Wednesday, April 02, 2008

Thursday Watch

Late-Night Headlines
Bloomberg:
- Daniel Zwirn, the NY-based manager who is shutting down a $4 billion hedge fund because of investor withdrawals, plans to start a new fund.
- Investors are so scared of stocks and bonds that they have stashed record $3.51 trillion in US money-market mutual funds. Investors have pulled about $40 billion from US equity funds through March 28.
- French President Nicolas Sarkozy offered a battalion of troops to fight the Taliban insurgency in east Afghanistan, a “substantial” increase of military power after NATO allies demanded more forces, the alliance said.
- Al-Qaeda’s deputy leader Ayman al-Zawahiri defended insurgent attacks in Iraq, Algeria and Morocco that killed Muslim civilians, according to a US-based intelligence group.
- The euro fell from a five-week high against the yen on speculation a government report will show consumers are curbing spending, after the IMF said the region’s economic growth is slowing “sharply.” The currency snapped a three-day winning run against the yen and weakened against the dollar as traders increased bets the European Central Bank will cut interest rates.
- Treasury Secretary Henry Paulson said the US and China must work together to reduce their dependency on oil and increase energy security.
- Research In Motion(RIMM) forecast profit and sales that beat analysts’ estimates after consumers snapped up devices with music players and Web browsers last quarter. The stock rose 4.1% in extended trading.
- LDK Solar(LDK) rose 9.3% in after-hours trading after the Chinese maker of silicon wafers in solar cells said it won a contract to supply 640 megawatts to a unit of Moser Baer India Ltd. over 10 years.

Wall Street Journal:
- The European Union’s greenhouse gas emissions from key industries rose 1.1% last year despite its anti-pollution policies, demonstrating the difficulty in meeting international commitments to fight climate change.

MarketWatch.com:
- Speculation grows about 3G iPhone release.
- GM(GM) calls for more hydrogen at the pump. Establishing an infrastructure to fuel hydrogen-powered vehicles is “economically viable and doable,” GM said.
- Nissan Motor(NSANY) plans to begin selling specially-designed electric vehicles for the US market in 2010.

CNBC.com:
- Congressional ‘Pork’ Spending Skyrockets. Federal Reserve Chairman Ben Bernanke has been getting plenty of heat from Congress for stepping in to rescue Bear Stearns(BSC). But a new report shows that lawmakers themselves don’t show much restraint when it comes to spending taxpayer money on pet projects. The amount of so-called pork barrel spending jumped 30% - to $17.2 billion – during the current fiscal year. Lawmakers awarded money to 11,610 pet projects, a 337% increase from 2007 but that was just one-third of the 36,0000 requests that Congress actually pitched itself.

CNNMoney.com:
- iPhone’s winners and losers.

Financial Times:
- Why the euro is unlikely to eclipse the US dollar.
- The $1.4 billion flagship hedge fund of London’s Plexus Partners has lost more than a third of its value this year after arbitrage trades in the credit markets went spectacularly wrong.
- Wall Street banks are working on plans to separate troubled assets from the rest of their businesses in an effort to ring-fence problems and restore investors’ confidence in the financial sector. A number of US firms are looking to follow the example set by UBS.

TimesOnline:
- Jerome Kerviel, the trader accused of losing Societe Generale $7.84 billion, plans to sue the bank for unfair dismissal.

Late Buy/Sell Recommendations
Citigroup:

- Maintained Buy on (MON), raised estimates, target $145.
- Reiterated Buy on (SNDK), lowered estimates, target $35.

Night Trading
Asian Indices are -.50% to +1.0% on average.
S&P 500 futures -.09%.
NASDAQ 100 futures -.03%.

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
- (RPM)/.06
- (STZ)/.25
- (SCHN)/.96
- (IART)/.50
- (AYI)/.68

Upcoming Splits
- None of note

Economic Releases
8:30 am EST

- Initial Jobless Claims for this week are estimated at 366K versus 366K the prior week.
- Continuing Claims are estimated to rise to 2860K versus 2845K prior.

10:00 am EST
- ISM Non-manufacturing for March is estimated to fall to 48.5 versus 49.3 in February.

Other Potential Market Movers
- The Fed’s Bernanke speaking, Treasury’s Paulson speaking, Fed’s Yellen speaking, Fed’s Mishkin speaking, weekly EIA natural gas inventory report, (DELL) analyst meeting, (AER) analyst day, (SRP) investor meetings, (FRG) analyst conference call, Morgan Stanley Banking Conference, Lehman Brothers Global Chemical Conference, Morgan Stanley Global Electricity Conference, Leerink Swann Bugs & Drugs Conference could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by commodity and real estate 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.

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