Sunday, July 23, 2006

Monday Watch

Weekend Headlines
Bloomberg:
- Israeli Prime Minister Ehud Olmert said he might accept a multinational force stationed in Lebanon, where a UN force has been stationed since 1978, as a means of ending the conflict, so long as it is manned by European Union troops and monitors Lebanon’s border with Syria.
- Amvescap Plc(AVZ), manager of the Aim and Invesco funds, agreed to buy financier Wilbur Ross’s buyout company for as much as $375 million.
- China’s economic growth, which reached the fastest pace in a decade in the second quarter, may slow as the government takes steps to clamp down on lending.
- Currency traders are losing interest in the Canadian dollar.
- India’s central bank may increase its overnight borrowing rate for the third time this year as higher fuel prices and an expanding economy threaten to stoke inflation.
- Bill Gross, manager of the world’s biggest bond fund at PIMCO, has history on his side when he predicts the “bull market has begun” for US Treasuries.
- Gold in Asian trading declined amid signs cease-fire talks may be near in the 13-day-old conflict in Lebanon between Israeli and Iranian-backed Hezbollah forces, reducing the metal’s appeal as a haven.
- Copper prices in Shanghai and New York fell amid concerns that demand will slow in China and the US, the world’s biggest users of the metal.
- China’s stock indices slid after the central bank restricted the amount of funds available for lending to rein in economic growth.

Wall Street Journal:
- HCA Inc.(HCA) is in advanced talks to be sold to an investor group for about $21 billion, a deal that may be announced as early as tomorrow.

LA Times:
- Denver billionaire Philip Anschutz is pouring billions of dollars into building projects in Los Angeles, forever changing its face.

NY Times:
- Iranians are concerned about the potential risks of the country’s support for the Shiite terrorist group Hezbollah, and resent seeing the money going abroad.

Business Week:
- Experts weigh in on ways to revive growth at Dell Inc.(DELL). Some ideas: rethink retail and bring back Mike.

Washington Post:
- A Bush administration program to cut utility emissions through a “cap-and-trade” system will clean the air as well as a Clinton-era plan to make aging power plants install pollution controls, citing a study by an independent panel.
- Representatives from Iraq’s religious, ethnic and political factions voiced optimism yesterday in the first meeting of the nation’s reconciliation panel.

San Jose Mercury News:
- Businesses in the Silicon Valley area of northern California added 6,100 workers to their payrolls in June, a quarter of them from the hospitality industry as technology companies are spending more money.

Denver Post:
- The number of workers employed in Colorado reached 2.29 million, surpassing the previous record of 2.27 million in December 2000.

AP:
- A US subsidiary of Kawasaki Heavy Industries won a $522 million contract to build 210 railcars for the state of Connecticut.

Financial Times:
- Las Vegas Sands(LVS) plans to invest more than $8 billion in its Macau casino and convention development in the next four-to-six years, citing COO Weidner.
- Large US companies, analysts and fund managers want an end to quarterly earnings guidance, saying it damages shareholders and corporate governance, citing a report by the Business Roundtable Institute of Corporate Ethics.

Reuters:
- Earnings expectations for the second quarter have climbed recently as Reuters Estimates now projects S&P 500 earnings grew 10% in the second quarter, up from an expectation of 9.2% last week.

Frankfurter Allgemeine Zeitung:
- SAP AG(SAP) is on course to boost orders and sales even after the company said second-quarter software license sales missed analyst estimates, CEO Kagermann said.

Nihon Keizai:
- Honda Motor will spend $69 million building a plant to make electric motors and other parts for hybrid cars at is Suzuka factory in Japan by 2008.

Weekend Recommendations
Citigroup:
- Upgraded (DELL) to Buy, target $24.

Barron's:
- Had positive comments on (ASH), (EGN), (DOW), (CVX), (LEH) and (ITC).
- Had negative comments on (STN).

Night Trading
Asian indices are -1.50% to -.50% on average.
S&P 500 indicated -.07%
NASDAQ 100 indicated unch.

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
- (ACL)/1.16
- (ALTR)/.21
- (AXP)/.74
- (AMLN)/-.45
- (AV)/.12
- (BLS)/.57
- (BRO)/.29
- (CVD)/.53
- (EXP)/1.16
- (HAS)/.07
- (KFT)/.48
- (MRK)/.65
- (PRE)/2.01
- (PBI)/.68
- (PCL)/.36
- (DGX)/.76
- (SNDK)/.44
- (SGP)/.17
- (SLAB)/.33
- (TXN)/.47

Upcoming Splits
- (MRVL) 2-for-1
- (TNC) 2-for-1

Economic Releases
- None of note

BOTTOM LINE: Asian Indices are lower, weighed down by commodity and exporting shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing modestly higher. The Portfolio is 75% net long heading into the week.

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