Tuesday Watch

Late-Night Headlines
Bloomberg:
- Copper will fall 9.4% in London by the fourth quarter as global demand for the metal used in pipes and wires weakens, according to Standard Chartered Plc. Copper for delivery in three months will sink to $7,500 a metric ton as demand growth slows in China, the world’s largest user, Judy Zhu and Dan Smith, analysts for the London-based investment bank, said in a report. They said consumption in the major industrialized nations fell 3.1% in the first half of the year compared with a year earlier, driven lower by slowing housing and automotive sales. Labor strife in Peru and Chile, as well as speculative investment and the dollar’s decline this year helped push copper up 27% in the first half in London, the analysts said. Standard Chartered said copper will fall 21% next year to $6,500 a ton in London.
- Petroleo Brasileiro SA(PBR), Brazil's state-controlled oil company, said it found oil in an offshore well in the Espirito Santo basin that may hold 150 million barrels of oil.
- Genentech Inc.(DNA), the biggest U.S. maker of cancer drugs, raised its 2008 forecast and said second- quarter profit increased 4.7 percent on higher sales of its Avastin treatment for colon, lung and breast tumors. The stock rose 1.2% in after-hours trading.
- Tribune Co.(TRB) said Los Angeles Times Publisher David Hiller and Chicago Tribune Editor-in-Chief Ann Marie Lipinski resigned, seven months after real-estate billionaire Sam Zell completed his buyout of the company.
- The Treasury Department is taking the right steps to bolster Fannie Mae(FNM) and Freddie Mac(FRE), and anyone who says the mortgage-finance companies must be left to fail is ``silly,'' hedge fund manager Barton Biggs said.
- Washington Mutual Inc.(WM), after dropping the most since its initial public offering in 1983, said it is ``well capitalized'' with more than $40 billion in liquidity and $150 billion in retail deposits. The company's tangible equity to tangible assets ratio is 7.8 percent as of June 30, Seattle-based Washington Mutual said in a Business Wire statement after the close of regular trading. Details will be provided on its July 22 earnings call, the company said. The stock gained 10% in extended trading.
- South Korea's government is working on a series of price controls designed to cool the fastest inflation in a decade, Vice Finance Minister Kim Dong Soo said.

Wall Street Journal:
- China’s government, stuck in a policy bind of its own making, is facing a growing risk of stumbling in its battle against a global wave of inflation.

CNBC.com:
- SEC to Crack Down on Short-Sellers’ Stock Manipulation. "I think there should be criminal prosecution at a high level because that’s the only thing that stops those people," said Jon Najarian, co-founder of Optionmonster.com. "Otherwise they just pay a fine and move on." "People hear rumors at cocktail parties, but there’s really something sinister going on today, particularly with the banks spreading rumors that customers are stopping doing business with Lehman Brothers. That has a tremendous effect on the market," he said. "In this market, any kind of rumor is being taken seriously," said Jake Zamansky, a lawyer at Zamansky & Associates Securities. "People spreading these rumors, in many cases have driven out the likes of [Bear Stearns] and potentially Lehman Brothers. People spread false information, outright lies, to drive these companies down."

BusinessWeek.com:
- What Capital Crunch? Despite the turmoil in housing and the stock market, big investors continue to pump money into venture capital.

CNNMoney.com:
- 100 Best Places to Live.

USA Today.com:
- Intel vs. AMD: Better computer chips raise laptops’ abilities.

Reuters:
- A crackdown on rumor-mongering by U.S. securities regulators is likely to see many in the financial markets take a lot more care about how they pass on both serious views and scuttlebutt, at least for a while. The big fear is that regulators will show up at hedge funds and brokerages, armed with subpoenas, demanding trading, phone and e-mail records to determine if any of them are to blame for declines in the shares of major financial companies such as Lehman Brothers Holdings(LEH). The SEC's actions may also be directed at the people many chief executives have publicly blamed for hammering their stocks -- hedge funds that focus on selling stocks short. For years so-called short sellers, hedge funds that concentrate on betting a stock price will go down, have been called nasty names and sometimes accused of trying to manipulate situations to make money.

Financial Times:
- The Children's Investment Fund, the London hedge fund, lost more than $1bn in its worst month ever in June as activists were hit particularly badly by the poor markets.
- New Yorker attacked for Obama cover. The magazine considered the bible of the white, liberal US intelligentsia was under attack on Monday for a satirical cover depicting Barack Obama as a Muslim and his wife Michelle as a terrorist.

TimesOnline:
- UK home sales fell to their lowest level in 30 years last month as the seizure in the mortgage market continued to drag house prices down.

Late Buy/Sell Recommendations
Pacific Growth:
- Rated (FDRY), (FFIV) Buy.

RBC Capital:
- Rated (CPHD) Outperform, target $34.

Night Trading
Asian Indices are -2.50% to -.75% on average.
S&P 500 futures -.16%.
NASDAQ 100 futures -.11%.

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)
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WSJ Intl Markets Performance
Commodity Movers
Top 25 Stories
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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
- (ETN)/1.94
- (PII)/.67
- (JNJ)/1.13
- (USB)/.59
- (STT)/1.36
- (GWW)/1.46
- (ALTR)/.28
- (INTC)/.27
- (CTAS)/.56
- (VFC)/.87
- (CSX)/.90
- (ADTN)/.30
- (SCHW).26

Upcoming Splits
- (FLR) 2-for-1

Economic Releases
8:30 am EST
- The Producer Price Index for June is estimated to rise 1.4% versus a 1.4% gain in May.
- The PPI Ex Food & Energy for June is estimated to rise .3% versus a .2% gain in May.
- Advance Retail Sales for June are estimated to rise .4% versus a 1.0% increase in May.
- Retail Sales Less Autos for June are estimated to rise 1.0% versus a 1.2% increase in May.
- Empire Manufacturing for July is estimated to rise to -8.0 versus -8.7 in June.

10:00 am EST
- Business Inventories for May are estimated to rise .5% versus a .5% increase in April.

Other Potential Market Movers
- The Fed’s Bernanke speaking, Fed’s Yellen speaking, weekly retail sales reports, IBD/TIPP Economic Optimism Index, (THQI) analyst meeting, (LRCX) analyst meeting, (KLAC) analyst briefing, (VRGY) analyst meeting, (AEO) analyst day, (DNB) investor day, (GE) analyst meeting and SEMICON West could also impact trading today.

BOTTOM LINE: Asian indices are lower, weighed down by financial and technology shares in the region. I expect US equities to open modestly lower and to rally into the afternoon, finishing mixed. The Portfolio is 50% net long heading into the day.