Bull Radar

Style Outperformer:

• Mid-Cap Growth (+2.21%)

Sector Outperformers:

• 1) Coal +4.05% 2) Networking +2.71% 3) Computer +2.51%

Stocks Rising on Unusual Volume:

• CMC, ROSE, CTSH, SNCR, BP, HES, EQIX, CVS, AFAM, HRBN, VRSN, NILE, RIMM, BODY, DEST, JVA, SCOR, SATS, RP, HOGS, WFM, USAP, ASTE, ARUN, GHDX, TIBX, BIIB, NJ, IJT, RFG, PEZ, CUK, RPG, PIQ, GLP, GNI, FEZ, KRO, GORO, BAS, PMC, SBGI, TEN, BSFT, DHX, RBCN, SATA, SPWRA, ANR, SCSS, IDT, HOC, ULTA, AMLN, HLX, LPS, MOS, PCLN, KSU, RHT, NILE, PKG, WLK, CRS, CCL, RP, TIN, ADSK and UA
  

Stocks With Unusual Call Option Activity:

• 1) MMI 2) LRCX 3) ATI 4) ADBE 5) ITT
  

Stocks With Most Positive News Mentions:

• 1) BBY 2) BIIB 3) VZ 4) JCI 5) RTN
  

Charts:

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

Tuesday Watch

Evening Headlines

Bloomberg:

• Papandreou Faces Confidence Vote. Greek Prime Minister George Papandreou faces a confidence vote in his government today that may determine whether Greece becomes the first euro-area country to default. Tonight’s vote caps a week of turmoil for Papandreou, who fended off a revolt from the ranks of his ruling socialist Pasok party in parliament last week. That came after opposition parties rejected his call for a national unity government. European Union leaders have insisted Papandreou secure multi- party support for austerity measures that are a condition of the aid needed to avoid default as soon as next month. “Pasok now knows it has to close ranks,” said Holger Schmieding, chief economist at Joh. Berenberg Gossler & Co. in London. “The situation is volatile. A negative vote by the Greek parliament could trigger a serious crisis in Europe.” The International Monetary Fund, contributor of a third of the bailout money for Greece, Ireland and Portugal, has warned European leaders that a failure to take decisive action on the debt crisis risks triggering “large global spillovers.” At the same time, Papandreou is struggling to convince Greeks to accept a 78 billion-euro ($112 billion) package of state-asset sales and budget cuts, which include a “crisis levy” on wages.
• Crude Oil Gains for Second Day as Concerns Over European Debt Crisis Ease. Crude oil advanced for a second day in New York as concern eased that Greece will default on its debt and disrupt the region’s economy. Futures advanced as much as 0.8 percent after Luxembourg’s prime minister, Jean-Claude Juncker, said Greek Prime Minister George Papandreou assured him the government would do everything to ensure financial aid. Oil also rose after technical indicators signaled prices may have declined too far. An Energy Department report tomorrow may show U.S. crude inventories fell for a third week. “There’s a little bit of optimism leading back into the market and the chances are that the Greece concerns will probably be solved some way,” said Jonathan Barratt, managing director of Commodity Broking Services Pty in Sydney, who predicted oil will average $100 a barrel this year. “We feel oil is due for a bit of a bounce.” Oil for July delivery rose as much as 74 cents to $94 a barrel in electronic trading on the New York Mercantile Exchange and was at $93.77 at 11:12 a.m. Sydney time.
• Refined copper imports by China, the biggest user, are estimated to fall 32% this year from 2010, according to metals researcher Beijing Antaike Information Development Co. "We have cut our forecast from 2.4 million tons made at the beginning of this year to 2 million tons," said Antaike copper analyst Li Yusheng in a phone interview. "We think the destocking will continue." "Imports failed to climb up in a pickup of seasonal demand in April and May, and this isn't a good sign," Li said. "We think inventories at bonded and exchange warehouses can be further tapped to meet demand in the fall." Stockpiles at the bonded warehouse in Shanghai have fallen to around 400,000 tons from as much as 600,000 tons two months ago, while the historical average was around 200,000 tons, according to Li. Imports of refined copper fell 29% from a year ago to 756,199 tons in the first four months this year, customs data showed.
• Nuclear-Plant Operators May Be Tapped to Cover Safety Costs, IAEA Says. The United Nations nuclear watchdog is weighing whether nuclear-plant operators should be tapped to fill budget shortfalls needed to finance tougher atomic-safety reviews in the wake of Japan’s Fukushima Dai-Ichi meltdown.
• China stocks are likely to post a record stretch of monthly declines after government measures to fight inflation pushed down financial companies on the benchmark index to an all-time low relative to earnings. Banks and developers slid to a record 8.8 times estimated earnings in the week ended June 3, and were at 9.14 on June 17, Bloomberg data show. Non-financials are valued at 19.2 times estimated earnings, compared with a record low of 14.8 reached in October 2008. "When you rule out financial companies, Chinese stocks are actually not cheap and most of them are still way above their valuation bottoms," siad Li Jun, a strategist at Central China Securities Co. in Shanghai. "On the back drop of the government tightening liquidity, it's hard for valuations to expand so high-valuation stocks risk converging with low-valuation ones."
• China Money Rate Jumps to 4-Month High on Lull in Bills Due. The seven-day repurchase rate gained 83 basis points to 8.33 percent as of 11:32 a.m. in Shanghai, according to a weighted average rate compiled by the National Interbank Funding Center. It touched 8.50 percent earlier, the highest level since Jan. 31.
• More of the U.S. corn crop will be used to fuel cars than feed animals for the first time during the marketing year that starts in September, the Agriculture Department projects. The proportion of the harvest going to ethanol has almost quadrupled since 2002. The share will reach 40% in the current marketing year and be close to that level in 2011-2012. "For egg, poultry and beef producers, their largest cost has doubled because of this policy," Coburn, an Oklahoma Republican, said on June 16.
• Ponnuru: Too Much FDA Intervention Means Too Few Drugs. The Food and Drug Administration reports that the U.S. has shortages of 246 drugs -- a record number. Oncologists and anesthesiologists are increasingly concerned, with more than 90 percent of the latter saying they have experienced shortages. In a September 2010 survey, by the Institute for Safe Medication Practices, one in four respondents reported that shortages had caused medical errors during the previous year. More alarmingly, one in five reported adverse patient outcomes. Doctors have had to respond to shortages by substituting drugs that are not as effective, and by making wrenching decisions about which patients get access to which drugs. The consequences can be dire. Cytarabine is a drug that is effective in the treatment of leukemia and lymphoma -- but it has to be administered quickly, and it’s one of the drugs in short supply. One middle-aged woman reportedly fell into a persistent vegetative state because anesthesiologists ran out of epinephrine. There are also anecdotal reports of “gray markets,” which charge high prices for the affected drugs. What’s behind this shortage? Blame a combination of low profit margins and government activism.

Wall Street Journal:

• Change in China Hits U.S. Purse. For more than a decade starting in the early 1990s, U.S. inflation declined as low-wage workers in China and other developing nations joined the global economy and produced a tide of cheap goods that washed onto U.S. shores. The trend made American consumers feel better off and, by restraining the upward crawl of consumer prices, helped enable the Federal Reserve to fuel the U.S. economy with low interest rates. That epoch appears to be over. Prices of imported goods are climbing, becoming a source of inflationary pressure. A wide variety of common products made abroad, from shoes to auto parts to jewelry, are landing on U.S. docks with higher price tags. U.S. import prices, excluding oil, rose 8% over the past two years, a historic shift from their downward drift for two decades. The increase is bigger still when including oil
• SEC Scrutinizes Conoco(COP), Occidental(OXY). ConocoPhillips and Occidental Petroleum Corp. said they have received inquiries from the Securities and Exchange Commission related to their operations in Libya. ConocoPhillips spokesman John McLemore said the Houston oil company has received a request for information from the SEC and is cooperating fully. Occidental spokesman Richard Kline said in an email the company was "among the companies which received an information request regarding Libya from the SEC." The SEC declined to comment. A person familiar with the inquiries said the SEC is asking oil companies for any type of communications they held with the government of Col. Moammar Gadhafi since 2008. "It's a very broad inquiry for communications with the Libyan government," the person said.
• 'Guilty' for Expert Consultant. Another Win for Prosecutors as Jury Convicts Ex-Primary Global Worker of Fraud and Conspiracy.
• Fed Swap Lines Could Rise to Fore if Greek Contagion Spreads. Euro-zone banks could seek dollar funding from the Federal Reserve if the Greek debt crisis were to spread contagion throughout the financial system. In an echo of the 2008 global financial crisis, banks could need extra help from abroad and existing swap lines would be a useful backstop for banks to have, analysts said. Many bigger banks are presumed to be implicitly backstopped by their governments or central banks--and hence "too-big-to-fail." But the financial system as a whole may still need extra dollars to keep functioning smoothly. The European Central Bank has a swap line open with the Federal Reserve that allows it to borrow dollars from the U.S. central bank that can then be lent to euro-zone banks. The spread between three-month LIBOR and the Overnight Indexed Swaps (OIS) rate is the key data point in indicating stress and increased odds of that the ECB would have to tap the Fed swap line. A widening spread would signal that banks are increasingly unwilling to lend money to each other. Stone noted the spread is narrow at the moment, at about 13 basis points. That's well off the peak in the heart of the 2008 financial crisis of around 360 basis points, he said.
• Feds Sue Bankers Over Fall in Bonds. Federal regulators accused J.P. Morgan Chase & Co.(JPM) and Royal Bank of Scotland Group PLC of duping five large credit unions into buying more than $3 billion in mortgage bonds that were "destined to perform poorly," and that quickly sank the credit unions. The two civil lawsuits filed Monday in U.S. District Court in Kansas City, Kan., by the National Credit Union Administration are the most aggressive move yet by U.S. regulators to recover losses from Wall Street firms for alleged wrongdoing before and during the financial crisis.
• Lending Battle is Risky Business. Banks and other lenders are engaged in an increasingly pitched fight for some corporate borrowers, raising concerns among analysts and regulators that the banks aren't charging enough to cover the risk they are taking on. The battle to make loans, in contrast to the credit squeeze of recent years, is being driven by two factors: demand by investors for these loans and desire by banks to boost their revenues, which they have struggled to do recently.
• The Fiscal Pledge We Need: Cut, Cap, Balance. The U.S. debt is now above its current limit of $14.3 trillion, a figure so large that it is nearly impossible for the average American to comprehend. Under the budget proposed by President Obama for 2012, the debt would rise to $15.7 trillion in 2021. The annual interest alone would be about $700 billion, and that would only increase with inflation. President Obama's proposed budget was so excessive and fiscally irresponsible that it was voted down in the Senate 97-0. In spite of these facts, President Obama and Democratic leaders in Congress still want to increase the national debt limit without making meaningful spending cuts or reforms. This plan, a so-called "clean" increase in the debt limit, recently failed a House vote of 318-97. Every Republican and 82 Democrats voted against.

MarketWatch:

• Tsunami-Hit Japan Town Faces Recovery Frustration.

Business Insider:

• John Paulson Just Dumped All His Sino-Forest After Taking a Gigantic Bath. John Paulson, the billionaire hedge fund manager, has sold all his shares of Sino-Forest, the Chinese timber company whose shares have collapsed in the wake of fraud allegations, according to Bloomberg. Paulson had a huge holding that has scorched his returns for June -- he's reportedly down 13% this month alone (also in part due to wrongway bets on financials). Originally, Paulson defended the stock in the wake of allegations from short-selling research firm Muddy Waters, but the negatives keep piling up. This weekend a Canadian newspaper basically corroborated the claims made by Muddy Waters.
  

Zero Hedge:

• Presenting Obama's Latest $50,000 Non-Recourse, Interest-Free Gift to "Troubled" Homeowners.

IBD:

• Bridgepoint(BPI) Benefits As Fed Rules Relax.

Politico:

• House GOP Considers New Limits on Libya.
• Obama's 30th Fundraiser Tonight. The White House says President Obama isn't focused on his reelection campaign, but tonight he will headline his 29th and 30th fundraisers for the year. Mark Knoller of CBS News, tabulator of White House statistics, said Obama so far this year has raised money in six states plus Washington, D.C. and Puerto Rico. At the same point in former President George W. Bush's reelection cycle, he had done only three fundraisers, Knoller said.
  

USA Today:

• Hybrid Car Sales Stagnate as Buyers Opt for Fuel-Thrifty Compacts.

Telegraph:

• UK Treasury Plans for Greece to Go Bust. Treasury ministers have admitted that the Government is drawing up contingency plans for a Greek bankruptcy after being warned by a former foreign secretary that the euro “cannot last”.

La Tribune:

• European Union Energy Commissioner Guenther Oettinger said nuclear power will continue to play an important role in Europe's energy production in the coming decades, citing an interview.

Yonhap News:

• North Korea has recently bought tear gas, helmets and shields in volume from China.

Hong Kong Economic Times:

• U.S.-listed Chinese companies have fundamental flaws and suffer from mismanagement that have come to light because the credit system of their home country is "backward," Yi Xianrong, a researcher at the Chinese Academy of Social Sciences, wrote in a commentary. These problems were exposed after the companies moved to a credit system that is based on the rule of law, he wrote.

China Finance:

• China should stick to a prudent monetary policy at the moment because consumer and asset prices may rebound if policy gets any looser, China Finance magazine said in an editorial. The nation still faces liquidity risks as banks' off-balance sheet businesses are growing rapidly, the editorial said. China should stay on high alert for imported inflation triggered by loose monetary policies in the world's major economies.

China Daily:

• The price of pork and live pigs rose to a record this month due to the rising cost of corn and labor, citing Feng Yonghui, chief analyst at Soozhu.com, a website that monitors the market. The price for live pigs rose to 18.57 yuan a kilogram by the end of the third week of June, exceeding the previous record set in April 2008, citing Feng. The price of pork rose to 27.67 yuan a kilogram last week, also exceeding a record set in 2008. Prices for pork and live pigs will continue rising until the end of this year, citing Zhu Baoliang, deputy director of the economic forecasting department at the State Information Center as saying. The price of corn, which makes up 60% of pig feed, is the "biggest force" fueling pork prices, citing Feng. Rising wages for workers also contributed.
• Industrial Bank Co. economist Lu Zhengwei said he expects China to raise interest rates in July. China should avoid an economic "hard landing," he said.
  

Evening Recommendations
CSFB:

• Reiterated Outperform on (AAPL), target $500.

Night Trading

• Asian equity indices are +.50% to +1.25% on average.
• Asia Ex-Japan Investment Grade CDS Index 116.0 unch.
  
• Asia Pacific Sovereign CDS Index 119.0 +1.0 basis point.
  
• S&P 500 futures -.11%.
  
• NASDAQ 100 futures -.07%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (CMC)/.20
• (BKS)/-1.00
• (GRB)/.04
• (WAG)/.63
• (JEF)/.40
• (CCL)/.24
• (JBL)/.57
• (ADBE)/.51
• (AVAV)/.69

Economic Releases
10:00 am EST

• Existing Home Sales for May are estimated to fall to 4.8M versus 5.05M in April.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The weekly retail sales reports, Jeffries Consumer Conference, RBC Capital Mining/Materials Conference, Goldman Sachs dot Commerce Day and the (CBT) analyst day 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 modestly lower and to rally into the afternoon, finishing modestly higher. The Portfolio is 75% net long heading into the day.

Stocks Rising into Final Hour on Short-Covering, Bargain-Hunting, Technical Buying

Broad Market Tone:

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

Equity Investor Angst:

• VIX 20.33 -6.96%
  
• ISE Sentiment Index 119.0 +26.60%
  
• Total Put/Call .90 -24.37%
  
• NYSE Arms .86 +1.37%
  

Credit Investor Angst:

• North American Investment Grade CDS Index 99.32 -.27%
  
• European Financial Sector CDS Index 117.58 +1.38%
  
• Western Europe Sovereign Debt CDS Index 223.33 -.59%
  
• Emerging Market CDS Index 231.30 +.50%
  
• 2-Year Swap Spread 27.0 +1 bp
  
• TED Spread 23.0 +1 bp
  

Economic Gauges:

• 3-Month T-Bill Yield .02% unch.
  
• Yield Curve 258.0 +2 bps
  
• China Import Iron Ore Spot $173.40/Metric Tonne -.12%
  
• Citi US Economic Surprise Index -99.50 +2.4 points
  
• 10-Year TIPS Spread 2.17% -1 bp
  

Overseas Futures:

• Nikkei Futures: Indicating +75 open in Japan
• DAX Futures: Indicating +36 open in Germany

Portfolio:

• Slightly Higher: On gains in my Retail longs, Biotech longs, Medical longs and emerging market/commodity shorts
  
• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges, covered some of my (EEM) short and added to my (SODA) long
  
• Market Exposure: Moved to 75% Net Long

BOTTOM LINE: Today's overall market action is mildly bullish as the S&P 500 trade slightly higher despite rising eurozone debt angst, financial sector weakness, higher energy/food prices and ongoing weakness in some market leaders. On the positive side, Airline, Road & Rail, Retail, REIT, HMO, Medical Equipment, Software and Defense shares are especially strong, rising more than +.75%. Small-Caps and Cyclicals are outperforming. (IYR) is outperforming. The Transports have traded well throughout the day again. Lumber is rising +1.51%. On the negative side, Bank, Oil Service, Coal and Alt Energy shares are under mild pressure, falling more than -.50%. (XLF) has lagged throughout the day. Copper is down -.66%, the UBS-Bloomberg Ag Spot Index is +.56% and oil is rising +.3%. The 10-year yield is flat at 2.95% despite the rise in stocks. The US price for a gallon of gas is -.03/gallon today to $3.65/gallon. It is up .51/gallon in less than 4 months. The Greece sovereign cds is rising +4.86% to 2,019.01 bps, the China sovereign cds is jumping +6.31% to 82.04 bps, the Japan sovereign cds is surging +7.46% to 93.0 bps, the Russia sovereign cds is gaining +4.08% to 149.17 bps, the Egypt sovereign cds is gaining +4.85% to 316.75 bps and the Saudi sovereign cds is gaining +4.4% to 98.65 bps. The Shanghai Composite finished near session lows last night, falling another -.82% and is now down -6.7% ytd. India's Sensex also continues to trade very poorly, dropping another -2.04%, and is now down -14.6% ytd. Some key US stocks, continue to trade very poorly notwithstanding the recent bounce in the major averages. With US stocks still technically oversold near their 200-day moving averages, gauges of investor sentiment mostly depressed and a likely short-term positive catalyst coming from Greece, bulls could gain upside traction over the coming days. I expect US stocks to trade modestly higher into the close from current levels on short-covering, bargain-hunting and technical buying.

Today's Headlines

Bloomberg:

• EU's Juncker Says Progress Made on New Greek Aid Package. The following are comments by Luxembourg’s Jean-Claude Juncker, who leads the group of euro- area finance ministers, on prospects for further aid payments to Greece. He spoke after a meeting of euro-region finance chiefs in Luxembourg. On the role of private investors in a new aid program for Greece: “We have agreed that there should be a private-creditor participation, which should really be voluntary because we want to avoid any credit default or credit event. But it also has to be clear that Greece has to bring about a situation where all the expected commitments are taken charge of. We depend very much that all legal processes are approved before the end of this month. Beginning of July we will have to continue to discuss the private creditor participation, which will be voluntary and we will have to check whether Greece has fulfilled all its obligations.” “Voluntary participation has to be voluntary which means that no pressure whatsoever can be exercised on the private sector and this has to be checked at the beginning of July. My objective is to call another euro group to Brussels in the first days of July where we will discuss these questions in detail.” “We agreed today that the participation of private creditors has to be voluntary, but Greece also has to deliver.” “With a voluntary contribution by private creditors, one can’t predict in advance the size of this participation. This has to be discussed also with the private creditors.”
• Corporate Bond Risk Rises in Europe, Credit-Default Swaps Show. Banks led an increase in the cost of protecting European corporate bonds from default amid concern Greece may reject austerity measures demanded for a bailout. The Markit iTraxx Financial Index of credit-default swaps on the subordinated debt of 25 banks and insurers jumped 8.5 basis points to 298, according to JPMorgan Chase & Co. at 9 a.m. in London. Contracts on the Markit iTraxx Crossover Index of 40 companies with mostly high-yield credit ratings rose 9 basis points to 419. “There only seem to be two stories in town right now,” CreditSights Inc. analysts led by Simon Adamson wrote in a note today. “Greek sovereign debt restructuring -- or not -- and Irish banks’ debt haircuts -- maybe.” The Markit iTraxx SovX Western Europe Index gained, rising 6.2 to 228.5. Default swaps on Greece jumped 40 basis points to 1,967 and contracts on Italian government debt climbed 12 basis points to 182.5, the highest since March 10, according to CMA. The Markit iTraxx Europe Index of 125 companies with investment-grade ratings rose 2.5 basis points to 113.5 basis points. The Markit iTraxx Financial Index linked to senior debt of 25 banks and insurers climbed 3.25 basis points to 167.24.
• China 1-Day Shibor Rises Most in 5 Months as Redemptions Drop. China’s one-day Shanghai interbank offered rate, or Shibor, surged the most in five months on speculation cash supplies will become tighter as redemptions of central bank bills decline this week. The seven-day repurchase rate, a gauge of interbank funding availability, rose for a fourth day as an increase in bank reserve ratios, announced last week, took effect. Some 88 billion yuan ($13.6 billion) of central bank bills and repurchase agreements will mature this week, compared with 115 billion yuan the week before, said Wee-Khoon Chong, a fixed- income strategist at Societe Generale SA in Hong Kong. “The cash squeeze worsened today because it’s the reserve ratio payment day,” said Guo Caomin, a Shanghai-based bond analyst at Industrial Bank Co. “Due to the small amount of maturing bills we probably won’t see an obvious easing of the liquidity shortage this week.” The one-day Shibor jumped 297 basis points, or 2.97 percentage points, to 6.96 percent, according to a fixing rate published at 11:30 a.m. in Shanghai by the National Interbank Funding Center. That was the biggest increase since Jan. 20. The seven-day repo, which measures interbank funding availability, jumped 80 basis points to 7.51 percent as of 4:20 p.m. in Shanghai, the highest level since Jan. 31, according to a weighted average rate compiled by the Interbank Funding Center.
• Oil Drops to Four-Month Low, Trades Below 200-Day Average on Europe Crisis. Oil fell to the lowest in four months in New York, bringing its loss from this year’s peak to 20 percent, on speculation a weakening global economy and Greece’s debt crisis will lead to reduced fuel demand. Futures slid as much as 2 percent, erasing this year’s gains, as European governments failed to agree on releasing a loan payout to spare Greece from default and Japan’s exports dropped in May more than forecast. Crude traded for a second day below its 200-day moving average, a major technical-support level. Today’s low marked a 20 percent decline from its 2011 settlement high in April, the sign of a bear market. Oil in New York is trading below its 200-day moving average, currently at $92.30 a barrel, according to data compiled by Bloomberg. Hedge funds and other speculators boosted wagers on crude rising in the seven days ended June 14, the U.S. Commodity Futures Trading Commission said in its weekly Commitment of Traders report. Net-long bets climbed by 3,398 futures and options combined, or 1.8 percent, to 194,372. That was the first increase in three weeks.
• Barclays(BCS), BofA(BAC) Can't Block Flyonthewall.Com Reports on Stocks, Court Rules. Barclays Plc (BARC), Bank of America Corp. (BAC)’s Merrill Lynch and Morgan Stanley can’t use New York law to block Theflyonthewall.com, an online financial news service, from issuing immediate reports about changes in their stock ratings, a federal appeals court ruled.
• Saudi Women Ask Clinton Why She Hasn't Supported Female Drivers. A group campaigning for the right of Saudi women to drive sent a letter to U.S. Secretary of State Hillary Clinton asking why she hasn’t expressed support for those who defied a ban on driving last week. More than 50 women got behind the wheels of their cars on June 17, according to Saudi Women for Driving, a group of women’s-rights activists, bloggers and academics challenging the world’s only ban on female drivers. No arrests were reported. In a letter released today, the group said it asked Clinton in a June 3 letter to “make a public statement supporting our right to drive.”
• Dollar to Gain as Asian Interest Rates Rise, Morgan Stanley Says. The US dollar will rebound through 2011 as Asian central banks raise interest rates to curb inflation, damping economic growth and demand for the region's assets, according to Morgan Stanley. Investor appetite for the dollar will rebound as central banks from China to India raise interest rates, Ian Stannard, head of European foreign-exchange strategy, said. The end of the Fed's $600 billion asset-purchase program this month will also renew demand for the U.S. currency. The dollar may also benefit from less selling pressure linked to the carry trade, based on less demand for assets in the Asian nations.
• BofA(BAC) Weighs Sale of CCB Stake. Bank of America Corp. (BAC) may sell part of its $21 billion stake in China Construction Bank Corp. (939) to bolster capital before new international standards take effect, said three people briefed on the plans. Bank of America, the biggest U.S. lender by assets, may try to keep about half its CCB shares because it intends to remain a strategic investor in the Chinese bank, said two of the people, who declined to be identified because the plans are private. The sale may take place later this year, they said.

Wall Street Journal:

• EU Urges Greece to Back More Austerity. European Union leaders expressed confidence Monday at a meeting in Luxembourg that Greece will concede on implementing economic reforms in exchange for the next tranche of aid to help it avoid default. A formal decision to disburse €12 billion ($17.17 billion) to Greece should be taken by early July, after the Greek government commits to a new austerity package, said Eurogroup President Jean-Claude Juncker, who also serves as prime minister of Luxembourg, and European Union Economic Affairs Commissioner Olli Rehn. The Eurogroup will convene on July 3 for an extraordinary session to tackle the issue.
• The Regulator Down the Hall. Fed and Comptroller of Currency Bolster the Ranks of Staffers 'Embedded' at Nation's Biggest Banks. Much like reporters assigned to a military unit during war, these regulatory "embeds" get unprecedented access to financial firms such as Bank of America Corp., Goldman Sachs Group Inc. and Morgan Stanley. They file through the same security turnstiles, eat lunch at the company cafeteria and press top executives for answers to questions about mortgage-documentation procedures and exposure to European debt and municipal bonds.
• Wal-Mart(WMT) Wins Supreme Court Sex-Bias Case Ruling. The Supreme Court ruled Monday that a sweeping gender-discrimination lawsuit against Wal-Mart Stores Inc. can't proceed as one large class action, a significant victory for the discount retailer and other corporations.

MarketWatch:

• Analysts Ring Up Whole Foods(WFM), Fresh Market(TFM). Natural-foods retailers Whole Foods Market Inc. and Fresh Market Inc. look appetizing, analysts said Monday.
• Credit Suisse Downgrades China Banks, GDP. Cites inflation, slowing growth, and continued tightening.
• Studios Disarming Cable in Battle with Netflix(NFLX).
  

CNBC.com:

• Insider Trading Probe Sparks Paranoia in Traders. “These days, if you aren’t wearing a wire, you have to assume someone nearby or on the other end of the phone is,” he said. He went on to explain that many traders who regularly met with others for drinks or dinner were become increasingly fearful of “talking shop.” “You mention a rumor. Or something you heard secondhand, and everyone wonders: Is this inside information? Which one of us at the table is taping this?” he said.

Business Insider:

• Nebraska Nuke Plant Owners Tell Management to Buy Anything They Need to Ward Off Rising Floodwaters. The owners of the flood-threatened Fort Calhoun Nuclear Power Plant in Nebraska assert that everything is under control. But just to be sure, they are allowing the plant's management to skip the normal procurement process and buy anything it might need to protect Fort Calhoun from the still-rising waters of the flooded Missouri River.
• Citi Explains Why This Quarter Was Horrendous for Goldman(GS) and Morgan Stanley(MS).
• Black Unemployment Jumps to Depression Levels.
• NBC Cuts "Under God" From US Open Pledge, And The Culture Wars Drag On. NBC caused a brief TwitterStorm yesterday by omitting the words “under God” and “indivisible” from a promotional video featuring the Pledge of Allegiance during the US Open.

Zero Hedge:

• Doubling Down on Bailout CDOs: EFSF Guarantees to be Raised From 440 Billion Euros to 780 Billion Euros.
• Goldman(GS) Caught Manipulating Brent/WTI Spread: Penalty: $40,340.
• PIMCO on Central Planning and "Financial Repression" By Central Banks to Keep Rates Low.
  

ZDNet:

• Rumor Time - Apple(AAPL) to Release iPhone 5 on September 7.

Reuters:

• US Top Court Rejects Global Warming Lawsuit. The U.S. Supreme Court on Monday rejected a global warming lawsuit against five big power companies, its most important environmental ruling since 2007 and a victory for the utilities and the Obama administration.

Market News International:

• China should continue to raise banks' reserve requirement ratios to curb inflation, citing a person familiar with the thinking within the National Development and Reform Commission. An increase in the reserve requirement ratios will help prevent the country's economy from having a hard landing, citing the person.

Financial Times:

• Equity Shorts in Disguise. Synthetic prime – a.k.a — the art of transforming client exposures. But, we wonder, could there be more to it than meets the eye?
• Hedge Funds Vs Bank of Ireland. More hedge funds than pensioners in the lawsuit filed against Bank of Ireland over the weekend:

Telegraph:

• Boris Johnson: Let Greece Go Bankrupt and Leave the Euro. Britain should refuse to contribute to a second bail-out of Greece and the country should be allowed to default on its debts and leave the euro, Boris Johnson has said. Writing in The Daily Telegraph, the Mayor of London claims that the euro's recent troubles have "exacerbated" the financial crisis and challenges George Osborne, the Chancellor, to "stop chucking good money after bad".

The Economic Times:

• India's Economy Skids as Leaders Sleep at the Wheel. Critics would have preferred Mukherjee focus more on dealing with a confluence of worrying economic trends -- accelerating inflation, declining foreign investment and slower growth and domestic investment -- that policy inertia will only make worse.

Bull Radar

Style Underperformer:

• Large-Cap Value (+.30%)

Sector Underperformers:

• 1) Banks -.61% 2) Coal -.61% 3) Energy -.31%

Stocks Falling on Unusual Volume:

• CBEY, ELN, HNR, TGA, SNE, LGCY, LECO, SPRD, SCOR, RIMM, AFAM, LHCG, SWKS, JVA, GTIV, AMED, VELT, GLP, SBR, PNC, BJ, BRC and DHX
  

Stocks With Unusual Put Option Activity:

• 1) SWKS 2) XRX 3) EWT 4) ADBE 5) UTX
  

Stocks With Most Negative News Mentions:

• 1) WMT 2) AEP 3) RIMM 4) VFC 5) JBL
  

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Value (+.57%)

Sector Outperformers:

• 1) HMOs +2.26% 2) REITs +.96% 3) Airlines +.95%

Stocks Rising on Unusual Volume:

• CVLT, BIIB, SGEN, HRBN, PWRD, TXRH, CRS, CIX and MCP
  

Stocks With Unusual Call Option Activity:

• 1) HANS 2) OCZ 3) BIIB 4) QIHU 5) MYL
  

Stocks With Most Positive News Mentions:

• 1) WFMI 2) NTGR 3) VSH 4) TFM 5) HON
  

Charts:

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