Wednesday Watch

Late-Night Headlines
Bloomberg:
- Timken Co. Chairman Ward Timken said he expects large takeover deals in the US steel industry this year after smaller companies were bought last year.
- Lawyers Embrace US Climate Practice at $700 an Hour.
- Dartmouth College, following moves by Harvard and Yale universities to make their schools more affordable, said students from families earning $75,000 or less won’t have to pay tuition, starting in the next academic year.
- Texas Instruments(TXN), the biggest market of mobile-phone chips, said profit climbed 13% and projected results this quarter that topped some analysts’ estimates as demand holds up better than anticipated. The shares rose 3.2% in extended trading.
- Hong Kong’s stocks jumped, lifting the benchmark index to its biggest advance in nine years, after the city followed an interest-rate cut by the US Fed.

MarketWatch.com:
- Fortune’s 100 Best Places to Work.
- Apple Inc.(AAPL) on Tuesday reported a first-quarter profit that rose 58% from a year ago, but the company’s shares tumbled in after-hours trading as the consumer electronics maker gave an earnings outlook that fell short of Wall Street analysts’ forecasts.

CNBC:
- Apple(AAPL): The LIVE Blog From Tuesday’s Earnings Call.

Briefing.com:
- Apple(AAPL) Conference Call Summary:

• iMac sales continue to be robust and Leopard launch has been very successful.
• iPod market share in US remained steady with previous year results; saw market share gains in European and Asian countries
• Total company gross margin was 34.7%; stronger than expected due to a more favorable commodity environment, stronger software sales, higher overall revenue and a weaker US dollar.
• Apple said they have reasonable confidence in achieving their guidance and that guidance at 29% is actually up from a year ago MarQ when they grew 21%.
• Ended quarter below Mac channel inventory target and said generally the Macintosh business has “been on fire.”
• Said traffic growth in US stores has been amazing.
• Company now has $18 billion in cash and no debt.
• Apple is thrilled with results they have seen from Best Buy(BBY).
• Orders are very strong for the new MacBook Air.
• Saw strong demand for new software.
• Half of Macs sold at retail to first-time buyers.
• Confident in selling 10 million iPhones in 2008.
• Plans to sell iPhone in Asia and added European cities in 2008.
  

USA Today.com:
- Rate cut should help borrowers, ease credit tightness.
- Gas prices fall to one month low.

Reuters:
- Short interest jumped 8.7% on the NYSE in mid-January, rising to another all-time high, the exchange said on Tuesday. Short interest soared 41% in shares of Washington Mutual(WM), 96% in shares of Sallie Mae(SLM), 40% in shares of Target(TGT) and 23% in shares of Wachovia(WB).
- Biggest changes in NYSE short interest.

Independent:
- BHP Billiton(BHP) is preparing a hostile $127 billion bid for rival Rio Tinto Plc(RTP).

Late Buy/Sell Recommendations
Citigroup:
- Upgraded (EXC) to Buy, target $85.
- Upgraded (EIX) to Buy, target $59.
- Upgraded (FE) to Buy, target $81.
- Upgraded (DTE) to Buy, target $48.
- Raised (PNM) to Buy, target $23.50.
- Raised (FPL) to Buy, target $74.
- Raised (AEP) to Buy, target $50.
- Maintain Buy on (DOX), target $46.

Bank of America:
- Upgraded (WYNN) to Buy.

Night Trading
Asian Indices are unch. to +4.5% on average.
S&P 500 futures -1.2%.
NASDAQ 100 futures -2.0%.

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
- (ABT)/.92
- (WLP)/1.50
- (COH)/.68
- (EAT)/.31
- (ROL)/.11
- (PX)/.96
- (PFE)/.47
- (SLM)/.55
- (GD)/1.40
- (KMB)/1.11
- (FCX)/1.73
- (UTX)/1.06
- (PJC)/.56
- (LUV)/.10
- (DAL)/-.18
- (STI)/.31
- (CHKP)/.44
- (EEXC)/1.02
- (ETH)/.69
- (PMTC)/.23
- (ATI)/1.41
- (ROK)/1.00
- (MOT)/.13
- (STJ)/.49
- (COP)/2.40
- (QCOM)/.52
- (SYK)/.66
- (GILD)/.43
- (COF)/.60
- (NFLX)/.14
- (QLGC)/.26
- (EBAY)/.41
- (CTXS)/.43
- (AB)/1.08
- (VAR)/.40
- (SYMC)/.29
- (FFIV)/.21
- (WDC)/1.04
- (NE)/1.30
- (RYL)/-.47
- (RDN)/-1.76

Upcoming Splits
- (FWLT) 2-for-1

Economic Releases
- None of note

Other Potential Market Movers
- The JPMorgan High Yield Conference, Sidoti Emerging Growth Forum, (HS) investor day, (SPW) investor meeting, weekly MBA mortgage applications report and weekly retail sales reports could also impact trading today.

BOTTOM LINE: Asian indices are sharply higher, boosted by automaker and financial 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.