Links of Interest

Market Snapshot
Detailed Market Summary
Market Internals
Economic Commentary
Movers & Shakers
Today in IBD
NYSE OrderTrac
I-Watch Sector Overview
NYSE Unusual Volume
NASDAQ Unusual Volume
Hot Spots
NASDAQ 100 Heatmap
DJIA Quick Charts
Chart Toppers
Option Dragon
Real-time Intraday Chart/Quote

Friday Watch

Late-Night Headlines
Bloomberg:
- Adobe Systems(ADBE), the world’s biggest maker of graphic-design software, said third-quarter profit fell 35% as customers waited for updated products. The shares surged 7% after-hours on raised guidance.
- Mexican President Fox canceled plans to kick off Independence Day celebrations in Mexico City tomorrow to avoid potentially violent clashes with election officials.
- The Senate approved legislation today to tighten security at US ports as Republicans overcame Democratic efforts to add provisions related to the Iraq war and intelligence operations.
- The US warned citizens to “exercise caution” in Mexico amid a wave of increasing drug-related violence and kidnapping.
- A Senate committee dealt a rebuff to President Bush by approving military tribunal legislation that would give more legal protection to suspected terrorists.
- Crude oil was little changed below $64 a barrel in NY after rising US fuel supplies prompted renewed selling.
- Copper prices in Shanghai fell on concern that domestic supplies of the metal will rise after the government reduced export tariff rebates on non-ferrous minerals and other products.
- Intercontinental Exchange(ICE), an electronic energy market whose shares have risen 78% this year, agreed to acquire the New York Board of Trade for about $1 billion in cash and stock.

Business Week:
- The health-care industry is buoying the US economy. Since 2001, the industry has added 1.7 million jobs.

Financial Times:
- Internet sites promoting user-generated content, such as YouTube and News Corp.’s MySpace, have become the fastest-growing online brands in the UK, citing Nielsen/NetRatings.

The Guardian:
- Former US Treasury Secretary in the Clinton administration, Larry Summers, will write a monthly column for the Financial Times starting later this month. Summers left Harvard after triggering controversy last year when he told a conference that “innate differences” may explain why there were few female scientists in high-ranking academic positions.

Crain’s NY Business:
- The unemployment rate in NYC fell to 5.1% in August from 5.7% in July. NY state’s unemployment rate dropped to 4.7% in August from 5.1% a month earlier.

AFP:
- Cuba, a net oil importer, is finding oil at rapid rates and may join OPEC in coming years.

Seoul Economic Daily:
- South Korean companies are seeking to build factories, petrochemical and construction operations in Iraq, citing the Federation of Korean Industries.

International Oil Daily:
- China plans to triple its ethanol production to more than 3 million metric tons a year by 2010. The increase would cut China’s dependence on imported oil and boost the income of hundreds of millions of farmers, Liu Qun of the National Development and Reform Commission said at a biofuel conference.

Late Buy/Sell Recommendations
Business Week:
- Omnicare(OCR), a pharmacy services company for health-care providers, may see its stock gain 36% in a year, citing John Maloney, President of M&R Capital Management.
- The shares of Walgreen Co.(WAG) may rise as much as 86% in four years, citing ValueSearch Capital Management President Schwartzman.
- The Knot Inc., owner of a Web site with 4 million unique visitors each month, could rise on online advertising.

Night Trading
Asian Indices are -.50% to +.25% on average.
S&P 500 indicated -.05%.
NASDAQ 100 indicated +.02%.

Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule

Earnings of Note
Company/EPS Estimate
- None of note

Upcoming Splits
- None of note

Economic Releases
8:30 am EST
- The Consumer Price Index for August is estimated to rise .2% versus a .4% gain in July.
- The CPI Ex Food & Energy for August is estimated to rise .2% versus a .2% increase in July.
- Empire Manufacturing for September is estimated to rise to 13.5 versus a reading of 10.5 in August.

9:15 am EST
- Industrial Production for August is estimated to rise .2% versus a .4% gain in July.
- Capacity Utilization for August is estimated to rise to 82.5% versus 82.4% in July.

9:45 am EST
- The Preliminary Univ. of Mich. Consumer Confidence reading for September is estimated to rise to 84.0 versus a reading of 82.0 in August.

BOTTOM LINE: Asian indices are mostly lower, weighed down by commodity shares in the region. I expect US equities to open modestly higher and to maintain gains into the afternoon. The Portfolio is 100% net long heading into the day.

***Alert***

I am unable to post the Thursday Close due to a scheduling conflict. I will post the Friday Watch later this evening.

Stocks Slightly Lower in Final Hour on Another Decline into Commodity Shares

BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Biotech longs, Retail longs and Commodity shorts. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is slightly negative as the advance/decline line is lower, sector performance is mixed and volume is above average. The rise in gold has helped pump air into the current “negativity bubble.” An ad from a local commodity broker just aired. It spoke of bird flu, nuclear war, drought, famine, stock market crashes, housing collapses, a plunging dollar and soaring inflation. Meanwhile gold is down another $11/oz. to $585.30. It is down $147/oz. from May highs or 20%. I expect US stocks to trade mixed-to-higher into the close from current levels on short-covering and lower energy prices.

Today's Headlines

Bloomberg:
- Crude oil is falling again, pulled lower by natural gas, after an EIA report showed that US inventories of the competing fuel jumped.
- France considers itself a terrorist target after an al-Qaeda leader this week asked an Algerian group to lead attacks against French “apostates,” Prime Minister Dominique de Villepin said.
- Natural gas plunged below $5 per million btus for the first time in almost two years in New York as cool weather cut demand and a very mild hurricane season curtailed speculation.
- Nintendo will start selling its latest video-game console on Dec. 2 in Japan, betting a low price will lure holiday shoppers and make up for a debut that comes three weeks after Sony Corp.(SNE) introduces the PlayStation 3.
- Amnesty International, the London-based human-rights group, today accused Muslim group Hezbollah of war crimes for deliberately targeting Israeli civilians during the Lebanon war.
- Gold in NY fell to the lowest since June and is now 20% off its recent highs as falling energy prices ease inflation concerns.

Wall Street Journal:
- Prices of flash-memory chips used in digital music players and cameras have begun to level off since late August after falling for months.
- Wal-Mart(WMT) hired designer Colin Cowie to produce the chain’s first celebrity-designed line of home-decoration products.
- Microsoft(MSFT) founder Gates and his wife Melinda are to give $68.2 million in grants through their charitable foundation to battle three deadly parasitic diseases which kill or disable millions of people each year.
- Oil prices are close to five-month lows and that’s good news for many companies. Appaloosa Management LP, a $4 billion hedge fund, is among investors that have bought airline carriers’ shares recently.
- Verizon Communications(VZ) replaced software and personnel from Microsoft(MSFT) working on a television set-top box with some of its own after delays and technical glitches.
- Bristol-Myers Squibb(BMY) options trading rose this week on speculation the drugmaker may be up for sale.

NY Times:
- World Bank President Paul Wolfowitz’s tough stance on corruption in poor countries is coming under criticism from colleagues at the bank and financial officials abroad.
- Google’s(GOOG) philanthropy unit is a for-profit organization that will pay taxes as it uses $1 billion in seed money to fulfill its mandate of fighting poverty.

Boston Globe:
- The Massachusetts Institute of Technology’s Sloan School of Management will be getting new quarters as part of a $750 million, 1 million-square-foot expansion over the next few years.

NY Sun:
- Al Franken, who hosts a talk show on Air America Radio, says the network is in financial trouble since he hasn’t been paid recently.

Washington Post:
- Prosthetic limbs, parts of which can be controlled by thought alone, offer amputees using the devices a chance to almost “feel” their missing arm or leg and better control the artificial limb.

Globe and Mail:
- Open Text(OTEX), the Canadian software maker that’s buying rival Hummingbird, may be a takeover target for a larger company such a Hewlett-Packard(HPQ).

Yediot Ahronot:
- Nice Systems(NICE), a maker of digital-recording equipment, is in talks to acquire chief competitor Witness Systems(WITS) for more than $750 million.

Import Prices Decelerate, Retail Sales Healthy, Job Market Strong

- The Import Price Index for August rose .8% versus estimates of a .3% gain and a 1.0% rise in July.
- Advance Retail Sales for August rose .2% versus estimates of a .2% decline and a 1.4% gain in July.
- Retail Sales Less Autos for August rose .2% versus estimates of a .3% increase and a .6% increase in June.
- Initial Jobless Claims for last week fell to 308K versus estimates of 315K and 313K prior.
- Continuing Claims were 2499K versus estimates of 2495K and 2481K prior.

BOTTOM LINE: Prices of goods imported into the US rose more than forecast in August, led by increases in oil, natural gas and metals. Over the last 12 months, import prices have risen 6.6%. However, excluding petroleum, prices have risen only 2.7%. Oil has declined 18.7% since peaking on July 14. Substantial declines in most commodity prices should dramatically cut import price increases going forward.

Retail sales in the US unexpectedly rose in August, a sign the economy is withstanding a slowing housing market, Bloomberg reported. Rising incomes and falling energy prices should give consumers added spending power. The unemployment rate is near a five-year low, while employee compensation rose at a 6.6% annual rate in the second quarter. Moreover, filling station sales decreased 1% in August, the largest drop since February. The average price of regular-grade gasoline at the pump dropped to $2.58 a gallon on Sept. 13, down 15% from highs of $3.04 on Aug. 9. I expect retail sales to continue to exceed estimates over the intermediate-term as energy prices continue to fall, stocks rise, housing stabilizes, inflation decelerates, interest rates remain low, the job market remains healthy and irrational pessimism lifts.


The number of US workers filing first-time applications for state jobless benefits unexpectedly dropped last week, evidence demand remains strong enough to encourage companies to retail workers. The four-week moving-average of jobless claims fell to 314,250. The unemployment rate among those eligible for benefits, which tracks the US unemployment rate remained steady at 1.9%. I continue to believe the job market will remain healthy over the intermediate-term without generating substantial unit labor cost increases.