Today's Headlines

Bloomberg:

- Nanya Technology Corp., Taiwan’s second-biggest maker of computer-memory chips, plans to raise prices of the semiconductors by 15% to 20% during the first half of April. Nanya plans to raise chip prices by at least 10% for the first half of April because of rising demand, the United Evening News reported.

- Archer Daniels Midland Co.(ADM), the world’s largest grain processor, declined in New York trading after a Citigroup Inc. analyst said weaker demand for agricultural products is hurting results in the oilseeds unit. “Slowing agricultural demand and overcapacity are negatively impacting volumes and margins in ADM’s oilseeds and agricultural-services businesses,” David Driscoll, a Citigroup analyst, said in a report today. Driscoll lowered his rating on the shares to “sell” from “hold.”

- Crude oil fell for a third day on speculation that a report tomorrow will show U.S. supplies increased as the recession curbs fuel demand. Stockpiles rose 1.5 million barrels last week, according to the median of 11 estimates by analysts in a Bloomberg News survey before the Energy Department report. “We still haven’t seen any evidence that the excess supply is being absorbed.” Crude-oil inventories climbed 2.84 million barrels to 359.4 million in the week ended March 27, the highest since July 1993, the Energy Department reported on April 1. It was the 23rd gain in 27 weeks. The increase left supplies 13 percent higher than the five-year average. The International Energy Agency, the Organization of Petroleum Exporting Countries and the Energy Department cut their 2009 forecast for oil demand in March. The IEA will probably lower its global demand forecast this month, given slowing world economic growth, Executive Director Nobuo Tanaka said April 2. The Paris-based agency is scheduled to release its next report on April 10.

- Members of the Organization of Petroleum Exporting Countries have split with developing nations over more stringent cuts in the burning of fossil fuels, fearing their economies will suffer from shrinking demand for oil. Most developing countries are calling for wealthier nations to reduce carbon-dioxide emissions 40 percent to 45 percent by 2020 at climate talks in Bonn, Chinese negotiator Su Wei said. Oil producers are concerned the cuts will shrink energy exports. “Whatever policies will be adopted will add to the uncertainties for the demand for oil,” said Mohammad Al Sabban, an adviser to Saudi Arabia’s Ministry for Petroleum and Mineral Resources, in an interview. “We share the concern for climate change but at the same time we don’t want to be a victim.”

- AMR Corp.’s American Airlines(AMR) and UAL Corp.’s United Airlines(UAUA) pared declines in traffic in March, suggesting that the industry’s slump in travel may be easing.

- European Central Bank council member George Provopoulos suggested the bank may cut its benchmark interest rate below 1 percent if the economy worsens and could also buy corporate debt to stimulate lending. “I do not see 1 percent as a threshold for the ECB benchmark rate,” Provopoulos, who heads the Greek central bank, said in a telephone interview in Athens late yesterday. “I do not exclude that the ECB could go down further from this level if the economic environment deteriorates further.”

- Colorado State University’s Atlantic hurricane forecast, the most-watched annual prediction, was lowered today to 12 named storms for the 2009 season, with six developing into hurricanes. Researchers William Gray and Philip Klotzbach cut the number from a preliminary estimate of 14 in December. Two of the hurricanes should reach major strength, meaning winds of 111 mph (178 kph) or more on the Saffir-Simpson Scale, they said today.

- Bayerische Motoren Werke AG, the world’s biggest maker of luxury vehicles, said March deliveries fell 17 percent, led by a drop in the U.S. and falling demand at the Mini small-car brand. Sales declined to 126,375 cars and sport-utility vehicles, Munich-based BMW said today in a statement. First-quarter deliveries fell 21 percent from a year earlier to 277,264. Shrinking European and U.S. car markets have prompted BMW and second-ranked competitor Daimler AG to scale back production, and the companies said last month that they’ll widen cooperation on parts to reduce costs. Daimler said today that its Mercedes Benz Cars division’s sales dropped 16 percent in March, with the U.S. also leading the decline.

Wall Street Journal:

- U.S. Energy Secretary Steven Chu raised the prospect Tuesday of getting the U.S. away from coal and nuclear power by the next century by relying more on renewable energy - and then backed away from the politically touchy position. "What I said is perhaps at the end of this century we could get renewables in a plane and energy storage and transmission that we can transition away from these others - but I don't see this happening any time soon," Chu told reporters after speaking at the Energy Information Administration's annual conference.

- U.S. President Barack Obama made a surprise visit to Baghdad, saying such a trip was critical because progress in Iraq, which has been rocked by a new round of bombings, lies "in political solutions." Meeting with Gen. Raymond Odierno and about 600 U.S. troops at Camp Victory, outside Baghdad, on Tuesday, Mr. Obama said that "we've made significant political progress" in Iraq. But, he added, "with the national elections coming up, many of the unresolved issues may be brought to a head."

- A federal judge set aside the conviction of former Alaska Sen. Ted Stevens and appointed a special prosecutor to investigate possible criminal-contempt charges against federal prosecutors who the judge said repeatedly withheld evidence from defense attorneys. U.S. District Court Judge Emmet G. Sullivan said, "In 25 years on the bench I have never seen anything approach the mishandling and misconduct I have seen in this case." Attorney General Eric Holder last week unexpectedly announced that the Justice Department wanted to drop charges against the 85-year-old Mr. Stevens, citing multiple missteps by prosecutors in failing to turn over key evidence to the defense. Mr. Stevens was convicted by a federal jury last October, just eight days before Election Day. The Republican lost his re-election bid by fewer than 4,000 votes, handing Democrats a crucial seat in the Senate.

CNBC:

- The US stock-market is about halfway or one-third into its rebound, though not necessarily at the start of a “secular bull market,” Barton Biggs, the managing partner at Traxis Partners LLC, said. The rebound in stocks might resemble the recovery seen in 1938, Biggs said. The Dow Jones Industrial Average rallied 28% that year. (video)

MarketWatch:
- Believing that the first quarter marked a "nadir" for software stock fundamentals, RBC Capital Markets upgraded several major players in the sector to buy ratings on Tuesday.

NY Daily News

- The Manhattan district attorney's office has smashed a sinister plot to smuggle nuclear weapons materials to Iran through unwitting New York banks, the Daily News has learned. fficials plan to unseal a 118-count indictment Tuesday accusing a Chinese national of setting up a handful of fake companies to hide that he was selling millions of dollars in potential nuclear materials to Tehran. This case will cut off a major source of supply to Iran and it shows how they are going ahead full steam to get a nuclear bomb. Long-range missiles they pretty much have already," a law enforcement source close to the case said.

Boston Globe:

- Citigroup Inc.'s(C) new board chairman, Richard Parsons, said financial institutions are being targeted for creating the nation's financial crisis, but they aren't the only ones responsible. "Everybody participated in pumping up this balloon. Now the balloon has deflated," he said Monday. "Everybody, in reality, has some part of the blame. But it's much more in the culture to find a villain and vilify the villain." Besides banks, there was reduced regulatory oversight, loans to unqualified borrowers were encouraged and people took out mortgages or home-equity loans they couldn't afford.

LA Times:

- Eight months after their surprising embrace of offshore oil drilling, Santa Barbara County supervisors are set today to resume their decades-old opposition to the practice. The board's majority has shifted from Republican to Democratic, the Obama administration has taken over in Washington, and the price of crude oil has plunged from nearly $150 a barrel last summer to about $52 a barrel on Monday. With an Interior Department hearing on offshore drilling planned next week in San Francisco, the supervisors are to consider a resolution urging a ban on new offshore drilling. "I feel strongly that we've been a national leader in conservation and alternative energy," Farr said. "That's the direction we need to go. We can't drill our way out of this." As gas prices soared toward $5 a gallon last year, Congress and the Bush administration lifted long-standing bans on expanding offshore drilling. Two months ago, Interior Secretary Ken Salazar slowed the process for granting new offshore leases, criticizing the previous administration's "headlong rush." But many Santa Barbara County residents have no problem with tapping into undersea resources, contending that evolving technology has minimized the risk of catastrophic spills. "It's irresponsible not to develop offshore drilling and production, with a serious eye to making certain it's safe -- which it can be," said Joni Gray, a supervisor who represents the Santa Maria and Lompoc areas. To some, the conflict mirrors a county split between its conservative, agricultural north and its liberal, more affluent south. "It's two different worlds," Gray said. "A lot of people in the north came here because their parents or grandparents worked in the oil industry. That was a good job. If you weren't fortunate enough to have a master's or a Ph.D. or a large inheritance, it was a way of working yourself out of the fields or washing dishes.

- The chief executive of Goldman Sachs Group Inc. on Tuesday called for new standards on how Wall Street executives are compensated and new regulation of large hedge funds and private equity funds. Lloyd Blankfein, who received compensation valued at nearly $43 million last year, said lessons from the financial crisis include the need to "apply basic standards to how we compensate people in our industry." He suggested a handful of guidelines, including only junior employees being paid mostly in cash and that the percentage of pay awarded as company stock increase significantly along with a worker's total compensation. Public anger over the financial distress and taxpayer bailout of the banking industry spilled over to Blankfein's appearance. As he began his address to the gathering in a hotel ballroom, two women appeared on the stage with a large purple sign saying, "We want our $$$$$ back." Blankfein asked them to leave and they did so. But the women later charged onto the stage and podium yelling protests against the bailout. While criticizing their demeanor, Blankfein acknowledged the legitimacy of the widespread anger they expressed.

Politico:

- President Barack Obama, after a lightning-quick start for his agenda on Capitol Hill, is bracing for a much slower pace and big changes in his proposals as early urgency and excitement give way to the more languid rhythms that are the norm for Congress. Officials are most pessimistic about his energy and global warming plan, with many aides doubting he will win passage of a cap-and-trade emissions reduction system, which is strongly opposed by business and Republicans. The White House is most optimistic for passage this year of his plans to overhaul the nation’s financial regulations, and aides also see a strong chance that a gradual version of his health care overhaul will get through Congress this fall.

Reuters:
- OPEC can live with oil prices of $50-$60 a barrel for the rest of 2009, a source close to the organization's Angolan presidency said on Tuesday. The comments fit with an emerging consensus in OPEC that it will accept lower prices than it would like to help nurse the global economy back to health and mark a retreat from OPEC President Jose Botelho de Vasconcelos' remarks in March that oil could reach $75 a barrel this year. hey also imply Angola is unlikely to argue for an output cut when the group next meets on May 28. The current oil price is not ideal but we can live with it. Taking into account the current economic crisis, OPEC will be comfortable with a price of $50 to $60 per barrel until the end of the year," the source told Reuters. We don't expect prices to reach $75 per barrel this year under the current economic climate." OPEC Secretary General Abdullah al-Badri said in Paris last week the group might be able to live with oil around $50 for the rest of this year.

- The U.S. Treasury Department is planning to delay the release of any completed bank stress test results until after the first-quarter earnings season to avoid complicating stock market reaction, a source familiar with Treasury's discussions said on Tuesday. The Treasury is still talking about how results of the regulatory stress tests on the 19 largest U.S. banks will be released, and may disclose them as summary results that are not institution-specific, the source said.

- General Motors Corp is in "intense" and "earnest" preparations for a possible bankruptcy filing, a source familiar with the company's plans told Reuters on Tuesday. A plan to split the corporation into a "new" company made up of the most successful units, and an "old" one of its less-profitable units, is gaining momentum and is seen as the most sensible configuration, said another source familiar with the talks. If the plan goes through, the new GM is expected to assume some previous creditor debt from bankruptcy proceedings, such as secured debt, said the second source, adding that GM bondholders are likely to lose substantial value in bankruptcy.

Financial Times:
- Hedge funds wanting loans from the Federal Reserve to buy securities backed by consumer loans – a key plank in the government’s efforts to revive the financial system – are seeking ways to circumvent restrictions on hiring skilled foreign workers to which they will be subject if they borrow government money. Authorization for the Talf is granted through the US’s recent stimulus bill. Inserted in an effort to boost jobs for American employees, the stimulus bill imposes restrictions on recipients of funds on the number of foreign workers that can be employed using H1B visas. These restrictions also apply to investors borrowing money from the Talf. Lawyers are working on setting up legal entities – a type of special purpose vehicle (SPV) – in which hedge funds can take stakes. These SPVs can then borrow money from the Fed. If investor stakes in the SPVs are small enough, then the limits on the number of workers employed under H1B visas might be avoided. Lawyers said they are still unsure whether such SPVs will actually avoid H1B visa restrictions. Last week, the US Citizenship and Immigration Services, part of the Department of Homeland Securities, said the restriction ”applies to the SPV and to any entity that owns or controls 25 per cent or more of the total equity of the SPV”. Whether the term ”controls” includes, for example, having some voting stakes in the entity is unclear, lawyers said.

Shanghai Securities News:

- Shanghai’s residential property sales fell 5% last week form the previous week, citing data from real estate agency E-House Holdings Ltd. The average price of Shanghai homes declined 3.8% last week to $1,932 per square meter from the March 22-29 period.

Efe:
- Repsol YPF SA, Eni SpA and Nippon Oil Corp have submitted bids to help develop the Nasiriyah oil field in Iraq, citing Iraqi officials. The field is one of the world’s largest, with estimated reserves of 4 billion barrels.

Bear Radar

Style Underperformer:
Mid-cap Growth (-2.94%)

Sector Underperformers:
Education (-7.16%), Coal (-5.70%) and REITs (-5.69%)

Stocks Falling on Unusual Volume:
NIHD, GLW, IOC, RIMM, BLUD, ISCA, ABAX, APOG, CSTR, DBRN, AFAM, APOL, PSYS, VTR, BWA, TGP and WMS

Stocks With Unusual Put Option Activity:
1) TXT 2) BBBY 3) GFI 4) WYNN 5) EMR

Bull Radar

Style Outperformer:
Large-cap Growth (-1.28%)

Sector Outperformers:
HMOs (+1.62%), Medical Equipment (+.55%) and Hospitals (+.53%)

Stocks Rising on Unusual Volume:
UNH, HUM, SONO, TSU, FNFG, PWRD, CSKI, GHDX, IBKC, GOLD, KNDL, EVY, EAT, DBD, ODC and UL

Stocks With Unusual Call Option Activity:
1) EMR 2) LMT 3) GPS 4) ISRG 5) BAX

Links of Interest

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Tuesday Watch

Late-Night Headlines
Bloomberg:

- European Central Bank Executive Board member Lorenzo Bini Smaghi said the bank can intervene in the currency market if needed. “Exchange-rate markets are prone to episodes of overshooting and undershooting,” Bini Smaghi said in a speech in Brussels today. “Public intervention -- in the form of public statements or even outright interventions in FX markets - - may thus be warranted.” Euro-area policy makers have expressed concern that the pound’s 13 percent slide against the euro in the past year could push the 16-nation bloc deeper into recession by undermining exports to its biggest trading partner. The region is already grappling with the worst recession since World War II as a collapse in global demand chokes foreign sales, prompting companies to scale back output and cut jobs. “If market perceptions of the inadequacy of the euro area’s response to the crisis grow and the euro loses out to competitive devaluations elsewhere, pushing it higher, the zone’s ability to take advantage of a tentative global recovery will be impeded,” Deutsche Bank AG economist Mark Wall wrote in a report published on April 3.

- The largest U.S. foreign aid program fighting the AIDS epidemic has cut the disease’s death toll by 1.2 million from 2004 to 2007 in a dozen hard-hit African countries, researchers said. The President’s Emergency Plan for AIDS Relief, started by President George W. Bush in 2003, lowered the AIDS death rate on average by 10.5 percent a year in those countries, said study author Eran Bendavid of Stanford University in a study published online today in the Annals of Internal Medicine. The program’s benefits didn’t extend to preventing new infections or lowering overall prevalence of the AIDS virus. The largest single U.S. foreign aid program for health in history, the PEPFAR program has invested most of its $18.8 billion to date in treatment for people already infected by the AIDS virus. The relief plan devoted a smaller share to prevention programs that often focused on sexual abstinence.

- The cost of protecting Asian bonds from default fell, according to traders of credit-default swap contracts. The Markit iTraxx Japan index fell 25 basis points to 318 at 9:48 am in Tokyo, BNP Paribas SA prices show. The Markit iTraxx Australia index was quoted 4 basis points lower.

- International Business Machines Corp.(IBM) and Computer Sciences Corp.(CSC) won the first major contracts in the U.K. government’s identity card program. The two awards are worth 650 million pounds ($971 million) over 10 years.

- Treasuries rose, ending three days of losses, as the Federal Reserve prepared to buy government securities tomorrow for the second time this week to hold down borrowing costs.

- The U.S. Securities and Exchange Commission sued a Toronto hedge-fund manager, claiming he touted himself as a Chinese Warren Buffett while raising as much as $75 million for a fund the agency said became a Ponzi scheme.

- Usinas Siderurgicas de Minas Gerais SA and Cia. Siderurgica Nacional SA, Brazil’s biggest providers of steel to the automotive industry, fell the most in a week on concern slowing demand will pull down prices for the metal. Brazilian steel prices will likely fall in the second quarter, Itau Corretora said, citing Christiano Freire, president of the country’s National Institute of Steel Distributors. Domestic prices are “too high,” compared with global prices and will likely fall 10% by May after declining 15% from the fourth quarter, Itau analysts led by Paula Kovarsky wrote. Distributors likely will pare inventories of flat steel until the second quarter, leading to a 20% decline in purchases this year, the analysts cited Freire as saying. Separately, Deutsche Bank AG analysts David Martin and Jorge Beristain cut their average steel price estimates for 2009 by 14% to $515 a metric ton. Steel demand will fall 20% in Latin America and 25% in North America this year, the analysts wrote. The analyst reduced their rating for Gerdau SA, Latin America’s largest steelmaker, to “sell” from “hold.” Analysts covering Brazil predict the economy will shrink .19% this year, compared with a forecast for zero growth a week ago, according to the median estimate.

- China’s non-ferrous metals industry is “quite expensive” and further share-price gains may be limited, according to UBS AG.

- David Dreman was fired as manager of a Deutsche Asset Management mutual fund he has run for 20 years after a bet on financial stocks contributed to a 47 percent loss in the past year. The trustees of the $2.2 billion DWS Dreman High Return Equity Fund voted to remove Dreman Value Management LLC on June 1, according to a filing last week with the U.S. Securities and Exchange Commission. The fund’s loss in the past year placed it in the bottom 3 percent of its peers, according to data compiled by Bloomberg.

- Cisco Systems Inc.(CSCO) is ready to pick up the pace of mergers and acquisitions over the next year after the valuations of technology companies slumped, said Ned Hooper, the company’s top dealmaker. “We will be active -- not hope to be -- will be,” Hooper, Cisco’s senior vice president of corporate business development, said in an interview. “We continue to use M&A as a key part of our growth strategy. The downturn for us is a big positive.”

- Earnings at companies such as Alcoa Inc.(AA) and Dow Chemical Co.(DOW) may show the first signs of recovery in the second quarter after profits at Standard & Poor’s 500 Index members fell 37 percent in the first three months of 2009. The slide may moderate in the second and third quarters, and earnings may start growing by the end of year, according to data compiled by S&P and Bloomberg. The first quarter may mark the seventh straight period of profit declines, the longest slump since the Great Depression. “This is a throwaway quarter -- everyone expects it to be bad,” said Richard Vanden Boogard, who helps oversee $60 billion at Victory Capital Management in Cleveland. “People will be looking forward to the commentary for guidance. It’s all about the outlook.”

- Defense Secretary Robert Gates today offered a blueprint for reorienting U.S. military purchases that calls for more to be spent on immediate battlefield needs and threats while eliminating programs designed in the Cold War-era and those exceeding budget estimates. Standard & Poor’s Aerospace & Defense Index rose 8.4, or 3.6 percent, to 244.12 after Gates’s announcements.

- Harley-Davidson Inc.(HOG), the biggest U.S. motorcycle maker, named Keith Wandell of Johnson Controls Inc.(JCI) chief executive officer and brought in a new president as part of a management restructuring. Wandell, 59, will replace retiring CEO James Ziemer May 1, the Milwaukee-based Harley said in a statement today. Wandell was formerly Chief Operating Officer and President of Johnson Controls Inc., North America’s largest auto supplier, also based in Milwaukee.

- Yemen, the ancestral homeland of al- Qaeda leader Osama bin Laden, is facing a rising tide of terrorist attacks as militants strengthen their base in the poorest Arab nation, which borders Saudi Arabia.

- General Motors Corp.(GM) is speeding up preparations for a possible bankruptcy filing even as directors seek deeper savings this week to avoid that outcome, people familiar with the plans said.

- The U.S. is pushing for the United Nations Security Council to condemn North Korea for firing a missile in violation of a UN resolution, Secretary of State Hillary Clinton said. “We remain convinced that coming out with a strong position in the United Nations is the first and important step that we intend to take,” Clinton told reporters in Washington yesterday. “We know that working out the exact language is not easily done overnight.” The U.S. is involved in consultations with members of the Security Council, Clinton said, adding that North Korea’s April 5 missile launch “has grave implications.” The U.S. says the launch violated a UN resolution prohibiting North Korea from developing missile technology. President Barack Obama called the test a “provocation” that “underscores the need for action” from the UN. “North Korea ignored its international obligations, rejected the unequivocal calls for restraint and further isolated itself from the community of nations,” Clinton said, according to a State Department transcript. China and Russia initially resisted U.S. and Japanese calls for tougher sanctions against North Korea at an emergency Security Council meeting. They can both veto any resolution, increasing the likelihood of prolonged negotiations at the UN.

- Hitachi Construction Machinery Co., Asia’s second-largest maker of earthmovers, tumbled by the most in a month in Tokyo trading on a report its operating profit may decline about 50 percent this fiscal year. The stock fell as much as 4.5 percent and traded 3.7 percent lower at 1,363 yen as of 10:20 a.m. on the Tokyo Stock Exchange.

Wall Street Journal:

- Treasury Revisits Rules for Toxic-Asset Sales. The Treasury Department, facing criticism over its bank-rescue program, said it may allow a broader group of private investors to purchase toxic securities. The Treasury said it may select more than five asset managers to coinvest with the government to purchase distressed real-estate investments. And it may allow firms with less than $10 billion under management to qualify for the program. "There are several ways smaller firms can partner with fund mangers, including as an asset manager, an equity partner or a fund-raising partner," the Treasury said Monday. "Other ways to participate include providing such services as trade execution, valuation and other important financial services." Some on Wall Street, primarily hedge funds, have criticized the Treasury's program as limiting access to a select few, such as Pacific Investment Management Co., a unit of Allianz SE, as well as BlackRock Inc. and Goldman Sachs Group Inc.

- A contentious public hearing Monday highlighted the Obama administration's challenge to craft an energy policy that emphasizes alternative fuels but also recognizes the dominance of traditional sources. Opponents of offshore drilling dominated the hearing, convened by the White House to gauge public opinion on whether the government should expand oil and natural-gas production in federal waters. Drilling supporters focused on the industry's improved safety record, as well as billions of dollars in potential government revenue. Many of President Barack Obama's supporters, particularly in the Northeast, strongly object to new drilling off their shores. According to an analysis of federal data by Securing America's Future Energy, a Washington-based group of business and retired military leaders that advocates increased domestic production, the offshore industry produced 10.2 billion barrels of oil between 1985 and 2007 with a spill rate of .001%. Many who attended Monday's hearing said they were more favorably inclined toward using coastal waters to host wind and wave-power projects. Mr. Salazar said the Interior Department will release final rules governing offshore renewable-energy projects "in a month or two," which would then allow lease sales and project development off the coasts. Mr. Salazar also said wind turbines off the East Coast could generate enough electricity to replace most, if not all, the coal-fired power plants in the U.S. Revis James, a spokesman for the Electric Power Research Institute, a nonprofit group based in Palo Alto, Calif., said that while such a development "might be theoretically possible, in practical terms, it's not very likely that it will be economical."

- A field of 111 teams -- ranging India's Tata Motors Ltd., Silicon Valley startup Tesla Motors Inc. and a team backed by musician Neil Young -- will compete for a $10 million prize to build a practical vehicle capable of getting the equivalent of 100 miles per gallon of gas, the contest's backers said Monday. The Progressive Automotive X-Prize contest, with its underlying premise that the legacy auto industry needs a shot of innovation to escape its current woes, coincides with the wrenching restructuring of Detroit's big automakers and heated debates about energy policy in Washington.

- Securities regulators and some financial firms are making it more difficult for investors to pile on when stocks are falling and further drive down prices. The Securities and Exchange Commission, facing years of criticism, has begun to crimp the ability of traders who bet against stocks to depress prices by selling millions of shares they don't possess, known as naked short selling. And some financial firms have cut back on lending to traders who want to bet against stocks. The result: The number of stocks in which big chunks of shares haven't properly been delivered to investors has plummeted.

- Barack Obama, in his first appearance as U.S. president in a Muslim nation, waded Monday into Turkey's thorniest issues -- the slaughter of Armenians in World War I and the rising power of political Islam in a secular state.

- President Barack Obama's plans to keep the estate tax in place are running into some resistance in Congress, where lawmakers may prefer a plan less burdensome on wealthy families. Congress is expected to act later this year to rewrite estate tax rules, to head off the full repeal of the tax which would take effect next year under legislation backed by former President George W. Bush.

- Record companies, weary of scraping by on 99-cent song downloads and dwindling CD sales, are trying to dress up and reimagine their most profitable product -- the album -- to woo music fans on Apple Inc.'s iTunes Store. On Tuesday, Sony Corp.'s Epic Records plans to release a $17 iTunes "pass" for pop band the Fray.

- General Motors Corp. (GM) will on Tuesday make another push into the realm of alternative vehicle technology through a joint venture with Segway Inc. to produce a two-wheeled upright personal transporter. The auto maker is targeting a 2012 launch for its electric-powered PUMA transporter, which would also employ wireless technology to allow users to navigate in urban areas and avoid traffic congestion.

NY Times:

- Sanford I. Weill, the man who built Citigroup, had not planned to donate the money until his death. He had already given more than $200 million to revamp the medical school at Cornell University into a more modern, competitive and research-focused institution (it has borne his name for a decade). At 76, Mr. Weill thought his third and final nine-digit gift could wait. But the university, like so many nonprofit institutions, has recently found itself in rough financial straits: its endowment — $5.39 billion last June — has lost more than a third of its value, its $2.9 billion annual budget has a deficit of 8 percent, and donations are down. So Mr. Weill, heart still beating, sent $170 million in December and January to Weill Cornell Medical College, where he serves as board chairman, he and university officials revealed on Monday.

Business Week:
- Credit default swaps got American International Group (AIG) into its current mess. Unraveling them might get U.S. taxpayers out of it. But it won't be easy or cheap. New York State Attorney General Andrew Cuomo is probing the $165 million bonus payments and the billions AIG transferred to such banks as Goldman Sachs (GS) and Société Générale.

Pensions & Investments:

- All talk, little action about hedge funds. Hedge fund experts shrugged off the results of the Group of 20 meeting in London on April 2, saying the results were expected and manageable.

Google Blog:

- We like to make search as easy as we can, so we've just finished the worldwide rollout of local search results on a map, which will now appear even when you don't type in a location. When you search on Google, we will guess where you are and show results near you.

CNNMoney.com:

- Unemployment at a 25-year high. Housing prices continuing to fall. Corporate titans such as General Motors on the brink of bankruptcy. There's no lack of bad economic news. And yet, amid the gloom, there are a growing number of economists that see a recovery on the horizon -- perhaps even a strong rebound. They say that a number of indicators appear to have bottomed out in recent months. Job losses may have peaked in January. Home sales are starting to pick up. Stocks are enjoying a strong rally. And because the economy has experienced such a steep decline in the current downturn, some economists are hopeful the recovery ahead will be much stronger than the anemic gains that came about after the end of the previous two recessions. Lakshman Achuthan, managing director of Economic Cycle Research Institute, said the economy could be as close to four months away from a recovery.

Reuters:

- Investors seem to be getting comfortable with Apple Inc's stable of executives amid uncertainty about Steve Jobs' return to the helm of the consumer electronics titan he founded. Apple shares have surged in the 10 weeks since Jobs stepped away on a five-month medical leave. The stock is up more than 45 percent since it bottomed out at a two-year low on January 20, days after Jobs, a pancreatic cancer survivor, announced he would hand over day-to-day duties to lieutenant Tim Cook to seek treatment for an undisclosed condition. "The management team is pretty good," said Bob Turner, chief investment officer for Turner Investment Partners. "I would say don't short-change the team that's in place now."

- Australia's government will build a A$43 billion ($30.7 billion) national high-speed fibre-optic broadband network, rejecting bids in a controversial tender involving some of the country's top telecoms firms. In a surprise decision, Prime Minister Kevin Rudd said on Tuesday the government would ask private companies join a new private-public firm to build the network.

- The Associated Press unveiled rate cuts on Monday to help member newspapers reeling from declining advertising revenue and said it would sue websites that use its members' articles without permission. Changes announced by the AP at its annual meeting in San Diego include $35 million in rate assessment reductions for 2010 on top of $30 million it already instituted for 2009.

Financial Times:
- The European Central Bank rejected a plan for European Union members in eastern Europe to adopt the euro currency without formally joining the euro zone. The proposal was made by the IMF as part of a regional anti-crisis strategy, citing an interview with Ewald Nowotny, ECB governing council member.

- Art prices plunged during the first quarter of the year as cash-strapped collectors looked to unload works by postwar masters that had earlier boomed in price along with the stock market. The Mei Moses index, set for release on Tuesday, shows art prices fell 35 per cent in the first quarter, having held up during earlier months of the financial crisis. The overall index fell 4.8 per cent last year.

TimesOnline:

- Lord Mandelson called on British business to “seize the opportunity” of investing in Iraq as he led the first British trade delegation in two decades to the war-torn country. The Business Secretary was joined by representatives from 23 British companies, including Wood Group, Rolls-Royce, HSBC, BP and Shell. It is the first such trip to Iraq after business links were severed by years of sanctions and war. A sharp decline in violence over the past 18 months has allowed foreign investors to start thinking seriously about ventures in Iraq, home to one of the world's largest oil reserves. It is also a country in desperate need of reconstruction work. Chinese, Russian, Iranian, French, German and American companies are among those competing for Iraqi government contracts in sectors including energy, health, transport and finance. “Things are settling down,” Mr Cave said. “There is change in the air.”

IFSL:
- Hedge funds’ assets are likely to fall by over 20 per cent in 2009, according to International Financial Services London (IFSL), the independent organisation promoting UK financial services worldwide. Its annual Hedge Funds report indicates that in the first two months of 2009 hedge fund assets fell by 9 per cent, largely due to redemptions. The surge in withdrawals at the start of the year came as restrictions on redemptions in some hedge funds, particularly in the US, were lifted.

Edaily:

- Hynix Semiconductor Inc. is in talks with clients to increase4 contract prices of dynamic random access memory, or DRAM, by between 10% to 20% this month. Samsung Electronics Co. may also seek to raise prices, citing an industry official.

Late Buy/Sell Recommendations
Citigroup:

- Upgraded (AXP) to Hold.

- Reiterated Buy on (PVH), target $24.

Night Trading
Asian Indices are -1.25% to +.50% on average.
S&P 500 futures -.18%.
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
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WSJ Intl Markets Performance
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Top 25 Stories
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Today in IBD
In Play
Bond Ticker
Economic Preview/Calendar
Earnings Calendar

Conference Calendar

Who’s Speaking?
Upgrades/Downgrades
Rasmussen Business/Economy Polling

Earnings of Note
Company/EPS Estimate
- (CHTT)/1.13

- (ISCA)/.65

- (MOS)/.22

- (BBBY)/.44

- (RT)/1.0

- (AA)/-.56

- (RECN)/.07

Economic Releases

3:00 pm EST

- Consumer Credit for February is estimated at -$3.0B versus $1.8B in January.

Upcoming Splits
- None of note

Other Potential Market Movers
- The weekly retail sales reports, IBD/TIPP Economic Optimism Index, (ALKS) analyst meeting, (ARUN) analyst meeting, (GT) shareholders meeting, (EMR) analyst meeting and the (DNR) analyst meeting could also impact trading today.

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

Stocks Finish Lower, Weighed Down by Financial, Technology and Commodity Shares

Evening Review
Market Summary
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In Play