Thursday Watch

Late-Night Headlines
Bloomberg:
- Oracle Corp.(ORCL) posted a 27% increase in fourth-quarter profit and overtook IBM as the second-largest software maker.
- Nike Inc.(NKE) fell as much as 6% in late NY trading after the world’s largest athletic-shoe maker spent more to market new sneakers than analysts estimated.
- Research In Motion(RIMM), the maker of the BlackBerry e-mail phone, missed analysts’ profit estimates for the first time in five quarters and gave a disappointing forecast amid higher spending to take on Apple’s(AAPL) new iPhone.
- Bed Bath & Beyond(BBBY), the largest US home-furnishings retailer, climbed 8.3% in trading following the close of US markets after reporting profit that fell less than analyst estimated because of higher sales.
- The House voted to boost taxes for executives of investment funds and many other kinds of partnerships to generate revenue to match money lost by preventing a $61.5 billion tax increase for 25 million American households this year. The House voted 233-189 to send the bill to the Senate, where Republicans object to a provision that would more than double tax rates for certain partners of buyout, real estate, hedge fund, venture capital, and oil and gas firms.
- Fischer Francis Trees & Watts plans to buy more US commercial mortgage-backed securities relative to government bonds in coming months, Tokyo-based fund manager Naruki Nakamura said in an interview.
- India’s central bank will likely add to its biggest interest-rate increase since 2000 as inflation quickens at the fastest pace in 13 years, Merrill Lynch(MER) forecast, citing record-high swap levels. Two-year swap rates surged 1.3 percentage points in the week through yesterday to a record 9.85%.

Wall Street Journal:
- Anheuser-Busch Cos.(BUD) is prepared to reject InBev NV’s $46.3 billion takeover offer, possibly this week, paving the way for a possible higher bid for the maker of Budweiser.

NY Times:
- New York’s High Court Sides With Grasso. The court affirmed a ruling that dropped claims against the former chairman of the NYSE.

LA Times:
- You can fill’er up with hydrogen. A West LA station becomes the first in California to be able to dispense the fuel in addition to gasoline.

CNNMoney.com:
- McCain’s economic gurus. From ex-Senators to CEOs, McCain has tapped a wide range of advisers to bring him up to speed on the economy.

Portfolio.com:
- Senate Ethics Committee may not conclude its probe into VIP mortgages for months. A key issue: What constitutes a “gift”?

Reuters:
- More mergers seen in US defense space.
- Google(GOOG) names Bell Canada exec as its new CFO.

Financial Times:
- Barack Obama has again called on Tesco, the UK supermarket group, to let unions represent workers at its new US chain. The move comes as the Democratic candidate seeks to reinforce he labor support ahead of November’s presidential election.
- The world’s biggest maker of consumer goods, Procter & Gamble(PG) has urged Barack Obama and John McCain to ease up on the gloomy economic rhetoric.

Daily Telegraph:
- Plans for a massive expansion of a wind energy program in the UK are to be unveiled by the government. They will include the building of 7,000 wind turbines both in the countryside and around the coast.

Late Buy/Sell Recommendations
Citigroup:
- Rated (ALTH) Buy, target $11.
- Reiterated Buy on (SLGP), raised target to $32.
- Reiterated Buy on (WW), target $64.

Morgan Stanley:
- Reiterated Overweight on (MON), target $170.

RBC:
- Rated (BRCM) Outperform, target $36.

Night Trading
Asian Indices are +.25% to +.75% on average.
S&P 500 futures -.20%.
NASDAQ 100 futures -.35%.

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

Earnings of Note
Company/EPS Estimate
- (MKC)/.39
- (LEN)/-.68
- (WOR)/.45
- (CAG)/.36
- (DFS)/.37
- (PALM)/.18
- (CBK)/.26
- (MU)/-.30
- (ACN)/.69
- (PAYX)/.38

Upcoming Splits
- None of note

Economic Releases
8:30 am EST
- Final 1Q GDP is estimated at 1.0% versus a .9% prior estimate.
- Final 1Q Personal Consumption is estimated at 1.0% versus a 1.0% prior estimate.
- Final 1Q GDP Price Index is estimated at 2.6% versus a 2.6% prior estimate.
- Final Core PCE is estimated to at 2.1% versus a 2.1% prior estimate.
- Initial Jobless Claims for this week are estimated to fall to 375K versus 381K the prior week.
- Continuing Claims are estimated to rise to 3105K versus 3060K prior.

10:00 am EST
- Existing Home Sales for May are estimated to rise to 4.95M versus 4.89M in April.

Other Potential Market Movers
- The weekly EIA natural gas inventory report, (GT) investor meeting, (XLNX) analyst meeting, (BRCD) technology day, (AUXL) analyst call, Jeffries Healthcare Conference, Wachovia Nantucket Equity Conference and UBS Global Insurance Conference could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by financial and technology shares 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.