Tuesday Watch

Late-Night Headlines
Bloomberg:
- Australia’s home-building approvals unexpectedly surged in November by the most in nine months as higher employment, wages and immigration spurred investment.
- Wheat output in Australia, the world’s fifth-largest exporter, may rebound to a record next harvest as higher prices and expectations of improved weather spur farmers to lift plantings, Emerald Group Australia Pty said.
- President Bush and Treasury Secretary Paulson said that US economic indicators are sending “mixed” signals and that they are considering whether a stimulus is needed.
- Democratic presidential candidate Hillary Rodham Clinton, her voice cracking, told voters in New Hampshire “it’s not easy” to keep going in a long political campaign “against some pretty difficult odds.”
- You’re more likely to survive cancer if you live in a sunny place and make the most of the weather, scientists say.
- Starbucks Corp.(SBUX) ousted CEO Jim Donald and replaced him with former CEO and Chairman Howard Schultz after posting its worst-ever annual performance in US trading. The shares surged 9% in after-hours trading.
- Genzyme Corp.(GENZ) will license Isis Pharmaceuticals’(ISIS) cholesterol-lowering drug for $175 million to start and will buy 5 million of its partner’s shares for $150 million. The shares soared 51% in extended trading.
- Matsushita Electric Industrial, the world’s biggest consumer electronics maker, will sell televisions in the US that can access Internet video clips on Google’s(GOOG) YouTube.

CNBC.com:
- CNBC has confirmed that James Cayne, the chairman and CEO of Bear Stearns(BSC), is stepping down.
- Top Manager Names Wireless, Web Stocks.

IBD:
- Q4 Profits Seen Off Nearly 10%, But Up 12% Ex Financials.

USA Today.com:
- After an unprecedented year of toy recalls, the Consumer Product Safety Commission is adding staff at the nation’s busiest ports and pledging to work more closely with US Customs to stop suspect imports and identify potential hazards before toys hit the market.

Reuters:
- Short interest on the NYSE rose .7% in late December, the exchange said on Monday, indicating an increase in bearish sentiment in the stock market.

Financial Times:
- TV screen makers vie for slimness.
- Paramount Pictures plans to abandon Toshiba Corp.’s HD-DVD format after Warner Bros. Entertainment dropped its support of the technology.

globeandmail.com:
- TD Bank repeats it has no US subprime exposure.

Late Buy/Sell Recommendations
- None of note

Night Trading
Asian Indices are -.25% to +1.0% on average.
S&P 500 futures +.19%.
NASDAQ 100 futures +.27%.

Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Pre-market Stock Quote/Chart
Before the Bell CNBC Video(bottom right)
Global Commentary
WSJ Intl Markets Performance
Commodity Movers
Top 25 Stories
Top 20 Business Stories
Today in IBD
In Play
Bond Ticker
Economic Preview/Calendar
Daily Stock Events
Macro Calls
Upgrades/Downgrades
Rasmussen Business/Economy Polling
CNBC Guest Schedule

Earnings of Note
Company/EPS Estimate
- (FDO)/.37
- (STZ)/.55
- (KBH)/-1.34
- (AYI)/.82
- (APOL)/.73
- (PPDI)/.34
- (SWY)/.69
- (SVU)/.63

Upcoming Splits
- None of note

Economic Releases
10:00 am EST
- Pending Home Sales for November are estimated to fall .7% versus a .6% increase in October.

3:00 pm EST
- Consumer Credit for November is estimated to rise to $8.0 billion from $4.7 billion in October.

Other Potential Market Movers
- The Fed’s Plosser speaking, weekly retail sales reports, IBD/TIPP Economic Optimism Index, Needham Growth Conference, JPMorgan Healthcare Conference, Citigroup Entertainment Conference, Consumer Electronics Show, JPMorgan Global Energy Day and Raymond James Govt. Services & Tech. Summit could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by real estate and financial stocks in the region. I expect US equities to open modestly lower and to rally into the afternoon, finishing modestly higher. The Portfolio is 75% net long heading into the day.