Friday Watch

Late-Night Headlines
Bloomberg:
- Nelson Peltz, the billionaire investor known for pressing companies to take steps to increase their stock prices, is raising $2 billion for his hedge-fund group Trian Fund Management LP.
- CBS’s nightly newscast drew its smallest audience in 20 years last week, extending the drop in viewership for anchor Katie Couric that began almost from her first days on the job.
- James Chanos, president of Kynikos Assoc., is bearish on Moody’s Corp.(MCO), the bond rating company whose biggest shareholder is Warren Buffett. Kynikos sold Moody’s stock short, Chanos said.
- Dow Jones’(DJ) controlling Bancroft family, reversing decades of resistance to a sale of the company, said it will consider offers and plans to meet with Rupert Murdoch’s News Corp.(NWS/A) on his $5 billion bid.
- JPMorgan Chase(JPM) expects credit conditions to worsen and possibly make it cheaper to buy rivals.
- Shares of ethanol producers fell today, following separate analyst reports from Banc of America and UBS AG that said increased ethanol supplies will hurt prices and profits.
- Manufacturing activity in China expanded at a slower pace in May, according to a survey of purchasing managers released today. A plan for state companies to pay dividends may help to cool investment that threatens to leave the country with idle factories if the economy slows. Manufacturing overcapacity may lead to deflation and turn China’s investment growth into a “curse,” the Asian Development Bank said in March. State companies controlled by the central government will pay dividends under a trial program to start this year, the government said May 30. That will leave less money for investment.
- Trading in options to buy Staples(SPLS) surged to six times their daily average amid speculation the company might benefit from a takeover of rival OfficeMax(OMX).
- Chinese investors opened more than 420,000 new brokerage accounts on May 30, well above the daily average for the year, even as the government tripled the tax on securities transactions.
- The US dollar traded near the highest in more than three months against the yen before a US government report that will probably show jobs growth accelerated in May.
- Peter Kreisky, president of Kreisky Media Consultancy, expects the Bancrofts to sell Dow Jones(DJ) to News Corp.(NWS/A).

Wall Street Journal:
- CKX Inc.(CKXE), the operator of Elvis Presley’s Graceland estate, is near a deal to be taken private by Robert F.X. Sillerman.

China Daily:
- More than 70% of Chinese who studied overseas in the past two decades remained abroad, hindering the nation’s scientific progress, citing China’s social science academy.

Xinhua News Agency:
- China’s financial institutions have used up 6% of the $14.9 billion quota for overseas investment they’ve been granted so far.

Late Buy/Sell Recommendations
Citigroup:
- Reiterated Buy on (CHS), target $32.

Piper Jaffray:
- Rated (CELL) Outperform.

Business Week:
- Earnings growth could push railroad stocks up an additional 35% through 2009, citing Morgan Stanley analyst William Greene.
- ConocoPhillips(COP) has become the third-largest US oil company as a result of investments such as a 20% stake it acquired in Russia’s Lukoil for $7.5 billion in 2005. Bernard Picchi of Wall Street Access said ConocoPhillips shares could reach $85 a year from now.
- Sepracor Inc.(SEPR) will be more profitable than analysts’ consensus, citing Robert Hazlett of BMO Capital Markets Corp.

Night Trading
Asian Indices are +.50% to +1.25% on average.
S&P 500 indicated +.16%.
NASDAQ 100 indicated +.12%.

Morning Preview
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NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
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In Play
Bond Ticker
Conference Calendar
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Macro Calls
Rasmussen Business & Economy Polling
CNBC Guest Schedule

Earnings of Note
Company/EPS Estimate
- None of note

Upcoming Splits
- (ANSS) 2-for-1
- (CI) 3-for-1
- (TSBK) 2-for-1

Economic Releases
8:30 am EST
- Personal Income for April is estimated to rise .3% versus a .7% gain in March.
- Personal Spending for April is estimated to rise .4% versus a .3% gain in March.
- The PCE Core for April is estimated to rise .2% versus unch. in March.
- The Change in Non-farm Payrolls for May is estimated at 132K versus 88K in April.
- The Unemployment Rate for May is estimated at 4.5% versus 4.5% in April.
- Average Hourly Earnings for May are estimated to rise .3% versus a .2% gain in April.

10:00 am EST
- Pending Home Sales for April are estimated to rise .3% versus a -4.9% decline in March.
- ISM Manufacturing for May is estimated to fall to 54.0 versus a reading of 54.7 in April.
- ISM Prices Paid for May is estimated at 73.0 versus a reading of 73.0 in April.
- The Final Univ. of Mich. Consumer Confidence reading for May is estimated at 88.0 versus 88.7 in April.

Afternoon
- Total Vehicle Sales for May are estimated to fall to 16.3M versus 16.4M in April.

Other Potential Market Movers
- The Fed’s Kroszner speaking, (WMT) Analyst Day, (WY) Analyst Meeting, (AIG) Financial Services Presentation, ASCO Annual Meeting, Bank of American Healthcare Conference, Sanford Bernstein Strategic Decisions Conference, Cowen Tech Conference and Lehman Wireless/Wireline Conference could also impact trading today.

BOTTOM LINE: Asian indices are higher, boosted by technology and commodity stocks in the region. I expect US equities to open mixed and to rally into the afternoon, finishing modestly higher. The Portfolio is 100% net long heading into the day.

Evening Review

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Stocks Rising Modestly into Final Hour on Positive Earnings and Buyout Activity

BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Internet longs, Computer longs and Retail longs. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is positive as the advance/decline line is mildly higher, most sectors are higher and volume is heavy. In today's manic market where a short-sited pessimistic day trading mentality still rules the day, we jump from recession fears to boom fears almost overnight. While some recent data are indicating a sharp acceleration in U.S. economic activity, other data points are more muted. Moreover, the effects of the recent rise in the 10-year yield are already taking hold. The average 30-year mortgage rate has jumped from 6.11% in December to 6.42% last week. Moreover, mortgage applications fell -7.3% last week, the worst decline since January. On top of this, global growth, while still very high, is decelerating, not accelerating. I believe it is unlikely the 10-year yield will move substantially higher from current levels. Maybe the economy isn't too hot or too cold again, but just about right. I plan to add to my core iShares Lehman 20+ Year Treasury Bond (TLT) long on any substantial move higher in the 10-year yield from current levels. Bloomberg is reporting today that Royal Dutch Shell and Vitol Group are among companies that are hiring supertankers to hoard up to 20 million barrels of oil in the Gulf of Mexico due to the fact that U.S. onshore storage is completely full. Oil companies have hired at least 10 supertankers for storage, according to the report. An analyst at BNP Paribas said that storing the oil on tankers is a "cheaper alternative" than trying to deliver to a market that "may not want the incremental barrels now." This could be one of the reasons oil is coming under pressure again today. Moreover, demand destruction is pervasive, China's bubble is poised to burst, the U.S. dollar is firming, alternatives are exploding onto the scene like never before, conservation is taking hold, global spare production capacity is rising and the risk premium is shrinking. I still expect oil to head into the 40s before year-end. I expect US stocks to trade mixed-to-higher into the close from current levels on buyout speculation, stabilizing long-term rates, short-covering and investment manager performance anxiety.

Growth Revised Down, Consumer Spending Higher, Job Market Healthy, Chicago PMI Surges, Construction Muted

- Preliminary 1Q GDP rose .6% versus estimates of .8% and prior estimates of 1.3%.

- Preliminary 1Q Personal Consumption rose 4.4% versus estimates of 4.1% and a 3.8% prior estimate.

- Preliminary 1Q GDP Price Index rose 4.0% versus estimates of 4.0% and a prior estimate of 4.0%.

- Preliminary 1Q Core PCE rose 2.2% versus estimates of 2.2% and prior estimates of 2.2%.

- Initial Jobless Claims for last week fell to 310K versus estimates of 314K and 314K the prior week.

- Continuing Claims fell to 2472K versus estimates of 2500K and 2524K prior.

- Chicago Purchasing Manager for May rose to 61.7 versus estimates of 54.0 and 52.9 the prior month.

- Construction Spending for April rose .1% versus estimates of unch. and an upwardly revised .6% increase the prior month.

BOTTOM LINE: The US economy grew at a slower pace than previously thought in the first quarter, Bloomberg reported. The Fed’s favorite inflation gauge, the core PCE index, rose at a 2.2% rate versus the 20-year average of 2.5%. The downward revision in growth was mainly the result of lower inventories than expected, which is a positive going forward. As well, personal spending was revised higher to 4.4%, the best rate in a year. Housing was less of a drag on growth than previously though, subtracting .9 percentage points from GDP. Moreover, personal income was revised higher for the fourth quarter of 2006, boosting the gain over the prior quarter to an annual rate of 5.9% from 4.7%. This is over twice most measures of inflation and suggests either payrolls have been undercounted or employees were paid more than estimated. I continue to believe US growth bottomed in 1Q as a result of dramatic inventory de-stocking and that growth is reaccelerating meaningfully this quarter and will approach average rates before year-end.

The number of Americans filing first-time claims for state unemployment benefits unexpectedly fell last week, pointing to strength in the labor market, Bloomberg reported. The four-week moving average of jobless claims rose slightly to 304,500. The unemployment rate among those eligible for benefits, which tracks the US unemployment rate, held steady at a historically low 1.9%. I continue to believe the job market will remain healthy over the intermediate-term without generating substantial unit labor cost increases.

A measure of US business activity jumped more than forecast in May, signaling expansion for the third consecutive month and suggesting the economy is accelerating after bottoming in the first quarter, Bloomberg reported. The Chicago PMI has now exceeded 60 during two out of the last three months. The long-term average is 55.0. Moreover, the New Orders component of the index soared to 71.1 from 56.5 the prior month. The Prices Paid component rose to 70.2 versus 64.9 the prior month. The Employment component of the index rose to 57.3 versus 50.5 the prior month. I continue to believe manufacturing which subtracted from US growth substantially during 1Q will add to growth this quarter as companies rebuild depleted inventories.

Spending on US construction projects unexpectedly improved last month, as work increased on non-residential projects such as hotels and factories, Bloomberg reported. Private homebuilding fell to the lowest level since June 2004. Non-residential construction rose 1.1% in April and is up 13% from the same time last year. I continue to believe overall construction activity will remain muted throughout the year as homebuilders continue to work down inventories.

Links of Interest

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Intraday Chart/Quote

Thursday Watch

Late-Night Headlines
Bloomberg:
- Companies in the S&P 500 may still be a bargain after the benchmark for US equities surpassed its 2000 record. The index's 500 members are 45% less expensive relative to historical profits than when the index last peaked.
- China’s stocks fell, extending a slide that wiped out $161 billion of the market value yesterday after the tax on securities trades was tripled. About 15 of the CSI 300 Index’s members fell by the 10% daily limit.
- Thomas H. Lee Partners LP and Fidelity National Financial agreed to buy Ceridian Corp.(CEN) for $5.3 billion after shareholders pressed the company for changes.
- Fred Thompson, a star of NBC’s “Law & Order” since 2002, told the show’s producer Dick Wolf that he won’t return for the new season in September, the latest sign that he may run for president next year.
- Japan’s wages unexpectedly fell in April, a fifth month of declines that may hamper a recovery in consumer spending.
- A California appeals court refused to throw out a suit accusing Gradient Analytics Inc., a research firm, and Rocker Partners LLC, a hedge fund, of driving down the price of Overstock.com Inc.(OSTK) shares.
- Daily average US ethanol production increased 1,000 barrels a day in March over February and the increased output is likely to spur discretionary blending.
- David Humphreys, chief economist of OAO GMK Norilsk Nickel, the word’s biggest nickel producer, said China’s production of nickel pig iron is a “significant” addition to global supplies and the market is moving into surplus.
- Peru’s main stock index fell the most in 12 years today, plunging 7.6%, led by miner Sociedad Minera Cerro Verde SA, on concern that Chinese demand for commodities may slow.

Financial Times:
- Man Group Plc is poised to start a “true” NY-listed hedge fund. The listing, which would be underwritten by Morgan Stanley(MS), may raise several hundred million dollars.
- Postnuptial agreements are gaining popularity among wealthy hedge fund managers and executives who want to safeguard their fortunes in case of divorce.
- Google(GOOG) will announce an initiative on Thursday that will take its applications beyond the web and challenge Microsoft(MSFT) on its home turf of the computer hard-drive.

Korea Economic Daily:
- An oil field OAO Rosneft is developing with South Korean companies may hold 10 billion barrels of oil, almost 300% more than initial estimates, citing South Korean government officials.

Commercial Times:
- Taiwan retail investors have stepped up buying of US dollars as the local currency gained following attempts by the island’s central bank to shore up its value. Taiwan banks have had 20 or 30 percent more than usual retail customers in the past few days wanting to exchange local dollars into the US currency.

21^st Century Business Herald:
- China is to start a tracking system in June to crack down on stock market speculation by state-owned enterprises, citing an official at the nation’s state assets agency. The nation’s state assets supervisor will also step up crackdowns on insider trading and share price manipulation, starting next month.

Xinhua News Agency:
- Eastmoney.com, a Chinese Web site that provides financial news and information, may raise $500 million in an IPO on the Nasdaq Stock Exchange.

Late Buy/Sell Recommendations
Citigroup:
- Reiterated Buy on (ADBE), target $50.

Night Trading
Asian Indices are +1.0% to +1.50% on average.
S&P 500 indicated +01%.
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
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Business & Economy Polling
CNBC Guest Schedule

Earnings of Note
Company/EPS Estimate
- (ATVI)/-.03
- (BIG)/.19
- (BTH)/.19
- (BRCD)/.09
- (CIEN)/.25
- (CSC)/1.48
- (CPRT)/.41
- (COST)/.56
- (DELL)/.27
- (DG)/.08
- (ESL)/.64
- (FOSL)/.30
- (FRED)/.19
- (GCO)/.26
- (HNZ)/.56
- (IRF)/.58
- (JCG)/.29
- (JTX)/1.94
- (OVTI)/-.01
- (PLL)/.43
- (NX)/.76
- (SHLD)/1.21
- (TIF)/.35

Upcoming Splits
- (GEO) 2-for-1

Economic Releases
8:30 am EST
- Preliminary 1Q GDP is estimated to rise .8% versus a prior estimate of a 1.3% gain.
- Preliminary 1Q Personal Consumption is estimated to rise 4.1% versus a prior estimate of a 3.8% gain.
- Preliminary 1Q GDP Price Index is estimated to rise 4.0% versus a prior estimate of a 4.0% gain.
- Preliminary 1Q Core PCE is estimated to rise 2.2% versus a prior estimate of a 2.2% gain.
- Initial Jobless Claims are estimated to rise to 314K versus 311K the prior week.
- Continuing Claims are estimated to fall to 2500K versus 2529K prior.

9:45 am EST
- Chicago Purchasing Manager for May is estimated to rise to 54.0 versus 52.9 in April.

10:00 am EST
- Construction Spending for April is estimated to remain unch. versus a .2% rise in March.

10:30 am EST
- Bloomberg consensus estimates call for a weekly crude oil build of 1,000,000 barrels versus a 1,969,000 barrel increase the prior week. Gasoline supplies are expected to rise by 1,500,000 barrels versus a 1,431,000 barrel increase the prior week. Distillate inventories are estimated to rise by 700,000 barrels versus a 512,000 barrel increase the prior week. Refinery Utilization is estimated to rise .50% versus a 1.60% increase the prior week. Finally, Natural Gas supplies are expected to rise by 105 bcf versus a 104 bcf increase the prior week.

Other Potential Market Movers
- The (HNZ) analyst day, (NVLS) 2Q mid-quarter update, (MA) Investment Community Day, (AIG) Financial Services Presentation, FBR Growth Conference, Bank of American Healthcare Conference, Deutsche Bank Energy/Utilities Conference, Sanford Bernstein Strategic Decisions Conference, Cowen Tech Conference and Lehman Wireless/Wireline Conference could also impact trading today.

BOTTOM LINE: Asian indices are higher, boosted by technology stocks in the region. I expect US equities to open mixed and to rally into the afternoon, finishing modestly higher. The Portfolio is 100% net long heading into the day.

S&P 500 Closes at New All-Time High, Joining the DJIA and Russell 2000 in Record Territory

Indices
S&P 500 1,530.23 +.80%
DJIA 13,633.08 +.83%
NASDAQ 2,592.59 +.80%
Russell 2000 843.35 +.69%
Wilshire 5000 15,411.91 +.82%
Russell 1000 Growth 602.89 +.85%
Russell 1000 Value 881.83 +.79%
Morgan Stanley Consumer 747.20 +.33%
Morgan Stanley Cyclical 1,073.82 +1.05%
Morgan Stanley Technology 613.61 +.45%
Transports 5,233.78 +.52%
Utilities 520.04 +.81%
MSCI Emerging Markets 125.18 -.17%

Sentiment/Internals
Total Put/Call .90 -3.23%
NYSE Arms .59 -50.83%
Volatility(VIX) 12.83 -5.17%
ISE Sentiment 139.0 +8.59%

Futures Spot Prices
Crude Oil 63.40 +.40%
Reformulated Gasoline 227.0 -1.21%
Natural Gas 7.96 +2.99%
Heating Oil 186.84 -.03%
Gold 659.10 -.65%
Base Metals 262.54 -.48%
Copper 330.50 -.45%

Economy
10-year US Treasury Yield 4.87% -1 basis point
US Dollar 82.43 +.15%
CRB Index 309.25 +.58%

Leading Sectors
REITs +2.59%
Oil Service +2.32%
Engineering & Construction +2.03%

Lagging Sectors
HMOs -.14%
Restaurants -.27%
Semis -.36%

Evening Review
Market Performance Summary
Market Gauges
Daily ETF Performance
Style Performance
Market Wrap CNBC Video(bottom right)
S&P 500 Gallery View
Economic Calendar
Timely Economic Charts
GuruFocus.com
PM Market Call
After-hours Movers
After-hours Stock Quote
In Play

Afternoon Recommendations
Bank of America:
- Rated (HTZ) Buy.

Afternoon/Evening Headlines
Bloomberg:
- US stocks surged for a third day, sweeping the S&P 500 past its 2000 closing record, despite a 6.5% plunge in Chinese stocks overnight.
- Yahoo! Inc.(YHOO) said Chief Technology Officer Farzad Nazem resigned, leaving two of the top executive posts at the company unfilled.
- Intel Corp.(INTC) said it will join with Microsoft Corp.(MSFT) and Dell Inc.(DELL) to develop technology that helps flash memory speed up personal computers.
- WR Hambrecht Chairman Bill Hambrecht plans to form a professional football league in North American cities where there are no NFL teams.
- President Bush asked Congress today to approve $30 billion over the next five years to mount a more aggressive campaign against the spread of AIDS worldwide.
- Apple Inc.(AAPL) agreed to carry clips from Google’s(GOOG) YouTube starting in June, using the world’s most popular online video service to attract customers for its two-month-old digital-television box.
- Apple Inc.(AAPL) will replace MedImmune in the S&P 100.
- US steel imports fell 26% in April as domestic prices dropped and service centers held off on new orders, an industry group said.
- Gasoline futures fell to a three-week low on estimates a US Energy Department report tomorrow will show a fourth consecutive week of rising inventories, as some refineries increase production.
- Jim Rogers, CEO of Beeland Interests Inc., sees more China measures to pop their stock “bubble.”
- The Group of Eight leading industrial nations said they are ready to back tougher sanctions against Iran if the country fails to suspend uranium enrichment.

Financial Times:
- Dow Jones’(DJ) largest outside shareholder said News Corp.’s(NWS/A) $5 billion offer for the publisher is “fairly attractive” and may even been raised.

BOTTOM LINE: The Portfolio finished higher today on gains in my Internet longs, I-Banking longs, Retail longs and Computer longs. I added an (AKAM) trading long and added to a few energy-related shorts in the final hour, thus leaving the Portfolio 100% net long. The tone of the market was positive today as the advance/decline line finished mildly higher, sector performance was mostly positive and volume was above average. Measures of investor anxiety were about average into the close. Today's overall market action was very bullish. Once again, many stocks trounced the major averages today. True "growth stocks" were especially strong, with quite a few exhibiting explosive action. I still expect Google (GOOG) to exceed $600 and Apple (AAPL) to exceed $150 this year. These two stocks remain my two largest long positions. Despite the recent housing data, the August home price futures ticked up today to $214,800 from $214,400. I suspect today's whipsaw market action resulted in more investors leaning the wrong way. Performance anxiety is likely back in play in a big way. The Nikkei futures are indicating a 100-point gain in Japan on the open. Gold is falling another $4.30 per ounce on worries over emerging market demand and a report last night from London-based Virtual Metals that gold supply will exceed demand by 250 metric tons this year. The precious metal continues to trade very poorly given the numerous potential upside catalysts over the last year. I still expect a complete technical breakdown in gold before year-end.

DJIA Surging Near Another Record into Final Hour, Despite 6.5% Plunge in Chinese Shares, on FOMC Minutes

BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Internet longs, I-Banking longs, Retail longs and Computer longs. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is mildly positive as the advance/decline line is about even, most sectors are higher and volume is above average. Why is the myth that there is no oil demand destruction continuously perpetuated? Over the last three years global oil demand has only risen a total of 2.4% to 83.9 million barrels per day (OPCBRTOT Index on Bloomberg), while global economic growth has been the highest in over three decades, averaging near 5% annually. Global supplies (OPCBTSUP Index on Bloomberg) have risen 5.0% during that period to 85.6 million barrels per day. Just last year, global oil demand rose a paltry 0.9% while global growth boomed 5.3%. Moreover, oil consumption in the 30 OECD (Organization for Economic Co-operation and Development)countries actually fell 0.6% in the last year for the first time in over 20 years! These facts aren't possible without significant and pervasive global demand destruction. I believe the reason why the "no demand destruction" myth goes unchallenged in the media is that there has never been a time in U.S. history that more investors, analysts and pundits perceived that they benefit from high oil prices and they are positioned accordingly. Commercial hedgers, historically the smart money, remain net short crude despite record crack spreads and the onset of driving season. I continue to believe we have already seen the highs for the year in oil and gasoline prices. I expect US stocks to trade mixed into the close from current levels as buyout speculation, short-covering and investment manager performance anxiety offsets China bubble worries.

Today's Headlines

Bloomberg:
- Clashes between Venezuelan police and marchers protesting the government’s shutdown of Radio Caracas Television left dozens detained or injured across the country.
- Goldman Sachs Group’s(GS) Global Alpha hedge fund fell -3.4% in the first four months of this year, according to a report sent to investors last week. Global Alpha has declined -12% since 2005. The $10 billion fund struggled in a 16-month stretch when the S&P 500 rose 22%.
- Gold is falling another $4.70/oz. on speculation the US economy does not need a Fed rate cut, thus boosting the dollar and reducing demand for the precious metal.
- Federal Reserve officials acknowledged they underestimated to length of the US housing slowdown, while continuing to view inflation as the biggest threat to the economy, the release of the FOMC minutes showed.
- CBS Corp.(CBS) bought the music-focused social-networking site Last.fm for $280 million in cash.
- News Corp.(NWS/A) agreed to buy Web site owners Photobucket Inc. and Flektor Inc. to add digital picture services that let users store, edit and share images.
- Palm Inc.(PALM) will start selling a portable computer in a bid to increase sales as its Treo mobile phone and e-mail device loses ground to the BlackBerry.
- China’s stocks plunged 6.8% last night, the most in three months, after the government tripled the tax on securities transactions to cool a rally that’s drawing more than 300,000 new investors a day.

Wall Street Journal:
- The SEC intends to review so-called 12b-1 fees, charged by mutual funds to compensate intermediaries such as brokers.
- Pizza chains in the US are losing market share as consumers seek more innovative products.
- Navistar International(NAVZ), the delisted parent of International Truck & Engine Co., may be a buyout target and its stock has risen as a result.

Politico:
- Former Tennessee Senator Fred Thompson is expected to announce his candidacy for the 2008 Republican presidential nomination in Nashville over the Fourth of July holiday, citing unidentified Thompson advisers.

CNBC:
- The NYSE will close one of four trading rooms later this year because of a drop in activity.

Economic Releases

- None of note

Links of Interest

Market Snapshot
Detailed Market Summary
Quick Summary
Economic Commentary
Movers & Shakers
Today in IBD
NYSE OrderTrac
I-Watch Sector Overview
NYSE Unusual Volume
NASDAQ Unusual Volume
Hot Spots
NASDAQ 100 Heatmap
DJIA Quick Charts
Chart Toppers
Option Dragon
Intraday Chart/Quote

Wednesday Watch

Late-Night Headlines
Bloomberg:
- Asian stocks fell for the first time in three days after China tripled the tax on securities transactions. The Chinese benchmark CSI 300 Index fell 6.4% on the news.
- Gold supply will exceed demand by 250 metric tons this year, a bigger surplus than forecast in October, as increased prices deter jewelry buyers, London-based research company Virtual Metals said. Jewelry consumption will decline 2.5% to 2,218 tons, a second annual drop, Virtual Metals said.
- NBC Universal named producer Ben Silverman as co-chairman of television and entertainment with Marc Graboff in a reshuffle aimed at lifting the network out of last place.
- US Secretary of State Condoleezza Rice insisted Iran must suspend uranium enrichment, rebuffing a suggestion by the International Atomic Energy Agency’s chief that the US and its allies relax the demand.
- CDW Corp.(CDWC) agreed to be bought by Madison Dearborn Partners LLC for about $7.3 billion amid a surge of private-equity investments in technology.
- Japan’s industrial production unexpectedly fell for a second month as manufacturers reduced output.
- Australia’s retail sales in April gained less than economists forecast as rising gasoline prices crimped spending at department stores.
- Nippon Steel Corp., Asia’s largest steelmaker, doesn’t plan to buy rival producers, Nippon President Mimura said.
- Steel Dynamics(STLD) said second-quarter profit may fall to the low end of the per-share range of 95 cents to $1 forecast by the company in mid-April because of lower than expected shipments and pricing for flat-rolled steel.
- Gilead Sciences(GILD) said its experimental drug for cystic fibrosis, a fatal lung disease, met the main goal of a study.
- Japan’s birthrate rose in 2006 for the first time in six years, citing a Health Ministry report that will be released in the latter half of next week.
- Thailand’s Prime Minister Surayud Chulanont said he will order emergency rule in Bangkok if court rulings that may ban Thailand’s two main political parties spark violent protests.

Wall Street Journal:
- Cantor Fitzgerald LP, the firm that lost hundreds of employees during the Sept. 11, 2001, attacks, will combine two units in a $1.3 billion deal. The new company, to be known as BGC Partners, will comprise eSpeed Inc., a publicly-held electronic-trading company controlled by Cantor, and BGC Partners, Cantor’s closely-held bond-trading unit.

Financial Times:
- Microsoft Corp.(MSFT) will release information today about a coffee table-shaped “surface computer” that the company says will open up a multibillion dollar area of computing, citing a demonstration by Microsoft(MSFT).

Economic Times:
- India may increase the amount of money local mutual funds can invest in equity and debt abroad.

Securities Times:
- Some Chinese banks started internal probes to prevent customers from using loans to buy stocks as the benchmark index reaches new highs daily. Banks told branches to look more closely at loans for working capital and small business operations so they aren’t diverted into the stock market.

Late Buy/Sell Recommendations
Citigroup:
- Retailing-softlines short interest rose 8.5% in May to a record 257,000,000 shares short on the heels of a prior peak in April on lingering worries over consumer spending. Retailers with the most significant increases in short interest include ANN +38%, CHRS +35%, CTR +29%, MW&URGI +26%, ANF/CMRG/LTD +25%, CBK +24%, GPS +23%, TJX +22%, DBRN +20%, CHIC +21%, TUES&ARO +15%, HOTT +12% and BEBE/PLCE/ROST +11%.

Morgan Stanley:
- Reiterated Overweight on (GILD).

Night Trading
Asian Indices are -.75% to -1.0% on average.
S&P 500 indicated -.28%.
NASDAQ 100 indicated -.28%.

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
Conference Calendar
Daily Stock Events
Macro Calls
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Earnings of Note
Company/EPS Estimate
- (CHS)/.26
- (DAKT)/.08
- (DLTR)/.37
- (DBRN)/.31
- (JAS)/-.07
- (JOYG)/.72
- (NOVL)/.01
- (PSS)/.59
- (RL)/.62
- (SMTC)/.10
- (THO)/.41
- (WSM)/.13

Upcoming Splits
- (NRG) 2-for-1
- (SRCL) 2-for-1
- (GEO) 2-for-1

Economic Releases
2:00 pm EST
- The Minutes of May 9 FOMC Meeting

Other Potential Market Movers
- The weekly MBA Mortgage Applications report, weekly retail sales reports, ADP Employment Change, (SPAR) analyst meeting, (IRBT) analyst meeting, (GNW) strategic update, FBR Growth Conference, Merrill Lynch Small-cap Tech Healthcare Conference, Bank of American Healthcare Conference, Deutsche Bank Energy/Utilities Conference, Sanford Bernstein Strategic Decisions Conference, Cowen Tech Conference and Lehman Wireless/Wireline Conference could also impact trading today.

BOTTOM LINE: Asian indices are lower, weighed down by commodity and automaker stocks in the region. I expect US equities to open modestly lower and to rally into the afternoon, finishing mixed. The Portfolio is 100% net long heading into the day.

Stocks Finish Higher on Fall in Energy Prices, More Economic Optimism and Buyout Speculation

Indices
S&P 500 1,518.11 +.16%
DJIA 13,521.34 +.10%
NASDAQ 2,572.06 +.58%
Russell 2000 837.53 +.92%
Wilshire 5000 15,286.36 +.28%
Russell 1000 Growth 597.80 +.33%
Russell 1000 Value 874.88 +.15%
Morgan Stanley Consumer 744.76 +.11%
Morgan Stanley Cyclical 1,062.67 +.23%
Morgan Stanley Technology 610.87 +.40%
Transports 5,206.63 +1.15%
Utilities 515.86 +.63%
MSCI Emerging Markets 125.38 -.13%

Sentiment/Internals
Total Put/Call .93 -8.82%
NYSE Arms 1.20 +46.53%
Volatility(VIX) 13.53 +1.42%
ISE Sentiment 128.0 +9.4%

Futures Spot Prices
Crude Oil 63.37 -2.81%
Reformulated Gasoline 230.50 -4.11%
Natural Gas 7.59 -.64%
Heating Oil 187.80 -3.15%
Gold 663.20 +.27%
Base Metals 263.80 +.99%
Copper 330.0 -.62%

Economy
10-year US Treasury Yield 4.88% +3 basis points
US Dollar 82.31 -.02%
CRB Index 307.47 -1.80%

Leading Sectors
REITs +3.54%
Networking +3.12%
Internet +2.14%

Lagging Sectors
Gold -.42%
Oil Service -.73%
Energy -.76%

Evening Review
Market Performance Summary
Market Gauges
Daily ETF Performance
Style Performance
Market Wrap CNBC Video(bottom right)
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Economic Calendar
Timely Economic Charts
GuruFocus.com
PM Market Call
After-hours Movers
After-hours Stock Quote
In Play

Afternoon Recommendations
Bank of America:
- Rated (RNR) Buy.

Piper Jaffray:
- Rated (JMBA) Outperform.

Afternoon/Evening Headlines
Bloomberg:
- The private-equity boom will continue in the next few years as near-record-low borrowing costs keep buyouts affordable, KKR co-founder Henry Kravis said.
- Shares of Coldwater Creek(CWTR), the Idaho-based women’s clothing retailer, soared as much as 15% after-hours as first-quarter profit unexpectedly rose.
- Cotton futures declined 2.2% in NY on speculation the US may miss government export forecasts on cooling demand from China.
- Coffee had its biggest decline in six weeks, falling 2%, on expectations that favorable weather will aid crops in Brazil, the world’s largest producer.
- Corn fell 3% to a two-week low in Chicago and soybeans dropped 1.9% after rains boosted moisture levels in fields east of the Mississippi River, increasing yield potential for the two biggest US crops.
- Gasoline futures in NY plunged 4.4%, the most in seven months, on estimates that gasoline supplies rose for the fourth consecutive week, which curtailed investment fund speculation on the commodity.
- Robert Zoellick, the former US trade representative and an executive at Goldman Sachs Group(GS), will be nominated by President Bush to replace Paul Wolfowitz as head of the World Bank, a senior administration official said.
- Broadcom(BRCM) won a $19.6 million verdict after a California jury ruled rival Qualcomm(QCOM) intentionally infringed three patents for mobile-phone technology.
- Nationwide gasoline prices at the pump fell $.01/gallon, breaking a string of increases, to $3.21/gallon, a government report said.

BOTTOM LINE: The Portfolio finished higher today on gains in my Internet longs, I-Banking longs and Energy-related shorts. I did not trade in the final hour, thus leaving the Portfolio 100% net long. The tone of the market was positive today as the advance/decline line finished higher, sector performance was mostly positive and volume was below average. Measures of investor anxiety were about average into the close. Today's overall market action was mildly bullish. Small-caps and mid-caps outperformed throughout the day. The U.S. dollar recouped morning losses, finishing unchanged. The 10-year yield was up 3 basis points on the home price data and better-than-expected consumer confidence reading. Gasoline futures are near session lows, falling 4.4%. This is significant. It appears to me the gasoline crack spread is finally breaking down, as well. The iShares FTSE/Xinhua China 25 (FXI) finished off session lows, falling 1.2% on news of increased trading fees for investors in China. Google (GOOG) finished off session highs, rising $3.59, but it has broken out of its recent downtrend. I suspect another attack on $500 is imminent and I expect it to hold this time.

Stocks Mostly Higher into Final Hour as Buyouts and Falling Energy Prices offset China Bubble Worries

BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Internet longs, I-Banking longs and Energy-related shorts. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is positive as the advance/decline line is higher, most sectors are higher and volume is below-average. The Yale School of Management Crash Confidence Index is showing the individual (herd) is the most concerned about a stock market crash since December 2002, right near the trough of one of the worst bear markets in U.S. history. This is another amazing number and helps to illustrate how deep-seeded the herd's pessimism towards U.S. stocks really is, in my opinion. Notwithstanding any weekly or monthly blips higher in various measures of investor confidence, I continue to believe overall investor sentiment regarding U.S. stocks has never been worse in history with the DJIA just off fresh record highs. This has to be very disturbing to the many U.S. secular bears. I expect US stocks to trade modestly higher into the close from current levels on buyout speculation, lower energy prices and more economic optimism.

Today's Headlines

Bloomberg:
- China’s Ministry of Public Security warned investors not to fall for scams aimed at capitalizing on enthusiasm over a rapidly rising stock market, such as false initial share offerings or fake investment funds.
- Crude oil is dropping $2.03/bbl. in NY as investment fund speculation subsided after an end to a strike in Nigeria and on expectations that supplies are adequate.
- Stephen Schork, an energy investor and president of Schork Group sees lower gas prices during the summer driving season.
- Venezuelan President Hugo Chavez threatened to shut down the country’s last opposition television station as students took to the streets for a third day protesting what they say is a crackdown on free speech.
- The Bank of Canada said for the first time in a year that it’s ready to increase interest rates because inflation is accelerating faster than it expected.
- Trading in options to buy shares of Commerce Bancorp(CBH) surged ninefold to a six-week high after the largest bank based in NJ canceled an appearance tomorrow at a Sanford C. Bernstein conference.
- President Bush imposed economic sanctions against Sudan in a bid to curb the violence in Darfur and he called on the UN to step up financial pressure on a leader who hasn’t stopped genocide in the war-torn African country.

Wall Street Journal:
- CDW Corp.(CDWC), one of the biggest US resellers of computers, software and related equipment, may be bought by a private-equity firm.
- The World Bank said direct foreign investment in emerging markets was a record $325 billion last year, yet cautioned that there are still concerns over the stability of some banks in such countries.
- Cutbacks in merchandise at Wal-Mart(WMT) are starting to trim orders to some of the company’s suppliers in China.
- Morgan Stanley(MS) Chairman John Mack is directing the investment bank’s business toward propriety trading and advisory services in a bid to boost profit.
- Florida plans to cut property taxes to promote economic growth slowed by a drop in real estate sales.
- US investors in mutual and hedge funds may benefit in coming years as more and more managers depend on third-party providers for internal monitoring and risk management.

NY Times:
- US lawmakers are pushing to subsidize coal as an alternative fuel. Democrat and Republican lawmakers are proposing to guarantee billions of dollars in construction loans for coal-to-liquid production plants, guarantee prices and future government purchases.

AP:
- Sony Corp.(SNE) will introduce its first HD radio tuners in July, as prices for radios that detect AM and FM signals that broadcast digitally fall from their $800 debut more than two years ago.

Efe:
- The Venezuelan lawmaker deported form Colombia yesterday for allegedly interfering in domestic politics, called Colombian President Alvaro Uribe the country’s “biggest terrorist.”

Xinhua News Agency:
- China tripled the stamp tax on securities trading to help promote a “healthy” stock market, citing the Ministry of Finance. The government boosted the stock trading fee from .1% to .3%.

Consumer Confidence Rebounds, % Planning to Buy "Major Appliance" at 9-year High

- Consumer Confidence for May rose to 108.0 versus estimates of 105.0 and an upwardly revised 106.3 in April.

BOTTOM LINE: An index of consumer confidence in the US jumped more than forecast in May as rising stock prices and a resilient labor market put Americans in a mood to spend. Better consumer sentiment raises the odds that the Fed’s forecast for accelerating economic activity will come to fruition. The Present Conditions component of the index rose to 136.1 from 133.5 the prior month. The Expectations component rose to 89.2 from 88.2 prior. The percentage of Americans that said jobs are hard to get fell to 19.9% from 20.4% in April. A 2.9% surge in the S&P 500 from the last week in April through May 22 also buoyed confidence. A $3.22/gallon nationwide average gas price on May 22 likely prevented an even greater jump in the reading.

34.4% of consumer said they plan to purchase a “major appliance,” the highest since May 1998 and up 10% from April. Moreover, this number has only been higher during 2 other months(March and May of 1998) over the last 19 years. This is very significant considering the percent that plan to purchase a major appliance is higher now than at any time during the peak of the recent housing boom. This is likely due to the fact that Americans’ net worth is at an all-time high as a result of the 106% gain in the stock market since the October 2002 bottom, a healthy job market, low interest rates, below average inflation and a 127.3% gain(Case-Shiller Home Price Index) in home prices over the last decade. These facts continue to be ignored by those that have expected consumer spending to fall off a cliff over the last couple of years as a result of housing.

The gain in the overall reading was spurred by a 19.2% jump in the Northeast Central region. However, the overall gauge continues to be skewed negatively by depressed confidence in the northern part of the country where most investment funds and major media outlets are located. Here is a breakdown of today’s Consumer Confidence reading by region:

Northeast Central 69.5 +19.2%

New England 74.6 -7.9%

Mid Atlantic 90.2 -8.3%

Northwest Central 99.5 -1.9%

Southeast Central 115.8 -.7%

South Atlantic 116.9 +.3%

Pacific 127.7 +7.7%

Southwest Central 130.5 +2.1%

Mountain 138.20 +1.5%

Links of Interest

Market Snapshot
Detailed Market Summary
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Economic Commentary
Movers & Shakers
Today in IBD
NYSE OrderTrac
I-Watch Sector Overview
NYSE Unusual Volume
NASDAQ Unusual Volume
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Chart Toppers
Option Dragon
Intraday Chart/Quote

Tuesday Watch

Weekend Headlines
Bloomberg:
- Venezuelan President Hugo Chavez put the nation’s most popular TV network off the air this weekend, accusing the broadcaster of “coup-mongering.”
- The US dollar reached the strongest level in six weeks against the euro and a three-month high versus the yen as reports suggested the US economy is gaining momentum.
- President Bush, in a Memorial Day weekend radio address, said the wars in Iraq and Afghanistan are aimed at promoting in those countries the freedom people enjoy in the US.
- Overseas stock exchanges including NYSE Euronext(NYX) and Nasdaq Stock Market(NDAQ) said they plan to open offices in China for the first time, amid efforts to woo Chinese companies to their bourses.
- Japan, a signatory to the Kyoto Protocol on climate change, wants the 21 Asia-Pacific Economic Cooperation members to adopt specific measures to cut energy consumption.
- Venezuela’s new state television channel TVes took control of the country’s most-watched network as protesters accused President Hugo Chavez of seeking to stamp out voices of opposition to his government.
- Venezuela’s streets echoed with sirens, horns and pot-banging late last night as thousands of supporters of Radio Caracas Television readied for a final day of protest hours before the independent TV network exits public airwaves.
- Avaya Inc.(AV) delayed a meeting with analysts scheduled for next week amid speculation the world’s largest maker of corporate phone equipment will be acquired.
- China’s CSI 300 Index rose about 4,000 for the first time, driven by a surge in new investors who are ignoring warnings of a bubble to enter a market that’s doubled this year.
- A tax-cut war is spreading across Europe as leaders of the continent’s biggest economies give up criticizing smaller neighbors for slashing business tax rates and decide to join them instead.
- Venezuela’s government urged a probe of Time Warner’s CNN and local television station Globovision for broadcasting “lies” and inciting violence against President Hugo Chavez.
- Japan’s jobless rate unexpectedly fell to a nine-year low and households increased spending for a fourth month in April, suggesting consumers will help extend the economy’s longest postwar expansion.
- Colorado and Utah have as much oil as Saudi Arabia, Iran, Iraq, Venezuela, Nigeria, Kuwait, Libya, Angola, Algeria, Indonesia, Qatar and the UAE combined. That’s not science fiction. Trapped in limestone up to 200 feet thick in the two Rocky Mountain states is enough so-called shale oil to rival OPEC and supply the US for one hundred years.
- Crude oil fell as much as 1.4% in NY after oil workers in Nigeria ended a two-day strike.

Wall Street Journal:
- Avaya Inc.(AV), the world’s largest maker of corporate phone equipment, is in talks with private equity firm Silver Lake Partners about a leveraged buyout.
- Tishman Speyer Properties LP and Lehman Brothers Holdings(LEH) are close to reaching an agreement to acquire Archstone-Smith Trust(ASN).

CNNMoney.com:
- The Top 25 fastest growing tech companies.
- The Top 25 greatest tech stock gainers.

NY Times:
- Amherst College, Harvard University and University of Virginia are among the two dozen elite US schools accepting students based on their low-income backgrounds as the universities diversify “economically.”
- Iraqis say a rapid American troop withdrawal would fuel more violence in the country, citing a survey and interviews with more than 40 Iraqi politicians and residents.
- Coca-Cola(KO) may look for more acquisitions like its agreement to buy Glaceau Vitaminwater to boost its non-carbonated offerings, citing CEO Isdell.
- Witnesses aren’t cooperating with Newark, NJ Mayor Cory Booker’s bid to cut the murder rate in the state’s largest city. Police officers say witnesses often refused to say who committed crimes, the result of public mistrust dating back to riots in 1967 and hip-hop artists railing against informants.
- 33% of NYC residents owned their own homes in 2005, an all-time high and up from 30.2% in 2000, citing an analysis of Census Bureau data.
- Google Inc.(GOOG), Yahoo! Inc.(YHOO), Microsoft Corp.(MSFT) and their technology rivals are using unconventional recruiting methods to lure workers as they compete for top job candidates.
- Will stocks suffer a multi-decade bear market as the baby-boom generation sells its shares to retirement? Some have predicted such an outcome, but a new study – which projects huge growth in 401k assets in future decades – paints a far more sanguine picture.
- Google’s(GOOG) $3.1 billion acquisition of online advertiser DoubleClick Inc.(DCLK) led the US FTC to top a preliminary antitrust probe into the purchase.

Washington Post:
- Ryan Crocker, US ambassador in Baghdad, will tell Iranian diplomats how the Islamic republic can help stabilize Iraq, both militarily and politically, during talks in Baghdad tomorrow.

Newsweek:
- US intelligence has identified a secret Iranian group called Department 9000 as the unit behind Tehran’s efforts to support Shiite insurgent cells in Iraq.

AP:
- To deal with high gas prices, 47% of the 1,000 Americans polled said they were considering buying a more fuel-efficient vehicle versus 39% last year, according to an AP-Ipsos poll.
- US military forces rescued 42 captured Iraqis from an al-Qaeda post near Baghdad today. Some of the group had been held for as longs as four months, including some who showed signs of torture.

Age:
- Rio Tinto Group(RTP) hired Deutsche Bank AG to advise it on a possible bid for aluminum producer Alcan Inc.(AL).

Reuters:
- Iran plans to develop new oil fields with neighboring Iraq, citing National Iranian Oil Co. Managing Director Gholam Hossein Nozari.

Financial Times:
- Japan’s ruling Liberal Democratic Party is preparing to allow casino gambling next year.

Sunday Telegraph:
- Coca-Cola Co.(KO) is in talks to buy the Highland Spring Ltd. bottled water company for as much as $992.3 million.

Sunday Times:
- The Dubai International Financial Centre may block Nasdaq Stock Market’s(NDAQ) acquisition of Sweden’s OMX AB by making its own bid.

BBC:
- World Bank President Paul Wolfowitz, who plans to resign June 30, says the media was a bigger factor in his decision to leave the lender than his standing among bank employees. The bank’s board agreed he hadn’t done anything unethical with regard to compensation for a bank worker who was his girlfriend.

Nikkei English News:
- Toshiba Corp. will start using Advanced Micro Devices(AMD) chips in some products to cut costs.

South China Morning Post:
- The Chinese Central government has asked local officials to stop offering tax and power incentives to energy-intensive industries.

Shanghai Securities News:
- China may have more than 100 million stock market accounts as of yesterday, as new investors stormed in to tap a record share rally. The value of shares in China surged more than 600% in the past two years to $2.4 trillion. So far this year, about 20.9 million accounts have been opened at brokerages, 400% more than the entire amount in 2006.

Xinhua News Agency:
- China won’t meet its energy efficiency targets if annual economic growth reaches 9% or higher, citing the deputy head of energy efficiency research at the nation’s top planning agency.
- Chinese university students shouldn’t be involved in stock trading, because they are unable to bear the losses should their investments turn sour, citing the Ministry of Education.

21^st Century Business Herald:
- Yu Yongding, a former monetary policy adviser to China’s central bank, says the nation faces a “most urgent” problem of a “quite serious” stock market bubble. The government needs to curb share prices to make them drop gradually. Yu proposed raising stamp duty on share trading, cracking down on irregularities by brokers and increasing the supply of shares. Monetary policy alone can’t curb the asset bubble, because small interest rate increases won’t be enough to siphon money back into back accounts and raising rates too much risks hurting the economy, he said.
- China’s government may soon let citizens buy stocks overseas, broadening an investment program that currently only allows banks to invest abroad. Chinese brokerages and fund management companies may also be allowed to invest abroad as qualified domestic institutional investors.

Chosun Ilbo:
- North Korean dictator Kim Jong Il may be ill, citing a South Korean government official.

Emirates Today:
- Taxis in Dubai will be converted into more environmentally friendly “duel fuel” vehicles that will use electricity as well as gasoline.

Al-Ahram:
- Egypt is expected to produce eight metric tons of gold next year, one ton more than its entire production in the past 100 years, citing a government official. The increase is expected following new government regulations that encourage foreign companies to explore for gold.

Weekend Recommendations
Barron's:
- Made positive comments on (LWSN) and (ARC).
- Made negative comments on (JSDA).

Morgan Stanley:
- As China’s Shanghai A-share market continues to rise rapidly despite historically high valuations, fears of serious consequences from a potential burst of the stock market bubble have intensified greatly in recent weeks. However, on examination of household and corporate exposure to the stock market, we conclude that the negative wealth effect on consumption would be moderate and financing conditions for corporate investments would be unlikely to deteriorate significantly in the aftermath of such a burst. The potential impact on the banking sector is much more difficult to gauge, given the paucity of data. However, our stress test suggests that the impact on banks’ balance sheets would, while significant, likely be manageable. A major correction of the A-share market could well result in a significant contagion to global markets, as seen during February’s short-lived correction. However, to the extent that any such global sell-off were driven by concerns about a stock-market-correction-triggered-recession in China’s real economy, it would likely prove overdone, in our view. We think the risk of a much more serious impact from a potential stock market correction will heighten significantly if Chinese shares continue rising rapidly from current levels.

Night Trading
Asian indices are unch. to +.50% on average.
S&P 500 indicated +.03%.
NASDAQ 100 indicated +.09%.

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Earnings of Note
Company/Estimate
- (ALKS)/.02
- (BCSI)/.28
- (BMC)/.39
- (BAMM)/.12
- (BGP)/-.36
- (CWTR)/.09
- (DCI)/.46
- (PVH)/.86
- (SGR)/.18
- (STP)/.22
- (TSAI)/.31
- (PAY)/.37

Upcoming Splits
- (VSEA) 3-for-2
- (NRG) 2-for-1
- (SRCL) 2-for-1
- (GEO) 2-for-1

Economic Releases
- Consumer Confidence for May is estimated to rise to 105.0 from 104.0 in April

Other Potential Market Movers
- The Case-Shiller 1Q Home Price report and Merrill Lynch Small-cap Technology Healthcare Conference could also impact trading Tuesday.

BOTTOM LINE: Asian indices are higher, boosted by technology and financial shares in the region. I expect US stocks to open mixed and to rally into the afternoon finishing modestly higher. The Portfolio is 100% net long heading into the week.