Bull Radar

Style Outperformer:
Small-cap Value (+2.10%)

Sector Outperformers:
Oil Service (+4.60%), Networking (+4.34%) and Software (+3.75%)

Stocks Rising on Unusual Volume:
INFA, TIN, HES, NFX, MSFT, FO, MICC, E, EVR, IMN, CB, TECD, RVBD, ALGN, STAR, CAKE, OPLK, BAGL, DDUP, AMZN, POWI, JNPR, IDXX, MCRI, LOGI, AMGN, HITT, NTGR, SYNA, LNCE, MHK, DSG, LHO, NTY, RZG, PNK, DEG, LTM, SNS, DV and EMN

Stocks With Unusual Call Option Activity:
1) RVBD 2) IBKR 3) GRMN 4) ONXX 5) CIT

Links of Interest

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Friday Watch

Late-Night Headlines
Bloomberg:

- Amazon.com Inc.(AMZN), the world’s biggest Internet retailer, reported first-quarter sales and profit that beat analysts’ estimates, bolstered by free shipping offers and demand for the Kindle electronic-book reader. Amazon.com rose 2.69 percent to $82.78 in extended trading after closing at $80.61 today on the Nasdaq Stock Market. The shares have soared 57 percent this year.

- American Express Co., the biggest U.S. credit-card company by purchases, beat analysts’ profit estimates and said that it intends to repay the government’s rescue-fund investment. The bank rose 6.6% in late New York trading.

- Microsoft Corp.(MSFT) rose as much as 5.9 percent in extended trading after reporting a smaller drop in third-quarter profit than some investors anticipated and predicting bigger cost savings this year.

- A group of Democrats on the House Energy and Commerce Committee want alterations to climate-change legislation to benefit the coal, oil and gas industries. Among recommendations to revamp a draft measure offered by the committee’s Democratic chairman will be slowing the pace of cuts in greenhouse-gas emissions and distributing free some emission credits that large polluters may otherwise have to acquire under a proposed cap-and-trade system, members of the group said today.

- Ford Motor Co.(F), the only major U.S. automaker surviving without federal aid, has more than doubled in the past seven weeks even as it prepares to announce its largest first-quarter loss in 17 years. The company may say tomorrow it lost $3.2 billion, or $1.33 a share, the average estimate of four analysts surveyed by Bloomberg about the quarter. Investors pushed Ford up to $4.49 today in New York Stock Exchange composite trading from $1.87 on March 4 on expectations it will be a strong survivor when the U.S. industry emerges from the worst sales in 27 years. “Ford is a completely different animal” than General Motors Corp. and Chrysler LLC, said Jeffrey Spotts, a New York- based portfolio manager at the $250 million Prophecy Fund which has been accumulating Ford shares since February. “Consumers don’t want to buy a car from a company that took money from the government or that might go bankrupt.”

- The pound and the euro fell against the US dollar after the Daily Telegraph said Moody’s Investors Service and Standard & Poor’s are reviewing the U.K.’s AAA credit rating on concern about the nation’s rising debt burden.

- Samsung Electronics Co. reported first-quarter profit that beat analyst estimates, led by higher- than-expected earnings at the mobile-phone division.

- The Markit iTraxx Japan Index fell 5 basis points to 330 as of 9:40 am in Tokyo, according to Barclays Plc, while the Markit iTraxx Australia index was down 7.5 basis points at 317.5 as of 8:50 am in Hong Kong, Citigroup Inc. prices show.

Wall Street Journal:

- The U.S. government may end up acquiring a significant ownership stake in banks as it works to stabilize the financial system, according to a draft report from top regulators -- the starkest acknowledgment yet of the extent to which the government could become intertwined with the financial system. The draft report from the Financial Stability Oversight Board, which consists of officials from the Federal Reserve and the Treasury Department, among others, says U.S. ownership of individual firms "is not an objective," and that any such occurrence would be temporary. Such an outcome would nonetheless raise a host of thorny questions about government control over private companies, including how deeply officials would delve into daily management decisions and whether the U.S. would exercise stock voting rights.

- Leading nations have already agreed to commit more than $340 billion to boosting the International Monetary Fund's resources, a Treasury Department official said Thursday. The Treasury official was speaking to reporters ahead of key meetings in Washington this week of international finance ministers and central bankers. During the Group of 20 London summit earlier this month, leaders agreed to dramatically boost IMF resources by $500 billion to boost its capability to help developing countries grapple with economic turmoil. So far, concrete commitments by individual nations total more than $340 billion.

- Weak demand is likely to lead to increased losses in the world steel industry next quarter, which could prompt consolidation, the shakeout of marginal players and lower prices, much of the industry now predicts. "The demand for steel is virtually nonexistent," says Dan DiMicco, CEO of steelmaker Nucor Corp., which reported a $189.6 million loss and said it expected a wider loss in the second quarter.

- Congressman Henry Waxman played to the crowds this week with high-profile hearings designed to boost his climate legislation. To listen to the Energy and Commerce committee chair, a House global warming bill is all but in the recyclable bag. To listen to Congressman Jim Matheson is something else. During opening statements, the Utah Democrat detailed 14 big problems he had with the bill, and told me later that if he hadn't been limited to five minutes, "I might have had more." Mr. Matheson is one of about 10 moderate committee Democrats who are less than thrilled with the Waxman climate extravaganza, and who may yet stymie one of Barack Obama's signature issues. If so, the president can thank Democratic liberals, who are engaging in one of their first big cases of overreach. Not that you couldn't see this coming even last year, when Speaker Nancy Pelosi engineered her coup against former Energy chairman John Dingell. House greens had been boiling over the Michigan veteran's cautious approach to climate-legislation. Mr. Dingell's mistake was understanding that when it comes to energy legislation, the divides aren't among parties, but among regions. Design a bill that socks it to all those manufacturing, oil-producing, coal-producing, coal-using states, and say goodbye to the very Democrats necessary to pass that bill.

- President Obama's global warming agenda has been losing support in Congress, but why let an irritant like democratic consent interfere with saving the world? So last Friday the Environmental Protection Agency decided to put a gun to the head of Congress and play cap-and-trade roulette with the U.S. economy. The pistol comes in the form of a ruling that carbon dioxide is a dangerous pollutant that threatens the public and therefore must be regulated under the 1970 Clean Air Act. This so-called "endangerment finding" sets the clock ticking on a vast array of taxes and regulation that EPA will have the power to impose across the economy, and all with little or no political debate.

NY Times:

- Alarm Grows Over Pakistan’s Failure to Halt Militant Gains.

Business Week:
- Sales of existing homes declined 3% in March, reversing February's surprising gain, the National Association of Realtors said on Apr. 23. But the market continues to show signs of stabilizing as first-time home buyers and investors jump in to scoop up bargains, analysts said.

CNNMoney:

- 24 Top-performing Stocks.

- The Cash Bubble Hasn’t Burst Yet. With the S&P 500 up 25% since early March, some investors -- particularly professional money managers -- may feel the need to chase the market's performance or face questions from customers about why they sat out the rally. Still, a lot of cash continues to sit on the sidelines. According to figures from ISI Group, the amount of money invested in money market funds and small certificates of deposit (CDs) make up more than 60% of the market's total valuation, as measured by the Wilshire 5000 index. The last time this measure of cash reserves was so high was in 1985. What's more, 28.5% of all U.S. stock mutual funds have more than 5% of their assets in cash, according to fund tracker Morningstar. Typically, any fund with more than 5% in cash is considered to be not fully invested in the market. In addition, more than 100 mutual funds are being ultra-conservative: they have more than 25% of their assets in cash.

Investors.com:

- Except for companies that have nowhere to go but up, MasterCard's (MA) business seems a lot like many others these days: It's apt to slow a bit before picking up speed. But MasterCard is doing a lot better than most.

Reuters:

- US officials testing the health of the nation's top banks must walk a tightrope when they disclose the exams' results: The scrutiny must be tough enough to be credible, but not so harsh as to rattle an already shaken system. "The challenging thing here is presumably they're going to be talking about some information that is not going to be at all flattering for some institutions," said Kevin Petrasic, a banking lawyer at Paul, Hastings, Janofsky & Walker in Washington.

- Chrysler's first-lien lenders are preparing another counter-offer to the U.S. Treasury that involves reducing the automaker's debt, sources familiar with the matter said on Thursday.

- Honda Motor Co expects to see some recovery in U.S. auto sales by summer and expects its own inventory levels to normalize by June, the company's president and chief executive said on Thursday. "I don't know the industry-wide sales trend in April, but by summertime we expect some recovery," Honda's Takeo Fukui told reporters on the sideline of an auto industry event sponsored by the automaker in Detroit.

- The global economic downturn has shown signs of easing in recent weeks, although significant risks remain, U.S. Treasury Secretary Timothy Geithner said before a meeting of G20 officials in Washington on Friday. Writing in the Financial Times newspaper, Geithner said the decline in world trade may be abating and conditions in some financial markets have improved.

Financial Times:
- Bankers’ bonuses and golden parachutes would be capped in all European Union countries under a draft policy circulating in Brussels that amounts to one of the broadest responses yet to concerns about executive pay. Under the European Commission recommendations, a copy of which has been seen by the Financial Times, the 27 EU countries would be asked to bring in tougher remuneration rules for financial institutions with an office within their borders, covering all staff whose activities affect the firm’s risk profile. The rules would also apply to subsidiaries of EU-based parents, including those in offshore centers. Directors’ termination payments would be limited to no more than two years of their fixed remuneration and they would also face a minimum three-year vesting period for share options. Financial companies would be able to withhold bonuses entirely or partly when performance criteria were not met and a major part of bonuses should be deferred, the policy says.

- Alistair Darling was warned on Thursday his new 50p income tax rate would drive talent from the City and discourage entrepreneurs, but early polls suggest that the chancellor’s Budget tax rises have tapped into rising popular hostility towards the rich. Mr Darling’s tax raid on higher earners was widely criticized in the press as a populist gesture to divert attention from spiraling government borrowing and a political tactic to wrongfoot the Conservatives. “There’s a definite sensation of ‘what’s next?’ The message is that high earners are not welcome here,” said Anna Chapman, a director of Ernst & Young’s private client services team. The head of one City institution with a strong private client business fumed, “What are they trying to do, drive all the high-earners out of London?”

- US banks could be forced to hold more equity than initially expected after it emerged that “stress tests” organized by regulators take into account risks not commonly understood to be included in the assessment. In addition to looking at potential losses on loans and securities, bank examiners are looking at so-called “counterparty risk” on derivative contracts – the chance that the party on the other end of a derivatives deal might default, depriving the bank of a payment that is due.

- The Obama administration will on Friday get the first indication of investor interest in its $1,000bn toxic assets plan amid fears that the threat of government intervention and banks’ reluctance to sell will deter fund managers from participating. Applications to become one of the five asset managers charged with raising funds to buy mortgage-backed securities from banks are due today and groups including BlackRock, Pimco and Bank of New York Mellon are set to apply. However, financial executives warn that the plan is in danger of missing its goal of quickly shifting billions of dollars in troubled assets off banks’ balance sheets unless the government dispels investors’ concerns. Potential buyers of assets complain that, a month after Tim Geithner, US Treasury secretary, unveiled the public-private investment program, the authorities have yet to reassure them they would not be subjected to draconian Congressional scrutiny. The Treasury did say that, aside from the small group of asset managers, investors who receive the generous loans available under the PPIP will not have to abide by restrictions on employees’ pay imposed on the banks that got funds from the troubled assets relief program. Yet some fund managers fear Congress and the government may change the rules mid-course, as they did with Tarp.

- Chesapeake(CHK), the largest independent producer of natural gas in the US, paid its chief executive more than $100m in total last year, bought millions of dollars worth of his art, sponsored his basketball team and approved a $75m bonus at least one institutional investor believes was paid to bail him out of personal financial difficulties. Chesapeake revealed in its SEC filings that it spent $12.1m on antique maps of the American Southwest, watercolours and books owned by Mr McClendon, spent $177,000 at Deep Fork Catering, of which he owns 50 per cent, and supported - to the tune of $4.6m in 2008 and 2009 - the Oklahoma City Thunder, a basketball team of which he holds just less than 20 per cent. The company is also a major donor to Oklahoma State University of which Burns Hargis, one of its independent directors, is president. At least one analyst is now advising other shareholders to put pressure on Chesapeake to change its ways, citing concerns the board appeared to lack independence. Benjamin Dell, analyst at Sanford Bernstein, yesterday advised shareholders to vote against allowing the company to increase the number of authorized common shares, warning that its board structure, corporate governance and dilution of ownership stakes created a material overhang for the stock.

Late Buy/Sell Recommendations
Citigroup:

- Upgraded (RIMM) to Buy, target $100.

JPMorgan:

- Downgraded (PTR) to Underweight.

Night Trading
Asian Indices are -.25% to +.75% on average.
S&P 500 futures -.40%.
NASDAQ 100 futures -.13%.

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Earnings of Note
Company/EPS Estimate
- (MMM)/.86

- (AEP)/.85

- (ACI)/.24

- (F)/-1.24

- (HON)/.54

- (ITT)/.58

- (SLB)/.73

Economic Releases

8:30 am EST

- Durable Goods Orders for March are estimated to fall 1.5% versus a 3.4% gain in February.

- Durables Ex Transports for March are estimated to fall 1.2% versus a 3.9% increase in February.

10:00 am EST

- New Home Sales for March are estimated at 337K versus 337K in February.

Upcoming Splits
- None of note

Other Potential Market Movers
- Treasury Secretary Geithner meeting with G7 Finance Ministers, (ABT) shareholders meeting, (T) shareholders meeting, (PGR) annual meeting, (XL) shareholders meeting, and the (K) 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 modestly higher. The Portfolio is 100% net long heading into the day.

Stocks Finish at Session Highs, Boosted by Financial, REIT, Restaurant, Gaming and Rail Shares

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In Play

Stocks Slightly Lower into Final Hour on Healthy Profit-taking

BOTTOM LINE: The Portfolio is slightly lower into the final hour on losses in my Retail longs and Medical longs. I haven’t traded today, thus leaving the Portfolio 100% net long. The tone of the market is mildly negative as the advance/decline line is lower, sector performance is mixed and volume is above average. Investor anxiety is high. Today’s overall market action is neutral. The VIX is falling 1.44% and is very high at 37.55. The ISE Sentiment Index is below average at 113.0 and the total put/call is above average at .94. Finally, the NYSE Arms has been running high most of the day, hitting 1.79 at its intraday peak, and is currently .93. The Euro Financial Sector Credit Default Swap Index is falling 1.48% today to 153.33 basis points. This index is down from its record March 10th high of 208.75. The North American Investment Grade Credit Default Swap Index is falling 1.21% to 182.99 basis points. This index is also well below its Dec. 5^th record high of 285.99. The TED spread is rising 3.31% to 100 basis points. The TED spread is now down 363 basis points since its all-time high of 463 basis points on October 10th. The 2-year swap spread is falling 4.90% to 61.81 basis points. The Libor-OIS spread is falling .45% to 89 basis points. The 10-year TIPS spread, a good gauge of inflation expectations, is up 12 basis points to 1.45%, which is down 119 basis points since July 7th. The 10-year TIPS spread bottomed at .65% in October 1998 during the Asian financial crisis and at 1.24% in October 2001 during the technology bubble-bursting meltdown. The 3-month T-Bill is yielding .09%, which is down 4 basis points today. Market-leading stocks are outperforming the major averages substantially today. A number of sectors are rising despite losses in the major averages, with strength seen in financial, rail, gaming, restaurant, reit, drug, energy, defense and coal shares. Tech shares are lagging on profit-taking after recent gains. Overall, it appears as though some healthy sector rotation is taking place. (XLF) has traded well throughout the day, which is always a meangingful broad market positive. The AAII % Bulls fell to 31.82% this week, while the % Bears rose to 38.64%, which is a big positive. I suspect the major averages will trade mixed-to-higher until the uncertainty over the bank stress tests begins to lift. Nikkei futures indicate an +18 open in Japan and DAX futures indicate an +34 open in Germany tomorrow. I expect US stocks to trade mixed-to-higher into the close from current levels on short-covering, diminishing economic fear and bargain-hunting.

Today's Headlines

Bloomberg:

- Investors should buy bullish options on companies with a higher concentration of their shares sold short because better-than-expected earnings may boost the stocks, Macro Risk Advisors LLC said. General Motors Corp., U.S. Steel Corp., Nordstrom Inc. and other companies with higher percentages of shorted shares are at risk of a “short squeeze” like the one that sent Sherwin- Williams Co. up the most in six months after results beat estimates, Macro Risk president Dean Curnutt wrote in a report. The New York-based strategist also cited Abercrombie & Fitch Co., AvalonBay Communities Inc., CenturyTel Inc., Cephalon Inc., Meredith Corp., Mylan Inc., Whole Foods Market Inc. and Wynn Resorts Ltd. as stocks at risk of being “squeezed” because they report earnings by May and have short interest of at least 15 percent.

- Sales of existing U.S. homes in March stayed near a four-month average, and prices rose from February, a sign the housing recession has stopped getting worse. Prices for home resales posted their biggest monthly gain since June 2005, and NAR chief economist Lawrence Yun said that some regions are seeing multiple bids on properties. Today’s housing figures indicate that the record-low mortgage rates fueled by the Federal Reserve are stanching the industry’s hemorrhage. “We’re seeing signs of some pickup in some of the sales activity -- we’re getting a lot of reports that banks are successfully selling off foreclosures,” Stephen Gallagher, chief U.S. economist at Societe Generale in New York, said in a Bloomberg Television interview. The rate for a 30-year fixed home loan declined to 4.80 percent from 4.82 percent a week earlier, Freddie Mac, the McLean, Virginia-based mortgage buyer, said today. Earlier this month the measure hit 4.78 percent, the lowest in Freddie Mac data going back to 1971. The number of houses on the market dropped 1.6 percent to 3.74 million. The NAR’s affordability index, which tracks mortgage rates, home prices and incomes, surged in February to the highest level in 20 years of data.

- General Electric Co.(GE) Chief Executive Officer Jeffrey Immelt defended the University of of Notre Dame’s invitation to President Barack Obama to speak at a graduation ceremony, after more than 300,000 people signed a petition against him making the address.

- Moody’s Investors Service downgraded its Latvian and Lithuanian credit ratings as the global financial crisis pushes the Baltic region into the European Union’s deepest recession. Latvia, with the worst contraction in the 27-nation EU in the fourth quarter, was cut to the lowest investment grade of Baa3 from Baa1. Lithuania’s foreign and local currency ratings were cut to A3 from A2, while Moody’s confirmed Estonia’s A1 rating. All three countries have a negative outlook. “The depth and pace of the economic adjustment is much more severe than previously anticipated” for Latvia, said Kenneth Orchard, a vice president and senior analyst in Moody’s Sovereign Risk Group.

- Mexican corporate defaults on high- yield foreign bonds may jump to 31 percent this year as the global recession crimps revenue and chokes off companies’ access to credit markets, JPMorgan Chase & Co. said. The default rate on overseas debt sold by Mexican companies will rise from 22 percent in 2008, already the highest in Latin America, JPMorgan analysts including Luis Oganes and Fabio Akira wrote in a report dated yesterday. Brazilian corporate defaults on high-yield foreign debt will climb to as high as 9 percent from 4 percent, according to JPMorgan.

- China probably isn’t adding to its copper stockpiles to diversify its foreign exchange reserves, contrary to some speculation in the metals markets, Commerzbank AG said.

- President Barack Obama is seeking to substitute Bush administration political appointees for intelligence-agency professionals as targets of public outrage over interrogation techniques used on suspected terrorists. Obama’s decision to rule out prosecuting those who conducted the interrogations reflects his need to avoid antagonizing the Central Intelligence Agency as the U.S. fights two wars and faces terrorist threats. Still, he risks a bruising political fight with Republicans furious over potential prosecutions of senior Bush administration officials. “When you get one administration prosecuting its predecessor, you start creating the conditions of a banana republic,” said Philip Heymann, a law professor at Harvard University in Cambridge, Massachusetts, who served as deputy attorney general under President Bill Clinton. “Every Republican in the country would think this was a dangerous attack on the two-party system.” Prosecuting Republican appointees may destroy any semblance of national security bipartisanship, as well as further expose Obama to opposition-party accusations that he’s jeopardizing the nation’s safety in case of another terrorist attack. Senator Russell Feingold, a Wisconsin Democrat, urged the president to hold open the possibility of prosecuting the interrogators. The American Civil Liberties Union and the other groups said they would present Attorney General Eric Holder with more than 250,000 signatures demanding an independent prosecutor begin a criminal investigation.

- European industrial orders fell the most in at least 13 years in February as the worldwide economic slump lowered demand for factory equipment and metals. Industrial orders in the euro area declined 34.5 percent from the year-earlier month, after a revised 34.3 percent drop in January, the European Union’s statistics office in Luxembourg said today. The February drop is the seventh straight decline and the largest since the data series began in 1996.

- Barclays Plc said the global financial crisis has aided its ambition to be one of the world’s largest banks as it indicated first-quarter performance was “well ahead” of last year. The third-biggest U.K. bank will continue to diversify its holdings after an “extraordinary shift” in the competitive environment over the past 18 months, Chief Executive Officer John Varley told shareholders at the company’s annual meeting today in London. Barclays has risen 86 percent this year, making it the best-performer in the FTSE 350 Banks Index, after announcing a profit for the second half of 2008, passing regulatory stress tests and selling its iShares unit for 4.4 billion pounds ($6.4 billion). The bank shunned government financing as Royal Bank of Scotland Group Plc and Lloyds Banking Group Plc slipped into state control.

- Potash Corp. of Saskatchewan Inc.(POT), the world’s largest fertilizer producer by market value, said 2009 profit will be less than it previously expected after North American sales of the crop nutrient reached “a virtual halt.” Earnings this year will be $7 to $8 a share, Saskatoon, Saskatchewan-based Potash Corp. said today in a statement. That’s less than the $10 to $12 a share the company forecast in January and trails the $9.33 average estimate of 14 analysts surveyed by Bloomberg.

Wall Street Journal:

- Auto loan delinquencies fell in March, especially among subprime borrowers, but first-quarter net losses on prime auto loan asset-backed securities jumped despite an 8% increase in the value of used vehicles, Fitch Ratings said.

- Combined DRAM and NAND revenue is likely to rise 3.6% in the second quarter from the first part of 2009. The sequential increases are expected to be 22% and 18% in the third and fourth quarters, respectively, iSuppli said.

CNBC:

- It’s one of the best times to buy real estate, Donald Trump, chairman and president of the Trump Organization, said in an interview with CNBC. It’s an amazing time to buy,” Trump said. “This is the best time I’ve ever seen to buy both real estate and probably other things. This is one of the great opportunities."

MarketWatch:
- Castle Hall Alternatives, the hedge fund industry's leading provider of operational due diligence, today published its latest White Paper, "The New Standard of Operational Due Diligence: Five Principles to Guide Best Practice." Chris Addy, Castle Hall's President and CEO, said "after the events of recent months, investors are re-examining their current and potential relationships with hedge fund managers. Many of the issues under discussion, including fees, liquidity, transparency and valuation, are driven by hedge funds' operational and business risks, not investment strategy and performance. This has created a new environment where skilled operational due diligence is now vital, not optional."

- Shares in Credit Suisse(CS) jumped over 12% Thursday after the bank said it returned to profit in the first quarter of 2009, easily beating market expectations thanks to a rebound from its investment-banking arm.

FINalternatives:

- The Big Apple remains the undisputed capital of the hedge fund world, according to the latest ranking of the world’s largest hedge fund managers. Almost six in 10 of the biggest hedge fund firms reside in New York or its suburbs, according to Alpha magazine’s annual ranking. Forty-four of the top 100 firms are based in the city itself, including six of the top 10 and 13 of the top 25. The city’s suburbs boast another 13 of the 100 largest hedge fund managers. Ten are based in Connecticut, including the world’s biggest, Bridgewater Associates, with one each in Long Island, New Jersey and Westchester County, N.Y.

Politico:

- Sen. John McCain (R-Ariz.) warned Thursday that any attempt by the Obama administration to prosecute the Bush-era lawyers who wrote memos signing off on waterboarding would start a “witch hunt.” “If you criminalize legal advice, which is basically what they're going to do, then it has a terribly chilling effect on any kind of advice and counsel that the president might receive,” McCain said during an interview on CBS’s “Early Show.”

Reuters:
- Banks and the U.S. housing market are past the crisis stage and are now on a path to recovery, a top U.S. regulator said on Thursday. "We're in the clean-up stage now," Sheila Bair, chairman of the Federal Deposit Insurance Corp, said at a financial reform conference.

- China celebrated its military confidence at sea on Thursday, when anniversary celebrations for the founding of its navy climaxed with a show of the warships and submarines projecting its spreading power. The fleet parade off the mist-shrouded eastern port city of Qingdao marks 60 years since the founding of the People's Liberation Army Navy, long the somewhat neglected arm of China's military forces. The spectacle included two of China's nuclear-powered Long March submarines, vessels capable of firing ballistic missiles far from the country's shores, the China Daily reported.

- The hedge fund and private equity industries attacked a draft European Commission directive designed to regulate their activities and due to be published next week. Trade associations representing both sectors on Thursday characterized the draft as a rush job heavily influenced by politicians seeking to score short-term electoral points.

TimesOnline:

- An unprecedented number of cancelled orders is thought to have cost Asian shipyards more than $25 billion (£17 billion) in lost revenues. Two of the world's largest fleet owners estimate that worldwide between 250 and 300 orders for bulk carrier, liquefied natural gas (LNG) tankers and container ships may have been cancelled this year, The Times was told in Tokyo on Wednesday. Plunging commodity demand from China has created a large surplus supply in bulk carriers, which is thought to have accounted for as much as half the order cancellations. Taking such a step is usually viewed as a last resort for ship owners because of the expensive loss of deposits and, in some cases, additional penalty payments. Moreover, Roy Thomson, a regional marine manager in Asia for Lloyds Register, speaking at the Sea Asia 2009 conference in Singapore, said that the number of cancellations would rise. “We have not got to the root of it yet,” he said. Brokers in London said that as much as half the global order book might be cancelled, a process that could hasten a recovery in shipping rates. The problems are not restricted to bulk carrier fleets. Analysts are warning that it is “only a matter of time” before a big container ship operator declares bankruptcy in a collapse that would add a fresh layer of disruption to the already turbulent world of global shipping.

Financial Times Deutschland:

- German house prices dropped 9% in the first quarter because of the global financial crisis, citing the Hypoport Index. The average price for a house fell to 168,375 euros from 185,000 euros during the quarter, the biggest percentage decline since the index was created in January 2005. An excess of properties on the market was exacerbated by the credit crunch.

National Business Daily:

- Three-fourths of Chinese industries are experiencing a trend of profit declines, citing Lou Qinjian, vice minister of the Ministry of Industry and Information Technology. The nation’s automobile industry has capacity to produce 12 million vehicles a year, while demand is only about 9.5 million cars annually, Lou said.