THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP – January 14, 2013

As we look at today's setup for the S&P 500, the range is 26 points or 0.89% downside to 1459 and 0.88% upside to 1485.                                           

SECTOR AND GLOBAL PERFORMANCE

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EQUITY SENTIMENT:


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CREDIT/ECONOMIC MARKET LOOK:

  • YIELD CURVE: 1.60 from 1.62
  • VIX closed at 13.36 1 day percent change of -0.96%

MACRO DATA POINTS (Bloomberg Estimates):

  • 11am: Fed to purchase $1.25b-$1.75b in 2036-2042 sector
  • 11:30am: U.S. Treasury to sell $32b 3M bills, $28b 6M bills
  • 11:55am: Fed’s Williams speaks in Half Moon Bay, Calif.
  • 12:40pm: Fed’s Lockhart speaks in Atlanta
  • 4pm: Fed’s Bernanke speaks in Ann Arbor, Mich.

GOVERNMENT:

    • Senate not in session, House in session
    • White House to push for comprehensive immigration plan
    • Agriculture Sec. Tom Vilsack speaks at American Farm Bureau Federation annual meeting

WHAT TO WATCH

  • UPS prepares to end $6.9b TNT Express takover as EU wants to block deal
  • JPMorgan said to weigh releasing Whale rept faulting Dimon
  • Transocean says Icahn acquired 1.56% of shrs, wants more
  • Hostess names Flowers as lead bidder for bread business
  • Evans says Fed support needed while govt tackles deficit
  • Hedge fund leverage rises to most since 2004 as margin grows
  • EnCana CEO Eresman steps down, takes advisory role
  • Lockheed’s F-35 falls short of testing goals
  • Japan Airlines probes Dreamliner fuel leak as FAA holds review
  • BlackRock profit seen accelerating as ETF sales rise to record
  • China’s unexpected export surge spurs skepticism
  • Swatch buys Harry Winston jewelry brand for $1b
  • Saint-Gobain sells U.S. jar unit to Ardagh for $1.7b

EARNINGS:

    • Corus Entertainment (CJR/B CN) 7am, C$0.62
    • PPG Industries (PPG) 8:11am, $1.53
    • Cogeco Cable (CCA CN) After-mkt, C$0.88

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)

CORN – fast short squeeze in Corn (+7% off the lows, up +2% this morning) after a bullish supply report from WASD (World Ag Supply/Demand) on Friday. Supply is a lagging indicator here, but with the long-term Commodity Bubble popping, volatility is much higher here than that implied by an oversold 13.36 VIX.

  • WTI Oil Trades Near Four-Month High on Seaway Pipeline Expansion
  • Hedge Funds Cut Bets to Six-Month Low Before Rally: Commodities
  • Gold Gains in London as U.S. Stimulus Signal Weakens Dollar
  • Crop Prices Advance After U.S. Supply Shrinks More Than Expected
  • Copper Rises as U.S. and Japan Signal More Stimulus Is Possible
  • Raw Sugar Falls in as Goldman Cuts Price Forecast; Cocoa Rises
  • Rebar Rallies Most in Three Weeks as China’s Economy May Rebound
  • Wilmar Boosts Africa Expansion With Palm Oil Refinery in Ghana
  • Goldman Sachs Turns Neutral on Commodities Seeing Advance of 5%
  • Argentine Corn Output May Rise to Record 24 Mln Tons, FAO Says
  • Russia’s Yuriev Opens U.S. Shale Fund as State Dominates at Home
  • Cotton Seen Climbing to $1 on Elliott Wave: Technical Analysis
  • Fish & Chips Battered in U.K. as Deluge Leaves Soggy Potato Crop
  • Chinese Steelmakers Boost Use of Domestic Iron Ore, Mysteel Says

CURRENCIES

YEN – getting very newsy here all of a sudden as A) the Yen hits my immediate-term TRADE oversold signal at $89.41 and B) Abe steals the top one-liner in the monetary policy world this morning stating he wants a “Bold new leader” at the BOJ (read, Money Printer who wants to live large in the Political Media spotlight like Bernanke).

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EUROPEAN MARKETS

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ASIAN MARKETS

CHINA – Most Read stories on Bloomberg this morn are all about Chinese growth and Japanese devaluation; Shanghai Comp ripped another +3.1% move to higher intermediate-term highs and the rest of Asian equities followed their lead (Indonesia +1.8% after leading losers at -2.4% last wk; Vietnam +12% is the best stock mkt in the world YTD).

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MIDDLE EAST


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The Hedgeye Macro Team