prev

THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP – April 8, 2014


As we look at today's setup for the S&P 500, the range is 37 points or 0.82% downside to 1830 and 1.19% upside to 1867.                                                                                                                              

SECTOR PERFORMANCE

 

THE HEDGEYE DAILY OUTLOOK - 1

 

THE HEDGEYE DAILY OUTLOOK - 2

 

EQUITY SENTIMENT:

 

THE HEDGEYE DAILY OUTLOOK - 10                                                                                                                                                                  

 

CREDIT/ECONOMIC MARKET LOOK:

  • YIELD CURVE: 2.30 from 2.31
  • VIX closed at 15.57 1 day percent change of 11.53%

MACRO DATA POINTS (Bloomberg Estimates):

  • 7:30am: NFIB Small Business, March, est. 92.5 (prior 91.4)
  • 7:45am ICSC weekly sales
  • 8:55am: Redbook weekly sales
  • 9am: IMF releases biannual world economic outlook
  • 10am: JOLTs Job Openings, Feb., est. 4.020m (prior 3.974m)
  • 1:30pm: Fed’s Kocherlakota speaks in Rochester, Minn.
  • 2:45pm: Fed’s Plosser speaks in Philadelphia
  • 4pm: Fed holds open board mtg in Washington on leverage ratios
  • 4pm: Fed’s Evans speaks in Washington
  • 4:30pm: API weekly oil inventories

GOVERNMENT:

    • 10am: House Ways & Means hearing on supporting economic growth through “a Fairer Tax Code”
    • 10am: House Armed Services Cmte hearing on Russia’s military developments, implications
    • 10am: Atty Gen. Holder testifies on Justice Dept. at House Judiciary Cmte
    • 10am: PPP hearing at House Transp. and Infrastructure Cmte
    • Senate leaders hold news conferences after party luncheons
    • FY15 budget panels/hearings:
    • 9:30am: NASA Admin. Charles Bolden, House Appropriations
    • 9:30am: Gen. Raymond Odierno, National Guard Bureau Chief Gen. Frank Grass, Army Reserve Chief Gen. Jeffrey Talley, Senate Armed Services Cmte
    • 10am: Secretary of State John Kerry, Senate Foreign Relations
    • 10:30am:Education Sec. Arne Duncan, House Appropriations
    • 2pm: GSA Admin Dan Tangherlini, House Appropriations
    • 2:30pm: Senate Judiciary marks up patent troll bill  S. 1720

WHAT TO WATCH:

  • Takeda, Lilly jury awards $9b over hiding Actos risks
  • Citigroup agrees to $1.13b settlement over mortgage bonds
  • Koch said to near deal for CVC’s Flint Group with Goldman Sachs
  • Fed holds open board meeting in Washington on leverage ratios
  • GM SUVs get top marks in insurance-industry front crash test
  • U.S. Court of Appeals hears Apple/Google patent arguments
  • Long-term jobless benefits stalled even with Senate passage
  • China approves Microsoft, Nokia deal with conditions
  • Express Scripts threatens to blackball Gilead’s Sovaldi
  • Barclays settles U.K. Libor case weeks before trial to start
  • BOJ refrains from boosting stimulus as recovery seen
  • U.K. industrial output rises more than forecast on factories
  • Weekly release of FDA warning letters
  • IMAX to sell 20% stake in China business for $80m: WSJ

EARNINGS:

    • Alcoa (AA) 4:03pm, $0.05 - Preview
    • International Speedway (ISCA) 7:30am, $0.34
    • Science Applications Intl (SAIC) 4:01pm, $0.65
    • WD-40 Co (WDFC) 4pm, $0.68

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)

  • Gold Climbs to Two-Week High as Dollar to Ukraine Spur Demand
  • EU Pig Farmers Miss Out on Boom as Russian Ban Spurs WTO Case
  • WTI Rebounds as Gasoline Stockpiles Seen Shrinking; Brent Gains
  • China Corn Glut No Barrier to Farmers as State Buys: Commodities
  • Copper Falls 0.4% to $6,648 a Ton in London; Nickel, Tin Drop
  • Coffee Extends Gains in London as Arabica Climbs for 4th Day
  • Soybeans Snap Two-Day Drop as USDA May Report Reduced Stockpiles
  • Rebar in Shanghai Climbs to One-Month High as Stockpiles Decline
  • U.S. Beef to Japan May Decline on Australia Deal, Ministry Says
  • Age of Gas Seen as Sideshow to U.S. Producers Preoccupied by Oil
  • Copper Producers Keep Faith in China as Rout Belies Demand
  • Gold’s Open-Interest Drop Signals Rally Ending: Chart of the Day
  • Ending Iran Oil Ban May Cut Refiners’ Supply Cost: Bull Case
  • Turkey’s Fracking Push Won’t Be Stalled by Bribery Probe: Energy

THE HEDGEYE DAILY OUTLOOK - 5

 

CURRENCIES


THE HEDGEYE DAILY OUTLOOK - 6

 

GLOBAL PERFORMANCE

 

THE HEDGEYE DAILY OUTLOOK - 3

 

THE HEDGEYE DAILY OUTLOOK - 4

 

EUROPEAN MARKETS

 

THE HEDGEYE DAILY OUTLOOK - 7

 

ASIAN MARKETS

 

THE HEDGEYE DAILY OUTLOOK - 8

 

MIDDLE EAST

 

THE HEDGEYE DAILY OUTLOOK - 9

 

 

The Hedgeye Macro Team

 

 

 

 

 

 

 

 

 

 

 

 

 

 


April 8, 2014

April 8, 2014 - Slide1 

BULLISH TRENDS

April 8, 2014 - Slide2

April 8, 2014 - Slide3

April 8, 2014 - Slide4

April 8, 2014 - Slide5

April 8, 2014 - Slide6 

BEARISH TRENDS

April 8, 2014 - Slide7

April 8, 2014 - Slide8

April 8, 2014 - Slide9

April 8, 2014 - Slide10

April 8, 2014 - Slide11
April 8, 2014 - Slide12


Penney: Why We're Short These 4 Restaurant Stocks

 

Veteran restaurants analyst Howard Penney highlights two major headwinds making him bearish on four stocks.


Early Look

daily macro intelligence

Relied upon by big institutional and individual investors across the world, this granular morning newsletter distills the latest and most vital market developments and insures that you are always in the know.

Poll of the Day Recap: Do You Hear That, Social Media? Pop, Pop, Pop!

Hedgeye CEO Keith McCullough wrote in today’s Morning Newsletter: “Risk happens fast. With the social media stock bubble crashing (single stock moves have been down -20% to -45% from their all-time peak), the Nasdaq is already -5.3% off its YTD high.”
 

Yikes. We went from “Bubble Overbought” (another note from Keith last week) to bubble popping, fast.

 

So, we asked you in today’s poll: Is the Social Media Bubble bursting the beginning of a broader market decline?


At the time of this post, 57% responded YES; 43% said NO.


Of those that voted YES, they said that the economy is slowing; people are running out of money.

 

One specifically noted that, “Inflation will reduce purchasing power for citizens and reduce top line revenue for consumer staple names. People on [government] assistance and fixed incomes won't be able to keep up with food prices and energy. GDP will fall precipitously.”

 

A few humorously explained, “This time, everyone will be able to tweet their dismay and Instagram their monthly statement.”

 

And: “The decline in the S&P will start in the next couple months, then Yellen will pump it back up, singing: ‘That's why I’m eaaaasing, I’m easing like Sunday morning.’”

 

Conversely, one NO voter felt that the Fed wouldn't “let the market fall too far.”

 

Hedgeye Managing Director Moshe Silver also argued NO, summing up that “In the short term, the social media froth will probably lead lots of frothy sectors lower; for the longer term, the next 12 months-plus, we are not on the brink of a broad bear market. There’s too much fear and uncertainty in the air to get outright bearish, plus the presidential campaigns will start this year, [which is] good for stocks.”

 

But, as Keith says, “I have no love for the bubbles - social or otherwise…Not buying this pullback was a risk managed choice.”

SUBSCRIBE TO HEDGEYE.


European Banking Monitor: CDS Tightens Broadly Across Europe

Below are key European banking risk monitors, which are included as part of Josh Steiner and the Financial team's "Monday Morning Risk Monitor".  If you'd like to receive the work of the Financials team or request a trial please email .

 

---

 

European Financial CDS - Swaps tightened sharply across the European Financials complex last week. The biggest movers were in Greece, Italy, Germany and Spain. The Greek banks have posted impressive M/M moves, dropping by an average of 238 bps in just the last four weeks. Outside of Greece, the only EU bank that is still trading above our so-called "Lehman line" (+300 bps) is Sberbank of Russia.

 

European Banking Monitor: CDS Tightens Broadly Across Europe  - bank cds.1

 

Sovereign CDS – Sovereign swaps were tighter around the world last week. Italy, Spain and Portugal lead the charge lower, dropping by 24, 19 and 26 bps, respectively.

 

European Banking Monitor: CDS Tightens Broadly Across Europe  - sovereign cds. 2

 

European Banking Monitor: CDS Tightens Broadly Across Europe  - sovereign cds.3

 

European Banking Monitor: CDS Tightens Broadly Across Europe  - sovereign cds.4

 

Euribor-OIS Spread – The Euribor-OIS spread (the difference between the euro interbank lending rate and overnight indexed swaps) measures bank counterparty risk in the Eurozone. The OIS is analogous to the effective Fed Funds rate in the United States.  Banks lending at the OIS do not swap principal, so counterparty risk in the OIS is minimal.  By contrast, the Euribor rate is the rate offered for unsecured interbank lending.  Thus, the spread between the two isolates counterparty risk. The Euribor-OIS spread tightened by 2 bps to 13 bps. 

 

European Banking Monitor: CDS Tightens Broadly Across Europe  - euribor OIS spread.5

 

Matthew Hedrick

Associate



the macro show

what smart investors watch to win

Hosted by Hedgeye CEO Keith McCullough at 9:00am ET, this special online broadcast offers smart investors and traders of all stripes the sharpest insights and clearest market analysis available on Wall Street.

next