Links of Interest

Market Snapshot Commentary
Market Performance Summary
Style Performance
Sector Performance
WSJ Data Center
Top 20 Biz Stories
IBD Breaking News
Movers & Shakers
Upgrades/Downgrades
In Play
Exchange Volume vs. Average
NYSE Unusual Volume
NASDAQ Unusual Volume
Hot Spots
Option Dragon
NASDAQ 100 Heatmap
DJIA Quick Charts
Chart Toppers
Real-Time Intraday Quote/Chart
Dow Jones Hedge Fund Indexes

Wednesday Watch

Late-Night Headlines
Bloomberg:
- The cost of protecting corporate bonds from default fell as the Federal Reserve signaled it won't boost borrowing costs anytime soon and U.S. stocks rallied the most since April. Credit-default swaps on the Markit CDX North America Investment Grade Index, a benchmark gauge of credit risk linked to the bonds of 125 companies in the U.S. and Canada, fell 3 basis points to 131 basis points, according to Credit Suisse Group AG.
- The cost to protect Japanese and Australian corporate bonds from default fell the most in a week, credit-default swaps show. The Markit iTraxx Australia Series 9 Index declined 7.5 basis points to 134 at 9:49 a.m. in Sydney, Citigroup Inc. prices show. The benchmark, which falls as perceptions of credit quality improve, is tied to 25 companies including Lend Lease Corp. and Macquarie Group Ltd. The Markit iTraxx Japan index fell 7 basis points to 106.5, according to Credit Suisse Group.
- The US dollar traded near a seven-week high against the euro as the price of a barrel of oil tumbled to the lowest level in three months. The U.S. currency was near its highest versus the yen in more than a month on optimism lower crude prices will bolster economic growth in the world's largest consumer of the fuel. Australia's dollar declined to a four-month low and Canada's traded near its weakest in almost a year as prices of commodities the nations export fell. ``The U.S. dollar should continue to be buoyed,'' said Tsutomu Soma, a bond and currency dealer in Tokyo at Okasan Securities Co. ``The fall in oil is a plus for the U.S. At the same time, it encourages the withdrawal of funds from the commodity currencies.''
- Crude oil fell for a third day in New York, trading near $118 a barrel as demand may be further eroded by economic slowdowns in the U.S., Europe and China. Oil has lost more than $28 since touching a record of $147.27 a barrel in New York on July 11 as unprecedented fuel costs prompted U.S. consumers to limit spending. Oil has also fallen as its appeal as an inflation hedge has been curbed on recent gains by the dollar against the euro and the yen. U.S. gasoline demand fell for a 15th consecutive week, as motorists cope with high fuel prices by driving less, a MasterCard Inc. report yesterday showed. Demand last week dropped 3.4 percent from a year earlier, MasterCard, the second-biggest credit-card company, said in its weekly SpendingPulse report.
- China's soybean production, the world's fourth-biggest, may surge 36.7 percent from year ago after farmers boosted planting and favorable weather improved yields, a state-owned market forecaster said. Output may rise to 17.5 million metric tons, the China National Grain and Oils Information Center said in an e-mailed monthly forecast report. Corn production may surge 2.7 percent to a record 156 million tons, it said. The country's output of wheat, the world's biggest producer, may gain 2.4 percent to 112.5 million tons, while rice production may rise 0.5 percent to 186.5 million tons, the center said. Production of rapeseed may also increase 8.5 percent to 11.5 million tons, it said.
- Gold fell below $900 an ounce for the first time since June as the dollar's rebound and plunging energy costs reduced the appeal of the precious metal as a hedge against inflation. ``The crude bubble looks like it's bursting, and the dollar is moving higher,'' said Matt Zeman, a metals trader at LaSalle Futures Group in Chicago. ``The main drivers for gold are reversing course, and you're seeing gold prices suffer for it.'' ``If gold closes weakly today, we will throw the towel in on our strong one-month and three-month views tomorrow,'' said John Reade, a UBS AG metals strategist in London. UBS forecast last month the metal would reach $1,000 in one month and $1,050 in three months.
- Cisco Systems(CSCO) said profit rose 4.4 percent and gave forecasts for the next six months in line with analysts' estimates, suggesting sales are holding up even in the face of an economic slump. The stock surged 7.3 percent in after-hours trading.
- Whole Foods Market Inc.(WFMI), the largest U.S. natural foods grocer, plunged 17.8% following the close of U.S. markets after reporting third-quarter profit that dropped more than analysts estimated.
- Priceline.com Inc.(PCLN), the travel agency that gets about two-thirds of its revenue from the U.S., fell 15.4 percent in late Nasdaq trading after saying bookings may suffer as high gas prices force consumers to cut back on travel.
- U.S. air travelers can keep laptop computers in some types of carry-on bags at security checkpoints starting Aug. 16 as part of an effort to speed up screening.
- General Motors Corp.(GM), Ford Motor Co.(F) and Chrysler LLC should have access by January to $25 billion in government loans to convert factories to build alternative-fuel vehicles, a Michigan lawmaker told U.S. regulators.
- Time Warner Inc.'s(TWX) ``The Dark Knight'' surpassed $400 million in ticket sales in 18 days, cementing the latest Batman movie's place as Hollywood's fastest moneymaker.

Wall Street Journal:
- Beijing Taxis Are Rigged for Eavesdropping.
- The new Muslim-outreach coordinator to the presidential campaign of Barack Obama has resigned amid questions about his involvement in an Islamic investment fund and various Islamic groups. Chicago lawyer Mazen Asbahi, who was appointed as a volunteer national coordinator for Muslim American affairs by the Obama campaign on July 26, stepped down Monday after an Internet newsletter wrote about his brief stint on the fund's board, which also included a fundamentalist imam.
- In an ambitious power grab, President Hugo Chávez has enacted a slew of presidential decrees which formalize the creation of a popular militia and further consolidate state control over key areas of the economy such as agriculture and tourism.

MarketWatch.com:
- Venture-capital and private-equity investments in the clean-technology sector more than doubled to nearly $6 billion across the globe in the second quarter, just as oil traded at record levels near $150 a barrel and the stock market moved lower on economic woes.
- A $550 million trust fund, created under the nation's new housing law, is the first concentrated effort to establish affordable housing for renters in the lowest income brackets since the formation of Section 8 housing in 1974, experts say.
- News Corp.(NWS/A) said Tuesday its quarterly profit rose 27% on improved results at its film studios and cable television networks, as well as gains related to its sale of stakes in Fox Sports Bay Area and Gemstar-TV Guide.

NY Times:
- Big-Dollar Donors Are Major Force in Obama Campaign. In an effort to cast himself as independent of the influence of money on politics, Senator Barack Obama often highlights the campaign contributions of $200 or less that have amounted to fully half of the $340 million he has collected so far. But records show that one-third of his record-breaking haul has come from donations of $1,000 or more: a total of $112 million, more than Senator John McCain, Mr. Obama’s Republican rival, or Senator Hillary Rodham Clinton, his opponent in the Democratic primaries, raised in contributions of that size. Behind those larger donations is a phalanx of more than 500 Obama “bundlers,” fund-raisers who have each collected contributions totaling $50,000 or more. The biggest fund-raisers include people like Julius Genachowski, a former senior official at the Federal Communications Commission and a technology executive who is new to political fund-raising; Robert Wolf, president and chief operating officer of UBS Investment Bank; James A. Torrey, a New York hedge-fund investor; and Charles H. Rivkin, chief executive of an animation studio in Los Angeles. Hedge-fund executives have bundled large sums for Mr. Obama at a time when their industry has been looking to increase its clout in Washington.

AutomatedTrader:
- Bloomberg Tradebook has released REACT, a new opportunistic trading strategy for US equity trading. This algorithm seeks to capture maximum price improvements by trying to predict and react to short-term price direction and by dynamically adjusting the quantity, price and market venues in which to represent an order. REACT makes decisions based on a number of factors including: real-time market trades; intraday stock trading performance; bid/offer spread and volatility; and deviation from historical trading patterns.

TV Squad:
- The presidential debate moderators are chosen.

Financial Times:
- Crude oil and natural gas producers are scrambling to "lock in" prices by buying insurance against further drops in prices, as oil on Tuesday hit a fresh three-month low of $118 a barrel. In the options market over the last week, for every buyer of insurance against a rise in prices in 2009 there were almost 10 buyers of protection against a fall. The number of financial bets providing insurance against a fall in prices below $100 a barrel before the end of the year has more than doubled in the past six weeks, according to the New York Mercantile Exchange. On Tuesday there were more than 46,000 outstanding contracts for Nymex December 2008 put options at $100 a barrel, up about 135 per cent on late June. Traders said a single market participant, believed to be a Latin American national oil company, had in the past 10 days taken a large position in put options to protect itself against a drop below $70 by December 2009.
- Petrol prices boost distance learning.

Caijing:
- China’s securities regulator expanded the information listed banks must disclose in earnings reports to include details of subprime holdings. The China Securities Regulatory Commission will order the banks to inform investors of the type, face value, yield, maturity, and provisions of their financial bond holdings for the first time. The new rules, effective from Sept. 1, also require public banks to disclose investments, acquisitions and asset sales that are worth more than $292 million, or that exceed 5% of last year’s net assets, the report said.

Late Buy/Sell Recommendations
Citigroup:
- Reiterated Buy on (FCX), added to Top Picks Live list, target $142.
- Reiterated Buy on (ONNN), target $14.
- Reiterated Buy on (HEW), target $50.
- Reiterated Buy on (MXGL), target $33.

Thomas Weisel:
- Rated (SONO) Overweight, target $40.
- Rated (CNMD) Overweight, target $36.

Night Trading
Asian Indices are +1.0% to +2.25% on average.
S&P 500 futures +.14%.
NASDAQ 100 futures +.56%.

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
- (RIG)/3.21
- (FWLT)/.84
- (EP)/.40
- (MMC)/.35
- (PCG)/.81
- (BX)/.08
- (TWX)/.23
- (LAMR)/.14
- (PWR)/.22
- (DF)/.32
- (DVN)/3.29
- (FRE)/-.54
- (ABK)/-.61
- (Q)/.10
- (S)/.03
- (RL)/.72
- (VRSN)/.23
- (AIG)/.79
- (CECO)/.09
- (AAP)/.72
- (CAR)/.10
- (SUN)/.36
- (HK)/.27

Upcoming Splits
- None of note

Economic Releases
10:30 am EST
- Bloomberg consensus estimates call for a weekly crude oil inventory decline of -200,000 barrels versus an -81,000 barrel decline the prior week. Gasoline supplies are expected to fall by -1,500,000 barrels versus a -3,525,000 barrel decline the prior week. Distillate supplies are estimated to rise by +2,000,000 barrels versus a +2,396,000 increase the prior week. Finally, Refinery Utilization is expected remain unch. versus a .3% increase the prior week.

Other Potential Market Movers
- The weekly MBA mortgage applications report, (AXP) analyst meeting, (TXT) analyst call, BMO Capital Healthcare Conference and RBC Capital Tech/Media/Communications Conference could also impact trading today.

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

Stocks Finish at Session Highs, Boosted by Transportation, Gaming, Retail, REIT and Financial Shares

Evening Review
Market Summary
Top 20 Biz Stories
Today’s Movers
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 Real-Time Stock Bid/Ask
After-hours Stock Quote
After-hours Stock Chart
In Play

Stocks Soaring into Final Hour on Diminishing Credit Market Angst, Less Financial Sector Pessimism and Lower Commodity Prices

BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Semi longs, Computer longs, Gaming longs and Retail longs. I covered all my (IWM)/(QQQQ) hedges and some of my (EEM) short today, thus leaving the Portfolio 100% net long. The tone of the market is positive as the advance/decline line is higher, almost every sector is rising and volume is about average. Investor anxiety is about average. Today’s overall market action is bullish. The VIX is falling 6.56% and is still above-average at 21.95. The ISE Sentiment Index is slightly below average at 138.0 and the total put/call is below average at .73. Finally, the NYSE Arms has been running slightly above average most of the day and is currently .92. The Euro Financial Sector Credit Default Swap Index is falling 4.75% today to 80.83 basis points. This index is up from a low of 52.66 on May 5^th, but down from 129.46 basis points on March 20^th. The North American Investment Grade Credit Default Swap Index is falling 1.5% today to 131.50 basis points. The TED spread is falling 3.39% to 1.07. The 10-year TIPS spread, a good gauge of inflation expectations, is falling another 4 basis points to 2.25%, which is the lowest since May 1st and down 38 basis points in a month. Energy-sensitive Russian equities fell another 4.42% today and are now down 27.5% in less than three months. I think part of the reason US equities are lifting as much as they are today is due to the fact that the large fund or funds that were cutting risk across the board yesterday is done selling. The (XLF) is at session highs, rising 4.1%. I view the Fed’s policy statement as a positive for stocks. The US dollar is maintaining recent gains on the announcement, which is a large positive. I keep hearing investors on CNBC make the case that commodity stocks are cheap because of their “low p/e ratios.” However, historically commodity stocks always appear the cheapest before substantial declines as their earnings growth peaks. Weakening earnings and falling stocks prices then lead to substantial p/e multiple increases in these types of stocks. That is what makes the fertilizer stocks so dangerous, in my opinion. Potash Corp.(POT), an investor favorite, currently has a trailing p/e of 27.3 even after recent losses and as earnings growth is likely near a multi-year peak. This company carried a p/e of around 7.0 in 2001. The fertilizer stocks are getting very oversold on a short-term basis. However, as I said a couple of months ago, I still view these stocks as carrying the most downside risk of any group in the market over the intermediate-term. Nikkei futures indicate an +250 open in Japan and DAX futures indicate an +57 open in Germany tomorrow. I expect US stocks to trade mixed-to-higher into the close from current levels on lower commodity prices, diminishing credit market angst, less financial sector pessimism and short-covering.

Today's Headlines

Bloomberg:
- The cost of protecting corporate bonds from default fell amid speculation that the Federal Reserve will leave interest rates unchanged today and as declining oil prices helped ease inflation concerns. Credit-default swaps on the Markit CDX North America Investment Grade Index fell 2 basis points to 132 as of 11:02 am in NY.
- Corporate defaults in Europe are unlikely to reach levels triggered in 2001 when Internet-related companies collapsed and terrorists attacked New York, said analysts at S&P. European company defaults climbed to .47% in July from zero in June, according to S&P. The rate would increase to 4.4% if there are defaults at the eight companies that S&P rates B- or lower, and are most likely to be downgraded. That’s less than half the default rate to 10.6% at the nadir of the dot-com collapse in the second quarter of 2002, S&P said.
- Wachovia Corp.(WB), the fourth-biggest U.S. bank, rose as much as 8 percent in New York trading after Chief Executive Officer Robert Steel met with Wall Street analysts yesterday for the first time. Wachovia isn't likely to issue new capital and doesn't anticipate management changes after the chief financial officer and chief risk officer step down, Steel told about 20 analysts at the company's midtown Manhattan office.
- The US dollar touched the highest in more than seven weeks versus the euro on speculation Federal Reserve policy makers will highlight concern that inflation needs to be contained while leaving interest rates unchanged. The U.S. currency also rose against the South African rand, Norwegian krone and Canadian dollar after crude oil fell to the lowest since May. The Australian dollar fell to a four-month low after the central bank signaled it may cut borrowing costs for the first time in almost seven years.
- China, where auto plants are running at about 70 percent of their potential, said vehicle export growth slowed in the first half, stoking concerns about excess capacity in the world's second-largest car market. ``Tight monetary policies are making it difficult for automakers to find capital and that led to the decline in exports,'' Fu said. Concerns about excess capacity and falling prices have caused SAIC Motor Corp., China's largest automaker, to plunge 70 percent this year in Shanghai trading. China's stockpile of unsold vehicles rose about 50 percent in the six months ended June to a four-year high, the National Development and Reform Commission said last month. That helped cause average vehicle prices to fall about 3 percent.
- China, the world's biggest soybean importer, may slow buying of oilseeds and vegetable oil as domestic stockpiles surge amid easing demand. Cooking oil inventories are at capacity. Soybeans on the Chicago Board of Trade plunged to the lowest since May today and palm oil slumped to a nine-month low on prospects for a larger-than-expected U.S. oilseed output this year on improved weather conditions. ``At the moment soybean oil and soybean meal face large inventories and weak demand,'' with many crushers throughout China shutting down, the China National Grain and Oils Information Center said in an e-mailed report today.
- China's home-appliances makers, the world's largest exporters of the products, are cutting purchases of copper as shipments of air conditioners and fridges slow, Jiangxi Copper Co. said. Shares fell the most in four months. Metal consumption may grow less than 10 percent this year in China, slower than 2007, Zhao Mingwang, general manager of rod and wire sales at the nation's second-biggest maker of the metal, said today by phone. Slowing global economic growth and a rising yuan have sapped China exports growth, with shipments gaining at the slowest pace in four months in June. ``Small and medium-sized companies such as air-conditioner makers were seriously hurt by a slump in exports,'' Zhao said in an interview from Jiangxi. China's copper apparent consumption grew only 2 percent in the first half as higher prices prompted consumers to use up stockpiles.
- Corn fell to the lowest price since March and soybeans dropped to a three-month low on speculation that Midwest rains have boosted the yield potential of crops in the U.S., the world's largest producer. ``The crops are improving dramatically,'' said Roy Huckabay, the executive vice president at the Linn Group in Chicago. ``This week's rains are million-dollar-crop makers for soybeans,'' which are beginning to develop pods that will be filled with beans later this month, Huckabay said.
- Crude oil fell to a three-month low as meteorologists forecast Tropical Storm Edouard will miss most offshore production facilities in the U.S. Gulf Coast while approaching Texas.
- Delta Air Lines Inc.(DAL), the third- largest U.S. carrier, said it will add Internet and messaging service on all aircraft used for its main U.S. flights.
- Goldman Sachs Group Inc.(GS), the most profitable U.S. securities firm, had its third-quarter earnings estimate cut 35 percent by Merrill Lynch & Co. because the company may be hurt by results from its commodities and hedge fund businesses. Merrill's Guy Moszkowski trimmed his per-share estimate for New York-based Goldman to $2.80, which would be the lowest since the second quarter of 2005, from $4.28. He also lowered his price target to $205 from $212.
- Syngenta AG, the world's biggest maker of agricultural chemicals, dropped the most since January in Zurich trading after falling crop prices raised concerns about pesticide and fertilizer demand. Syngenta, based in Basel, Switzerland, dropped 5.6 percent, or 16.75 Swiss francs. ``A mix of several factors has caused crop prices to decline, and this directly affects the demand for pesticides and fertilizers,'' said Martin Schreiber, a Zuercher Kantonalbank analyst with an ``overweight'' rating on the stock. Crop protection accounts for about 8 percent of farmers' costs, so when prices fall it hits demand for pesticides.''
- European retail sales dropped by the most in at least 13 years in June as a surge in oil and food costs left consumers with less money to spend on other goods. Sales in the 15-nation euro area fell 3.1 percent from a year earlier, the largest annual decline since the European Union's statistics office in Luxembourg began collecting the data in 1995.
- U.K. factory production unexpectedly shrank for a fourth month in June as record commodity prices sapped economic growth, bringing the British economy closer to a recession. Factory output fell 0.5 percent from May and was 1.3 percent lower than a year earlier, the Office for National Statistics said today in London.

USA Today:
- There's a glimmer of hope in the neon city of Nevada, where home sales are starting to heat up after two dismal years. In fact, sales in Las Vegas have risen over the past six months. Bank-owned foreclosed properties are setting the pace. With prices falling, the homes are grabbing attention. The median home price was $225,000 in June, down from a peak of $315,000 in June 2006. Las Vegas was one of the first areas hit by the subprime mortgage collapse. Many foreigners love to visit the city, and some are eager to take advantage of the lower prices and favorable currency exchange rates. "We're getting a lot more people from Canada and other foreign countries who are able to pick up property that they can afford," Kelley says. Local residents may also help lift the housing market after some new casinos open at the end of the year and in late 2009 and produce jobs, Schwer says. While Las Vegas may have been one of the first cities to suffer from the housing crisis, it now may lead the way out of the slump, he says.

Reuters:
- Venezuelan President Hugo Chavez said on Tuesday "it's good" that oil prices have come down, saying $150 per barrel would be irrational. The leader of OPEC member Venezuela has said several times recently that $100 per barrel is a fair price for oil. Venezuela under the leadership of socialist Chavez has been one of OPEC's most ardent price hawks, consistently seeking higher oil prices even as other OPEC members express worries that high prices reduce global demand.

Interfax:
- Russian weapons exports may exceed $8 billion this year, up from $7.5 billion in 2007, citing Mikhail Dmitriyev, head of the Federal Service of Military-Technical Cooperation. Dmitriyev said the Russian defense industry has 10-15 “regular trading partners,” including China, India, Algeria, Morocco and Venezuela.

Sueddeutsche Zeitung:
- The German economy shrank 1% in the second quarter from the first. Experts forecast the economy would shrink .5% and if the contraction continues in the third quarter Germany will have technically slid into a recession, Sueddeutsche said. The Federal Statistics Office will publish a first estimate of second quarter gross domestic product on Aug. 14. Record oil prices, accelerating inflation and a stronger euro weigh on the economic outlook and may prompt the German government to cut its forecast for full year growth from 1.2%.

Irish Times:
- The decline in commercial property values in Ireland is gathering pace with the latest property index showing that capital values fell by 7.2 per cent in the three months to the end of June. The fall in values has been triggered by a sudden collapse in investor confidence and is more than double the 3.3 per cent decline in values recorded in the first quarter of the year.

Bear Radar

Style Underperformer:

Mid-cap Growth +.77%

Sector Underperformers:

Gold irlind (-2.71%), Coal (-.98%) and Construction (-.21%)

Stocks Falling on Unusual Volume:

WTI, DNR, CLF, LIHR, SA, JRCC, RTP, RACK, TWGP, SNHY, OTTR, AMSC, GTLS, PTEN, PAAS, TAP, UTR, MVL, RRI, WTI and DNR

Stocks With Unusual Put Option Activity:

1) S 2) AMED 3) GRA 4) AVP 5) CCL