Weekly Scoreboard*

Indices

• S&P 500 1,199.73 +.04%
  
• DJIA 11,203.55 +.10%
  
• NASDAQ 2,518.12 unch.
  
• Russell 2000 724.36 +.71%
  
• Wilshire 5000 12,470.52 +.18%
  
• Russell 1000 Growth 550.29 +.41%
  
• Russell 1000 Value 605.51 -.13%
  
• Morgan Stanley Consumer 720.43 -.04%
  
• Morgan Stanley Cyclical 955.45 +.35%
• Morgan Stanley Technology 635.67 +1.14%
  
• Transports 4,873.44 +1.37%
  
• Utilities 398.0 -.76%
  
• MSCI Emerging Markets 46.47 -.48%
  
• Lyxor L/S Equity Long Bias Index 1,013.72 -1.09%
  
• Lyxor L/S Equity Variable Bias Index 861.27 -.97%
  
• Lyxor L/S Equity Short Bias Index 767.98 +1.98%
  

Sentiment/Internals

• NYSE Cumulative A/D Line +106,092 -2.55%
  
• Bloomberg New Highs-Lows Index +149 +101
  
• Bloomberg Crude Oil % Bulls 47.0 +9.3%
  
• CFTC Oil Net Speculative Position +171,991 +19.35%
  
• CFTC Oil Total Open Interest 1,399,774 -5.81%
  
• Total Put/Call .65 -32.99%
  
• OEX Put/Call .84 -36.84%
  
• ISE Sentiment 126.0 +50.0%
  
• NYSE Arms 1.0 -43.82%
  
• Volatility(VIX) 18.04 -12.47%
• S&P 500 Implied Correlation Index 44.73% -17.98%
  
• G7 Currency Volatility (VXY) 11.87 -5.94%
  
• Smart Money Flow Index 9,446.28 -1.16%
  
• Money Mkt Mutual Fund Assets $2.798 Trillion -.1%
  
• AAII % Bulls 40.0 -30.51%
  
• AAII % Bears 32.50 +14.08%
  

Futures Spot Prices

• CRB Index 298.89 -1.55%
  
• Crude Oil 81.98 -3.77%
  
• Reformulated Gasoline 219.60 -.75%
  
• Natural Gas 4.16 +9.35%
  
• Heating Oil 227.44 -3.75%
  
• Gold 1,352.30 -1.16%
  
• Bloomberg Base Metals 230.32 -6.16%
  
• Copper 384.25 -1.51%
  
• US No. 1 Heavy Melt Scrap Steel 329.67 USD/Ton +3.34%
  
• China Hot Rolled Domestic Steel Sheet 4,370 Yuan/Ton -.32%
• S&P GSCI Agriculture 434.63 -3.0%
  

Economy

• ECRI Weekly Leading Economic Index 124.30 +.08%
  
• Citi US Economic Surprise Index +29.70 -6.3 points
  
• Fed Fund Futures imply 55.2% chance of no change, 44.8% chance of 25 basis point cut on 12/14
• US Dollar Index 78.50 +.54%
  
• Yield Curve 236.0 +8 basis points
  
• 10-Year US Treasury Yield 2.87% +8 basis points
  
• Federal Reserve's Balance Sheet $2.297 Trillion +.08%
  
• U.S. Sovereign Debt Credit Default Swap 40.54 -3.16%
• Illinois Municipal Credit Default Swap 291.0 +4.01%
  
• Western Europe Sovereign Debt Credit Default Swap Index 163.0 -4.3%
  
• 10-Year TIPS Spread 2.13% +4 basis points
  
• TED Spread 15.0 -1 basis point
  
• N. America Investment Grade Credit Default Swap Index 91.02 -1.60%
  
• Euro Financial Sector Credit Default Swap Index 105.99 -1.95%
  
• Emerging Markets Credit Default Swap Index 218.58 +3.51%
  
• CMBS Super Senior AAA 10-Year Treasury Spread 260.0 unch.
  
• M1 Money Supply $1.880 Trillion +5.13%
• Business Loans 607.10 -.03%
  
• 4-Week Moving Average of Jobless Claims 443,000 -.9%
  
• Continuing Claims Unemployment Rate 3.4% unch.
  
• Average 30-Year Mortgage Rate 4.39% +22 basis points
  
• Weekly Mortgage Applications 713.60 -14.36%
  
• ABC Consumer Confidence -47 -1 point
  
• Weekly Retail Sales +2.70% +10 basis points
  
• Nationwide Gas $2.88/gallon unch.
  
• U.S. Heating Demand Next 7 Days 9.0% below normal
• Baltic Dry Index 2,164 -8.54%
  
• Oil Tanker Rate(Arabian Gulf to U.S. Gulf Coast) 45.0 +5.88%
  
• Rail Freight Carloads 232,888 +.78%
  
• Iraqi 2028 Government Bonds 91.0 -4.62%
  

Best Performing Style

• Small-Cap Growth +1.15%

Worst Performing Style

• Large-Cap Value -.13%

Leading Sectors

• Disk Drives +4.43%
• Coal +3.68%
• Oil Tankers +3.41%
• Oil Service +3.23%
• Airlines +1.82%

Lagging Sectors

• Alt Energy -1.97%
• REITs -2.0%
• Gold -2.08%
  
• Banks -2.25%
• Homebuilders -3.25%

One-Week High-Volume Gainers

One-Week High-Volume Losers

*5-Day Change

Stocks Slightly Higher into Final Hour on Tech Sector Optimism, Seasonal Strength, Short-Covering, Bargain-Hunting

Broad Market Tone:

• Advance/Decline Line: Slightly Higher
  
• Sector Performance: Most Rising
  
• Volume: Below Average
  
• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• VIX 17.94 -4.32%
  
• ISE Sentiment Index 118.0 -7.09%
  
• Total Put/Call .66 -18.52%
  
• NYSE Arms 1.29 +119.11%
  

Credit Investor Angst:

• North American Investment Grade CDS Index 91.02 bps +.93%
  
• European Financial Sector CDS Index 105.83 bps +3.69%
  
• Western Europe Sovereign Debt CDS Index 163.0 bps unch.
  
• Emerging Market CDS Index 217.61 bps -.34%
  
• 2-Year Swap Spread 17.0 -1 bp
  
• TED Spread 15.0 unch.
  

Economic Gauges:

• 3-Month T-Bill Yield .13% unch.
  
• Yield Curve 237.0 -3 bps
  
• China Import Iron Ore Spot $162.80/Metric Tonne -.25%
  
• Citi US Economic Surprise Index +29.70 -.2 point
  
• 10-Year TIPS Spread 2.13% +2 bps
  

Overseas Futures:

• Nikkei Futures: Indicating +88 open in Japan
• DAX Futures: Indicating +12 open in Germany

Portfolio:

• Slightly Higher: On gains in my Retail and Technology long positions
  
• Disclosed Trades: None
  
• Market Exposure: 100% Net Long

BOTTOM LINE: Today's overall market action is mildly bullish as the S&P 500 consolidates yesterday's gains on low volume despite China inflation concerns and euro sovereign debt angst. On the positive side, Gaming, Airline, Retail, HMO, Hospital, Restaurant, Disk Drive, Semi, Computer, Oil Tanker and Coal shares are especially strong, rising more than 1.0%. Cyclical and small-cap shares are outperforming. Tech shares have also been relatively strong throughout the day. US scrap steel prices are up +4.66% this week. On the negative side, Homebuilding, Bank, Utility and Telecom shares are underperforming, falling more than .5%. (XLF) has underperformed throughout the day. The Greece sovereign cds is jumping +3.49% to 1,004.11 bps and the Emerging Markets Sovereign Debt CDS Index is gaining +4.28% to 194.83 bps. Shanghai equities rallied overnight despite the announcement of additional tightening measures. While the euro currency has stabilized, I suspect investors need to see euro cds indices come in a bit before stocks can meaningfully build on yesterday's sharp gains. I expect US stocks to trade mixed-to-higher into the close from current levels on technical buying, short-covering, tech sector optimism, bargain-hunting and seasonal strength.

Today's Headlines

Bloomberg:

• Junk Bond Spreads Drop Most in Four Weeks as Irish Worries Wane. Relative yields on junk bonds in Europe dropped the most in four weeks after Irish officials signaled they may accept a bailout. The extra yield investors demand to own European speculative-grade bonds rather than government debt fell 9 basis points yesterday to 572 basis points, or 5.72 percentage points, according to Barclays Capital’s Pan-European High-Yield Index. That’s the biggest decline since Oct. 21. “A combination of optimism regarding an Irish bailout and a stronger-than-expected Philly Fed helped push risk assets higher,” Gary Jenkins, a strategist at Evolution Securities in London, said today in a note to clients. Yesterday’s spread tightening brings the week’s decline to 13 basis points, following 39 basis points of widening over the previous two weeks, Barclays Capital data show.
• Irish Bonds Drop as Allied Irish Says it Lost 17% of Deposits. Irish bonds fell, reversing earlier gains, after Allied Irish Banks Plc said customer deposits shrank 17 percent this year amid the debt crisis. The decline pared the bonds’ first weekly gain in five as European Union, International Monetary Fund and European Central Bank officials spent a second day in Dublin before a possible bailout of the nation’s banks. Deposits dropped by about 13 billion euros ($17.8 billion) since the start of the year, Allied Irish said in a statement today. “The risk of a bank run in Ireland is still at the back of people’s minds and reminds investors that a bailout needs to happen soon,” said David Schnautz, a fixed-income strategist at Commerzbank AG in London.
• China Will 'Inevitably' Raise Rates in Battle Against Inflation. China’s reserve-ratio increases for banks and threats of price controls on essential goods are likely to prove insufficient to tame inflation, and the central bank will have to raise interest rates further, economists said. The People’s Bank of China yesterday ordered a 50 basis point increase in the amount of money that lenders must set aside, two days after the cabinet announced measures to tackle inflation.
• Cisco(CSCO) Adds $10 Billion to its Stocks Buyback Program. Cisco Systems Inc., the largest maker of networking equipment, added as much as $10 billion to its stock repurchase program, giving a boost to investors after the shares fell 17 percent last week.
• Obama Health Law Attacked by 63 U.S. Representatives. Minnesota congresswoman Michelle Bachmann and 62 other members of the U.S. House of Representatives filed a brief in Florida supporting a lawsuit by 20 states attacking the Obama administration’s health care legislation, calling it unconstitutional. Requiring people to buy health insurance or pay a penalty “would constitute an unprecedented expansion of Congress’s commerce power that would threaten Americans’ individual economic liberty,” the representatives and the American Center for Law & Justice said today. “Congress cannot pass any law that seems to most efficiently address a national problem,” the representatives said. “Every federal law must derive from one of the grants of authority found in the Constitution.” U.S. District Judge Roger Vinson in Pensacola will hear further arguments next month after ruling in October that the case could go forward. The government’s expansion of powers is “simply without prior precedent,” Vinson said in October.
• NATO Says Europe Risk 'Paper Tiger' Status on Military Cuts. NATO’s chief warned that crisis- driven cuts in European defense spending threaten to turn the continent into a “paper tiger” in military matters and saddle the U.S. with an excessive burden. U.S. defense spending makes up 73 percent of the alliance total, up from 49 percent a decade ago, Secretary General Anders Fogh Rasmussen said. “This is a clear message to my dear European colleagues,” Rasmussen told a youth forum before a summit of the 28 North Atlantic Treaty Organization leaders in Lisbon today. “The Europeans should also invest a sufficient amount of money in defense. Otherwise the common European defense and security policy will just be a paper tiger, to speak bluntly.”
• SEC Weighs Rules for Hedge-Fund Registration, Swap Repositories. The U.S. Securities and Exchange Commission is scheduled to vote today on proposed rules requiring the registration of large hedge funds, one of the provisions of the financial regulatory overhaul enacted in July. The SEC is considering two rules expanding the threshold of SEC registration to investment advisers of private funds. The proposals would subject registered funds to periodic inspections by the SEC and require them to employ chief compliance officers. Other private funds were exempted by the Dodd-Frank regulatory law, including venture-capital funds, advisers of funds with less than $150 million in U.S. assets and those without significant U.S. investor numbers and “no place of business” within the country.
• Oil Heads for Biggest Weekly Decline in Three Months as China Drains Cash. Oil declined, headed for its biggest weekly loss in three months, following China’s decision to raise banks’ reserve ratios. Futures reversed a 1.1 percent gain after China ordered lenders to set aside larger reserves for the fifth time this year to rein in inflation, potentially crimping demand in the world’s fastest-growing major economy and biggest energy user. “The Chinese are fearful of inflation, and that’s causing a bit of risk reduction in the market,” said Robert Montefusco, a senior broker with Sucden Financial in London. Crude has dropped 3.8 percent this week, the most since the seven days ended Aug. 13, as Ireland grappled with its deficit and China’s Premier Wen Jiabao said the government was drafting measures to counter inflation.
• Oldest Truck Fleet Since 1979 May Mean 56% Jump in North American Output. North American commercial truck production may climb as much as 56 percent in 2011 as owners refresh the oldest U.S. fleet in at least 31 years, boosting sales at Paccar Inc.(PCAR) and partsmakers such as Eaton Corp(ETN). Output of Class 8 trucks, the workhorses of interstate hauling, may reach as many as 235,000 units in the U.S., Canada and Mexico next year from an estimated 151,000 in 2010, said Kenny Vieth, partner at market forecaster ACT Research Co. Rising freight rates and volumes are helping rekindle demand. “My members are saying they desperately need to replace trucks,” Bob Costello, chief economist for the American Trucking Associations, said in an interview. U.S. trucks now average 6.7 years of age, about 11 months older than the historical average and the oldest in ACT data going back to 1979, according to the Columbus, Indiana-based company. Class 8 truck orders for October rose 24 percent from September, the second-highest monthly total since April 2008, ACT said in a statement. North American output in 2011 matching ACT’s forecast or Robert W. Baird & Co.’s projection of 230,000 units would add to evidence of a recovery in shipments and vehicle purchases. Typical replacement demand is about 220,000 trucks, said Kristine Kubacki, an Avondale Partners LLC analyst in St. Louis. “The replacement cycle is kicking in,” David Leiker, a Milwaukee-based analyst for Baird, said in an interview. He recommends buying Paccar and rival Navistar International Corp. and holding shares of Sweden’s Volvo AB.
• Wells Fargo(WFC) Pays Citigroup(C) $100 Million Over Wachovia. Wells Fargo & Co. agreed to pay Citigroup Inc. $100 million to settle claims that the San Francisco-based bank improperly won bidding to acquire Wachovia Corp. during the financial crisis. “We are glad to put this matter behind us, and we look forward to our two institutions working together constructively in the future,” Wells Fargo said today in a joint statement with New York-based Citigroup.

Wall Street Journal:

• Google(GOOG) Turns Its Local Eyes to Groupon - But Who Else Could Enter Bidding? Sources said the price being considered is certainly no discount–well above the $2 billion to $3 billion that Yahoo offered Groupon in acquisition talks that took place earlier this year. But sources cautioned that the talks are not complete, and could also end up without any result, as the Yahoo discussions did.
• Hong Kong Imposes More Property Curbs. Hong Kong's government on Friday took some of its toughest measures yet to cool the city's red-hot real-estate market by significantly raising transaction costs for speculators. Financial Secretary John Tsang said the moves, which include additional stamp duties for properties sold within two years of purchase as well as lower mortgage ratios, underscore the government's commitment to ensuring stability in Hong Kong's property market as apartment prices continue to soar amid ample liquidity and rock-bottom interest rates.
• Glenn Hubbard: Fiscal Policy Overhaul Needed. (video) Columbia University professor Glenn Hubbard says an overhaul of fiscal policy is needed to help fix the U.S. economy. "I don't think quantitative easing is the answer to the country's problems," he said in an interview with Simon Constable.

CNBC:

• Companies are Busier, So Will Hiring Pick Up Soon? The unemployment rate may be stuck at 9.6 percent, but some economists are seeing a glimmer of hope for future jobs growth.

Business Insider:

• 12 Infuriating Facts About How Much Federal Employees Make.

Zero Hedge:

• RINO(RINO) Signs Own Death Sentence, Company Likely to be Halted Forever as Chinese IPO Craze Fizzles.
• In Hong Kong $1.8 Million Gets You 400 Square Feet, And Other Observations On the Biggest Bubble Ever, From Dylan Grice.
  

New York Post:

• New York in Need of a $10 Billion Belt Tightener. New York's budget chief warned New Yorkers yesterday to prepare for massive cuts next year as the economy sputters and money runs out. Budget Director Robert Megna said Gov.-elect Andrew Cuomo will have no choice but to enact deep spending cuts to close a $9.2 billion to $10.6 billion budget gap next year, even if the economy suddenly takes off. "Very, very difficult decisions are going to be made, have to be made," Megna said. "Quite honestly, we're in a position now where the state is going to have to decide that there are certain things it's not going be able to do anymore the way that it has been done in the past. "The numbers just don't allow it."
• Appliance Has-Been. Sears(SHLD) Loses Market Share to Lowe's(LOW), Home Depot(HD).
  

New York Times:

• China Move Could Counter Fed's Efforts.

Atlanta Journal Constitution:

• Kia Adding Another 1,000 Jobs in West Georgia.

Hot Air:

• Subprime Mortgage Profiteers Angle for an Education Bubble. Of course, the administration is not operating without the influence of it’s friends on Wall Street. Last March, when Deputy Undersecretary of Education Robert Shireman attacked for-profit colleges in a speech, the colleges’ stock values tumbled, losing the companies around $1.6 billion in a single day. The cause and effect of whispers of government regulations causing markets to tumble didn’t go unnoticed. In May, short seller king Steven Eisman, who made billions betting against the market as Wall Street banks bought billions in bad loans, called for-profit education the next ripe area to profit from short selling.Regardless of whether or not Eisman’s analysis is accurate, if government regulations force losses to the for-profit education industry, people like Eisman — who bet against success — stand to make millions.

Politico:

• Senate Democrats Vent Anger With Barack Obama. Senate Democrats — including typically mild-mannered Bill Nelson of Florida — lit into President Barack Obama during an unusually tense air-clearing caucus session on Thursday, senators and staffers told POLITICO. Nelson told colleagues Obama’s unpopularity has become a serious liability for Democrats in his state and blamed the president for creating a toxic political environment for Democrats nationwide, according to two Democrats familiar with his remarks.

Reuters:

• ECRI US Economic Growth Gauge Rises to 25-Week High. A measure of future U.S. economic growth rose to a 25-week high in the latest week, while the index's annualized growth rate rose to a 23-week high, a research group said on Friday. The Economic Cycle Research Institute, a New York-based independent forecasting group, said its Weekly Leading Index rose to 124.3 in the week ended Nov. 12 from 124.2 the previous week. That was the highest level since May 21, when it was 125.3. The index's annualized growth rate rose to minus 4.5 percent from minus 5.5 percent a week earlier. That was the highest since June 4, when it was minus 3.9 percent.

Financial Times:

• QE2-As-Bank-Bailout. QE2-as-bank-bailout continues with a Friday op-ed by Andy Kessler,a former hedge-fund manager and author of “Eat People—And Other Unapologetic Rules for Game-Changing Entrepreneurs”. As we’ve noted before, there’s something odd about the Federal Reserve’s second round of quantitative easing. Instead of trying to flatten the US yield curve, the Fed’s Treasury purchases look like they’re almost aimed at steepening it. Why? Here’s Kesslar’s theory via the Wall Street Journal:

Telegraph:

• IMF Chief Dominique Strauss-Kahn Urges Leaders to Cede More Sovereignty to EU. European nations need to cede more of their sovereignty and hand greater powers to the centre to avoid future crises, the head of the International Monetary Fund has said.

Cinco Dias:

• Spain may reduce subsidized rates for power from new photovoltaic solar generators during a cabinet meeting today. Plants built on open land will receive 45% less than the current price they're paid. Rates will decline 25% for large rooftop solar panels installations and by 5% for small ones, typically homes.

Bear Radar

Style Underperformer:

• Large-Cap Value (-.08%)

Sector Underperformers:

• 1) Homebuilders -.91% 2) Utilities -.61% 3) Telecom -.45%

Stocks Falling on Unusual Volume:

• KIRK, HRBN, INTU, SPWRA, GSIC, ADSK and RES
  

Stocks With Unusual Put Option Activity:

• 1) MELA 2) EWH 3) XLU 4) WLT 5) MAR
  

Stocks With Most Negative News Mentions:

• 1) RRI 2) RGCO 3) KSU 4) RCI/B 5) CPTS
  

Bull Radar

Style Outperformer:

• Small-Cap Growth (+.02%)

Sector Outperformers:

• 1) Coal +1.35% 2) Disk Drives +.91% 3) Computer Hardware +.88%

Stocks Rising on Unusual Volume:

• DECK, CSIQ, MRVL, WDC, STX, IAG, GE, PT, CLF, HIBB, AIRM, GTLS, SCVL, FINL, PETD, HANS, EXXI, SPLS, THOR, WYNN, BRCM, APKT, ARMH, FSLR, TSLA, LULU, DLM, JKK, ANN, VVI, FL, CKH and JKD
  

Stocks With Unusual Call Option Activity:

• 1) CRM 2) MYL 3) DF 4) WLT 5) DELL
  

Stocks With Most Positive News Mentions:

• 1) DELL 2) FFIV 3) DE 4) TGT 5) JNPR
  

Friday Watch

Evening Headlines
Bloomberg:

• Irish Bailout May Unleash Market Vigilantes on Portugal: Credit Markets. A resolution of the Irish debt crisis may shift the burden of speculation to Portugal. While officials such as European Central Bank Vice President Vitor Constancio predict a bailout of Ireland will reduce financial pressures in the euro region, analysts from Citigroup Inc. and Nomura International Plc say any relief would be short-lived as investors turn their focus to the next-weakest peripheral nation. The markets indicate that country is Portugal with 10-year bond yields of 6.92 percent, compared with 8.31 percent in Ireland and 11.71 percent in Greece, which received rescue funds in May from the European Union and International Monetary Fund. Portuguese Finance Minister Fernando Teixeira dos Santos said Nov. 15 that while “there is a risk of contagion,” that doesn’t mean the country will seek financial aid. “Portugal isn’t in the situation that it is now because of Ireland,” said Steven Mansell, director of interest-rate strategy at Citigroup Global Markets Ltd. in London. “If Ireland reaches an agreement to tap the European Financial Stability Facility or some other mechanism to support its banking sector, I don’t think that will alleviate the pressure on Portugal.”
• Cowen Scorned as Irish Mourn Loss of Sovereignty With Bailout. Irish rebels fought for independence during World War I, boasting they served “neither King nor Kaiser.” Ireland may now have to do exactly that to qualify for a bailout partly funded by both Britain and Germany. Prime Minister Brian Cowen is edging toward accepting a rescue package that may threaten the country’s low-tax policies and put voters on the hook to repay loans the central bank says may be worth “tens of billions” of euros. For critics of Cowen’s Fianna Fail party, which governed Ireland through its decade-long boom, national pride is at stake. Cowen has “squandered” independence for a “German bailout with a few shillings of sympathy from the British chancellor,” the Irish Times newspaper said yesterday. The government should be “ashamed that Fianna Fail should be the ones to surrender sovereignty,” said Michael Noonan, finance spokesman for Fine Gael, the largest opposition party.
• General Motors(GM) Sells $500 Million Stake to China Partner SAIC. General Motors Co. sold a $500 million stake in its initial public offering to Chinese partner SAIC Motor Corp ., cementing ties that have helped the American company boost sales in the world’s largest auto market. SAIC bought the 0.97 percent stake “on the basis of a good strategic partnership between the two” and its “confidence in GM’s development prospects,” the Shanghai-based carmaker said in an e-mailed statement yesterday.
• Oil Trades Below $82 on Speculation Ireland Bailout Not Enough. Oil traded below $82 a barrel, retracing earlier gains, on concerns that a European Union-led bailout of Ireland may not be enough to stabilize sovereign debt concerns in the region.

Wall Street Journal:

• Irish Grasp at EU, IMF Lifeline. Dublin Admits It Needs a Rescue; Moment of Truth for 16-Nation Euro Zone. The Irish government all but buckled to pressure to accept a historic international bailout Thursday, capitulating after a week of intense lobbying from officials across Europe and spurring questions about which other European economies will need a helping hand.
• Few Businesses Sprout, With Even Fewer Jobs. Fewer new businesses are getting off the ground in the U.S., available data suggest, a development that could cloud the prospects for job growth and innovation. In the early months of the economic recovery, start-ups of job-creating companies have failed to keep pace with closings, and even those concerns that do get launched are hiring less than in the past. The number of companies with at least one employee fell by 100,000, or 2%, in the year that ended March 31, the Labor Department reported Thursday. That was the second worst performance in 18 years, the worst being the 3.4% drop in the previous year. Newly opened companies created a seasonally adjusted total of 2.6 million jobs in the three quarters ended in March, 15% less than in the first three quarters of the last recovery, when investors and entrepreneurs were still digging their way out of the Internet bust.
• Private Medicare Plans Are Retrenching. Seniors enrolling in private Medicare policies starting this week are finding fewer options, as health insurers close down certain types of plans due to legislative changes and looming cuts to federal funding.
• Foreclosure Talks Gain Steam. Talks between major lenders and state attorneys general about the nationwide investigation of foreclosure practices are accelerating, with state officials pushing for an overhaul of the loan-modification process that would be much broader than a crackdown on the use of "robo signers," people familiar with the situation said. Ally Financial Inc.'s GMAC Mortgage unit on Thursday held its first face-to-face meeting in Iowa with the multistate group involved in the investigation. Iowa Attorney General Tom Miller is spearheading the probe. Bank of America Corp., Citigroup Inc. and J.P. Morgan Chase & Co. have recently picked up the pace of their talks or are planning to meet soon with key officials in the probe.
• Iran Rights Envoy Assails U.N. Censure. Official Defends Stoning, Arrests, as General Assembly Committee Condemns Crackdown by Tehran. Iran's top human-rights official gave a robust defense of his country's right to engage in the stoning of criminals and imprison lawyers viewed as threatening the stability of the Islamic Republic, as a United Nations committee censured Tehran for what it said was an accelerating crackdown on its opponents.
• An Energy Drink for the GOP. The Republicans have yet to make the billions wasted on job-killing subsidies to green energy projects a top issue.

CNBC:

• US Municipal Bond Prices Revive After Steep Sell-Off.
• Hedge Funds Holding Ground Despite Redemption Rumors. Hedge funds are poised to close out a strongly profitable year, even though smaller firms are under pressure as investors still have the jitters over an unpredictable market. Industry veterans refuted rumors that have passed our way regarding a strong flow of redemptions as managers close out their books for 2010. In fact, the $2.34 trillion dollar hedge fund business saw $26.6 billion of inflows in the third quarter as part of a net increase of $120.9 billion, according to data from Bank of America Merrill Lynch. That equates to a 5.45 increase in total assets under management. Not bad numbers considering increasing whispers that investors are bailing on hedge funds.
• Fed's Plosser: Zero Rates May Be Too Low. Philadelphia Federal Reserve Bank President Charles Plosser said on Thursday that it was "absolutely" possible that the U.S. central bank was making a policy mistake by keeping short-term rates pressed to zero. Plosser, who assumes a voting position on the Fed's policy-setting panel next year, also told a conference at the Cato Institute that it was not clear that "extra action" was a good thing. Plosser also said that he did not believe the Fed's further easing of monetary policy was warranted given current economic conditions. "For me, the benefits were not large enough to outweigh the costs," he told reporters after a conference at the Cato Institute.

Marketwatch.com:

• Bernanke Turns Up Heat on China Currency Policy. Federal Reserve Chairman Ben Bernanke put aside traditional central bank niceties and launched a direct attack on the slow pace of China’s steps to strengthen its currency. In a speech prepared for a conference at the European Central Bank on Friday morning, Bernanke said that China’s decision to undervalue the yuan has essentially thrown a monkey wrench into the global economic recovery.

Business Insider:

• The Next 7 American Monopolies.

Zero Hedge:

• More Hot Water for Phil Falcone? Company Once Linked to Kennedy Assassination Reveals Informal Investigation of Harbinger Trades.
• Man U Player of the Century Eric Cantona Appeals for Peaceful Revolution Against Banks, Calls for Europeans to Pull Their Money. (video)
  

NY Times:

• Pat-Downs at Airports Prompt Complaints. Some offer graphic accounts of genital contact, others tell of agents gawking or making inappropriate comments, and many express a general sense of powerlessness and humiliation. In general passengers are saying they are surprised by the intimacy of a physical search usually reserved for police encounters.

IBD:

• Audio Technology Maker Seeks New Growth Markets. In a world that can't seem to get enough video, there's still plenty of money to be made in audio. Consider the case of San Francisco-based Dolby Laboratories (DLB).

CNN Money:

• Wind Energy, Solar Power Face Cloudy Future. After years of rapid growth and darling status among many in Washington, the future of the American renewable energy industry is uncertain. That's because the government cash it has come to rely on may dry up on Dec. 31.

NASDAQ:

• Hong Kong's government will release measures intended to cool the rising home market after the stock exchange closes today, Dow Jones Newswires reported.

Rasmussen Reports:

• Daily Presidential Tracking Poll. The Rasmussen Reports daily Presidential Tracking Poll for Thursday shows that 25% of the nation's voters Strongly Approve of the way that Barack Obama is performing his role as president. Forty-two percent (42%) Strongly Disapprove, giving Obama a Presidential Approval Index rating of -17 (see trends).

Reuters:

• Dell's(DELL) Margins Blow by Street, Shares Rise. Dell Inc raised its yearly income forecast after third-quarter margins and smashed expectations, helped by sliding costs of PC components and propelling its shares 4.8 percent higher.
• Foot Locker(FL) Q3 Beats on Higher Margins, Shares Jump. n">Athletic footwear retailer Foot Locker Inc posted third-quarter results that raced past Wall Street expectations, as strong demand for running shoes spurred comparable-store sales and gross margin expansion, lifting its shares 10 percent in extended trade. Foot Locker, valued at about $2.61 billion, is now reaping the rewards of closing about 650 underperforming stores over the past 3 years to drive sales and margins.
• n">Salesforce.com(CRM) Sees Sales Growth, Shares Rise. Salesforce.com Inc beat Wall Street profit estimates and forecast better-than-expected sales for the next fiscal year as more customers sign up for its "cloud computing" services, and its shares rose 7 percent.

Financial Times:

• Meredith Whitney to Rival Moody's and S&P With Own Rating Agency.

Telegraph:

• European Central Bank Tightens Screw on Ireland, Portugal and Spain. The European Central Bank (ECB) has issued a clear warning that it will press ahead with plans to raise interest rates and withdraw lending support for banks despite the eurozone debt crisis, even if this risks pushing Ireland, Portugal and Spain into deeper trouble.

South China Morning Post:

• Chinese local-government levels of debt have risen to unsustainably high levels, citing a report by a National Audit Office official. Debt of 18 provinces, 16 cities and 36 counties in China rose 59.4% last year to 2.79 trillion yuan, according to the report by Cai Gen, an audit office official based in Jiangsu province. The debt ratios indicate local authorities are under pressure to repay and may be a credit risk, the report said.

Financial News:

• China's monetary authorities and financial regulators should improve the nation's mechanism for macroeconomic supervision, Wang Songqi, deputy director of financial research at the Chinese Academy of Social Sciences, wrote in a commentary. The biggest risks for China come from its own financial system, Wang said.

Evening Recommendations
Citigroup:

• Reiterated Buy on (FL), target $19.

Night Trading

• Asian equity indices are -1.25% to +.25% on average.
• Asia Ex-Japan Investment Grade CDS Index 103.0 -4.5 basis points.
  
• Asia Pacific Sovereign CDS Index 100.25 -3.5 basis points.
  
• S&P 500 futures -.23%
  
• NASDAQ 100 futures -.28%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (HIBB)/.38
• (ANN)/.34
• (MENT)/.15
• (ADCT)/.21
• (HNZ)/.76
• (SCMR)/-.06

Economic Releases

• None of note
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Bernanke/ECB's Trichet/IMF's Managing Director/Bank of China Governor speaking at ECB Conference and the (BSX) Investor Day could also impact trading today.
  

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