Tuesday Watch

Late-Night Headlines
Bloomberg:
- MasterCard Inc.(MA), the world's second- biggest credit-card company, rose 6.7 percent in late New York trading after beating analysts' estimates on overseas revenue gains. Profit excluding a previously disclosed $515.5 million charge to settle a lawsuit with Discover Financial Services was $322 million, or $2.47 a share, beating the $2.24 average estimate of 21 analysts surveyed by Bloomberg, the Purchase, New York-based firm said today in a statement.

- The corporate bond market showed encouraging signs last week as the extra yield borrowers typically pay on new debt to lure investors shrank and bond prices rose in secondary market trading, Bank of America said. The “new issue concessions” companies paid on debt sold last week fell to 70 basis points, from 130 basis points the previous week, analysts led by Hans Mikkelsen and Mike Cho wrote. “The one of the market improved significantly in the latter part of the month,” the analysts wrote, with newly priced bonds trading “meaningfully tighter.”

- Dow Jones Hedge Fund Indexes, Inc., today announced it will temporarily suspend publication of the Dow Jones Hedge Fund Equity Long/Short and Equity Market Neutral Strategy Benchmarks, effective November 3 until further notice. The company also said that its Dow Jones Hedge Fund Balanced Portfolio Indexes also will be suspended. In a statement, Dow Jones said: "The decision to halt publication of the benchmarks is the result of the temporary measures taken by the investment manager of the managed account platform that supports the Dow Jones Hedge Fund Strategy Benchmarks and Dow Jones Hedge Fund Balanced Portfolio Indexes to temporarily reduce the risk profiles of some of its managers."

- The cost of protecting investors in Australian corporate bonds from default declined, according to traders of credit-default swaps. The Markit iTraxx Australia index was quoted 10 basis points lower at 235 basis points as of 11:26 am in Sydney, Citigroup Inc. data show.

- European finance ministers ruled out a joint stimulus package to revive the region's economy and vowed instead to coordinate national policies as they try to limit the fallout from a recession on consumers and companies. ``We do not believe that in the euro area we need a general revival package, a sort of traditional program designed to stimulate the economy,'' Luxembourg Finance Minister Jean-Claude Juncker told a press conference after leading a meeting of euro- area counterparts in Brussels yesterday.

- UBS’s Jan Stuart, global oil economist at UBS Securities LLC, says crude oil may hit $50 a barrel next year.

- Australia's central bank cut its benchmark interest rate by a larger-than-expected three quarters of a percentage point, the third reduction in as many months, amid evidence global financial turmoil is buffeting the economy. Governor Glenn Stevens lowered the overnight cash rate target to 5.25 percent from 6 percent in Sydney today, adding to last month's 1 percentage point reduction.

Wall Street Journal:
- Yahoo Inc.(YHOO) and Google Inc.(GOOG) have sent the Justice Department a revised version of their search-advertising agreement, adding a number of new provisions designed to limit the scope of the deal as they scramble to get it past regulators, according to people familiar with the matter.

- In a world hard up for cash, even hedge-fund winners can wind up losers. Such is the fate of major credit fund Blue Mountain Capital Management, whose investors have begun yanking investments despite the fund's performance this year, a modest 2.4% loss, compared with an average 20% loss across all funds. Performance was largely beside the point for many Blue Mountain investors, who need access to cash. The perverse effect is that some investors have begun raiding their better-performing investments, giving the laggards a chance to recover.

- A report has cleared Gov. Sarah Palin of ethics violations in the firing of her public safety commissioner. The report, released Monday, said: "There is no probable cause to believe that the governor, or any other state official, violated the Alaska Executive Ethics Act in connection with these matters." It was prepared by Timothy Petumenos, an independent counsel for the Alaska Personnel Board.

NY Times:
- The US Treasury’s team of 45 staff members tasked with rescuing the financial system are working with “urgency” to deploy capital to banks, citing Treasury official James Lambright.

BusinessWeek:

- An analyst said Monday he is beginning to see a ramp up in demand for toys ahead of the holidays, but added that toy stocks so far have been as volatile as the rest of the market.

USA Today.com:

- The average price of gasoline has slipped to less than $2 a gallon in some metro areas for the first time since February 2007. The drop has even sparked some old-fashioned gas-price wars.

Financial Times:
- One of Goldman Sachs‘s(GS) flagship hedge funds, run by two of the Wall Street bank’s most talented traders, has lost close to $1bn since its launch in January in further evidence of the crisis facing the industry. Goldman Sachs Investment Partners, which was hailed in January as one of the biggest hedge fund launches, raising more than $6bn, has told investors that it had lost $989m by September. It said the fund was down about 13 per cent in the third quarter. Year-to-date performance fell about 15.5 per cent in the year to September. The fund was launched after a poor year for the bank’s quantitative, or computer-driven, hedge funds which were hit hard in August 2007 forcing the bank to inject $3bn to rescue its Global Equity Opportunities fund. More than half of GS Investment Partners’ losses in the third quarter was from its investments in commodities, basic materials, metals, mining, energy and agriculture.

- US retail investors have been trading stocks and options at record levels in recent months, apparently responding to the financial crisis by taking greater control of their own investments.The level of trading has helped brokers such as TD Ameritrade, Charles Schwab and Fidelity to lift their brokerage commission revenues, making this one of the few areas where financial services companies are making money.

Business Times:

- More companies have given up their factory space in Singapore because of the credit crunch, citing JTC Corp., the city’s largest industrial developer. Termination at ready-built facilities jumped 45% in the third quarter from a year earlier as manufacturers merged their operations, citing JTC.

South China Morning Post:

- China carmakers including Jianghuai Motor, Changan Ford Mazda and Dongfeng Peugeot Citroen are cutting staff because of a slowdown in the global economy.

Investor Daily Indonesia:

- PT Perusahaan Listrik Negara will delay the construction of 31 power-plant projects because of a lack of funding, citing an official of the utility.

Late Buy/Sell Recommendations
- None of note

Night Trading
Asian Indices are -1.0% to +1.25% on average.
S&P 500 futures -.14%.
NASDAQ 100 futures -.09%.

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
- (ADM)/.72

- (PPL)/.61

- (VNO)/1.22

- (RDC)/.87

- (JEC)/.92

- (AMSC)/-.09

- (MVL)/.45

- (JOE)/-.03

- (DF)/.31

- (EMR)/.86

- (PZZA)/.36

- (KCP)/.07

- (DNR)/.52

- (LPX)/-.29

- (NILE)/.16

Economic Releases
10:00 am EST

- Factory Orders for September are estimated to fall .8% versus a 4.4% decline in August.

Upcoming Splits
- None of note

Other Potential Market Movers
- The Fed’s Fisher speaking, weekly retail sales reports, (FFIV) analyst meeting, Oppenheimer Healthcare Conference and Goldman Sachs Software Conference could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by automaker and technology stocks in the region. I expect US equities to open modestly lower and to rally into the afternoon, finishing modestly higher. The Portfolio is 100% net long heading into the day.