Monday, April 11, 2005

Monday Watch

Weekend Headlines
Bloomberg:
- Protestors in Beijing overran police barricades and hurled bottles at the Japanese Embassy in a day of demonstrations against Japan's glossing over of wartime atrocities in the nation's textbooks and other grievances.
- Wal-Mart Stores said April sales at US stores open at least a year are rising within its forecast range as shoppers buy more food.
- Wal-Mart Stores will offer a line of premium bath and bedding items in more than 1,000 stores to lure affluent shoppers.
- Verizon Communications will pay investor Carlos Slim $1.1 billion for his 13% stake in MCI Inc. to fend off a competing bid for MCI by Qwest Communications.
- US corporate bond sales last week totaled $4.5 billion, about one-third of the average this year, as companies avoided borrowing from investors who demanded extra yield to compensate against falling bond prices.

NY Times:
- US consumers worried about how they will cope with chronic pain and said they still want to use banned painkillers made by Pfizer and Merck in spite of the warnings.
- China has increased its trade surplus with the rest of the world, which may increase international calls for China to loosen its currency's peg to the US dollar and allow the yuan to appreciate.
- Billionaire investor Warren Buffett is "fearful" that his involvement in an insurance investigation will sully his reputation.
- The US Defense Department may reduce the number of troops in Iraq by as much as 26% by early next year because of decreasing insurgent attacks and the rising number of trained Iraqi soldiers.

LA Times:
- Marine Terminals, a holding company owned by some of the world's largest shipping businesses, is leading a coalition to build a $1 billion port in Mexico to tap into California's trade business.
- San Diego County is drawing most of the venture capital being spent on technology startups in Southern California.

Edaily:
- The Bank of Korea won't diversify its foreign exchange reserves, a move that would cause the won to rise further against the US dollar.

San Jose Mercury News:
- Users of Microsoft's Windows operating system may be the target of a scam luring them to a phony security update that installs a virus on personal computers.

San Francisco Chronicle:
- Spending on online advertising rose 24% to a record $2.7 billion in the fourth quarter as more marketers turned to the Internet to reach out to customers.

Boston Globe:
- China's efforts to improve its air force and navy will soon allow it to block US forces from defending Taiwan.

Financial Times:
- Official aid to poor nations rose 4.6% in 2004 to $78.6 billion, boosted by donations to Iraq and Afghanistan.
- Coca-Cola, McDonald's Corp. and MasterCard are in talks about possible sponsorship deals with soccer's ruling body FIFA.

AFP:
- OPEC halted talks on boosting its oil-output quota by 500,000 barrels of oil a day because crude prices have dropped.
- China's Prime Minister Wen Jiabao yesterday said he wants to "properly settle" a decades-old border dispute with India and take ties between the two countries to a "new high."

al-Hayat:
- A price of $40 to $50 a barrel for the crude pumped by OPEC is "reasonable and fair," Qatar's oil minister said.

Sunday Times:
- Boeing Co. plans to build a new version of its 747 aircraft that would be able to fly further and carry more passengers than the original plane.

Economic Daily News:
- Taiwan's central bank has kept 50% to 60% of foreign-currency reserves in US dollars.

Commercial Times:
- Microsoft is exploring possible ties with Quanta Computer and other Taiwan companies in the manufacture of advanced automotive electronics.

Xinhua News Agency:
- China's crude steel output rose 23.7% in the first-quarter from a year earlier to 77.7 million metric tons.

Weekend Recommendations
Bulls and Bears:
- Had guests that were positive on ZMH, SU, AIG, BRK/B, mixed on IGT, GM, CY, COP, ADSK, TM and negative on YHOO, OVTI, F.

Forbes on Fox:
- Had guests that were positive on APC, AZR and mixed on BRY, ORI.

Cashin' In:
- Had guests that were positive on DUK, TSRA, NXTP and PVH.

Barron's:
- Had positive comments on DTV, DRI, DII and CC.

Goldman Sachs:
- Reiterated Outperform on COF, AMGN, DNA, GILD, FMD, SYK and KRB.
- Reiterated Underperform on EW.

Night Trading
Asian indices are -.75% to -.25% on average.
S&P 500 indicated -.04%.
NASDAQ 100 indicated -.13%.

Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell Video(bottom right)
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Analyst Actions
Macro Calls
CNBC Guest Schedule

Earnings of Note
Company/Estimate
CC/.59
DNA/.25

Splits
BER 3-for-2

Economic Releases
None of note

BOTTOM LINE: Asian Indices are lower on weakness in technology shares in the region. I expect US stocks to open modestly lower in the morning on weakness in Asia and continuing worries over slowing global growth. The Portfolio is 25% net long heading into the week.

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