BETWEEN THE HEDGES

Monday, November 12, 2007

Tuesday Watch

Posted by Gary .....at 7:57 PM

Late-Night Headlines
Bloomberg:
- Investors should bet on a decline in the euro as the European Central Bank may step in and sell its currency to protect exports and economic growth, according to UBS AG.
- Billionaire Carl Icahn’s activist hedge funds posted their first quarterly decline since they opened three years ago because of volatile markets and losses on stocks including WCI Communities(WCI) and Lear Corp.(LEA).
- China’s inflation rebounded to a decade high in October as food prices climbed, adding pressure for the central bank’s sixth interest-rate increase this year.
- The US is evaluating whether existing automobiles can safely handle a greater concentration of ethanol than the 10% currently blended into gasoline, a finding that would boost demand for the biofuel.
- Japan’s economy grew faster than economists forecast in the third quarter as an unexpected increase in consumer spending counters a drop in housing construction.
- Japanese bonds gained, pushing 10-year yields to the lowest since February 2006, on speculation central bank Governor Toshihiko Fukui will signal plans to keep borrowing costs unchanged in coming months.
- Indonesia cut its forecast for export growth next year on concern soaring energy prices will cause a global slowdown, sapping demand for commodities including palm oil and tin, Trade Minister Mari Pangestu said.
- Copper prices fell 2.1% in Asia as LME-monitored stockpiles rose to a seven-month high.
- Jonathan Barratt, managing director of Commodity Broking Services, says the slump in copper foreshadows oil rally’s end.
- InterContinental Hotels Group and Wyndham Worldwide executives said they don’t see slower spending by US consumers and higher prices for oil affecting their operations.

Wall Street Journal:
- Predictions of the demise of bond insurers could be premature, particularly if they succeed in securing lifelines from a deep-pocketed insurance salesman in Omaha, Neb.

NY Times:
- Voter Anger May Free Up Energy Bills.
- Salesforce.com(CRM) wants to become a platform like Microsoft’s Windows operating system, a product so popular that it is the foundation for a veritable ecosystem of software developers.

USA Today.com:
- Large hotel chains are upgrading their TV programming as digital technology expands possibilities and cable-obsessed travelers demand more of what they have at home.
- America crazy about breadbox on wheels called Smart car.

Financial Times:
- Accelerating investment in US railroads’ capacity could come to a halt if proposed legislation to re-regulate many of the railroad’s prices is brought into force, the CEOs of three of the top five US railroads have warned.

Late Buy/Sell Recommendations
Citigroup:
- Reiterated Buy on (HEW), target $44.

Night Trading
Asian Indices are -1.50% to +.50% on average.
S&P 500 futures +.40%.
NASDAQ 100 futures +.10%.

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
Macro Calls
Upgrades/Downgrades
Rasmussen Business/Economy Polling
CNBC Guest Schedule

Earnings of Note
Company/EPS Estimate
- (PPC)/1.14
- (FOSL)/.34
- (TJX)/.55
- (HD)/.59
- (WMT)/.67
- (FIG)/.26
- (EXM)/1.01
- (BIG)/.12
- (PBY)/.02

Upcoming Splits
- (MPR) 4-for-3
- (TNP) 2-for-1
- (CRS) 2-for-1
- (APAGF) 4-for-1

Economic Releases
2:00 pm EST
- The Monthly Budget Deficit for October is estimated to widen to -$59.0 billion versus -$49.3 in September.

3:00 pm EST
- Pending Home Sales for September are estimated to fall -2.5% versus a -6.5% decline in August.

Other Potential Market Movers
- The weekly retail sales reports, IBD/TIPP Economic Optimism Index, (TSS) analyst presentation, (MCD) analyst meeting, (AMP) analyst meeting, (ITT) analyst day, Piper Jaffray Global Internet Summit, Deutsche Bank Gaming Forum, Morgan Stanley Global Consumer & Retail Conference, Piper Jaffray Industrial Growth & Business Services Symposium, JMP Securities Healthcare Conference, UBS Global Tech & Services Conference, Goldman Sachs Global Shipping Conference, Bear Stearns SMid Cap Conference and Merrill Lynch Banking & Financial Services Conference could also impact trading today.

BOTTOM LINE: Asian indices are mostly lower, weighed down by commodity stocks 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.

Averages Finish at Session Lows, Weighed Down by Market Leaders

Posted by Gary .....at 4:20 PM

Evening Review
Market Performance Summary
WSJ Data Center
Sector Performance
ETF Performance
Style Performance
Commodity Movers
Market Wrap CNBC Video(bottom right)
S&P 500 Gallery View
Timely Economic Charts
GuruFocus.com
PM Market Call
After-hours Commentary
After-hours Movers
After-hours Stock Quote
In Play

Stocks Lower into Final Hour on Weakness in Market Leaders

Posted by Gary .....at 3:47 PM

Bottom Line: Overall, today's market action was bearish as the major averages are finishing mostly lower with slightly negative breadth. Market leading stocks substantially underperformed the broad market today. The underlying tone of the market wasn't very good. The fact that the broad market couldn't generate a better bounce on unexpected strength in financial shares is a bad sign. It still looks as though we need to see a capitulation day to provide a better bottom and set the stage for a strong rally into year-end. I am finishing the day 50% net long.

Today's Headlines

Posted by Gary .....at 2:58 PM

Bloomberg:
- Gold fell 3.2%, the most in 13 months, after the yen strengthened against major currencies, slowing the pace of investment in the precious metal and other commodities.
- Crude oil is falling $2/bbl. as investment funds reduce speculative positions on global growth worries.
- The US dollar rose the most against the euro since July 2006 as credit-market losses pushed investors to reduce holding of assets in higher-yielding currencies.
- IBM(IBM) to buy Cognos for $2.9 billion, its largest acquisition, to compete with Oracle Corp.(ORCL) and SAP AG(SAP) in providing software that tracks corporate performance.
- Al Gore, who won a Nobel peace prize for his global warming campaign, will join venture capital firm Kleiner Perkins Caufield & Byers to find investments in green businesses.

Wall Street Journal:
- MGM(MGM) Seeks Help With Big Plan. Partnership Deals Are Forged For Push Into New Markets.

NY Times:
- Wireless networks may open up and follow lead of the Internet, which once was dominated by closed communities such as AOL, citing Shahid Khan, a partner at the IBB Consulting Group.

CNNMoney.com:
- A single hedge fund has made a gain of more than $3 billion at the expense of investment banks be betting on the subprime crisis.

Advertising Age:
- IAC/InterActiveCorp(IACI) CEO Barry Diller said he would consider buying AOL if Time Warner’s(TWX) new CEO, Jeffrey Bewkes, decides to sell.

Economic Releases

Posted by Gary .....at 12:36 PM

- None of note