Sunday, March 05, 2006

Monday Watch

Weekend Headlines
Bloomberg:
- China announced the biggest increase in its defense budget in four years as the economy grows and tensions flare with political foe Taiwan, regarded as a renegade province by the mainland government.
- President Bush said the US and Pakistan are putting together a trade agreement to spur economic growth in the South Asian nation.
- Warren Buffett, Berkshire Hathaway’s 75-year-old chairman, said his board has selected an executive to eventually succeed him.
- Berkshire Hathaway(BRK/A) said fourth-quarter earnings were little changed because of claims from a record hurricane season.
- Talks between NFL owners and players broke off less than 36 hours before a deadline for a new collective-bargaining agreement that could maintain stability in the nation’s most-popular sports league.
- Iran’s top nuclear negotiator Ali Larijani said his nation won’t renounce its right to enrich uranium on its soil, paving the way for it to be referred to the UN Security Council this week.
- US Joint Chiefs of Staff chairman Peter Pace said Iraq isn’t on the brink of civil war and that there isn’t any deadline for withdrawing American and coalition troops from the country.
- OPEC members will probably keep production close to a two-decade high as a disruption to Nigerian supply and possible sanctions against Iran keep prices above $60 a barrel.

Wall Street Journal:
- Cablevision Systems(CVC) will build a replacement for NYC’s Madison Square Garden arena a block west of the current site.
- AT&T(T) is nearing the acquisition of BellSouth(BLS) for about $65 billion.

Barron’s:
- Companies spun-off from their parents beat the S&P 500 by 45% in their first two years, according to a study conducted by Lehman Brothers’ Chip Dickson.

AP:
- Iraqi President Talabani said he has been assured that US armed forces will remain in Iraq as long as needed.

NY Times:
- Cingular Wireless, owned by AT&T(T) and Bellsouth(BLS), and other US mobile phone providers are working to improve their customer service and keep subscribers from switching carriers.
- DaimlerChrysler’s Chrysler Group says new models to be introduced this year will help the company avoid a sales slump, while a focus on style may allow it to reduce rebates in the longer-term, citing an interview with CEO LaSorda.
- Vermont, which as a population of about 620,000, is faced with the dilemma of convincing young people to stay in the state with few opportunities for jobs and housing.
- Research In Motion(RIMM) reached its $612.5 million settlement with licensing company NTP Inc. after a three-day negotiation session at Citigroup Inc.(C).
- Iran’s ambition to develop nuclear weapons still faces several technical hurdles including converting uranium ore to a gas and then turning the gas into enriched nuclear fuel.

Washington Post:
- Democratic congressional leaders Harry Reid and Nancy Pelosi complained in a private meeting with Democratic National Committee Chairman Howard Dean that he isn’t directing the party’s money to states with key races.

San Francisco Chronicle:
- California officials proposed changes to the state’s method of execution in an attempt to satisfy a judge who blocked the injection of lethal drugs into a convicted murderer last month.

Financial Times:
- The NYSE may offer derivatives trading and may combine with European exchanges as it tries to diversify its product mix, citing CEO Thain.
- Microsoft(MSFT) may reveal details this week for a portable computer sized between a mobile phone and a laptop.

London-based Times:
- The NYSE’s chief executive officer, John Thain, wants to “share out” contracts with investment banks, citing Thain.

Sunday Telegraph:
- Britain and the US will withdraw all their troops from Iraq next year as they seek to bring peace to the nation, citing a senior defense source.

Sunday Times:
- National Grid Plc, the British owner of electric utilities in NY and Massachusetts, was interested in making another purchase in the northeastern US, citing CEO Urwin.

AFP:
- Ayman al-Zawahiri, the deputy leader of al-Qaeda, has urged Islamist movement Hamas to carry on its fight and not accept agreements between the Palestinian government and Israel

Reuters:
- The investment show Mad Money, hosted by Jim Cramer, has drawn a loyal following since it began nearly a year ago.

China Securities Journal:
- China will cut duties on certain products to spur imports this year, part of efforts to seek balanced trade.

Weekend Recommendations
Barron's:
- Had positive comments on (AIG), (ATPG), (PFE), (CMCSK), (BSX), (FLR) and (SU).
- Had negative comments on (ARXT).

Goldman Sachs:
- Reiterated Outperform on (MDT).

Night Trading
Asian indices are -.25% to +.50% on average.
S&P 500 indicated +.09%.
NASDAQ 100 indicated +.09%.

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

Earnings of Note
Company/Estimate
(ALD)/.34
(BOL)/1.20
(IMDC)/.65
(JAS)/.31
(KFX)/-.08
(LEXR)/-.15
(MEDX)-.36
(SMTC)/.17

Upcoming Splits
(AAUK) 2-for-1

Economic Releases
10:00 am EST
- Factory Orders for January are estimated to fall 5.4% versus a 1.1% rise in December.
- Pending Home Sales for January are estimated to rise .5% versus a 3.0% decline in December.

BOTTOM LINE: Asian Indices are mostly higher, boosted by gains in financial shares in the region. I expect US stocks to open mixed and to rally modestly into the afternoon. The Portfolio is 75% net long heading into the week.

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