Bear Radar

Style Underperformer:

• Large-Cap Growth (+.38%)

Sector Underperformers:

• 1) Oil Service -.41% 2) Retail -.34% 3) I-Banking -.04%

Stocks Falling on Unusual Volume:

• BBY, HMC, RIMM, ACTG, SWM, SNX, DRI, HS and ERJ
  

Stocks With Unusual Put Option Activity:

• 1) URBN 2) AUY 3) DF 4) EK 5) RIMM
  

Stocks With Most Negative News Mentions:

• 1) EWP 2) AAP 3) URBN 4) SAI 5) LOJN
  

Charts:

• ETFs Falling on Unusual Volume
• Stocks Falling on Unusual Volume
  

Bull Radar

Style Outperformer:

• Small-Cap Growth (+1.60%)

Sector Outperformers:

• 1) Hospitals +2.0% 2) Agriculture +1.45% 3) Road & Rail +1.44%

Stocks Rising on Unusual Volume:

• PETS, OSK, BODY, ORCL, FINL, TRGT, CTEL, TZOO, OPEN, UTIW, JRCC, KNOT, ASMI, GLNG, GTLS, BIDU, SCVL, ZBRA, HITT, HTWR, INFY, ACN, KOP, BC, ENB, EW, SRZ, PPO, HOC, CF, FL, ABG, AH, NOG, OCLR, SFLY, LXU, MD, ALTR, VHC, DOLE, ARBA, DK and CPO
  

Stocks With Unusual Call Option Activity:

• 1) EK 2) DISH 3) DTV 4) ACN 5) ODP
  

Stocks With Most Positive News Mentions:

• 1) KMX 2) LVS 3) ACN 4) ORCL 5) FFIV

Charts:

• ETFs Rising on Unusual Volume
• Stocks Rising on Unusual Volume
  

Friday Watch

Evening Headlines
Bloomberg:

• Portugal Is Said to Need $99 Billion Rescue; Ratings Cut. A bailout for Portugal may total as much as 70 billion euros ($99 billion), two European officials with direct knowledge of the matter said, as credit-rating cuts threatened to deepen Portugal’s debt woes. Preliminary calculations put the cost of a lifeline from 50 billion to 70 billion euros, said the officials, who declined to be named because the issue is confidential. Portugal continued to rule out a rescue after the parliament’s rejection of budget cuts led Prime Minister Jose Socrates to offer to quit. Downgrades by Fitch Ratings and Standard & Poor’s dealt a further blow, as European Union leaders called on Socrates and the opposition parties to unite behind belt-tightening measures that might spare Portugal from becoming the third euro country to tap emergency aid.
  
• NATO to Run No-Fly Zone While U.S.-Led Force Hits Qaddafi Troops. NATO agreed to take command of the Libya no-fly zone, stopping short of assuming responsibility for airstrike missions against Libyan ground forces that sparked discord within the 28-nation alliance. The limited agreement among members of the North Atlantic Treaty Organization may delay a U.S. handoff of responsibility for strikes on Muammar Qaddafi’s fighters. The anti-Qaddafi coalition will continue to handle actions which don’t involve the no-fly zone, said NATO Secretary-General Anders Fogh Rasmussen.
• VIX Heads for Biggest Six-Day Drop Since '08 as Japan Quake Concerns Abate. The benchmark measure of U.S. stock options completed its biggest six-day drop since November 2008 as concern that this month’s Japanese earthquake will curb global economic growth eased. The VIX, as the Chicago Board Options Exchange Volatility Index is known, fell 6.1 percent to 18 at 4:15 p.m. New York time, extending its retreat since March 16 to 39 percent. That’s the biggest drop over the same number of days in 28 months. The VIX needed to fall below 17.53 to beat the six-day record set two months after Lehman Brothers Holdings Inc.’s September 2008 bankruptcy sent stocks plunging. “This market is as remarkably resilient as any I’ve seen,” said Mike Shea, a managing partner and trader at Direct Access Partners LLC in New York. “We had a nuclear disaster in Japan and the Mideast two days from who-knows-what, and with that, you’d think the VIX would stay at 30.”
• EU Cuts Future Aid Fund's Start-Up Capital After Germany Balks. European Union leaders cut the startup capital for the future euro emergency aid mechanism after German demands to make smaller upfront payments stoked fresh concerns about Europe’s effort to quell the debt crisis. As speculation swirled that Portugal will be the next victim of the crisis, the leaders bowed to German Chancellor Angela Merkel’s call to pare the fund’s paid-in capital as of 2013 to 16 billion euros ($23 billion), less than the 40 billion euros foreseen in a March 21 accord.
• Japan Widens Evacuation Zone as Workers Push to Repair Reactor. Japan advised more people living close to a damaged nuclear plant to evacuate because basic goods are in short supply, while assuring them that radiation levels haven’t risen. The recommendation applies to residents living between 20 kilometers (12 miles) and 30 kilometers from the Fukushima Dai- Ichi facility, which was damaged by the March 11 earthquake and tsunami. The government previously evacuated everyone living closer to the plant. "It’s becoming difficult for people to live a normal life and we can’t rule out the possibility of broadening the mandatory evacuation if radiation levels rise," Chief Cabinet Secretary Yukio Edano told reporters in Tokyo today.
• Yemenis Plan Opposing Protests in Defiance of Emergency Rule. Yemen’s strengthening opposition movement plans to march to the Presidential Palace and hold nationwide protests as government supporters pour into Sana’a, the capital, for a rally dubbed “Tolerance Friday.” The opposing demonstrations are in defiance of a ban on gatherings under the country’s emergency rule, proposed by President Ali Abdullah Saleh and backed two days ago by his loyalists in parliament.
• Banks to Lose Business to Hedge Funds on Rules, Telegraph Says. New bank regulations will cause business to move away from investment banks toward “non-bank” institutions such as hedge funds, private equity firms and pension funds that aren’t subject to the rules, the Daily Telegraph reported, citing a report by investment bank Morgan Stanley (MS) and consulting firm Oliver Wyman.
• Retiree Health-Plans' U.S. Subsidies May Run Out of Funds Later This Year. A $5 billion U.S. government fund to subsidize retiree health costs for employers including Johnson & Johnson, Alcoa Inc. (AA) and General Electric Co. (GE) may run out of money as soon as this year, a congressional report found. The health law President Barack Obama signed last year created the fund as a stop-gap measure to help keep people insured until 2014, when the measure creates a national system of subsidized plans for most Americans.
• Labor Faces New South Wales Vote 'Bloodbath' in Blow to Gillard. The Liberal-National coalition in New South Wales, Australia’s most populous state, is set to end 16 years of Labor Party rule in tomorrow’s election, making it harder for Prime Minister Julia Gillard to implement her plans. Kristina Keneally’s Labor state government will suffer its worst defeat in 110 years, according to a Galaxy poll of 1,000 people published in the Daily Telegraph newspaper today without a margin of error. A loss will mean three of Australia’s eight states and territories will be controlled by Liberal-National coalitions as Labor’s Gillard tries to win support to reduce carbon emissions and tax mining company profits.
• Patek Philippe's Stern Says Overinvesting in China Is a Mistake. “I’m not putting all my eggs in the same basket,” Stern said in an interview at the world’s largest watch fair in Basel, Switzerland, yesterday. “It’s a big mistake I think that a few brands are doing by going only in China. They focus everything on China and it’s dangerous.” Beijing’s communist government this week moved to ban outdoor advertising that promotes lavish lifestyles in the Chinese capital, as it faces a widening gap between rich and poor in a nation where 150 million people live on less than $1 a day.

Wall Street Journal:

• Japan: The Business Aftershocks. Japan's devastating combination of earthquake, tsunami and nuclear accident was a wakeup call reminding companies across the world just how much they rely on the island nation.
  
• Bahrain Says Meddling by Iran Risks 'Conflict'. Bahrain gave its sternest warning yet to Iran to keep out of its affairs, saying an escalation in the two countries' dispute over Bahrain's recent crackdown on political unrest could even lead to "conflict." The threat from Iran could increase "to any level" at a time of deep divisions between Iran and its Arab neighbors in the Persian Gulf region, Bahrain's foreign minister Sheik Khalid bin Ahmed Al Khalifa said in an interview.
• IMF To Soon Activate Special Funding Pool. The International Monetary Fund is expected to soon activate a supplementary funding pool to boost resources available for lending in Europe and elsewhere, raising the pool by several hundred billion dollars. Activation of the New Arrangement to Borrow, or NAB, is in anticipation of an expected wave of possible new IMF programs, one person familiar with the matter said. The resource pool, the IMF says, is "to forestall or cope with an impairment of the international monetary system or to deal with an exceptional situation that poses a threat to the stability of that system." It's essentially a mechanism for the IMF to borrow from a group of countries if it thinks it may need extra resources beyond its conventional reserves saved up through member dues. For example, the U.S., Japan and China have promised to lend the several hundred billion dollars to the facility above their required contributions for the kitty. Last year, the IMF agreed to provide around one-third of any possible European bailouts, boosting the effective capacity of Europe's proposed bailout fund of a half-trillion euros. The IMF has since then already signed up to take part in joint European Union programs dealing with Greece and Ireland. Although Portugal has made no formal request for IMF aid, analysts and economists say rejection by the parliament of a belt-tightening budget earlier this week all but sealed the likelihood Lisbon will need to request aid from the IMF and the European Union. Economists estimate that Portugal would need around $60 billion to $75 billion over the next three years to meet its debt obligations and potentially recapitalize its banks. The person familiar with the matter said that the aid fund could also be tapped for a potential increase in the loan amount for Greece, in addition to extending Athens's repayment schedule, as some officials in Europe are concerned that it's not credible enough. Also, other peripheral countries may need IMF help and the fund will want to assure markets that it has the firepower to handle even a core European country, such as Spain or Italy, in a worst-case scenario.
• A Nation of Dropouts Shakes Europe.
• Spain Takes Turn in Debt Spotlight. Portugal's admission that it will probably need a financial bailout raises a question that will shape the outcome of the euro zone's debt crisis: Is Spain next? The cost of saving Spain, a €1.1 trillion ($1.56 trillion) economy, would dwarf previous bailouts and could test the financial strength of Europe as a whole. But if Spain can continue to repair investors' trust, as in recent weeks, then Europe stands a chance of containing the debt crisis to three countries, Greece, Ireland and Portugal, whose combined economies are half the size of Spain's.
• Fed Would Have Turned Down ANY BofA(BAC) Dividend Bump. Bank of America Corp. had its plan for a “modest” second-half dividend increase rejected last Friday by the Federal Reserve. But how did the bank define “modest”? The Charlotte, N.C. lender requested that the current penny a share payout go to three cents and then four, the amount increasing in stages over time, said people familiar with the proposal. That’s nothing compared to the 20-cent per share dividend boost J.P. Morgan Chase & Co. announced last Friday with the Fed’s approval. (Just before the financial crisis, Bank of America had paid out as much as 64 cents a share in quarterly dividends.) What Bank of America didn’t anticipate: the Fed would be unmoved by the modesty of the amount. The Fed, according to another person familiar with the situation, wasn’t going to approve an increase of any amount. The position the Fed took with Bank of America was different than the “no” the Fed gave to Capital One Financial Corp. The smaller McLean, Va. bank had its dividend hike rejected because it asked for a larger increase than the Fed was willing to give, said people familiar with the situation. Bank of America officials were caught off guard by the Fed’s rejection, according to people familiar with the matter. Executives had the impression the Fed wouldn’t reject its dividend blueprint outright because the bank hadn’t asked for a second quarter increase like many of its rivals, these people said.
• A Very Bad Year. And it'll only get worse, unless ObamaCare is repealed or struck down. A year ago today President Obama signed into law the broadest, most expensive, most intrusive health-care bill in our history. So we the people are subject to a 2,700-page law that will cost us nearly $1 trillion over 10 years and will put the federal government, in charge of everyone's medical care. The bill appropriates in advance some $100 billion from now until 2020, making it more difficult for future Congresses or Presidents to defund it. The bill creates some 159 new government agencies to administer health care. As of Jan. 1, 2014, unless it is repealed, health care will be run, controlled, and totally supervised by Washington.
• The Speech Obama Hasn't Given. What are we doing in Libya? Americans deserve an explanation. It all seems rather mad, doesn't it? The decision to become involved militarily in the Libyan civil war couldn't take place within a less hospitable context. The U.S. is reeling from spending and deficits, we're already in two wars, our military has been stretched to the limit, we're restive at home, and no one, really, sees President Obama as the kind of leader you'd follow over the top.

MarketWatch:

• Radiation Could Boost Japan's Food Imports. Radiation seeping into the food chain from Japan’s crippled nuclear power plants is raising expectations that the nation needs to boost imports to safely feed its 125 million citizens.

CNBC:

• US Equities Are Cheap, 'Under-Invested': Larry Fink. BlackRock(BLK) CEO Larry Fink isn't surprised by the recent climb in U.S. equities, as the asset class remains "very cheap," he told CNBC Thursday.
• Dennis Gartman: Heed Outside Reversal in Gold.
  

New York Times:

• G.E.'s(GE) Strategies Let It Avoid Taxes Altogether. General Electric, the nation’s largest corporation, had a very good year in 2010. The company reported worldwide profits of $14.2 billion, and said $5.1 billion of the total came from its operations in the United States. Its American tax bill? None. In fact, G.E. claimed a tax benefit of $3.2 billion. That may be hard to fathom for the millions of American business owners and households now preparing their own returns, but low taxes are nothing new for G.E. The company has been cutting the percentage of its American profits paid to the Internal Revenue Service for years, resulting in a far lower rate than at most multinational companies.

Forbes:

• 6 Things Analysts Are Missing About Apple(AAPL).

CNN Money:

• Postal Service: 7,500 Workers, $20,000 Buyouts. The Postal Service is offering a $20,000 buyout to thousands of veteran workers as part of its bid to eliminate 7,500 administrative jobs, the agency announced Thursday. The struggling agency also announced plans to shutter seven district offices.

PIMCO:

• Understanding Japan's Disasters by Mohamed A. El-Erian. Japan’s reconstruction challenge will likely be more difficult than after the Kobe earthquake. Negative wealth and income effects this time around will be more severe, and the recovery process will probably take longer and be more complex. Japan's disasters will add to the global economy’s headwinds.

Real Clear Politics:

• Corporate Welfare by John Stossel. In America today, the biggest recipients of handouts are not poor people. They're corporations. General Electric CEO Jeffrey R. Immelt is super-close to President Obama. The president named Immelt chairman of his Council on Jobs and Competitiveness. Before that, Immelt was on Obama's Economic Recovery Advisory Board. He's a regular companion when Obama travels abroad to hawk American exports. (Why does business need government to do that?) "Jeff Immelt is perhaps the CEO who is most cozy with President Obama," says journalist Tim Carney. "General Electric is structuring their business around where government is going ... high-speed rail, solar, wind. GE is lining up to get what government is handing out."

Politico:

• Frank Isn't Buying Case on Libya. Barney Frank says President Obama’s reasoning for attacking Libya without going to Congress first isn’t good enough. Frank, the liberal congressman from Massachusetts, said “consultations are no substitute” for seeking Congress’s permission to go to war. “Consultations, schmonsultations,” Frank said. Frank also didn’t buy Carney’s argument on Thursday that Obama couldn’t ask Congress to go to war because doing so would have given Muammar Qadhafi time to slaughter Libyans in Benghazi. “They should have asked earlier,” Frank argued, also suggesting that publicizing a request for war could have even spooked Qadhafi.

USA Today:

• Economic Stress Index is Lower Than January 2010. See Best, Worst Counties. Lower unemployment and fewer bankruptcies helped reduce the nation’s economic stress in January compared with a year earlier, according to The Associated Press’ monthly analysis. Midwestern and Southeastern states posted the strongest gains year over year, thanks to increased manufacturing, the AP’s Economic Stress Index shows.

AP:

• Chinese activist Liu Xianbin was sentenced to 10 years in prison for inciting subversion of state power, citing Liu's wife. Liu had posted online articles calling for street protests and democratic reforms.

Reuters:

• Oracle(ORCL) Signals Strong Tech Spend, Shares Rise. Oracle Corp forecast a 4 to 14 percent rise in sales of new software this quarter and hiked its dividend by a fifth, fueling hopes that a global resurgence in technology spending remains intact. The business software maker run by flamboyant billionaire Larry Ellison again delivered quarterly results and forecasts that beat Wall Street expectations, sending its shares 3.5 percent higher. "It's green lights across the board," said Richard Davis, an analyst at Canaccord Genuity who has a 'buy' rating on the stock.
• Spain's Savings Banks Held Talks With Hedge Funds - FT. Spain's struggling saving's banks, or cajas, have held talks with major hedge funds and private equity groups to try to raise 15 billion euros ($21 billion) in fresh capital to avoid a bail-out, the Financial Times said on Friday. U.S. hedge fund Paulson & Co and buy-out groups Cerberus and Apax Partners have held meetings with several cajas to discuss possible investments, the paper said.
  
• RIM's(RIMM) Outlook Disappoints, Shares Tumble. Blackberry maker Research In Motion on Thursday warned its earnings would slip as it spends heavily on the launch of its PlayBook tablet, sending its shares tumbling as much as 12 percent. While the Canadian technology company's net profit in the quarter ended in February jumped 32 percent, and it shipped a solid number of its BlackBerry smartphones, investor attention zoomed in on its less-than-rosy forecasts for the current quarter. "The February quarter was fine. The May quarter guidance -- shocking might be too strong a word -- but it was very weak," said Matthew Thornton, an analyst at Avian Securities.
• Brazil's Housing Carnival Stokes Bubble Worries. Listening to Jose Carlos de Vasconcellos talk about Rio de Janeiro's property market is like being transported back to the bubble days in the United States or Europe.
• Accenture(ACN) Raises Outlook, Shares Rise. Technology outsourcing and consulting firm Accenture raised its outlook for the full year, reflecting a recovery in corporate investment, and its shares rose 5.6 percent.

Financial Times:

• Gates Calls for Syrian Forces to Move Aside. Syria should follow Egypt’s lead and the Syrian army should “empower a revolution”, Robert Gates, US secretary of defence, argued as thousands marched in a southern city. Mr Gates made his comments – some of the toughest remarks to date by a US official about the rule of Bashar al-Assad, Syria’s president – on a day of further upheaval in the Middle East and beyond.
• US Banks in 'Cash for Keys' Foreclosure Talks. The five biggest US mortgage servicers were told this week at a private meeting with regulators to consider paying delinquent borrowers up to $21,000 each as part of a broader settlement of the foreclosure crisis. People who attended the meeting, chaired by the Federal Deposit Insurance Corporation on Monday, said the industry-wide “cash for keys” programme would involve the biggest servicers, led by Bank of America(BAC), paying borrowers as an incentive to leave their homes.

DigiTimes:

• Samsung Electronics Co. will raise contract prices of DRAM chips, after the earthquake in Japan disrupted supplies of silicon wafers.

Asahi:

• Japan may raise the danger level of the Fukushima nuclear crisis to 6 from 5 on an international scale of 1 to 7. That would exceed the level of the Three Mile Island accident, which was rated 5.

China Securities Journal:

• China's consumer prices may rise about 5% in March from a year earlier, citing a report by the pricing department of the National Development and Reform Commission. In the first half, consumer prices may rise 4.8% to 5%.
• China's State Information Center proposed to gradually expand the home purchase limits to the whole nation within three years, citing a report from the Center's economic forecast department.
  

21st Century Business Herald:

• The China Banking Regulatory Commission is investigating loans made by banks to the railway ministry on credit risk concerns, citing a person close to the commission.

Shanghai Securities News:

• China's crude steel demand may rise as much as 50 million tons in 2011 compared to the previous year, citing Liu Yinan, vice chairman of the China Chamber of Commerce of Metals, Minerals and Chemicals Importers and Exporters.

China Business News:

• China should be watchful of Japan's quantitative easing policies after the earthquake as there is a high possibility of a debt crisis in Japan and yen depreciation, China Citic Bank Corp.'s Vice President Cao Tong wrote. If quantitative easing becomes long-term monetary policy for Japan and other developed countries, it will have a large impact on China and other emerging countries, Cao wrote.

Evening Recommendations
Citigroup:

• Upgraded (CLP) to Buy, target raised to $22.
• Reiterated Buy on (PCLN), boosted estimates, raised target to $610.
• Downgraded (BBY) to Sell, target $27.
• Reiterated Buy on (CPO), target $60, added to Top Picks Live list.
  

Wedbush:

• Rated (HOG) Outperform, target $48.
• Rated (BC) Outperform, target $29.
  

Night Trading

• Asian equity indices are +.25% to +1.0% on average.
• Asia Ex-Japan Investment Grade CDS Index 113.0 -2.0 basis points.
  
• Asia Pacific Sovereign CDS Index 117.0 unch.
  
• S&P 500 futures +.31%.
  
• NASDAQ 100 futures +.40%.

Morning Preview Links

Earnings of Note
Company/Estimate

• None of note
  

Economic Releases
8:30 am EST

• Final 4Q GDP is estimated to rise +3.0% versus a prior estimate of a +2.8% gain.
• Final 4Q GDP Price Index is estimated to rise +.4% versus a prior estimate of a +.4% gain.
• Final 4Q Core PCE is estimated to rise +.5% versus a prior estimate of a +.5% gain.
• Final 4Q Personal Consumption is estimated to rise +4.1% versus a prior estimate of a +4.1% gain.

9:55 am EST

• Final Univ. of Mich. Consumer Confidence for March is estimated to fall to 68.0 versus a prior estimate of 68.2.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Kocherlakota speaking and the Fed's Evans speaking could also impact trading today.
  

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

Stocks Surging into Final Hour on Less Tech Sector Pessimism, Short-Covering, Technical Buying, Lower Energy Prices

Broad Market Tone:

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

Equity Investor Angst:

• VIX 18.08 -5.69%
  
• ISE Sentiment Index 186.0 +151.35%
  
• Total Put/Call .91 +5.81%
  
• NYSE Arms .62 -45.02%
  

Credit Investor Angst:

• North American Investment Grade CDS Index 95.28 -2.10%
  
• European Financial Sector CDS Index 103.86 -2.90%
  
• Western Europe Sovereign Debt CDS Index 169.0 bps -.64%
  
• Emerging Market CDS Index 210.48 -4.29%
  
• 2-Year Swap Spread 21.0 +1 bp
  
• TED Spread 23.0 +1 bp
  

Economic Gauges:

• 3-Month T-Bill Yield .08% -1 bp
  
• Yield Curve 272.0 +3 bps
  
• China Import Iron Ore Spot $166.40/Metric Tonne +.54%
  
• Citi US Economic Surprise Index +53.8 -4.0 points
  
• 10-Year TIPS Spread 2.48% +9 bps
  

Overseas Futures:

• Nikkei Futures: Indicating +110 open in Japan
• DAX Futures: Indicating +20 open in Germany

Portfolio:

• Higher: On gains in my Biotech, Tech, Retail and Medical longs
  
• Disclosed Trades: Covered all of my (IWM)/(QQQ) hedges and some of my (EEM) short
  
• Market Exposure: Moved to 100% Net Long

BOTTOM LINE: Today's overall market action is bullish as the S&P 500 breaks above its 50-day moving average and trades at session highs, despite high energy prices, US housing worries, growing Mideast unrest and Japan concerns. On the positive side, Education, Gaming, Retail, Construction, HMO, Biotech, Wireless, Networking, Disk Drive, Semi, Computer and Software shares are especially strong, rising 2.0%+. Tech shares are strongly outperforming. The Transports are also relatively strong today. Gold is falling -1.0%, lumber is rising +1.44% and oil is down -.4%. The China Iron Ore Spot Index has begun to firm. The Japan sovereign cds is falling -3.87% to 99.01 bps, the Hungary sovereign cds is falling -2.83% to 263.77 bps and the Belgium sovereign cds is declining 2.13% to 142.46 bps. On the negative side, Homebuilding shares are lower on the day. (IYR)/(XLF) have underperformed throughout the day again. The UBS-Bloomberg Spot Ag Index is rising +1.67%. US price for a gallon of gas is unch. today at $3.55/gallon. It is up .43/gallon in 37 days. The euro continues to trade very well, considering the news, which is very surprising. Volume and breadth remain poor given the extent of the recent equity rally, however leadership is improving. Reports of easing tech supply chain worries from (AAPL) and (DELL), combined with (RHT)'s strong earnings, are boosting tech stocks today, which is a major positive. I would be surprised to see strong reports from (RIMM)/(ORCL) after the close, which could provide a better entry for tech shares in the morning. I expect US stocks to trade mixed-to-higher into the close from current levels on short-covering, technical buying, lower energy prices, less tech sector pessimism, more economic optimism and bargain-hunting.

Today's Headlines

Bloomberg:

• Spanish Banks Downgraded by Moody's Amid Review of Possible Government Aid. Thirty of Spain’s smaller banks had their senior debt and deposit ratings downgraded, as Moody’s Investors Service reviews whether governments are willing to support all their lenders in a crisis. Citing heightened financial pressure on the country’s sovereign rating and “many weak banks,” the New York-based ratings firm cut 15 lenders by two levels and five by three or four, according to a statement today. The outlook on most banks’ senior and deposit ratings remains negative, Moody’s said. “It seems increasingly plausible that hard choices will need to be made at some point over the rating horizon, balancing the sovereign’s incentive to support the banks with the need to protect its own balance sheet,” Moody’s said in the statement. “It is, in Moody’s view, increasingly likely that the sovereign will not be prepared to write all banks a blank check.”
• Highway to Japan Quake Area Opens as Tolls of Dead, Missing Exceeds 25,000. Japan’s main expressway between Tokyo and the region devastated by the record earthquake and tsunami 13 days ago opened for the first time since the temblor, as the number of dead and missing rose above 25,000.
• Traders piled into leveraged and inverse ETFs last week at the fastest pace since May as a jump in volatility spurred bets that magnify or run counter to price swings in underlying securities. Weekly flows more than doubled to $1.04 billion as the VIX climbed to an eight-month high. The last time inflows for leveraged funds and inverse ETFs topped that level was the week ended May 21 when they reached $1.29 billion, Bloomberg data show. Leveraged and inverse ETFs make up about $34.8 billion of the more than $1 trillion ETF market.
• Jobless Claims in U.S. Fell by 5,000 Last Week to 382,000. Fewer Americans filed applications for unemployment benefits last week, signaling the labor market is mending. Jobless claims declined by 5,000 to 382,000 in the week ended March 19, Labor Department figures showed today in Washington, in line with the median forecast of economists surveyed by Bloomberg News. The four-week moving average, a less volatile measure than the weekly figures, fell to 385,250 last week, the lowest level since July 2008, today’s data showed. The unemployment rate among people eligible for benefits, which tends to track the jobless rate, was 3 percent for a fourth consecutive week.
• Walgreen(WAG) Buys Drugstore.com for $429 Million to Add Sites. Walgreen Co. (WAG), the largest U.S. drugstore chain, agreed to buy Drugstore.com Inc. (DSCM) for about $429 million to add about 60,000 products available online. Drugstore.com holders will receive $3.80 in cash for each of their shares, in a transaction with an enterprise value of $409 million, Deerfield, Illinois-based Walgreen said today in a statement. That’s a 112 percent premium to Drugstore.com’s closing share price of $1.79 yesterday.
• Consumer Comfort in U.S. Falls to Seven-Month Low on Gas. Consumer confidence in the U.S. fell last week to the lowest level since August as more Americans became despondent over the economy. The Bloomberg Consumer Comfort Index dropped to minus 48.9 in the period to March 20 from minus 48.5 the prior week. The measure of the current state of the economy slumped to a 15- month low. The highest gasoline prices in more than two years weighed on families already dealing with rising grocery bills.
• Small-Business Hiring Gains Momentum, Data Show. U.S. small businesses are starting to ramp up hiring 21 months after the end of the deepest recession since the 1930s, supporting Federal Reserve Chairman Ben S. Bernanke’s confidence in a gradual labor-market recovery. Paychex Inc. (PAYX), which manages payroll accounting for companies that employ fewer than 100 workers, said checks per client rose 2.8 percent from a year ago in the quarter ended Feb. 28, the biggest gain in at least two years. The data, released with the company’s fiscal third-quarter earnings yesterday, adds to other evidence showing growing confidence by small businesses, including data from Insperity Inc. and surveys by Intuit Inc. (INTU) and the National Federation of Independent Business.
• Emerging-market stocks are likely to fall victim to accelerating inflation even after performing better this month than shares traded in developed countries, according to Barclays Capital. Emerging markets tend to do relatively poorly when the ISM index of prices paid exceeds 75, according to Barclays. The ISM gauge surpassed 75 in January and rose last month to 82, the highest since July 2008.
• Top U.S. Republicans Question Purpose and Goals of Libya Military Mission. Top Republicans in Congress questioned the purpose and goals of U.S. military intervention in Libya and complained that lawmakers weren’t consulted before President Barack Obama decided that America would join the international combat mission. House Speaker John Boehner sought an explanation of what he termed a “contradiction” between Obama’s stated goal of regime change in Libya and the limitation of the United Nations- sanctioned attack to curbing the ability of Muammar Qaddafi’s forces to attack civilians. Senator Richard Lugar of Indiana, the top Republican on the Senate Foreign Relations Committee, yesterday called for congressional hearings on the mission as U.S. and allied warplanes continued to strike Qaddafi’s ground forces.
• Apple's(AAPL) 50% Sales Growth My Continue Through 2012 on Boom in Mobile Apps. Apple Inc. (AAPL) can keep posting sales growth of more than 50 percent in the next two years as a mobile applications boom fuels demand for devices such as the iPad, said the chief executive officer of Forrester Research Inc. (FORR) George Colony, who founded Cambridge, Massachusetts-based Forrester in 1983, outlined his predictions in an interview at Bloomberg’s headquarters in New York.
• Orders for U.S. Durable Goods Unexpectedly Declined in February. Orders for long-lasting goods unexpectedly fell in February, reflecting declines in demand for capital goods and military aircraft. Bookings for goods meant to last at least three years dropped 0.9 percent after a 3.6 percent gain the prior month that was higher than initially reported, the Commerce Department said today in Washington. Orders excluding transportation equipment fell for a second month and demand for business equipment declined.
• Caterpillar(CAT), Komatsu Say U.S. Construction Equipment Demand is Rebounding. Caterpillar Inc. (CAT), Komatsu Ltd. (6301) and Volvo Group AB said North American construction equipment demand is rebounding from the slump that followed the financial crisis. The market may expand as much as 30 percent in 2011, said Olof Persson, president of Volvo’s construction equipment unit.
• BP(BP), Rosneft Share-Swap Deal is Blocked by Arbitration Tribunal in London.
  

Wall Street Journal:

• Airstrikes Fail to Loosen Libyan Siege. Military assessments suggested strikes on Col. Moammar Gadhafi's ground forces have failed to loosen their siege of the key western city of Misrata, as coalition forces pounded targets of the Libyan regime on the Mediterranean coast and deep inland. The city of Misrata, 125 miles east of Tripoli and Libya's third largest, faces a humanitarian emergency, according to military assessments.
• Radiation Extends Past Zone, New Report Says. Levels of radioactivity from Japan's damaged Fukushima Daiichi nuclear complex may be above government limits for infants in some areas outside the plant's 20-kilometer evacuation zone, according to the latest estimate to fuel an international debate over how close civilians should be allowed to the plant.
• Bernanke to Hold Press Conferences 4 Times a Year. In a break with tradition, Federal Reserve Chairman Ben Bernanke will hold public press conference four times a year, in the U.S. central bank's latest move to boost transparency and improve communications after its policies came under attack.

MarketWatch:

• AT&T Upgraded on T-Mobile 'Synergies'. Shares of AT&T Inc. got a boost Thursday after a Bernstein Research analyst upgraded the company, saying the potential payoff of its pending merger with T-Mobile is too great to ignore.

CNBC.com:

• US Family Income Down 18% Post-Crisis: Fed. American families have seen their incomes slide by almost a fifth since before the financial crisis, according to a study released by the Federal Reserve on Thursday.

Business Insider:

• Shocking Video Shows Pakistani Children Acting Out a Suicide Blast.

New York Times:

• States Pass Budget Pain to Cities. The state budget squeeze is fast becoming a city budget squeeze, as struggling states around the nation plan deep cuts in aid to cities and local governments that will almost certainly result in more service cuts, layoffs and local tax increases.

AppleInsider:

• US iPad 2 Orders From Apple's(AAPL) Online Store Now Ship in 3-4 Weeks. Availability of the iPad 2 has begun to improve, as Apple has eased the estimated ship time to between three and four weeks for new orders through its online store in the U.S. The new estimated shipping times for U.S. customers are an improvement from the previous estimate of between four and five weeks. But the wait is a little longer than some international orders, which are estimated to ship in two to three weeks. The shipping improvement is only a week, but it's a sign that Apple is beginning to catch up with strong demand it has faced since the iPad 2 first launched in the U.S. earlier this month. It's also a good sign for the international launch, as there had been some concern that sales in 25 new countries would only exacerbate the problem. The iPad 2 completely sold out at all retail outlets in the U.S. in its first weekend of availability, and stock has continued to trickle in over the following weeks. But there has also been concern about Apple's stock going forward, following the earthquake disaster in Japan and its potential effect on iPad components. Last week, a report from the Far East indicated that Apple's manufacturing partner Foxconn had stockpiled enough components to continue to assemble iPad 2 units for at least another two to three weeks. It was said that if the situation in Japan did not improve, Apple could face a stockout of the iPad 2. But for now those concerns appear to be unfounded, as availability appears to be improving with quicker shipping estimates. In addition, numerous readers have informed AppleInsider that their iPad 2 online order has shipped ahead of schedule.
  

The Washington Times:

• A President Worth a Billion Dollars? In a political career already noted for historic breakthroughs, President Obama is poised in 2012 to chalk up another: the nation’s first $1 billion candidate.

Reuters:

• Warren Buffett Says Collapse of Euro Not Unthinkable: TV. A collapse of the euro currency was not "unthinkable" if it comes under too much strain, billionaire investor Warren Buffett told CNBC on Thursday. "Enough of a strain could cause it to fall apart," Buffet told the news channel. "I know some people think it is unthinkable, I don't think it is unthinkable."
• Canada Fund Managers See Promise in U.S. Stocks. Canadian investment managers are increasingly upbeat about U.S. equities and slightly less bullish about Canadian stocks, according to a survey released on Thursday.
• Dell(DELL): No Material Hit to Supply Chain From Quake. Dell Inc has not suffered any material disruption to its supply chain as a result of the Japan earthquake, a senior executive at the company said on Thursday. "Supply chain disruption has not been material," Paul Bell, head of Dell's public sector and large enterprise business units and a member of the company's executive leadership team, told journalists in London.
• U.S. Commercial Paper Market Expands. The U.S. commercial paper market expanded in the latest week, pointing to growing credit demand to fund payrolls and inventories in the economy, Federal Reserve data showed on Thursday.
• JD Power Sees U.S. March Auto Sales Up 9%. J.D. Power and Associates forecast U.S. March light vehicle sales would rise 9 percent from a year earlier and indicated that no sales drop due to events in Japan had yet been felt in the new vehicle market. Also on Thursday, Barclays Capital said U.S. light vehicle sales would rise 15 percent in March to 13.4 million vehicles on a seasonally adjusted annualized rate. J.D. Power forecast 12.7 million on the same basis. Retail sales to consumers, excluding bulk fleet sales, are forecast to rise 12 percent, J.D. Power said, to 10.9 million vehicles on an annualized and season-adjusted basis.

Telegraph:

• Portugal Debt Crisis: David Cameron Holds Crisis Talks With EU Leaders.

Irish Independent:

• EU to Call Emergency Talks on Bank Crisis. AN EMERGENCY meeting of EU finance ministers is now on the cards to investigate the full extent of our banking crisis. It will be called because European leaders are seriously concerned that rescuing the banks will cost more than the €35bn agreed in the bailout deal.

Corriere della Sera:

• Italian Prime Minister Silvio Berlusconi said Libyan leader Muammar Qaddafi remains confident he'll retake full control of the country and called on him to abide by a UN demand for a cease-fire, citing an interview. "Qaddafi is still confident he can succeed because he has full control of the capital," Berlusconi said.

Publico:

• Portugal will revise its public debt figures to show a ratio of debt to gross domestic product higher than 90%. The Portuguese government, before the adjustment, estimated a debt ratio of 82.4% for 2010, rising to 87.9% this year.

Globe and Mail:

• We're Fighting War Lite, Without Leadership or Goals.

Bear Radar

Style Underperformer:

• Small-Cap Value (+.54%)

Sector Underperformers:

• 1) Homebuilders -.74% 2) Gold & Silver -.56% 3) Oil Service -.13%

Stocks Falling on Unusual Volume:

• SCHL, BBY, GCI, NSANY, AVEO, PAYX, EBIX and FUL
  

Stocks With Unusual Put Option Activity:

• 1) UUP 2) WTW 3) CBS 4) SD 5) RHT
  

Stocks With Most Negative News Mentions:

• 1) ABAX 2) ICO 3) CLI 4) AAP 5) AMSF
  

Charts:

• ETFs Falling on Unusual Volume
• Stocks Falling on Unusual Volume