Thursday Watch

Late-Night Headlines
Bloomberg:
- Morgan Stanley(MS) said investors should bet the US dollar will rise against the Australian dollar and overcome its recent economic-related weakness. Dollar “valuations already reflect a lot of bad news,” wrote Morgan Stanley currency strategists Sophia Drossos and Yilin Nie in New York in a note to clients today. “While the possibility for further weakness remains, the bulk of depreciation is behind us.”
- The yen declined to a record low against the euro as traders took advantage of the lowest borrowing costs among major economies to buy higher-yielding currencies.
- In the end, it was Segolene Royal who lost her cool. The French Socialist presidential candidate raised her voice and accused her opponent Nicolas Sarkozy of “immorality” for presenting himself as a defender of handicapped children.
- Gold traded near a three-week low in Asia amid speculation physical demand from India will slow in the months ahead. India uses more gold than the US and China combined.
- Israeli Prime Minister Ehud Olmert’s prospects of staying in office are fading after Foreign Minister Tzipi Livni offered herself as a candidate to lead their Kadima Party, allowing the ruling coalition to retain power.
- China’s property developers invested 22% more in projects last year, citing the Chinese Academy of Social Sciences. The surge in investment last year came even as China’s government tried to cool the real-estate market to prevent a price bubble.
- Chris de Lavigne, global vice president of consulting at Frost & Sullivan, says the ability to make ethanol from waster “is here” now.

Wall Street Journal:
- The United Auto Workers union is preparing a final counteroffer to wage and benefit cuts proposed by bankrupt auto supplier Delphi Corp.
- PepsiCo Inc.(PEP) is starting a new advertising campaign to boost sales of Diet Pepsi as it competes with Coca-Cola’s(KO) Diet Coke.

Dow Jones:
- Dow Jones’(DJ) board won’t act on News Corp.’s $5 billion takeover bid. 52% of shareholders with voting power in the company oppose the takeover, citing a survey of the company’s controlling family, the Bancrofts.

Late Buy/Sell Recommendations
Citigroup:
- Reiterated Buy on (SYMC), target $22.
- Reiterated Buy on (WXS), target $38.
- Reiterated Buy on (S), target $25.

Night Trading
Asian Indices are +.25% to +.75% on average.
S&P 500 indicated +.01%.
NASDAQ 100 indicated +.08%.

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Earnings of Note
Company/EPS Estimate
- (ANDW)/.08
- (BEBE)/.13
- (CVC)/-.11
- (ELY)/.46
- (CECO)/.35
- (CBS)/.32
- (CELG)/.20
- (CKP)/.08
- (CHK)/.78
- (CXW)/.47
- (CROX)/.48
- (DF)/.45
- (DNB)/.96
- (EDS)/.21
- (EL)/.46
- (FAF)/.78
- (FSLR)/.00
- (GMST)/.05
- (GM)/.83
- (IACI)/.32
- (IP)/.40
- (IFF)/.66
- (ITG)/.54
- (JSDA)/.03
- (LF)/-.40
- (CLI)/.25
- (MSO)/-.17
- (MDR)/.75
- (MGM)/.63
- (MORN)/.36
- (NBR)/.85
- (NBL)/.99
- (OMX)/.91
- (PTEN)/.71
- (PPL)/.70
- (PSA)/1.12
- (QLGC)/.23
- (SBUX)/.19
- (STRA)/1.29
- (TK)/1.07
- (TKLC)/-.04
- (TSO)/1.88
- (TIE)/.37
- (WTW)/.63
- (WMB)/.33
- (WMS)/.34

Upcoming Splits
- (AZZ) 2-for-1

Economic Releases
8:30 am EST
- Preliminary 1Q Non-farm Productivity is estimated to rise .7% versus a 1.6% gain in 4Q.
- Preliminary 1Q Unit Labor Costs are estimated to rise 3.8% versus a 6.6% gain in 4Q.
- Initial Jobless Claims are estimated to rise to 325K versus 321K the prior week.
- Continuing Claims are estimated to fall to 2550K versus 2594K prior.

10:00 am EST
- ISM Non-Manufacturing for April is estimated to rise to 53.0 versus a reading of 52.4 in March.

BOTTOM LINE: Asian indices are higher, boosted by utility and technology 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.