Thursday Watch

Late-Night Headlines
Bloomberg:
- Rule Blamed for Subprime Losses Unlikely to Change. Financial Accounting Standards Board Chairman Robert Herz said the standard-setting panel isn’t planning changes to a rule on valuing subprime-mortgage assets blamed for forcing companies to overstate losses. Companies that think investments will regain lost value should say so in regulatory filings, he said.
- Ambac Financial Group’s(ABK) AAA bond insurer credit ratings were confirmed by Moody’s Investors Service and S&P today after the company sold $1.5 billion in stock and equity units to cushion against losses.
- China’s industrial production growth slowed as exports cooled and the worst snowstorms in half a century closed factories in central provinces. Output rose 15.4% in January and February from a year earlier after gaining 17.4% in December.
- Ferraro Leaves Clinton Committee After Obama Remarks.
- Apollo Turns to Distressed Debt, Including LBOs. Apollo Management LP adapted to the leveraged-buyout freeze by investing $1 billion in distressed securities, including the debt of companies it already owns, founder Leon Black told investors.
- Target Corp.(TGT) said it’s in talks with an investment partner to sell about half of its credit-card loans for $4 billion.

Wall Street Journal:
- The US government will pay $666 million to 667 hospitals to settle a lawsuit over a change in Medicare reimbursement policies, citing a lawyer for the hospitals.

MarketWatch.com:
- US Mint looks to cut expenses by reducing metal content as rising metal price make coins costlier to produce than they’re worth.
- Has the bottom been seen? Monday may have marked end of the correction.

CNBC.com:
- Fast Money: Bears Outnumber Bulls; Bottom Signal?

NY Times:
- Woman in Spitzer Prostitution Allegation to Testify. Ashley Alexandra Dupre, the woman described in a federal affidavit as having a Feb. 13 hotel rendezvous with New York Governor Eliot Spitzer, appeared in court March 10 as a witness in the case against the operators of a prostitution ring.
- YouTube Coming to TV, With TiVo the Gateway.

BusinessWeek.com:
- The Search for the Killer iPhone App. Many developers are hard at work building tools for Apple’s(AAPL) popular phone.
- Ad Wars: Google’s(GOOG) Green Light. The official marriage of search- and display-ad titans Google and DoubleClick may take a while to pay off, but it deals a blow to Microsoft(MSFT) now.

CNNMoney.com:
- The 8 most fuel-efficient cars.

USA Today.com:
- E-book fans are flocking to the Net as Kindle sales catch fire.

Reuters:
- UK hedge fund Toscafund Asset Management LLP has approached Washington Mutual(WM), offering to participate in any consortium looking to recapitalize the bank.
- CME(CME) may announce deal with NYMEX(NMX) next week.

The Economic Times:
- Battered credit products are great bargains for brave investors. Reflecting how market pricing has gone beyond reality, the cost of European corporate bond insurance hit all-time highs last week, as measured by the iTraxx Crossover Index. The index has nearly quadrupled since March. However, corporate defaults in Europe remained low. Their number actually fell to a two-year low at the end of 2007.

Financial Times:
- India faces wave of defaults. India is beginning to experience its own version of the subprime crisis as banks tighten lending procedures to curb rising delinquencies, particularly in small unsecured personal loans.
- There must be no turning back on NAFTA. For the past few months, we Canadians had had our ears pressed to the border, listening with great interest as our American friends discuss the North American Free Trade Agreement.
- Clinton raises primary pressure. Democrat wants recounts in two states.
- The Short View: Chinese bubble. Anxiety about China has suddenly spiked.

TimesOnline:
- Hedge funds on the brink. The potential closure of six funds came as a leading private equity executive, who declined to be named, said that such funds were “snapping like twigs,” with one failing every day.

The Australian:
- ASX to foil short sellers.

Late Buy/Sell Recommendations
Citigroup:
- Reiterated Buy on (FST), target $62.
- Maintained Buy on (EXLS), target $28.

Night Trading
Asian Indices are -1.75% to -1.25% on average.
S&P 500 futures -.56%.
NASDAQ 100 futures -.42%.

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
Upgrades/Downgrades
Rasmussen Business/Economy Polling
CNBC Guest Schedule

Earnings of Note
Company/EPS Estimate
- (PSUN)/.30
- (ARO)/.88

Upcoming Splits
- None of note

Economic Releases
8:30 am EST
- The Import Price Index for February is estimated to rise .8% versus a 1.7% gain in January.
- Advance Retail Sales for February is estimated to rise .2% versus a .3% gain in January.
- Retail Sales Less Autos for February are estimated to rise .2% versus a .3% gain in January.
- Initial Jobless Claims for this week are estimated to rise to 357K versus 351K the prior week.
- Continuing Claims are estimated to rise to 2835K versus 2831K prior.

10:00 am EST
- Business Inventories for January are estimated to rise .5% versus a .6% gain in December.

Other Potential Market Movers
- The (CVG) analyst meeting, (MSFT) analyst briefing, (TS) analyst day, (JAZZ) investor day, Bear Stearns Healthcare Conference and Lehman Brothers High Yield Conference could also impact trading today.

BOTTOM LINE: Asian indices are lower, weighed down by commodity 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 75% net long heading into the day.