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Thursday Watch

Late-Night Headlines
Bloomberg:

- Anthony Bolton, president of investments at Fidelity International, said financial shares are set to rally and ignite an equity bull market. Low valuations indicate recent gains that began in March are the start of a bull market, Bolton said. He favors financials, consumer cyclical, technology, and “value stocks,” such as retailers, automakers and construction-related shares. “All the things are in place for the bear market to have ended,” Bolton said in an interview with Bloomberg TV. “When there’s a strong consensus, a very negative one, and cash positions are very high, as they are at the moment, I’d like to bet against that.”

- The cost to protect against a default on North American corporate bonds dropped the most in 12 days amid signs that the worst of the recession may be over. Credit-default swaps on a benchmark index of U.S. and Canadian corporate debt dropped the most since April 13, according to CMA DataVision. Sentiment appeared to have been bolstered as consumer spending last quarter climbed at a 2.2 percent annual pace, more than the 0.9 percent economists had estimated, said Mikhail Foux, credit strategist at Citigroup in New York. “If the consumer bottoms,” Foux said, investors are optimistic that “this quarter and next quarter we’ll have better-than-expected economic numbers.” Credit swaps on the Markit CDX North America Investment- Grade Index Series 12, linked to the bonds of 125 companies in the U.S. and Canada, dropped 9 basis points to 168 basis points as of 5:35 p.m. in New York, according to London-based CMA. A decline in the derivatives typically signals improvement in investor confidence.

- The Markit iTraxx Japan index fell 13 basis points to 342 as of 9:45 am in Tokyo, Morgan Stanley prices show. The Markit iTraxx Asia index of 50 investment grade borrowers outside Japan fell 12 basis points to 293 as of 9 am in Hong Kong, according to ICAP Plc. The Markit iTraxx Australia index was quoted 15 basis points lower at 310 as of 10:10 am in Sydney, National Australia Bank Ltd. data show.

- Visa Inc.(V), the world’s largest electronic payments network, said profit rose 71 percent as consumers relied more on debit cards to make purchases. Net income rose to $536 million, or 71 cents a share, in the fiscal second quarter, from a pro forma $314 million a year earlier, the San Francisco-based company said today in a statement. Adjusted net income was 73 cents a share, beating the 65-cent average estimate of 23 analysts surveyed by Bloomberg.

- First Solar Inc.(FSLR), the world’s largest manufacturer of thin-film solar power modules, said first-quarter profit more than tripled as production costs fell and utilities increased demand for renewable energy. Net income climbed to $164.6 million, or $1.99 a share, from $46.6 million, or 57 cents a share, a year earlier, Tempe, Arizona-based First Solar said in a statement today. That beat the $1.50 a share average estimate of 16 analysts compiled by Bloomberg. Sales doubled to $418.2 million from $196.9 million. First Solar surged 13 percent in aftermarket trading following the release of results.

- Beverly Hills hedge-fund manager Bradley Ruderman was sued by U.S. regulators for allegedly lying to clients about losses and falsely claiming Oracle Corp. Chief Executive Officer Larry Ellison was among his investors. Two hedge funds at Ruderman’s firm, Ruderman Capital Management LLC, raised at least $38 million since 2002, the Securities and Exchange Commission said today in a statement announcing the suit at federal court in Los Angeles. Though the 46-year-old manager claimed annual profits of 15 percent to 61 percent, the funds lost millions of dollars and were valued at less than $1 million at the end of 2008, the agency said.

- Individual holders of General Motors Corp. bonds, dubbing themselves “silent sufferers,” called on President Barack Obama’s car task force to press the automaker for a sweeter offer for their debt. GM imperils small investors with its proposal to swap 225 new shares of stock for each $1,000 in principal under its April 27 plan to cut liabilities and win more federal aid, bondholders said today at a meeting in Warren, Michigan. “What we want to do today is to put a human face on who these bondholders are,” Warren Mayor Jim Fouts said. “These small bondholders are the silent sufferers in this situation.”

- Bill Gross, who run the world’s biggest bond fund at Pacific Investment Management Co., said the Federal Reserve is “saving ammunition” by refraining from increasing purchases of Treasuries and mortgage securities at today’s policy meeting. “Obviously they have come to the conclusion that they don’t need anything,” more at the moment, Gross said in a Bloomberg Television interview. “We by no means are out of the woods. The real problem is a delevering economy that continues and is requiring Fed purchases.” Pimco expects the Fed to add to its program of buying Treasuries if rising yields make it difficult to drive down mortgage rates, Gross said.

- Dendreon Corp.’s(DNDN) 69 percent plunge yesterday began with orders to sell hundreds of thousands of shares at whatever price buyers would pay for them. More than 3 million Dendreon shares changed hands as the stock fell from $24.25 to as low as $7.50 in 70 seconds, before trading was halted at 1:27 p.m. in New York, according to data compiled by Bloomberg. In the first 20 seconds of the sell-off, more than 260,000 shares were sold at the so-called bid price, or about 60 percent of the total, showing investors were willing to accept almost any offer to unload the stock. Shareholders who sold were burned when the Seattle-based drug developer said minutes after the halt that its Provenge cancer treatment extended the lives of men in a clinical study, spurring a rally of more than 130 percent after hours. The Nasdaq Stock Market investigated the drop and said it would take no action. “It could have been manipulation; somebody could’ve been trying to make things run the wrong way. Or it could’ve been panic for no reason at all.” Short interest in Dendreon, the number of shares that have been borrowed and sold in anticipation of a price decline, totaled 21.6 million as of April 15, more than a fifth of the number available for trading. Hedge funds own 35 percent of the shares, according to data compiled by Bloomberg. “This time there’s a lot less leverage rolling around, but there’s still guys who made major, major bets against the data,” said David Miller, chief executive officer of Biotech Stock Research in Seattle. “If it turns out there were shenanigans, it doesn’t surprise me at all. There’s a lot of incentive to do that because guys were once again really short this stock.”

- Goldman Sachs Group Inc.(GS), the fifth-biggest U.S. bank by assets, took advantage of a rise in its share price today to sell 6.1 million shares, increasing the total raised in a stock sale this month to $5.75 billion, according to data compiled by Bloomberg.

- Honda Motor Co., Japan’s second- largest automaker, rose as much as 6 percent after the company forecast a profit for the current year on optimism the U.S. car market may recover. The stock added as much as 155 yen to 2,755 yen and traded at 2,750 yen as of 9:16 a.m. on the Tokyo Stock Exchange. Other auto shares also gained.

- Europe’s economy will probably lag behind the U.S., and government debt in the region may outperform Treasuries, according to Pacific Investment Management Co., which runs the world’s largest bond fund. “In the Eurozone and the U.K. we expect very weak growth -- worse in fact than in the U.S.,” Andrew Balls, the head of Pimco’s European investment team in London, wrote in a report on the company’s Web site. “There is some limited room for gains in the U.K. and the Eurozone, while yields in the U.S. are likely to be range-bound for some time.” “We don’t expect rate hikes in the U.K. or Eurozone in the next one to two years,” the report said. “Central banks are signaling an extended holding period.”

- Taiwan’s stock index rose the most since 1991 and the currency rallied after the island allowed Chinese investments for the first time since a civil war ended six decades ago.

- Japan’s industrial output rose for the first time in six months and at twice the pace predicted by economists, indicating the economy may resume expanding as soon as this quarter.

Wall Street Journal:

- Apple Inc.(AAPL) is building a significant capability to design its own computer chips, a strategy shift that the company hopes will create exclusive features for its gadgets and shield Apple's work from rivals. The Silicon Valley trend-setter has been hiring people from many different segments of the semiconductor industry, including engineers to create multifunction chips that are used in cellphones to run software and carry out other chores. Apple could use the internally developed chips to sharply reduce the power consumption of its hit iPhone and iPod touch devices, and possibly add graphics circuitry to help its hardware play realistic game software and high-definition videos, people familiar with its plans say.

- Gettelfinger Motors. The mauling of GM’s bondholders reveals Treasury’s political hand. President Obama insisted at his press conference last night that he doesn't want to nationalize the auto industry (or the banks, or the mortgage market, or . . .). But if that's true, why has he proposed a restructuring plan for General Motors that leaves the government with a majority stake in the car maker?

- The top securities regulator in Massachusetts said he is investigating whether State Street Corp. misled pension funds by telling customers that funds that invested in volatile fare such as mortgage-backed securities were low-risk vehicles.

- General Motors Corp.(GM) confirmed Wednesday it will force some salaried workers to take up to three months off with partial pay as part of an effort to reduce costs during its expected summer shutdown of its car-making plants. The program, called Salaried Downtime Paid Absence Policy, states that salaried and executive employees could be required to take time off in one-week increments. During the time off, an employee's salary would be reduced to 75% of full salary. The program is in effect starting Friday. GM told employees that any required time-off at a 25% pay cut will not exceed more than 12 weeks in a calendar year. It could be mandated during periods when there is lack of work, according to an employee briefed on the program. For an employee asked to take time off for the entire 12 weeks under the program, the salary cut would amount to about 5.8% of total salary.

- Bank of America Corp.(BAC) shareholders voted to strip Kenneth Lewis of his duties as chairman, weakening the embattled chief executive as he struggles to steady the troubled bank and fend off criticism of his rocky takeover of Merrill Lynch & Co.

- The World Health Organization warned countries Wednesday that a global pandemic from a new strain of flu appeared imminent, as the number of ill continued to grow and the first death outside Mexico was reported in Texas.

- President Barack Obama said he wants to get the government out of the private sector as fast as possible -- but that as long as his administration is acting as a major shareholder for large sectors of American commerce, from cars to finance, he won't hesitate to shape decisions at those firms.

- Congress passed a $3.5 trillion budget outline for 2010, handing President Barack Obama a victory on the 100th day of his presidency and helping set the stage for a significant shift in national priorities. The new budget, which aims to reverse the Bush administration approach of limited government, would set up special funds to pay for sweeping changes in health care, energy and education. Democrats said the plan would cut the federal deficit-which is projected to total $1.2 trillion in fiscal year 2010 beginning Oct. 1 -- by more than half in five years. Republicans disputed the assertion.

- As of late Wednesday, a measure allowing judges to reduce the mortgages of homeowners in bankruptcy court, known as "cramdown," didn't have the 60 votes needed to pass a procedural vote in the Senate, where Republicans still have the numbers needed to block legislation. The measure lacks the support of some Democrats as well, amid opposition by community banks and credit unions.

NY Times:

- North Korea said Wednesday that it would start a uranium enrichment program, declaring for the first time that it intended to pursue a second project unless the United Nations lifted sanctions. Calling the Security Council “a tool for the U.S. highhanded and arbitrary practices,” North Korea also threatened to conduct nuclear and intercontinental ballistic missile tests.

- In the devastating slump that has forced two of Detroit’s automakers to the brink of bankruptcy, the United Automobile Workers union stands to become one of the industry’s few winners. According to restructuring plans proposed this week, the union will have more than half the stock in Chrysler and a third of General Motors, meaning it will have tremendous influence, with the government, in determining the future of the companies.

Washington Post:

- Chrysler chief executive Robert Nardelli would be replaced by the management of Italian automaker Fiat under a bankruptcy plan that the United States is preparing for the storied automaker, sources familiar with the matter said. While the government is holding out hope that the bankruptcy could be averted at the 11th hour, the administration has detailed plans in which the ownership of Chrysler would be dramatically reordered and the company would receive billions more in aid from the United States and Canada, where the company has substantial operations, industry sources said. These governments would provide about $4 billion in new funds while Chrysler is in bankruptcy, with 80 percent of the funds coming from the United States and 20 percent from Canada, the sources said. As the company emerges from its reorganization, the United States would provide roughly another $5 billion, with more coming from Canada, the sources said.

BusinessWorld:

- London-based think tank Economist Intelligence Unit (EIU) has turned up the gloom on the Philippines, saying in a report on its Web site this month that the economy may contract by as much as 1.9% from an earlier projection of 0.6% growth, as growth drivers such as exports and remittances suffer from the global economic crisis. EIU also projects Thailand to contract by 4.4%, Malaysia by 3% and Indonesia by 1.48%. However, it expects Vietnam to still grow by 1.6%.

Time:

- Lew Ranieri, the man who built the market for mortgage securities in the 1980s (and proud member of TIME's list of 25 People to Blame for the Financial Crisis), was very early in predicting that subprime mortgage lending was going to result in a really big mess. I first heard of about his gloomy views on the subject in 2007, but Michael Milken—who is moderating a panel with Ranieri on it right now at his annual hoedown in Beverly Hills—says Ranieri began sounding warnings in 2005. Well, Ranieri is warning no more: I'm actually very enthusiastic about housing. I haven't said that in five years. … Not only are we within shouting distance of a bottom, we are standing at beginning of an amazing brave new world. … Affordability has never been this good.

Forbes.com:

- Coffee company Green Mountain Coffee Roasters Inc.(GMCR) said Wednesday its fiscal second-quarter profit more than doubled as revenue grew, and it signed a distribution deal with Wal-Mart Stores Inc.(WMT) The company also raised its full-year outlook and shares soared 20.4% in after-hours trading.

USA Today.com:

- OK, it was a PR stunt. But it's still impressive that an mpg-obsessed team drove a showroom-stock Ford Fusion gas-electric hybrid around Washington, D.C., the gridlock capital of the Free World, for 1,445 miles on one tank of gas (video here). For those of you keeping score that works out to 81.5 mpg, nearly double the 2010 Fusion hybrid's government rating of 41 mpg in city driving.

Reuters:

- Fed says US recession appears to be easing.

- Sumner Redstone, executive chairman of CBS Corp, said on Wednesday that he thinks the U.S. stock market is at the start of a bull market. "I think we're in the beginning of a bull market. When a bull market begins, nine months later the economy turns around," said the media mogul at the Milken Institute, who said he felt like he had the vital statistics of 20 year old. "It was always tough, but today we are in the throes of something we have never seen in our history. It's clear in recent times the market is looking for a bottom." "The news was extremely bad on the GDP and the market went up. In a bull market, the market ignores bad news. Today, we ignored extremely bad news," Redstone said in a Q&A session with CNN's Larry King.

TimesOnline:

- The role of the City of London as one of the world’s preeminent financial centers came under attack for the second time in two weeks yesterday, this time from proposed EU rules for private equity and hedge funds. The EU wants private equity firms with more than €500 million under management and hedge funds with more than €100 million of funds to file detailed financial information with the Financial Services Authority. Private equity firms will also need to file figures relating to debt, risk and cash. If the European Parliament approves the proposed legislation, about 1,000 British companies – owned by private equity firms either headquartered or with an office in the EU and with more than €500 million under management – would be saddled with annual compliance costs estimated at about £30,000. The financial and business community said that the move threatened both Britain’s economic recovery and the City’s status as one of the world’s most respected financial centers.

China Daily:

- The nation's stimulus package has benefited energy conservation and emission controls with energy used to generate growth dropping further in the first quarter, the National Bureau of Statistics (NBS) has said. Energy intensity, or the amount of energy needed to generate per unit of GDP, dropped 2.89 percent year on year from January to March. That compares with a drop of 2.62 percent in the first quarter of 2008. Overall energy consumption grew only 3.04 percent in the first quarter from a year earlier while the economy expanded 6.1 percent, the bureau said in a statement.

Late Buy/Sell Recommendations
Citigroup:

- Reiterated Buy on (SLAB), target $41..

Night Trading
Asian Indices are +1.25% to +3.25% on average.
S&P 500 futures +.62%.
NASDAQ 100 futures +.65%.

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Earnings of Note
Company/EPS Estimate
- (NYX)/.39

- (PTEN)/.14

- (STRA)/1.97

- (HOT)/.04

- (IP)/-.04

- (TBL)/.16

- (OC)/-.04

- (WMB)/.19

- (CMCSA)/.23

- (CAH)/.95

- (IRM)/.12

- (COCO)/.23

- (EXPE)/.15

- (MWW)/-.11

- (CI)/.90

- (DOW)/-.19

- (MOT)/-.10

- (EK)/-.44

- (VIA/B)/.25

- (K)/.79

- (APA)/.34

- (MXIM)/-.02

- (MORN)/.39

- (DLB)/.47

- (CEC)/1.30

- (QLGC)/.21

- (MET)/.33

- (ACS)/.93

- (IM)/.13

- (ATHN)/.12

- (BWA)/-.20

- (D)/.87

- (XOM)/.95

- (LVS)/-.02

- (MRO)/.39

- (DPZ)/.17

- (OMX)/.16

- (PG)/.81

- (GM)/-10.97

- (CL).96

- (CMI)/.25

- (MFE)/.48

- (MCHP)/.12

- (NEM)/.41

- (TRV)/1.31

- (CELG)/.43

- (DNA)/.89

Economic Releases

8:30 am EST

- Personal Income for March is estimated to fall .2% versus a .2% decline in February.

- Personal Spending for March is estimated to fall .1% versus a .2% increase in February.

- PCE Core for March is estimated to rise .1% versus a .2% gain in February.

- The 1Q Employment Cost Index is estimated to rise .5% versus a .5% gain in 4Q.

- Initial Jobless Claims for last week are estimated at 640K versus 640K the prior week.

- Continuing Claims are estimated to rise to 6200K versus 6137K prior.

9:45 am EST

- The Chicago PMI for April is estimated to rise to 35.0 versus 31.4 in March.

Upcoming Splits
- None of note

Other Potential Market Movers
- The NAPM-Milwaukee, weekly EIA natural gas inventory report, (BDK) shareholders meeting, (AZN) annual meeting, (GLW) shareholders meeting and the (SCHW) business update could also impact trading today.

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

Stocks Finish Sharply Higher, Boosted by Gaming, Hospital, Bank, Networking, Alt Energy, REIT and Homebuilding Shares

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In Play

Stocks Sharply Higher into Final Hour on Falling Credit Market Angst, Diminishing Economic Fear, Declining Financial Sector Pessimism, Short-Covering

BOTTOM LINE: The Portfolio is higher into the final hour on gains in my Biotech longs, Medical longs, Retail longs, Technology longs and Financial longs. I added to my (URBN) long and took profits in another long today, thus leaving the Portfolio 100% net long. The tone of the market is very positive as the advance/decline line is substantially higher, every sector is rising and volume is about average. Investor anxiety is above average. Today’s overall market action is very bullish. The VIX is falling 5.45% and is very high at 35.93. The ISE Sentiment Index is below average at 121.0 and the total put/call is slightly below average at .74. Finally, the NYSE Arms has been running about average most of the day, hitting .94 at its intraday peak, and is currently .61. The Euro Financial Sector Credit Default Swap Index is falling 3.81% today to 150.0 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 5.17% to 168.79 basis points. This index is also well below its Dec. 5^th record high of 285.99. The TED spread is rising 1.13% to 93 basis points. The TED spread is now down 370 basis points since its all-time high of 463 basis points on October 10th. The 2-year swap spread is unch. at 55.50 basis points. The Libor-OIS spread is falling 1.23% to 83 basis points. The 10-year TIPS spread, a good gauge of inflation expectations, is up 3 basis points to 1.54%, which is down 110 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 3 basis points today. The euro financial sector credit default swap index appears to be rolling over again technically, which is a large broad market positive. Moreover, the North American Investment Grade Credit Default Swap Index is breaking down to the lowest level since October 7^th of last year, which is a major positive. The S&P 500 is now only -2.3% lower for the year after this month’s 9.7% surge higher. I still see much evidence that many large funds are positioned net short or seriously underexposed to US stocks. A close above 880 in the S&P 500 would likely trigger another meaningful round of short-covering. Nikkei futures indicate an +400 open in Japan and DAX futures indicate an +25 open in Germany tomorrow. I expect US stocks to trade mixed-to-higher into the close from current levels on less economic fear, short-covering, declining financial sector pessimism, investment manager performance anxiety and diminishing credit market angst.

Today's Headlines

Bloomberg:

- The U.S. economy plunged again in the first quarter, making this the worst recession in at least half a century. Gross domestic product dropped at a 6.1 percent annual pace, weaker than forecast, after contracting at a 6.3 percent rate in the last three months of 2008, the Commerce Department said today in Washington. The report, which reflected a record slump in inventories and further declines in housing, comes hours before Federal Reserve officials decide how much money to pump into the economy. Smaller stockpiles may set the stage for a return to growth in the second half of the year amid signs Fed efforts to reduce borrowing costs and unclog lending are starting to pay off. “Businesses are running about as lean as they possibly can be. It sets up the reality that any sort of increase in demand will cause firms to have to increase production.” As a result, Naroff predicted growth won’t “be nearly as bad in the current quarter, and will probably be reasonably good.” Consumer spending, which accounts for about 70 percent of the economy, climbed at a 2.2 percent annual pace last quarter, the most in two years.

- Dendreon Corp.(DNDN)than doubled in market value, wiping out yesterday’s 45 percent plunge that caused a trading halt before the biotechnology company said its lead drug candidate worked against prostate cancer. The shares climbed to $23.76 at 12:45 p.m. New York time, from $11.81 yesterday, when the Nasdaq Stock Market halted trading in the company at 1:27 p.m. The drug, Provenge, extended the lives of men with advanced prostate cancer by four months in a study that Seattle-based Dendreon presented yesterday to a meeting of the American Urological Association in Chicago. Provenge, if approved, would be the first drug designed to train the body’s immune system to attack cancer cells like a virus. The medicine stands to generate $2 billion a year in revenue, said Joel Sendek, an analyst for Lazard Capital Markets Ltd. in New York.

- The U.S. economy is “leveling off at a low level” and doesn’t need a second fiscal stimulus package, said former Federal Reserve Chairman Paul Volcker, one of President Barack Obama’s top economic advisers.

- Companies worldwide are likely to rebuild inventories through September, spurring a surge in production of goods and services, according to Tim Rocks, an equity strategist at Macquarie Group Ltd. “The largest restocking cycle in living memory is under way,” Rocks wrote. “Production should now bounce.” Transportation, technology and capital-goods companies may benefit most from the recovery, he wrote, as they tend to have “an easing of earnings pressure” in times of inventory growth. Banks and real-estate companies may be in a similar position.

- Lending to euro-region companies and households declined for a second month in March, extending the worst drop since records began 18 years ago and threatening to exacerbate a recession. Loans fell 0.2 percent from February, when they declined 0.1 percent, the European Central Bank said in Frankfurt today. While a separate report showed banks expect to tighten credit standards less forcefully in the second quarter, the European Commission said consumers now expect prices to fall for the first time since at least 1990. “The hard lending data shows that the ECB is facing a deflation problem and will have to act more aggressively,” said James Nixon, an economist at Societe Generale SA in London and a former ECB forecaster. “Unfortunately, the Governing Council will probably latch on to the more positive bank survey and do a lot less than is necessary in the current environment.”

- European Central Bank Executive Board member Juergen Stark said the bank will only implement additional non-standard policy measures once interest rates have reached a floor. “We will decide about the remaining moderate room for maneuver on interest rates” at the next policy meeting on May 7, Stark today said today in a speech in Siegen, Germany. “At the same time we will make a decision about additional non- standard measures, which we will implement when the lower interest-rate limit is reached.”

- At least six of the 19 largest U.S. banks require additional capital, according to preliminary results of government stress tests, people briefed on the matter said. While some of the lenders may need extra cash injections from the government, most of the capital is likely to come from converting preferred shares to common equity, the people said.

Wall Street Journal:

- The Securities and Exchange Commission, hoping for a better shot at catching the next big fraud, is working on plans to set up teams of specialists who focus on specific kinds of wrongdoing.

- Hillary Clinton dropped out of the presidential election last June, but her campaign committee continued to raise millions of dollars this year by selling access to a valuable asset: Mrs. Clinton's vast list of political supporters. In the first three months of 2009, Mrs. Clinton's presidential campaign brought in $4.5 million by selling or renting out the list, which has contact information for more than a million people.

- The World Health Organization said Wednesday that a deadly new strain of swine flu is moving closer toward becoming a pandemic, as it continues to spread to new corners of the globe and as the U.S. reported its first death from the disease.

- Spain's top investigative magistrate opened an investigation into the Bush administration Wednesday over alleged torture of terror suspects at Guantanamo Bay. Judge Baltasar Garzon said documents declassified by the new U.S. government suggest the practice was systematic. Judge Garzon said he was acting under Spain's observance of the principle of universal justice, which allows crimes allegedly committed in other countries to be prosecuted in Spain. Judge Garzon's move is separate from a complaint by human rights lawyers that seeks charges against six specific Bush administration officials they accuse of creating a legal framework to permit torture of suspects at Guantanamo Bay and other U.S. detention facilities.

NY Times:

- As Washington pushes banks to mend their finances, the banks are pushing back. Emboldened by newfound profits and eager to shake off federal control, a growing number of banks are resisting the Obama administration’s proposals for fixing the financial system. Lenders that skirted disaster only months ago with the help of taxpayer dollars are now balking at government prescriptions. Despite pressure from federal regulators, industry executives are taking issue with major elements of the president’s bank plan.

- London Ponders Its Future as Financial Powerhouse.

MarketWatch:
- Shares of Time Warner Cable Inc.(TWC) were up 8% Wednesday morning after the company showed that subscriber growth is improving after recent quarters of decline and that it has been able to keep its costs under control. The stock was up $2.08 at $29.33.

CNNMoney.com:

- It's been a busy few weeks for Gilead Sciences(GILD). Since Fortune last checked in on it, the biotech has reported record first-quarter revenues, completed its all-cash acquisition of CV Therapeutics, and launched the Phase II trials of its most promising pipeline product, the four-in-one, once-daily HIV "quad pill." Now Gilead is in the spotlight again. As governments formulate their responses to the deadly swine flu outbreak, which has already claimed over 100 lives in Mexico and triggered a worldwide public health emergency, Gilead is one of the drugmakers that could benefit.

WCBSTV.com:

- A furious President Barack Obama ordered an internal review of Monday's low-flying photo op over the Statue of Liberty. CBS 2 HD has discovered the feds will have plenty to question. Federal officials knew that sending two fighter jets and a 747 from the presidential fleet to buzz ground zero and Lady Liberty might set off nightmarish fears of a 9/11 replay, but they still ordered the photo-op kept secret from the public. In a memo obtained by CBS 2 HD, the Federal Aviation Administration's James Johnston said the agency was aware of "the possibility of public concern regarding DOD (Department of Defense) aircraft flying at low altitudes" in an around New York City. But they demanded total secrecy from the NYPD, the Secret Service, the FBI and even the mayor's office and threatened federal sanctions if the secret got out. "To say that it should not be made public knowing that it might scare people it's just confounding," Sen. Charles Schumer said. "It's what gives Washington and government a bad name. It's sheer stupidity." The cost of the frivolous flight was about $60,000 an hour and that was just for the presidential aircraft. That doesn't include the cost of the two F-16s that came along. The flight by the VC-25, a modified Boeing Co. 747, and two F-16 fighter jets cost $328,835, Air Force spokeswoman Vicki Stein said. The NYPD was so upset about the demand for secrecy that Police Commissioner Ray Kelly vowed never to follow such a directive again and he accused the feds of inciting fears of a 9/11 replay.

Politico:

- A hedge fund with some ties to Vice President Joe Biden's family was shuttered by the Securities and Exchange Commission Monday due to allegations of fraud. The finance blogger John Hempton was the first to note that Biden family company, Paradigm Global Advisors, which is led by Biden's brother James and his son Hunter shares an address with the closed fund, Ponta Negra. The Wall Street Journal reported that the Biden company -- a fund of hedge funds -- also shares a marketing company with Ponta Negra -- a marketing company that also marketed funds for alleged Ponzi schemer Alan Sanford.

Reuters:
- European Central Bank Governing Council member Ivan Sramko said the bank may have to revise down its growth forecast fort the euro area. “Risks have been identified that it will go further down,” Sramko said.

- Goodyear Tire & Rubber Co (GT) posted a narrower-than-expected quarterly loss on Wednesday as it accelerated cost cuts and reduced inventory in response to a deep economic downturn, sending its shares up nearly 12 percent.

- Goldman Sachs Group (GS) on Wednesday sold $2 billion of notes not backed by a government guarantee, in a sign of an incipient thaw in credit markets, analysts said. "That's a good sign for the banking sector," said William Larkin, portfolio manager with Cabot Money Management in Boston, with both Goldman and JPMorgan starting to issue bonds that are not backed by the U.S. government after a virtual drought of such issues, Larkin said.

- German companies generally regard their inventories as being too high, so industry cannot expect a boost any time soon from firms rebuilding stocks, an economist at the Ifo think tank said on Wednesday. laus Abberger said the Munich-based institute's monthly survey of some 7,000 companies showed that most more focused on reducing stocks before rebuilding them.

Bear Radar

Style Underperformer:
Large-cap Growth (+2.10%)

Sector Underperformers:
Restaurants (+.55%), I-Banks (+.63%) and Drugs (+.84%)

Stocks Falling on Unusual Volume:
LGCY, VFC, PNRA, BWLD, PMTC, OTEX, TRLG, ENDP, ANW, CRI, AET, ROC and TSS

Stocks With Unusual Put Option Activity:
1) AN 2) TRMB 3) ETFC 4) GMCR 5) LTD