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TODAY’S S&P 500 SET-UP - September 30, 2010

As we look at today’s set up for the S&P 500, the range is 17 points or -0.59% downside to 1138 and 0.90% upside to 1155. Equity futures are trading lower.  Weak economic data hit Asia overnight (except China), while European markets retreated following Moody's downgrade of Spain, and after Irish regulators unveiled the cost of rescuing its financial system. Today's macro highlights include Q2 GDP and Initial Jobless Claims, followed by Chicago PMI.

  • Stericycle (SRCL) agreed to buy Healthcare Waste Solutions from Altaris Capital Partners for $245M
  • Synnex (SNX) sees 4Q EPS $0.94-0.97 vs estimate $0.90
  • VeriFone Systems (PAY) proposes to buy Hypercom (HYC) for $5.25 per share
  • Worthington Industries (WOR) reported 1Q sales of $616.8m, vs estimate $582m 
  • Xyratex (XRTX) forecast 4Q adjusted EPS $0.60-0.86 vs estimate $0.86

PERFORMANCE

  • One day: Dow (0.21%), S&P (0.26%), Nasdaq (0.13%), Russell 2000 +0.33%
  • Month-to-date: Dow +8.19%, S&P +9.09%, Nasdaq +12.42%, Russell +12.54%
  • Quarter-to-date: Dow +10.86%, S&P +11.06%, Nasdaq +12.67%, Russell +11.17%
  • Year-to-date: Dow +3.91%, S&P +2.66%, Nasdaq +4.73%, Russell +8.35%

EQUITY SENTIMENT:

  • ADVANCE/DECLINE LINE: 299 (-872)
  • VOLUME: NYSE - 1012.19 (-1.28%)  
  • SECTOR PERFORMANCE: The on sector up yesterday was the XLE - the push and pull surrounding a number of high-profile themes continues including QE2 and the accompanying depressed interest rate environment and dollar weakness, European sovereign concerns, the quality of the September rally, regulatory overhangs, Chinese policy direction and protectionist risks.
  •  MARKET LEADING/LAGGING STOCKS YESTERDAY: Cabot Oil & Gas 5.19%, Range Resources +4.90% and Advance Micro +4.75%/Urban Outfitters -8.35,News Corp -2.94% and Kimco -2.72%
  • VIX: 23.25 +2.88% - YTD PERFORMANCE: (+7.24%)
  • SPX PUT/CALL RATIO: 1.42 from 2.36 -39.63%

CREDIT/ECONOMIC MARKET LOOK:

  • TED SPREAD: 13.68, 0.203 (1.506%)
  • 3-MONTH T-BILL YIELD: 0.16%
  • YIELD CURVE: 2.08 from 2.11

COMMODITY/GROWTH EXPECTATION:

  • CRB: 285.93 +0.56%
  • Oil: 77.86 +2.21%
  • COPPER: 366.15 +0.67%
  • GOLD: 1,309.88 +0.03% - up 6 days in a row

CURRENCIES:

  • EURO: 1.3630 +0.38%
  • DOLLAR: 78.691 -0.41% - down for the last 5 days

OVERSEAS MARKETS:

Europe

  • European markets opened lower as bank capital requirements and sovereign credit were in focus
  • Ireland's central bank published its assessment of capital requirements for the country's banks, saying the restructuring of Anglo Irish Bank needs €29.3B in capital under base scenario
  •  Allied Irish Banks proposed an equity capital raising and asset divestments to fund its capital needs under the Capital Assessment Review
  • Spain's credit rating was downgraded to Aa1, outlook stable at Moody's
  • Major indices recovered from initial lows to briefly trade in positive territory
  • Germany Sep unemployment rate +7.5% vs consensus +7.6%
  • France Aug PPI +0.1% m/m vs consensus +0.2%
  • UK Sep Nationwide House Price Index +0.1% m/m vs consensus (0.3%) 

Asia

  • Asian Markets: Nikkei (1.99%); Shanghai Composite +1.72%
  • Most Asian indices traded lower following a weak US and poor Japanese economic data.
  • The FT reported Sinochem is struggling to mount a Potash bid
  • According to the Australian Financial Review Telstra plans to cut 6,000 jobs, or 15% of its workforce, over a three year period
  • Japan August industrial output (0.3%) vs consensus +1.1%
  • Japan Sep Manufacturing PMI 49.5 vs consensus 50.1