reversed back into the green; KOSPI down -0.3% was controlled and most importantly held both TRADE (1980) and TREND lines of support; Thailand said no more rate cuts for now as the economic demand side of the picture improves.
MIDDLE EAST
The Hedgeye Macro Team
