Thursday Watch

Late-Night Headlines
Bloomberg:
- Dynamic random access memory, or DRAM, contract prices will advance 15%-20% in the first half of July from the second half of last month, a “significant rise,” CJ Investment & Securities said. Demand is rising while chip supply may increase less than expected this year, wrote Song Myung Sup, an analyst. Dramexchange.com, Asia's biggest DRAM spot market, said yesterday that prices will rise at least 10% this month from June.
- Coca-Cola(KO) may consider making a bid for Cadbury Schweppes’ Snapple fruit-beverage unit, a move that would fit into its plan to expand with water and teas as soda consumption falls.
- Hilton Hotels Corp.(HLT) agreed to be taken private by buyout firm Blackstone Group LP for $20 billion, ending more than 60 years as a public company.
- Asian stocks rose for a fifth day, led by Samsung Electronics and Kookmin Bank, after North Korean leader Kim Jong Il signaled he’s ready to dismantle the country’s nuclear program.
- Apollo Management LP, a NY-based private-equity firm, offered to buy US chemical maker Huntsman Corp.(HUN) for about $6 billion, topping a bid from billionaire Len Blavatnik’s Access Industries Holdings.
- China said one-fifth of its consumer products don’t meet government safety and quality standards, underscoring the nation’s challenge in restoring confidence after scandals ranging from tainted pet food to defective toys.
- Kohlberg Kravis Roberts, the leader in leveraged buyouts this year, plans to raise as much as $1.25 billion in an IPO to help finance its appetite for the biggest takeovers.

Wall Street Journal:
- Starwood Hotels & Resorts(HOT) could be the next hotel chain to be purchased after private equity firm Blackstone Group LP announced its $20 billion takeover of Hilton Hotels(HLT).

NY Times:
- A riddle: Why has the Toyota Prius enjoyed such success, with sales of more than 400,000 in the United States, when most other hybrid models struggle to find buyers? One answer may be that buyers of the Prius want everyone to know they are driving a hybrid.
- Only a week ago, the buyout boom seemed ready to deflate. Then over the last week, a torrent of big buyout activity swept in: Bell Canada agreed to be acquired on Saturday for $48.8 billion, the largest leveraged buyout ever. The Blackstone Group, newly public, made a $26 billion offer for Hilton Hotels late Tuesday. And Kohlberg Kravis Roberts & Company, credited with creating the leveraged buyout, said at last that it would go public, in a $1.25 billion stock offering.

Financial Times:
- Telefonica SA’s O2 wireless unit is close to signing a contract with Apple Inc.(AAPL) to become the exclusive UK network partner for the iPhone.
- Lead prices show how the long-running world commodities boom is continuing yet also may demonstrate how fragile that expansion is.

Miami Herald:
- Three of the five senior forecasters at the National Hurricane Center in Miami called for the ouster of the center’s new director on the grounds he has damaged public confidence in their forecasts.

Globe and Mail:
- Research In Motion(RIMM) has obtained permission to sell its BlackBerry e-mail phone in China for the first time.

Jornal de Negocios:
- The European Union won’t be ready to classify China as having a market economy any time soon, EU Trade Commissioner Peter Mandelson said in an interview.

Xinhua News Agency:
- China’s planned issuance of $200 billion of special government bonds won’t “directly affect” the stock market’s financial liquidity, citing the finance ministry.

Late Buy/Sell Recommendations
- None of note

Night Trading
Asian Indices are +.25% to +.75% on average.
S&P 500 indicated +.20%.
NASDAQ 100 indicated +.20%.

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Earnings of Note
Company/EPS Estimate
- (HWAY)/.30
- (IRF)/.59

Upcoming Splits
- (CXW) 2-for-1
- (EME) 2-for-1

Economic Releases
8:30 am EST
- Initial Jobless Claims for last week are estimated to rise to 315K versus 313K the prior week.
- Continuing Claims are estimated to rise to 2503K versus 2490K prior.

10:00 am EST:
- ISM Non-Manufacturing for June is estimated to fall to 58.0 versus 59.7 in May.

Other Potential Market Movers
- The ECB Policy Meeting, Challenger Job Cuts, ADP Employment Change and weekly MBA Mortgage Applications report 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 rally into the afternoon, finishing modestly higher. The Portfolio is 100% net long heading into the day.