Today's Headlines

Bloomberg:

- The Standard & Poor’s 500 Index is in the middle of a rally that will drive it as much as 70 percent above its March lows, billionaire Kenneth Fisher said. “Bear market rallies are not that big,” Fisher, 58, who oversees $28 billion as chairman of Woodside, California-based Fisher Investments Inc., said in a telephone interview yesterday. He is the world’s 647th richest person, according to a tally by Forbes magazine in March. “Stocks are cheaper compared to long-term interest rates than they have been in anyone’s life,” he added. Fisher said the S&P 500 may extend the rally that began on March 9 to between 60 percent and 70 percent by March 2010. That would drive the index to as high as 1,150, or 33 percent more than yesterday’s close of 865.30.

- Financial companies are the best performers in the Standard & Poor’s 500 Index this quarter, a ranking that has eluded them for more than a decade and a half. The industry hasn’t finished in the top spot among the S&P 500’s 10 main groups since the third quarter of 1993, according to data compiled by Bloomberg. Every other group has been first at least one quarter in this decade.

- American International Group Inc.(AIG) Chief Executive Officer Edward Liddy should sell his $3.3 million stake in Goldman Sachs Group Inc.(GS) because it represents a conflict of interest, members of Congress said. The AIG chief, who is paid $1 a year plus an undisclosed stock grant by the New York-based insurer, owns 27,129 Goldman Sachs shares, the bank said in a regulatory filing last year. Liddy acquired most of the shares as a Goldman Sachs board member for five years. AIG, recipient of a $182.5 billion government bailout, the largest in U.S. history, paid Goldman Sachs $12.9 billion after receiving the funds. The payments helped settle credit-default swaps or other transactions backed by AIG. Goldman Sachs is the biggest recipient of AIG payments from the bailout funds. “It turns out that he has a personal multimillion-dollar stake in what turns out to be the biggest counterparty of AIG and the company that has received the largest amount of the bailout money given to AIG, namely Goldman Sachs,” U.S. Representative Alan Grayson, a Florida Democrat and a member of the House Financial Services Committee, said yesterday in a phone interview.

- Credit-default swaps traders set an initial value of 3.75 cents on the dollar for bonds of an AbitibiBowater Inc. unit to settle derivatives linked to the newsprint maker that’s now in bankruptcy protection. The price means sellers of credit swaps guaranteeing as much as $1.1 billion against a default by the Abitibi- Consolidated unit would pay 96.25 cents on the dollar to settle the contracts. A final price is scheduled to be released at 2 p.m. in New York after a second round of the auction, which is being administered by Markit Group Ltd. and broker Creditex Group Inc. Eleven dealers, including JPMorgan Chase & Co., Barclays Plc and Morgan Stanley, are bidding.

- China’s equities rally, the second-biggest in the world this year, may falter as record lending by banks in the first quarter won’t be repeated, removing a funding source for stock purchases, Roth Capital Partners LLC said. Stock transactions on the Shanghai and Shenzhen exchanges doubled this year to an average of 20.6 billion trades a day, from 9.5 billion a year earlier. “Some of that money we think may have found its way into the stock market,” John Ma, Shangahi-based director of China research at Roth Capital, said. “Would that likely be repeated? We think it’s almost impossible.” The lending surge is a “cause for worry,” as it means the increase in liquidity behind this year’s stock rally will probably weaken, UBS AG said April 13. China’s banking regulator told lenders yesterday to enhance risk management and monitor threats that may arise from increased lending.

- Nicholas Cosmo may have swindled more than $413 million from twice as many victims as previously believed, based on an examination of overseas investors, a U.S. prosecutor said.

- The euro fell for a fourth day against the US dollar in the longest stretch of declines since October as European Central Bank President Jean-Claude Trichet’s pledge to spur confidence failed to convince investors that policy makers are united in their views. The dollar advanced to the level at which it traded versus the euro on March 18, when the Federal Reserve announced a plan to buy Treasuries to keep interest rates low, a policy known as quantitative easing. The euro declined against the Canadian dollar and South African rand after a report showed yesterday that February factory output in Europe plunged. “When you look at the data flow out of Europe, you could even argue we’ve seen an accelerating downward move,” said Michael Klawitter, a currency strategist at Dresdner Kleinwort in Frankfurt. “The market was looking for a reason to sell.” The euro will probably fall to $1.20 this year, he said.

- The cost of borrowing in dollars in London fell for a 14th day, the longest stretch of declines since November, as improved earnings at banks signaled a thaw in the global credit freeze. The London interbank offered rate, or Libor, for three- month loans in dollars fell half a basis point to 1.10 percent today, the British Bankers’ Association said, down three basis points in the week. The Libor-OIS spread, a gauge of bank reluctance to lend, narrowed to within one basis point of the least since before the collapse of Lehman Brothers Holdings Inc. Improved bank results are no “one-off,” Barclays Plc President Robert Diamond said in a Bloomberg Television interview on April 15. The declines are “reflecting a reduction in systemic risk,” a team of analysts at Morgan Stanley in London led by Laurence Mutkin wrote in a research note to clients today. Contracts in the forward market show traders are betting the Libor-OIS spread will fall to 79 basis points by December, according to data compiled by Tullett Prebon Plc, the biggest broker of interbank transactions after ICAP Plc. In a further sign the turmoil in the credit markets is easing, the disparity in the dollar rates submitted by the 16 banks to the BBA is decreasing. The difference between the highest and the lowest quotes today was 25 basis points, down from 175 basis points in the aftermath of Lehman’s collapse.

- BB&T Corp.(BBT), the largest U.S. commercial bank by deposits that hasn’t cut its dividend, rose as much as 17 percent in New York trading after it posted a first-quarter profit and the bank’s chief executive officer said loan losses may be moderating.

- Amazon.com Inc.(AMZN), expanding into digital downloads of music and books to boost sales, said demand for the Kindle electronic reader beat its estimates. “Kindle sales have exceeded our most optimistic expectations,” Chief Executive Officer Jeff Bezos said in a letter to shareholders, filed with regulators today.

Wall Street Journal:

- Chrysler LLC will likely get a new chief executive and board of directors appointed by Italy's Fiat SpA and the U. S. government, if Chrysler and Fiat follow through on their plans to form an alliance, Chrysler's current CEO told employees in a letter.

- The United Food and Commercial Workers union is ramping up organizing at Wal-Mart Stores Inc.(WMT) after a five-year lull, dovetailing with its efforts to win support in Congress for a bill to make union organizing easier. The Bentonville, Ark., retailer, a leading opponent of the legislation, said managers have seen increased union activity at a number of stores, prompting mandatory meetings to discuss unionization. "We have noticed that the UFCW has been working harder lately in its attempts to get Wal-Mart associates to sign union cards, but we don't think our associates have any reason to be more interested than before," said Wal-Mart spokesman David Tovar.

- Insurance giant Allstate Corp.(ALL) has been asked by the New York Insurance Department to immediately report its participation in "unregulated insurance markets," along with its knowledge of any insurance companies that conducted unregulated writing of credit-default swaps.

CNBC:

- Avenue Capital Group founder Marc Lasry told CNBC that the casino industry offers a “huge amount” of opportunity on the debt side.
- Accounting changes aimed at helping the balance sheets of banks with toxic assets appear to be providing little or no help so far with earnings reports. The accounting rules, known as mark-to-market, were amended so that banks stuck with underperforming assets—particularly mortgage and other credit-related securities—could value them at their future projected worth and not at current value. But the early earnings are showing that the rules probably won't be reflected until second-quarter results are reported. And that has some investors hoping that financial earnings, which have been better-than-expected so far, will do even better once market-to-market accounting takes effect.

- No surprises: GE and Citi report earnings. Shorts have a big problem: bank stocks were supposed to sell off this earnings week, but stronger than expected results is keeping bank stocks moving sideways and the rest of the market up modestly. This is sucking in shorts. According to Reuters, State Street, which tracks buying and selling within the $12 trillion in assets it holds as custodian, said flows into U.S. equities were close to the highest they have been in 12 years.

Barron’s:
- Generic drugs play a big role in President Obama's plans to overhaul health care and efforts by other countries to curb their own rising costs. So it's easy to see why shares of generic-drug makers have soared in recent months, even as health-care stocks suffered a big selloff. As big players in the $78 billion generic-drug industry, Teva Pharmaceutical Industries (ticker: TEVA) and Mylan (MYL) have more gas left in the tank despite stock gains.

NY Times:

- Institutional investors are participating in a broad-based recovery in equities with the United States leading the way and the euro zone lagging, State Street said on Friday. The U.S. financial services firm, which tracks buying and selling within the $12 trillion in assets it holds as custodian, said flows into U.S. equities were close to the highest they have been in 12 years. Specifically, it said, monthly flows into U.S. stocks were in the 98th percentile, meaning they have only been higher in 2 percent of months over the period. “It seems the nightmare may now be ending. Markets have been having quite a party of late,” State Street said in a note. “Institutional investors are backing this rally.”

Salon.com:

- Why credit swaps encourage bankruptcy. Here's how it works: A lender buys the bonds of a company -- let's say General Growth, the huge mall operator that declared bankruptcy this week. But then, hoping to hedge against the risk that General Growth might default on its bond obligations, the lender purchases a credit default swap protecting against that event from another party, in effect buying insurance against the chance that those bonds will go bust. But the kicker is that owning a credit default swap on General Growth bonds turns out to make the lender less willing to cut a deal that would allow General Growth to avoid bankruptcy, because the lender can get paid in full in the event of that bankruptcy by collecting on the insurance policy. So it's better for the lender to force the company to its knees rather than come to a less disastrous arrangement.

Dallas Morning News:

- AT&T Inc.(T) outlined its 2009 wireless and broadband network expansion plans for Texas on Thursday. The Dallas-based company said it will expand its high-speed wireless 3G networks throughout the state, with a focus on rural areas, as well as its U-verse home broadband service. AT&T did not say how much it will spend on this year's upgrades but said it spent more than $6 billion on infrastructure statewide from 2006 to 2008. It said its capital expenditures companywide for 2009 will total between $17 billion and $18 billion.

The Detroit News:

- The Obama auto task force is preparing to loan General Motors Corp. about $5 billion in additional federal short-term aid, and Chrysler LLC $500 million, an Obama administration official familiar with the matter said Thursday.

- A coalition of Muslim organizations is asking U.S. Attorney General Eric Holder today to investigate complaints that the FBI is approaching local Muslims and asking them to inform on Islamic congregations in Metro Detroit. Muslim leaders in Michigan and across the country say members of mosques are frequently approached and asked to provide information about activities in their communities.

The Seattle Times:

- Human rights groups and former detainees in U.S. custody expressed disappointment Friday with the decision by President Barack Obama not to prosecute CIA operatives who used interrogation practices described by many as torture. Obama sought to turn a page on what he called "a dark and painful chapter" with his announcement a day earlier. He condemned the aggressive techniques - including waterboarding, shackling and stripping - used on terror suspects while promising not to legally pursue the perpetrators. But the decision left some bitter in the Muslim world, where there was widespread anger over abuse of detained terror suspects. It could tarnish somewhat Obama's growing popularity among Arabs and Muslims, who have cheered his promises to close the Guantanamo Bay detention facilities and withdraw U.S. troops from Iraq. "All of us in Guantanamo never had hope or faith in the American government," said Jomaa al-Dosari, a Saudi who spent six years in Guantanamo before being released last year. "We only ask God for our rights and to demand justice for the wrongs we experience in this life. There will be a time in history when every person who committed a wrong will be punished."

Reuters:
- The Environmental Protection Agency on Friday unveiled a finding that greenhouse gases endanger human health and welfare, opening the door to federal regulation of carbon dioxide as a pollutant. The finding does not "automatically trigger" new carbon rules but could allow the EPA to move forward with limiting greenhouse gas emissions under the federal Clean Air Act. Rising levels of greenhouse gases "are the unambiguous result of human emissions, and are very likely the cause of the observed increase in average temperatures and other climatic changes," the EPA proposal said. Environmentalists applauded the decision, while affected industries expressed concern.

- U.S. consumers have more confidence in the U.S. economy than they have had since the sudden collapse of Lehman Brothers in September, which caused the near-implosion of the global banking system, a survey showed on Friday. The Reuters/University of Michigan Surveys of Consumers said its preliminary April reading of consumer sentiment rose to a level of 61.9, up from 57.3 in March and was the highest since 70.3 recorded in September.

- McDonald's Corp (MCD) has added millions of diners at its restaurants over the past few years, and an improving financial climate should help out consumers, Chief Executive Jim Skinner said on CNBC on Friday. "Everybody's a little skittish right now about the future," Skinner said on CNBC. "It's still a tough environment, but I do see some thawing. If you look at the credit markets and you look at the activities around the financials, I think that bodes well for the future and bodes well for the consumer."

- A weekly measure of U.S. future economic growth slipped, while its annualized growth rate climbed to levels last seen in October 2008, indicating that economic recovery is probable in the coming months, a research group said Friday. The Economic Cycle Research Institute, a New York-based independent forecasting group, said its Weekly Leading Index slipped to 107.2 for the week ending April 10 from 107.4, which was revised lower from 107.9. "With the upturn in Weekly Leading Index growth continuing for over five months now, growth in U.S. economic activity will begin to improve in short order," said Lakshman Achuthan, managing director at ECRI.

Bear Radar

Style Underperformer:
Large-cap Growth (+.14%)

Sector Underperformers:
Gold (-3.31%), Software (-.99%) and Coal (-.47%)

Stocks Falling on Unusual Volume:
GOLD, RTP, ALJ, OFIX, RGLD, PBCT, ANDE, CYT and AOS

Stocks With Unusual Put Option Activity:
1) ALL 2) XTO 3) YGE 4) BSX 5) SLM

Bull Radar

Style Outperformer:
Large-cap Value (+.11%)

Sector Outperformers:
Homebuilders (+2.19%), Road & Rail (+1.24%) and I-Banks (+1.10%)

Stocks Rising on Unusual Volume:
ICUI, CMED, PG, NUS, ABT, BMY, DB, CSKI, ZUMZ, CHIC, ISRG, DNDN, TNDM, GOOG, RVBD, ILMN, PRSP, FTEK, BIDU, AMSC, TPX, VMI and OCR

Stocks With Unusual Call Option Activity:
1) RVBD 2) PPG 3) MAT 4) PDCO 5) ADI

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Friday Watch

Late-Night Headlines
Bloomberg:

- Asia-Pacific bond risk declined after JPMorgan sold $3 billion in bonds and reported profit that beat analysts’ estimates, spurring confidence the worst of the global credit crunch has passed. The Markit iTraxx Japan index of credit-default swaps fell 12.5 basis points to 292.5 at 10:08 am in Tokyo, Barclays Capital data show. The iTraxx Asia index of 50 investment-grade borrowers outside Japan was 5 basis points lower at 295 at 9:10 am in Hong Kong, according to BNP Paribas SA. The Markit iTraxx Aust4alia index fell 2.5 basis points to 302.5 at 10:30 am in Sydney, according to Citigroup.

- Senate Democrats are scaling back legislation that would let bankruptcy judges alter mortgage terms because lawmakers don’t have enough votes for passage, a spokesman for Senate Majority Whip Richard Durbin said. The main “sticking point” is whether the measure, which passed the House of Representatives in March, should be limited to certain loans or a specific timeframe, Max Gleischman, a spokesman for Durbin, an Illinois Democrat, said today.

- Google Inc.’s(GOOG) YouTube reached agreements with Hollywood studios including Sony Corp., CBS Corp. and Metro-Goldwyn-Mayer Inc. to put movies and television shows on the Internet. YouTube will add two tabs to its homepage to highlight shows from sites such as Sony’s Crackle, and offer new material to subscribers who log in, the San Bruno, California-based company said today on its Web site. The accord extends efforts by Hollywood studios to offer mostly older full-length movies and television shows on advertiser-supported Web sites. Google is also separating professional clips on YouTube from home videos to charge more for ads. The site will increase its use of so-called in-stream ads that viewers must sit through, similar to a TV show. “Our initial focus is on advertising,” Google Chief Executive Officer Eric Schmidt said of the company’s plans to add content to YouTube. “We do expect over time to see micro- payments and other forms of subscription to come,” Schmidt said today on a conference call after quarterly earnings.

- Hynix Semiconductor Inc. led shares of computer-memory chipmakers higher in Asia as rising prices helped fuel expectations that the industry may be recovering from record losses. Hynix gained 9.1 percent to 14,450 won, while top memory chipmaker Samsung Electronics Co. rose 2.9 percent at 9:56 a.m. in Seoul trading. Japan’s Elpida Memory Inc. added 3.3 percent on the Tokyo Stock Exchange. In Taiwan, all five listed memory chipmakers, including Nanya Technology Corp., advanced. Prices of the benchmark dynamic random access memory, or DRAM, chips climbed 7.6 percent to $1.13 yesterday, the highest since Oct. 14, according to Dramexchange Technology Inc., operator of Asia’s biggest spot market for semiconductors. Nanya Technology, Taiwan’s second-biggest DRAM maker, said yesterday it plans to raise prices for the second time this month after industrywide production cuts helped ease a glut. The “price recovery has just started, in line with our bullish expectation,” Henry Kim, an analyst at Citigroup Inc., wrote in a note yesterday. Kim predicts spot prices of the DRAM chip will increase 50 percent in the current period.

- Crude oil fell, poised for the biggest weekly decline since February, amid forecasts the recession will curb demand at a time when U.S. inventories are already at their highest in almost 19 years. U.S. crude-oil inventories rose 5.67 million barrels to 366.7 million last week, the highest since September 1990, the Energy Department said April 15. The International Energy Agency reported April 10 that worldwide consumption will shrink by 2.8 percent in 2009 as the global economy contracts. “There’s potential for oil prices to slide off the current plateau and fall back to perhaps a number like $40 a barrel, just because inventories are at such an elevated level and may not have peaked yet,” said Tim Evans, an energy analyst with Citi Futures Perspective in New York. U.S. fuel demand in the first quarter fell to the lowest for the period in 11 years, the American Petroleum Institute said in a monthly report yesterday. Deliveries of petroleum products, a measure of consumption, averaged 19.2 million barrels a day, 3.4 percent less than during the same period in 2008, the industry-funded API said.

- Gold and silver fell to the lowest prices in a week on speculation that the pace of inflation will be slower than investors expected, eroding demand for the precious metals as a store of value. U.S. consumer prices slipped in March to the first 12-month decline since 1955, the Labor Department said yesterday. The euro declined for a third straight day against the dollar, the longest losing streak in six weeks, as industrial output fell. “Gold is showing signs of weakness amid the drop in prices of goods to consumers, indicating that inflation has yet to rear its head,” Miguel Perez-Santalla, a sales vice president at Heraeus Precious Metals Management in New York, said in an e- mailed note. “Investor- and industrial-demand remain weak at these levels as well.” “With gold prices continuing to be capped under $915 an ounce, I would look for the market to roll over and play bear,” Ralph Preston, a commodity analyst at Heritage West Futures Inc. in San Diego, said in an e-mail. “A close under $853 an ounce projects another move down towards $800 an ounce.”

- Research In Motion Ltd.(RIMM) Co-Chief Executive Officer Mike Lazaridis plans to keep hiring to spur the flow of new BlackBerry models, signaling the phone maker is withstanding a recession that forced rivals to trim payrolls. The mobile-phone maker has more than 600 positions to fill, mostly in North America. RIM boosted its workforce by 50 percent to about 12,000 last year.

- Luxury cars in the U.S., for those who can afford them, have never been cheaper. General Motors Corp. knocked an average $6,724 off the price of Cadillacs last month, Bayerische Motoren Werke AG discounted cars by $5,234 and Daimler AG sweetened the purchase of a Mercedes-Benz by $4,697, according to Edmunds.com, a Santa Monica, California-based auto data provider. Overall, incentives on luxury cars in March jumped 45 percent from a year ago. “It’s ‘buy-low’ time, almost across the board,” said Jack Nerad, executive market analyst for Kelley Blue Book in Irvine, California, which tracks vehicle pricing. “We’re seeing brands that had not discounted as much, really doing so now.”

- President Barack Obama and Mexican president Felipe Calderon announced a new framework for the two countries to lower carbon output, promote clean energy technology and combat climate change. The agreement seeks to promote renewable energy, energy efficiency and green jobs, Obama said at a news conference with Calderon in Mexico City. The pact also aims at strengthening the reliability of cross-border electricity grids and encourages border states to cooperate on energy.

- Jean-Claude Trichet is facing the biggest split on the European Central Bank’s Governing Council in his six years as president. Months after other central banks cut their key interest rates close to zero and started pumping money into their economies, the ECB’s 22-member council is still divided over whether to follow suit. The stand-off has delayed new measures to stem the euro region’s deepest recession since World War II. “I fear the ECB will be bogged down by internal squabble,” said Ken Wattret, chief euro region economist at BNP Paribas in London. “It seems to be turning into a battle between the activists and those with a more conservative persuasion. It’s the biggest dispute under Trichet.”

Wall Street Journal:

- Steven Rattner, the leader of the Obama administration's auto task force, was one of the executives involved with payments under scrutiny in a probe of an alleged kickback scheme at New York state's pension fund, according to a person familiar with the matter. A Securities and Exchange Commission complaint says a "senior executive" of Mr. Rattner's investment firm met with a politically connected consultant about a finder's fee. Later, the complaint says, the firm received an investment from the state pension fund, then paid a $1.1 million fee. The "senior executive," not named in the complaint, is Mr. Rattner, according to the person familiar with the matter. He is co-founder of the investment firm, Quadrangle Group, which he left to join the Treasury Department to oversee the auto task force earlier this year.

- In its latest attempt to restart financial markets, the Federal Reserve is weighing a twist in one of its rescue programs that it hopes will encourage investors to buy long-term commercial-mortgage-backed securities. The Term Asset-backed Securities Loan Facility, or TALF, offers three-year loans to investors who use them to buy asset-backed securities. Fed officials are considering whether to offer investors in commercial real-estate securities loans of as long as five years to make the program more appealing.

- Danny Pang, the California investment-fund manager whose credentials have come under question, has stepped aside as chairman and chief executive of PEMGroup pending the outcome of an internal probe, the firm said in a press release.

- In a move likely to be watched by peers, the giant California pension fund Calpers is considering expanding its own internal hedge-fund investments even as it presses established external funds to cut fees and make other client-friendly changes that many money managers have resisted. Calpers is raising the prospect of providing start-up money to new and relatively unknown teams of traders and portfolio managers, with hopes that the best would spin out later as bigger, independent firms with many additional clients, according to public documents from Calpers.

- The Federal Bureau of Investigation earlier this year launched a nationwide operation targeting white supremacists and "militia/sovereign-citizen extremist groups," including a focus on veterans from Iraq and Afghanistan, according to memos sent from bureau headquarters to field offices. The initiative, dubbed Operation Vigilant Eagle, was outlined in February, two months before a memo giving a similar warning was issued on April 7 by the Department of Homeland Security. Disclosure of the DHS memo this week has sparked controversy among some conservatives and veterans groups. Appearing on television talk shows Thursday, Homeland Security Secretary Janet Napolitano defended the assessment, but apologized to veterans who saw it as an accusation.

Dow Jones:

- Verizon Communications(VZ) is still interested in buying out Vodafone Group’s(VOD) share of their joint wireless business.

CNBC.com:
- Google's(GOOG) quarterly profit topped expectations, helped by cost controls, but Chief Executive Eric Schmidt said the economic environment remains tough with users still searching but buying less. Shares of the No. 1 U.S. Internet search company initially rose 5 percent on the stronger-than-expected results, but then erased gains to trade flat after hours. The stock had risen about 30 percent in the past three months.

- U.S. mortgage rates fell back toward record lows this week and stayed a percentage point below levels a year ago just as the important spring sales season heats up. Freddie Mac said Thursday. Low mortgage rates are a boon for owners looking to cut monthly payments by refinancing and should attract new buyers.

NY Times:

- Chrysler is close to a deal with the United Automobile Workers to finance retiree health care that is crucial to the company’s bid for more government aid, according to people with knowledge of the negotiations.

- Edward M. Liddy, the dollar-a-year chief executive leading the American International Group since its bailout last fall, still owns a significant stake in Goldman Sachs(GS), one of the insurer’s trading partners that was made whole by the government bailout of A.I.G.

- Just three short months ago, many of the nation’s biggest banks were on life support. Now, a number are showing glimpses of a recovery, aided by a tentative improvement in some corners of the economy and new business picked up from rivals that stumbled in the wake of the financial crisis. On Thursday, JPMorgan Chase became the latest bank, after Goldman Sachs and Wells Fargo, to announce blockbuster profits in the first quarter. The reports fed a rally in financial stocks that began more than five weeks ago, when Citigroup and Bank of America, two of the banks hit hardest by the crisis, suggested the worst might already be over.

TechCrunch:

- Amazon’s(AMZN) Kindle 2, which first shipped in late February, is selling at roughly double the rate of the first generation device, says a source close to Amazon. Approximately 300,000 of the Kindle 2s have been shipped to date, suggesting Amazon has made over $100 million in revenue from sales of the $359 device alone this year.

Seeking Alpha:

- A Visit to Kingdom Hedge Fund 2009.

Investors.com:

- A lot of IBD's New America stories will tell you how a company will benefit from President Obama's stimulus package. But LHC Group (LHCG) is prospering in spite of the administration rather than because of it.

Politico:

- Here's quite a blockbuster from the Connecticut Post: Out of the $1 million that Sen. Chris Dodd (D-Conn.) raised this quarter, only $4,250 -- less than a half-of-a-percent -- of it came from home-state donors:

USA Today.com:

- The federal government agreed Thursday to begin taking public comment on a proposal that could boost the amount of ethanol in gasoline by 50% — a small, early victory for suppliers seeking to expand sales of ethanol, usually made from corn.

Reuters:

- Shopping malls sold in bankruptcy by General Growth Properties may finally set prices in a stalled market and release billions of dollars stockpiled for good buys in U.S. commercial real estate. "The public companies we think are best positioned to capitalize on General Growth's unraveling are Simon Group Inc SPG.N, Taubman TCO.N, Westfield WDC.AX, and Vornado VNO.N," J.P. Morgan real estate investment trust (REIT) analysts wrote in a research note.

- The United States is in a "bone-crushing recession" but wide-ranging Federal Reserve policies to unlock credit markets should accelerate a recovery, Dallas Fed President Richard Fisher said on Thursday. Fisher, in remarks prepared for a forum at Tsingua University in Beijing, reiterated his recent themes: the U.S. jobless rate will top 10 percent by year-end; inflation is not an imminent threat; and the Fed will not "monetize" the huge increase in its balance sheet. "The innovative policies being pursued by the Federal Reserve will facilitate and, indeed, expedite the recovery process," he said.

- Sony Corp's Sony Pictures on Thursday became the sixth major studio to support a theater-chain upgrade to digitally convert 20,000 U.S. and Canadian cinema screens, at an estimated cost of more than $1 billion. Other studios announced in October they would back a theater-upgrade program with the Digital Cinema Implementation Partners (DCIP), a group of theater chains comprising Regal Entertainment Group, Cinemark Holdings Inc and AMC Entertainment Inc. The other studios include Walt Disney Co, Viacom Inc Paramount Pictures, News Corp's Twentieth Century Fox, General Electric Co's Universal Pictures and Lions Gate Entertainment. In October, the DCIP estimated it could complete the conversion within 3 to 3-1/2 years of a start date in early 2009, although some of the conversions have gotten pushed back due to the credit crisis. Once outfitted with digital projectors, theaters can then be modified to show 3-D films. Hollywood studios are investing heavily in 3-D on expectations these films will draw bigger audiences at premium ticket prices.

- GMAC LLC, the General Motors Corp (GM) financing affiliate that received a government bailout, said its mortgage unit is hiring 1,000 people to handle a surge in refinancings and jumbo loans.

- Two top Federal Reserve policy-makers took divergent views on the U.S. economy on Thursday, with the head of the Atlanta Fed seeing a return to growth later this year, while the head of the San Francisco Fed saw the potential for an even deeper contraction. Both policy-makers -- Dennis Lockhart, president of the Atlanta Fed, and Janet Yellen, president of the San Francisco Fed -- told a conference in New York that it was important to address how to regulate systemically important institutions, those seen as "too big to fail." Lockhart said he expects the recession to end by mid-year with growth slowly picking up in the following months."Today, the economy is still very weak, but there are some encouraging signs that support cautious optimism," Lockhart told the conference at the Levy Economics Institute in New York.

- Giant-screen movie theater company Imax Corp is not seeing the recession damage its box-office performance, its chief executive said on Thursday. "It seems that consumers are willing to pay a premium price for a premium experience, even in this environment," Richard Gelfond told Reuters in an interview. "I would be surprised to see the economic factors affect our box office unless (the environment) materially worsens."

Financial Times:
- Credit default swaps, the derivatives instruments that have figured prominently in the global financial crisis, are now being blamed for playing a role in two bankruptcy filings this week. Bankers and lawyers involved in restructuring efforts say they are concerned some lenders to troubled companies, such as newsprint producer AbitibiBowater and mall owner General Growth Properties, stand to benefit from a default because they also hold default swaps, which entitle them to payments in such events. “We have seen CDS becoming a significant factor” when negotiations on out-of-court restructurings fail, said Alan Kornberg, the partner in charge of the bankruptcy practice at Paul, Weiss, Rifkind, Wharton & Rice, speaking generally. “We used to talk about the practice theoretically but now we see cases where it is hard to get lenders to agree to tender or to compromise and then you find out that these holdouts had significant CDS protection.” Abitibi , which filed for bankruptcy protection on Thursday, ran into trouble as the dire state of the newspaper industry eroded its cash flow and left it unable to service its debt load. It sought to persuade debt holders to exchange bonds due in August for new debt with longer dated maturity and higher yields, but failed to do so as creditors squabbled. Such exchange offers require the support of a significant number of lenders, 97 per cent in the case of bondholders in this case. But those who withhold support often have powerful incentives to do so, either because they hope to be made whole or because they are seeking to force a filing that would trigger payments under their credit protection agreements, bankers and lawyers say. Some creditors, including Citigroup, which held a small exposure to AbitibiBowater, hedged themselves in the CDS market, meaning their economic interest in the deal was different to lenders who had not bought credit insurance, according to people familiar with the matter.

- General Motors(GM) is prepared to argue that hundreds of its suppliers are “critical vendors” who require timely payments if it seeks bankruptcy protection, setting the stage for what would be the most sweeping attempt ever to win special treatment for such contractors, people close to the matter say. Bankruptcy experts say GM would stand a good chance of winning protection for more suppliers than is usual because of the large number that provide “just-in-time” car parts to the company. By seeking permission to pay hundreds of suppliers, GM could mitigate damage to the car parts industry. People close to GM say the company would make the request regardless of where it filed its bankruptcy petition. “No matter what court they go into, they’ll get authority to pay whatever suppliers they need,” said one person close to GM. “In a GM bankruptcy, there won’t be very much fallout for suppliers except perhaps for suppliers of Saturn and Hummer.” Those two brands will be shut if they are not sold. More suppliers could drop outside the key vendor pool if GM is pressed to cull its portfolio further, targeting brands such as Pontiac.

- Barack Obama is “not always up to standard on decision-making or efficiency”, José Luis Rodríguez Zapatero is “perhaps not very intelligent” while Angela Merkel “had no choice but to come round to my position” when she saw the state of German banks. President Nicolas Sarkozy is well known for his blunt speaking and ascerbic observations. But even by his standards, insulting his American, Spanish and German counterparts – three of his closest allies – over a brief lunch is quite an achievement. In the space of three courses at the Elysée palace on Wednesday the French president suggested the new US president was inexperienced, hesitant and vague on certain policy issues, that the Spanish prime minister lacked brain power while the German chancellor did not share Mr Sarkozy’s foresight about the financial and industrial crisis unfurling across Europe last autumn.

China Business News:

- The China Iron and Steel Assoc. said a report that Japanese steelmakers may accept a 30% cut in iron ore prices was incorrect, citing Vice Chairman Luo Bingsheng. “As far as I know the report is untrue,” Luo said. Contract prices should fall more than 40% as steel prices have dropped to 1994 levels, citing the association’s general secretary Shan Shanghua.

Nation:

- Thailand’s economy may contract between 4.5% and 5% this year, more than earlier forecast, citing Finance Minister Korn Chatikavanij.

Business Times:

- Singapore landlords are charging lower rents for office space in the island’s central business district to retain tenants. Landlords are in negotiations for rents of less than S$10 per square foot in buildings including OUB Centre and Equity Plaza, located in Raffles Place. Tenants in Singapore Land Tower, owned by Singapore Land Ltd., have received offers of about S$7 a square foot. That’s down from the average monthly rent of S$12.30 for so-called Grade A space at the end of March, citing property broker CB Richard Ellis.

The Economic Times:

- NEW DELHI: For the first time in the past five years, Mumbai’s commercial real estate market is headed for an oversupply with a total of 16.02 million sq ft of new commercial office space expected to enter the market in 2009. However, demand has been dipping steadily. According to property consultancy Jones Lang LaSalle Meghraj (JLL-M), the demand for office space has dropped 60-80% compared to the peak period from late 2005 to early 2008. “Rentals are set to go down a further 20-25% in Mumbai owing to the mismatch in supply and demand. BFSI, which generated the most demand for the Mumbai market, has been hit the most in the recent times,” said Vivek Dahiya, CEO of property consultancy GenReal. The first quarter of 2009 saw a total supply of 2.47 million sq ft of new space in Mumbai, of which the total absorption of space is only 35%. The total absorption was only 896,454 sq ft. Rentals have been steadily falling in most major micro-markets of Mumbai. Rentals in Nariman Point are down 13% compared to last quarter and about 30% down compared to a year-ago. Worli, Lower Parel, Bandra Kurla Complex and Andheri-Kurla are the worst-hit, with rentals declining by 38%, 39%, 27% and 33%, respectively, over the last one year.

Nikkei:

- Toshiba Corp.may beat its full-year operating loss forecast because of cost cuts and a halt in chip-price declines.

Asahi:

- Nippon Steel Corp. and other Japanese steelmakers agreed with Toyota Motor Corp. to cut the price of steel by more than 10% for the year through March 2010. The price will be cut by about $151 a metric ton, the first reduction in seven years. Toyota may seek further reductions depending on the result of iron ore price talks.

Late Buy/Sell Recommendations
Citigroup:

- Rated (SPN) Buy, target $25.

- Reiterated Buy on (APH), target $37.

CSFB:

- Reiterated Underperform on (SQM), lowered target to $28.

Night Trading
Asian Indices are -.25% to +1.75% on average.
S&P 500 futures -.45%.
NASDAQ 100 futures -.843%.

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Company/EPS Estimate
- (AOS)/.40

- (BBT)/.31

- (C)/-.34

- (FHN)/-.25

- (GE)/.21

- (MAT)/-.13

- (ALGT)/1.26

- (PRSP)/.55

Economic Releases

10:00 am EST

- The Preliminary Univ. of Mich. Consumer Confidence reading for April is estimated at 58.5 versus 57.3 in March.

Upcoming Splits
- None of note

Other Potential Market Movers
- The Fed’s Hoenig speaking, Fed Chairman Bernanke speaking at Fed Conference, (SNY) annual meeting, (DHX) stockholders meeting and the (SSD) shareholders meeting could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by technology and financial 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 Near Session Highs, Boosted by Technology, Financial, REIT, Education and Homebuilder Shares

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