Today's Headlines

Bloomberg:

• Euro-Area Retail Sales Decline, Led by Weakness in France. Euro-area retail sales fell in February as a decline in France offset gains in Germany and Spain. Sales in the 17-nation currency bloc decreased 0.3 percent from January, when they rose a revised 0.9 percent, the European Union’s statistics office in Luxembourg said today. Economists had forecast a decline of 0.4 percent, according to the median of 20 estimates in a Bloomberg News survey. From a year earlier, February sales fell 1.4 percent. Retail sales in France, the second-biggest euro-area economy, dropped 2.2 percent in February from the prior month after a 0.2 percent gain in January, today’s report showed. Sales in Finland declined 0.8 percent after a 0.3 percent gain in the previous month. 
• European Stocks Post Biggest Weekly Decline in 2013. European stocks posted their biggest weekly decline since November as reports signaled that the economic rebound in the U.S. has slowed, while the European Central Bank said risks remain to the euro area’s recovery. Vodafone Group Plc lost 2.1 percent after Verizon Communications Inc. denied that it has considered buying the mobile-phone operator. Kazakhmys Plc and Evraz Plc slumped more than 7 percent this week, leading a gauge of mining stocks to its longest streak of losses in 13 years. Alcatel-Lucent SA advanced 3.9 percent as Deutsche Bank AG recommended that investors buy shares in the telecommunications equipment maker. The Stoxx Europe 600 Index (SXXP) fell 2.3 percent in the four-day week following the Easter holiday, completing its longest stretch of losses in more than 10 months. The slump pared the gauge’s advance so far this year to 2.7 percent.
• Retail Employment Slumps Most in Year as Stores Cut Back. Employment by retailers slumped the most in more than a year last month, hurting growth in the U.S. job market, as higher payroll taxes and concern fiscal policies will reduce consumer spending prompt companies to trim costs. Retail employment declined by 24,000 in March, the most since February 2012, Labor Department data showed today in Washington. That included a drop of 15,000 in clothing and accessories stores and a decrease of 10,000 in building-material and garden suppliers, according to the report. Retailers have been cautious about hiring because of political paralysis in Washington and concern the 2 percentage-point increase in payroll taxes will slow purchases, said Jack Kleinhenz, chief economist for the National Retail Federation.
• Sequestration Seen as Airline Drag as U.S. Cuts Travel. U.S. government spending on air travel probably fell as much as 30 percent in the past month amid congressionally mandated budget cuts that threaten to keep weighing on the industry, a JPMorgan Chase & Co. analyst said. Demand from federal employees may stay at this level or even lower “in perpetuity,” JPMorgan’s Jamie Baker wrote today in a note to clients in which he estimated that the government accounts for 3 percent to 4 percent of airline revenue. He pared his full-year revenue projections by as much as 3 percent.
• Gross Says U.S. Growth Won’t Beat 2% in 2013: Tom Keene. Pacific Investment Management Co.’s Bill Gross, manager of the world’s biggest bond fund, said the U.S. economy won’t expand more than 2 percent this year even with one or two quarters of faster growth. “A 2 percent ‘new normal’ economy is the best we can expect,” Gross said in a radio interview with Tom Keene after a report showed employers hired fewer workers than forecast in March and a decline in the size of the labor force pushed the jobless rate down to a four-year low. “The sun isn’t going down, but there’s certainly an element of dusk to it.” 
• New Bird Flu Seen Having Some Markers of Airborne Killer. The new bird influenza that’s killed six people in eastern China has some of the genetic hallmarks of an easily transmissible virus, according to the scientist who showed how H5N1 avian flu could become airborne. The H7N9 strain, which is a new virus formed as a result of two others merging their genetic material, has features of viruses that are known to jump easily from birds to mammals, and a mutation that may help it attach to cells in the respiratory tract, said Ron Fouchier, a professor of molecular virology at Erasmus Medical Center in the Netherlands, in a telephone interview yesterday. “That’s certainly not good news,” said Fouchier, who reviewed a gene sequencing of H7N9 published by Chinese health authorities. “This virus really doesn’t look like a bird virus anymore; it looks like a mammalian virus.”
• Job and Export Drops Show Canada Hurt by Global Weakness. Canada’s biggest employment loss since the recession four years ago and an unexpected trade deficit underscore how the world’s 11th largest economy is being hobbled by weak global demand. The drop of 54,500 positions reported today by Statistics Canada offset a 50,700 gain in February, and lifted the unemployment rate to 7.2 percent from 7 percent. The merchandise trade deficit for February was the 11th in a row, marking the longest streak in records dating to 1988. 
• Oil Heads for Biggest Weekly Drop in Six Months on Jobs. West Texas Intermediate crude headed for the biggest weekly drop in six months as U.S. employers hired less than half the number of workers forecast in March, raising concern that economic growth won’t be strong enough to support oil demand. Prices tumbled for the fourth time in five days after the Labor Department said payrolls climbed by 88,000, the smallest gain in nine months. WTI oil for May delivery dropped 63 cents, or 0.7 percent, to $92.63 a barrel at 1:48 p.m. on the New York Mercantile Exchange after falling to $91.91, the lowest intraday level since March 21.
• Citigroup(C) Blows by Santander as Greenest Bank on Wind Power Push. As developers rushed to build wind- power plants last year before U.S. tax credits were set to run out, California’s Solano Wind Project was racing against a different deadline: getting turbines running for the state’s most blustery months. The Citigroup Inc (C).-backed wind farm succeeded. In May, it began delivering enough new power for 44,000 homes, an effort that helped New York-based Citi bump Banco Santander SA (SAN) from its perch as the world’s greenest bank, Bloomberg Markets magazine will report in its May issue.

 Fox News:

• North Korea moves missile launchers, issues safety warning to foreign embassies. As tensions continued to mount on the Korean peninsula, the communist dictatorship in the North deployed mid-range missile launchers to its east coast and reportedly warned foreign embassies Friday it cannot guarantee the safety of diplomats after April 10. Reuters reported early Friday that North Korea deployed two of its intermediate range missiles on mobile launchers and hid them on the east coast of the country, citing a South Korean news agency. South Korea said Thursday North Korea moved a missile with "considerable range" to its east coast after an unnamed spokesman for the North Korean army warned the U.S. Wednesday that its military has been cleared to wage an attack using "smaller, lighter and diversified nuclear" weapons. Meanwhile, the United Kingdom foreign office confirmed in a statement Friday that North Korea asked a number of foreign embassies in Pyongyang  to consider moving staff out since they could not assure their safety in the event of conflict.

CNBC:

• Data Leak Shakes Notion of Secret Offshore Havens and, Possibly, Nerves. They are a large and diverse group that includes a Spanish heiress; the daughter of the former Philippine dictator Ferdinand Marcos; and Denise Rich, the former wife of the disgraced trader Marc Rich, who was pardoned by President Bill Clinton. But, according to a trove of secret financial information released Thursday, all have money and share a desire to hide it.

Zero Hedge: 

• People Not In Labor Force Soar By 663,000 To 90 Million, Labor Force Participation Rate At 1979 Levels. (graph)
• Real March Unemployment Rate: 11.6%. (graph)
• George Soros Warns "Central Banks Are Creating Financial Instability". (video)
• Japan's 13 Sigma Bond Swan. (graph)
• Bridgewater Asks "Could Italy Blow Up The Euro?"
• European Stocks Slammed But Bonds Bid.

Business Insider: 

• North Korea Poised To Enter Stage Three Of A Plan To Create Fear Of Nuclear War.
• This Map Shows The Spread Of A Deadly New Bird Flu Strain Terrifying Everyone In China.
• ACHUTHAN: The Key Jobs Metric I Follow Has Dropped To A 19-Month Low.
• This Sure Doesn't Look Like An American Manufacturing Renaissance. (graph)
• EL-ERIAN: The Central Bank 'Pharmaceutical Company' Has Brought An Untested Medicine To The Market.
• It's Time To Cut The Payroll Tax.
• The Scariest Jobs Chart Ever. (graph)

Reuters: 

• Copper slides after weak U.S. jobs report.
• S&P says Britain's AAA at risk if growth, deficit disappoint. Standard & Poor's warned Britain on Friday that worse-than-expected economic growth or slow progress in fixing its budget deficit could cost the country its top-notch credit rating. S&P affirmed the UK's AAA sovereign credit rating but kept the outlook as negative. "The outlook remains negative, reflecting our view of at least a one-in-three chance that we could lower the ratings if the UK's economic and fiscal performances were to weaken beyond our current expectations," S&P said in a statement.

Yonhap News:

• N. Korea loads two medium-range missiles on mobile launchers. North Korea has loaded two intermediate-range missiles onto mobile launchers and hidden them in an unidentified facility near the east coast, Seoul military sources said Friday, triggering speculation that the North is ready for an abrupt missile launch.

RTHK:

• Bank of Japan's quantitative easing won't stimulate domestic demand because it will result in a depreciation of the yen and thereby increase the cost of raw materials, which are mostly imported, citing Yu Yongding, a former academic adviser to the People's Bank of China. Yu said the measures may not help Japan's economy recover and that there is a chance the economy slides into recession, according to the report.

Bear Radar

Style Underperformer:

• Large-Cap Growth -1.20%

Sector Underperformers:

• 1) Education -2.71 2) Gaming -2.30% 3) Networking -2.22%

Stocks Falling on Unusual Volume:

• RDWR, FFIV, ETP, ENB, ANV, CONN, THI, NTCT, DAL, SI, SLF, TTF, CRH, UNM, CVLT, PAMT, SWI, HTWR, CAVM, CWH, MPLX, IMO, HMIN, CP, ASR, PRU, MTW, FLT, JNPR, TEX, DAL and NTCT

Stocks With Unusual Put Option Activity:

• 1) LO 2) FFIV 3) FXY 4) WYNN 5) CSCO
  

Stocks With Most Negative News Mentions:

• 1) TEX 2) MAT 3) HPQ 4) CVLT 5) CAT
  

Charts:

• ETFs Falling on Unusual Volume

• Stocks Falling on Unusual Volume

Bull Radar

Style Outperformer:

• Large-Cap Value -.70%

Sector Outperformers:

• 1) Oil Service +.28% 2) Steel +.19% 3) Utilities +.01%
  

Stocks Rising on Unusual Volume:

• NIHD, XCO, CRK, OWW, SRPT, JCP, BBG and CRK

Stocks With Unusual Call Option Activity:

• 1) NFX 2) FFIV 3) WLP 4) TLT 5) IGT
  

Stocks With Most Positive News Mentions:

• 1) IHS 2) LUV 3) CELG 4) TDC 5) WYN

Charts:

• ETFs Rising on Unusual Volume 

• Stocks Rising on Unusual Volume

Friday Watch

Evening Headlines 
Bloomberg: 

• Lew to Push Growth Amid Contagion Concerns in First Europe Visit. Lew arrives April 8 for a two-day visit to meet with European Central Bank President Mario Draghi in Frankfurt, German Finance Minister Wolfgang Schaeuble in Berlin, French Finance Minister Pierre Moscovici in Paris and European Union officials in Brussels. He returns to Washington the evening before President Barack Obama sends his overdue fiscal 2014 budget to Congress on April 10. “Lew’s trip to Europe comes at a critical juncture for the U.S. economy,” said Prasad, a former International Monetary Fund official. “A flare-up of the euro zone debt crisis could create turmoil in global financial markets and set back the fragile U.S. recovery.”

• Draghi's Whatever It Takes Limited to More of Same: Euro Credit. The ECB president said yesterday policy makers "stand ready to act" to bolster the flagging economy. While they discussed lower interest rates and more long-term bank loans, they failed to reach a consensus, according to three euro-area officials familiar with the talks. The Governing Council didn't consider a plan to boost company lending because it isn't ready, the officials said on condition of anonymity.   

• Hollande Dismisses Reshuffle as Political Crisis Hits Popularity. French President Francois Hollande, in the midst of the worst political crisis since entering office in May, dismissed speculation of a cabinet reshuffle after a minister he’d charged with fighting tax evasion admitted to a secret overseas bank account. “It’s not the government that failed, but a man,” Hollande said yesterday at a press conference in Rabat during a state visit to Morocco. “There’s no decision on the government to be taken.”

• Merkel Losing Allies in $700 Billion Shift to Renewable Energy. Chancellor Angela Merkel is losing support from her two biggest allies in the utilities industry as their mounting debt prompts a retreat from renewable-power expansion, undermining her $700 billion program to reshape Germany’s energy market.

• Europe to Shut 10 Refineries as Profits Tumble. Oil refiners in Europe will shut 10 percent of their plants this decade as fuel demand falls to a 19-year low. Of the region’s 104 facilities, 10 will shut permanently by 2020 from France to Italy to the Czech Republic, a Bloomberg survey of six European refinery executives showed. Oil consumption is headed for a fifth year of declines to the lowest level since 1994, the International Energy Agency estimates. Two-thirds of European refineries lost money in 2011, according to Essar Energy Plc (ESSR), owner of the U.K.’s second-largest plant.

• China Consumer Sector 'Deteriorating'; BNP Paribas. No signs of recovery as overall consumption growth slower than expected; consumer staples likely to outperform as inventors stick with defensives in an uncertain Chinese economy, analyst Charlie Y. Chen wrote. 

• Chinese Airline Shares Fall on Bird Flu Concern. China Southern Airlines Co. (1055), the country’s biggest domestic carrier, and Cathay Pacific Airways Ltd. led a decline in shares of Asian airlines on concern the widening bird flu infections may crimp travel. China Southern plunged as much as 15 percent, the most since September 2001, while Cathay Pacific, Hong Kong’s biggest airline, dropped the most in almost 11 months. Shares in Air China Ltd. (601111), China Eastern Airlines Corp., Singapore Airlines Ltd. (SIA) and Qantas Airways Ltd. (QAN) also declined. 

• Kospi Drops Most in 4 Months on North Korea Threats. The won slid to a six-month low as the risk of conflict with North Korea spurred capital outflows and monetary easing in Japan fanned speculation South Korea will seek to prevent appreciation that puts exports at risk.

• Yen Drops to Weakest Since August 2009 on BOJ Stimulus Plans. The yen fell to its weakest since August 2009 as investors speculated the Bank of Japan (8301)’s 7 trillion yen ($72 billion) of monthly bond purchases will devalue the currency.

• Platinum to Slump as Europe Car Sales Tumble: Chart of the Day. Platinum prices that tumbled to the lowest since August may extend declines as a drop in European vehicle sales crimps demand for the metal used in catalytic converters, according to INTL FCStone. Total sales of cars and light trucks in Europe have slipped for five straight months through February. Platinum prices may fall 7.8% to $1,400 an ounce this year as consumption wanes, according to Edward Meir, an analyst at FCStone.

• Copper Poised for Third Weekly Decline Amid Rising Stockpiles. Copper traded near an eight-month low, poised for a third weekly drop, on concern that growth is slowing in China, the biggest user, and as global inventories continued to climb. Metal for delivery in three months fell 0.2 percent to $7,428.50 a metric ton on the London Metal Exchange at 11:03 a.m. in Seoul. Prices are down 1.5 percent this week and yesterday touched the lowest since Aug. 3. Futures for May delivery were little changed at $3.3555 a pound on the Comex in New York. Markets in China are closed today for a national holiday. Inventories tracked by the LME rose for a 34th session to 579,175 tons, daily exchange figures showed. That’s the most metal since October 2003.

• Crude Set for Biggest Weekly Drop Since October on Supply Gains. Oil in New York traded near a two- week low and headed for its biggest weekly drop since October after U.S. inventories climbed to a 22-year high, raising concern that slower economic growth may weaken fuel demand. West Texas Intermediate futures were little changed, poised for a 4 percent loss since the close on March 28, the most since the week ended Oct. 26.

• SGX to Introduce Iron Ore Futures as Investors Wager on China. SGX AsiaClear, the world’s largest clearer of iron ore swaps, is scheduled to start a futures contract for the steel-making commodity next week as investors seek to bet on the pace of Chinese growth and swings in prices. The Singapore-based clearing house, a unit of Singapore Exchange Ltd. (SGX), will offer the contracts from April 8 alongside the swaps, according to a statement on its website. One futures contract will be 100 metric tons compared with 500 tons for the swaps, the website shows.

• Bombs Hit Damascus Like Shooting Stars as Battle Intensifies. Syrian businessman Ammar Sinan was having dinner at a Damascus restaurant last week when mortar rounds fired by rebel insurgents fell “like shooting stars” a few streets away. “There were bombs, then the sound of sirens and then the whoosh of the Katyusha launchers responding to the source of fire,” Sinan said in an interview in Beirut. “Damascus is a dying city. You see it breaking up and there’s nothing you can do about it,” he said. Damascus had escaped the worst of the violence that has ripped through other big cities until a few months ago, when rebels intensified their attacks on its suburbs. In February, the insurgents declared an “epic” battle to “liberate” the capital and stepped up their offensive against President Bashar al-Assad’s troops. “It’s a political battle of great significance,” said Paul Salem, director of the Carnegie Endowment for International Peace’s Middle East Center in Beirut. “Whoever wins Damascus can claim authority over Syria.”

• Freeh Says Corzine’s Risky Strategy Helped Fell MF Global. Former MF Global Holdings Ltd. (MFGLQ) Chairman and Chief Executive Officer Jon S. Corzine’s risky business strategies and mismanagement helped accelerate the futures brokerage’s demise, according to a report by bankruptcy trustee Louis Freeh. The 124-page report blames Corzine and his management team for bungling an expansion of the company’s traditional business model while ignoring deficiencies in its risk controls. Corzine’s “aggressive trading strategy” that invested heavily in European sovereign debt produced no significant revenue, and he and Chief Financial Officer Henri Steenkamp knew that the company’s controls were flawed as early as May 2010, according to the filing today in U.S. Bankruptcy Court in Manhattan.

Wall Street Journal: 

• Foreign Firms Brace for More Pressure in China. Recent troubles in China for Apple Inc. and Volkswagen AG represent a growing risk for global companies, as their dependence on the booming Chinese economy leaves them exposed to Beijing's shifting winds. In some cases, foreign companies are coming under withering attacks from state-run media. In others, they are running afoul of Chinese regulators or government policies, such as an anticorruption campaign that limits ostentatious gifts. On Monday, Apple apologized for its Chinese customer-service policies and said it would revamp them following more than two weeks of criticism from government-run media. It isn't clear whether the spotlight will hurt Apple in what has become the tech giant's No. 2 market after the U.S.

Barron's: 

• F5 Networks(FFIV) Drops 16%: Cuts FYQ2 View on North American Slowing. Shares of networking equipment vendor F5 Networks (FFIV) were halted this afternoon in late trading just before the company warned fiscal Q2 revenue and earnings per share will come in well below consensus owing to a slowdown in North American sales, and some slowing in Europe, the Middle East and Africa, especially among telecom and federal government buyers. The stock is now down $14.64, or almost 17%, at $75.78. Said CEO John McAdam: From a market perspective, Telco bookings were down sharply on both a sequential and year-over-year basis. U.S. Federal sales were also down significantly from the second quarter a year ago.

Fox News:

• North Korea's missile launchers on the move, indicating possible new provocation. North Korea has begun moving its mid-range missile launchers, possibly indicating a looming test as tensions are already boiling on the peninsula, U.S. officials told Fox News. Earlier Thursday, South Korea said North Korea moved a missile with "considerable range" to its east coast after an unnamed spokesman for the North Korean army warned the U.S. Wednesday that its military has been cleared to wage an attack using "smaller, lighter and diversified nuclear" weapons.

MarketWatch.com: 

• Feds talk about identifying risky non-banks.

• What to look for in March employment report.

• BRICS countries take their turn at bat: Andy Xie. Emerging nations take a swing without cheap liquidity from the West. The bursting of the BRICS bubble is the main source of instability in 2013. Because interest rates are low everywhere, this bursting is happening in slow motion, confusing financial markets. As the months pass, the picture will become clear. The global economy is likely to be dragged into recession again. 

• China’s austerity call bites some restaurants. A government campaign to cut the spending of public funds on banquets for officials is having an impact on several upscale restaurant chains.

CNBC: 

• Soros to CNBC: What Japan Is Doing Is 'Quite Dangerous'. (video) The policy measures taken in Japan to revive economic growth are "quite dangerous," billionaire investor George Soros told CNBC in an interview on Friday. Japan's new Prime Minister Shinzo Abe is on a concerted drive to kick start the world's third largest economy, which has been hampered by two decades of deflation. On Thursday, the Bank of Japan unveiled a slew of radical steps to boost inflation, sparking huge gains in the Nikkei stock index and sending the yen to three-and-a-half year lows against the dollar on Friday.

• Economy Has No 'Real Lift,’ Says Wilbur Ross. A lumbering U.S. economy is not growing fast enough to create jobs, billionaire investor Wilbur Ross told CNBC on Thursday. "I think the economy is going to continue to lumber ahead," he said in a "Closing Bell" interview. "There's not real lift. There's not real top-line growth and top-line growth is what makes jobs." 

Zero Hedge: 

• A Ton Of Gold Bricks: What Capital Flight Looks Like In Italy.

• Fed's Fisher: "Too-Big-To-Fail Regulation Should Be Written By A Sixth-Grader".

• Japan's Debt Crisis Visualized. (video)

• In Cyprus, Shock Turns To Anger.

Business Insider: 

• North Korea Likely To Launch 'A Relatively Small Attack That Won't Leave Many People Dead'.

• There Is A Worrying Sign That The New Bird Flu May Spread Between Humans.

IBD:

• Palo Alto(PANW) Takes On Big Rivals With Firewall Approach.

Washington Post:

• Bird flu death toll rises to six in China, CDC says. The death toll from a new strain of bird flu rose to six in China on Thursday as scientists at the U.S. Centers for Disease Control and Prevention and around the world stepped up efforts to determine its pandemic risk. There is no evidence that the H7N9 bird flu strain is transmitted from human to human, officials said. At least 14 people in China have been confirmed to have H7N9, all in the eastern part of the country. According to the World Health Organization, three of the most recent fatal cases involved men: a 38-year-old from Zhejiang province, in eastern China, who became sick March 7; a 64-year-old, also from Zhejiang, who became ill March 28; and a 48-year-old from Shanghai who also became sick March 28. 

• Obama rekindles talk about boys club after comment about California attorney general. President Obama reopened the debate Thursday over whether his administration is too influenced by men after praising the looks of Kamala Harris, California’s attorney general and a possible future gubernatorial candidate. “You have to be careful to, first of all, say she is brilliant and she is dedicated and she is tough, and she is exactly what you’d want in anybody who is administering the law, and making sure that everybody is getting a fair shake,” Obama said at a party fundraiser in Atherton, Calif., a wealthy suburb of San Francisco. “She also happens to be, by far, the best looking attorney general in the country.”

Reuters: 

• Brazil stocks slump to 8-month low as OGX dives.  

• US-based stock funds post $2.24 bln inflows -Lipper.

• U.S. Fed balance sheet grows to record size in latest week. The U.S. Federal Reserve's balance sheet expanded to a record size on an increase in the central bank's holdings of U.S. government debt, Fed data released on Thursday showed. The Fed's balance sheet, a broad gauge of its lending to the financial system, stood at $3.198 trillion on April 3, compared with $3.185 trillion on March 27.

Financial Times: 

• Yellen latest to hint about slowing of QE3. The US Federal Reserve could adjust the pace of asset purchases to send a signal about its intentions, vice-chair Janet Yellen said on Thursday, as she became the latest senior official to hint at a slowing of QE3.

Les Echos:

• French Confidence in Hollande Falls Below 30%. CSA polls finds President Francois Hollande is least popular president since establishment of Fifth Republic.

Sankei:

• Japan Considers Shooting Down North Korea Missile. North Korea recently transported a missile to its eastern coast, possibly for training and test-firing.

21st Century Business Herald:

• Beijing's municipal government summoned some of the city's developers for private discussions about the local real estate market in a move to further rein in prices in the Chinese capital, citing people familiar with the situation.

Evening Recommendations 

• None of note

Night Trading

• Asian equity indices are -1.75% to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 121.50 -.5 basis point.

• Asia Pacific Sovereign CDS Index 97.25 -1.25 basis points.

• FTSE-100 futures -.07%.

• S&P 500 futures -.19%.

• NASDAQ 100 futures -.17%.

Morning Preview Links

Earnings of Note
Company/Estimate

• None of note

Economic Releases
8:30 am EST

• The Trade Deficit for February is estimated at -$44.6B versus -$44.4B in January.

• The Change in Non-farm Payrolls for March is estimated at 190K versus 236K in February.

• The Unemployment Rate for March is estimated at 7.7% versus 7.7% in February.

• Average Hourly Earnings for March are estimated to rise +.2% versus a +.2% gain in February.

3:00 pm EST

• Consumer Credit for February is estimated to fall to $15.0B versus $16.151B in January.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Eurozone retail sales report, German Factory Orders report and the Canadian Unemployment report could also impact trading today.

BOTTOM LINE: Asian indices are mostly lower, weighed down by transportation and technology shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower. The Portfolio is 50% net long heading into the day.

Stocks Higher into Final Hour on Global Central Bank Stimulus Hopes, Short-Covering, Retail/REIT Sector Strength

Today's Market Take:

Broad Market Tone:

• Advance/Decline Line: Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Below Average

• Market Leading Stocks: Underperforming

Equity Investor Angst:

• VIX 14.09 -.84%

• ISE Sentiment Index 69.0-11.5%

• Total Put/Call 1.09 +5.83%

• NYSE Arms .77 -52.52%

Credit Investor Angst:

• North American Investment Grade CDS Index 87.95 -1.47%

• European Financial Sector CDS Index 179.05 -.11%

• Western Europe Sovereign Debt CDS Index 103.19 -.64%

• Emerging Market CDS Index 258.88 -1.59%

• 2-Year Swap Spread 15.25 -.75 bp

• TED Spread 22.0 -.5 bp

• 3-Month EUR/USD Cross-Currency Basis Swap -18.25 -.25 bp

Economic Gauges:

• 3-Month T-Bill Yield .06% unch.

• Yield Curve 153.0 -5 bps

• China Import Iron Ore Spot $135.90/Metric Tonne +.22%

• Citi US Economic Surprise Index 5.40 -3.0 points

• 10-Year TIPS Spread 2.49 unch.

Overseas Futures:

• Nikkei Futures: Indicating +450 open in Japan

• DAX Futures: Indicating +22 open in Germany

Portfolio: 

• Higher: On gains in my tech/biotech/medical/retail sector longs and emerging markets shorts

• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges

• Market Exposure: Moved to 50% Net Long

Today's Headlines

Bloomberg:

• Draghi Signals ECB Stands Ready to Ease Policy If Needed. European Central Bank President Mario Draghi said the bank stands ready to cut interest rates if the economy deteriorates further, and officials are considering additional measures to boost growth as the debt crisis enters its fourth year. “Our monetary policy stance will remain accommodative for as long as needed,” Draghi said at a press conference in Frankfurt today after the ECB kept its benchmark interest rate at a record low of 0.75 percent. “We will assess all the incoming data in the coming weeks and we stand ready to act.”
• European Stocks Drop for a Second Day on Draghi Comments. European stocks retreated, posting the biggest two-day slump in more than four months, as European Central Bank President Mario Draghi said that the economic recovery in the euro area remains subject to downside risks. Banca Generali (BGN) SpA lost 5.1 percent after Assicurazioni Generali SpA sold part of its stake in the lender. European Aeronautic, Defence & Space Co. dropped 2.7 percent as an investor offered to sell shares worth 384 million euros ($494 million) in the owner of Airbus SAS. BTG Plc (BTG) gained 1 percent after increasing its sales forecast for 2013. The benchmark Stoxx Europe 600 Index (SXXP) declined 1.1 percent to 291.71 at the close in London.

MarketWatch:

• Bloomberg Integrates Live Twitter Feeds with Financial Platform.
• Fed's George says current policy is 'overly' easy.
• Stockman: Central Banks Providing 'Heroin'.

CNBC: 

• Central Bank Efforts May 'End in Tears': Pimco CEO El-Erian. (video)

Zero Hedge: 

• Initial Jobless Claims Soar, Biggest Miss Since November. (graph)
• 97% Of Spanish Social Security Pension Fund In Domestic Bonds. (graph)
• Mario Draghi Responds To Zero Hedge: "There Is No Plan B".
• French Stocks To Drop 33% On Macro Recoupling. (graph)
• CEO Of Italy's Largest Bank Says Haircuts Of Uninsured Depositors "Acceptable", Should Become A Template.

Business Insider:  

• Obama's Disapproval Rating Hits Highest Level Since The Election.
• Facebook(FB) Unveils Home For Android.
• Microsoft(MSFT) Could Be Completely Irrelevant In Four Years, Warns Analyst.
• TOP US COMMANDER IN SOUTH KOREA: 'We've Got To Be Ready To Go' With North Korea.
• Kyle Bass Slams The 'Macro Tourists' Who Are Buying Up Japanese Stocks.
• 'SLIPPING INTO SLOWDOWN': The 9 Scariest Slides From Goldman's New Presentation On The Weakening Global Economy.

Dallas Business Journal:

• Job cuts in March are up 30 percent over a year ago. March saw 49,255 job cuts announced by the nation's employers, but that's down from the number announced in February, according to a report from outplacement consultancy Challenger, Gray & Christmas Inc. Challenger said 55,356 jobs were cut in February. Quarterly job cuts were the highest since 2011, Challenger said. The job cuts in March were an increase of 30 percent over March 2012, when companies announced plans to trim 37,880 workers.

Telegraph:

• French service firms suffer steep downturn. French businesses suffered their worst downturn since the nadir of the recession, surveys revealed on Thursday, as Germany - the eurozone powerhouse - also slowed. 

Les Echos:

• France is shooting itself in the foot by backing transaction tax proposed by EU, Paul-Henri de La Porte du Theil, Chairman of French asset managers association AFG, said. Proposed tax on transactions of shares, bonds and derivatives may cost French asset managers EU6b, including EU4b for money market funds.

Expansion:

• Europe May Force Losses on Covered Bonds in Bailouts. Europe may consider forcing losses on covered bond investors in future bank rescues. If a bond is worth more than the assets that guarantee it, it should be possible to apply haircut to the part not covered, citing Sharon Bowles, chairwoman of European Parliament's economic and monetary affairs committee.

Xinhua:

• China reports 5th death from H7N9 bird flu. Authorities in Shanghai said Thursday night that another person has died from H7N9 bird flu, bringing the death toll from the new deadly strain to five around the country. The city has reported six infections to date, and four have died, said the Shanghai Municipal Health and Family Planning Commission. Of the rest two, there was a four-year-old, the agency said. The baby was recovering from mild illness, it added.