Bear Radar

Style Underperformer:

• Large-Cap Growth -.77%

Sector Underperformers:

• 1) Homebuilders -2.34% 2) HMOs -2.01% 3) Internet -1.86%

Stocks Falling on Unusual Volume:

• UTEK, SNDK, UNXL, EWBC, FCS, DHR, ALB, ROG, GLNG, GHL, UNH, EBAY, EOPN, ALKS, SI, CRM, KYAK, MS, THR, FDX, AIXG, HUM, CFNL, LH, DGX, EOPN, CFNL and THR

Stocks With Unusual Put Option Activity:

• 1) XOP 2) SWN 3) KMX 4) BTU 5) IBM
  

Stocks With Most Negative News Mentions:

• 1) CAT 2) C 3) FDX 4) APA 5) EXPD
  

Charts:

• ETFs Falling on Unusual Volume

• Stocks Falling on Unusual Volume

Bull Radar

Style Outperformer:

• Large-Cap Value -.10%

Sector Outperformers:

• 1) Gold & Silver +2.75% 2) Road & Rail +1.99% 3) Oil Service +.89%
  

Stocks Rising on Unusual Volume:

• TSM, SPRD, PEP, UNP, PVTB, THRX, SCSS, BTU, GOLD, CLDX and VZ

Stocks With Unusual Call Option Activity:

• 1) THRX 2) WLL 3) PEP 4) ESRX 5) CPB
  

Stocks With Most Positive News Mentions:

• 1) COG 2) AXP 3) AYI 4) VZ 5) AN
  

Charts:

• ETFs Rising on Unusual Volume 

• Stocks Rising on Unusual Volume

Thursday Watch

Evening Headlines 
Bloomberg: 

• G-20 Draft Affirms Commitment to Avoid Competitive Devaluations. The Group of 20 economies will affirm a commitment to avoid weakening their currencies to gain an advantage for their exports, according to a draft statement prepared for a meeting this week in Washington, Bloomberg BNA reported. The draft statement, seen by a Bloomberg BNA reporter, maintains a pledge made in February in Moscow to “move more rapidly toward more market-determined exchange rate systems and exchange-rate flexibility” and to refrain from competitive devaluations. A first draft communique, prepared for meetings of finance ministers and central bankers starting today, describes the global outlook as “generally somewhat weaker and uneven” with “unbalanced” recoveries between advanced economies and emerging markets. The maintaining of the language on currencies suggests the G-20 members will withhold direct criticism of Japan’s efforts to rally its economy from 15 years of deflation so long as it doesn’t seek to do so at their expense by driving the yen down.

• China Home Prices Rise in Almost All Cities on Mild Local Curbs. China’s new home prices rose in all but two cities, led by major centers, as local governments announced milder-than-expected property measures and targets. Prices in March climbed in 68 of the 70 cities the government tracks from a year earlier, the National Bureau of Statistics said in a statement today, the most since September 2011. The southern city of Guangzhou posted the biggest gain, rising 11.1 percent from the same period last year. Beijing prices jumped 8.6 percent, while they advanced 6.4 percent in Shanghai, both the most since January 2011 when the government changed its methodology for the data. 

• China Bird-Flu Outbreak Seen Adding Risks as Growth Slows. China’s deadly bird-flu outbreak is rippling through industries from restaurants to travel, adding economic headwinds after last quarter’s unexpected slowdown. The disease “may suppress domestic consumption in the near term,” Goldman Sachs Group Inc. said in a report this week. Ding Shuang, a Citigroup Inc. economist in Hong Kong, sees a danger of “short-term volatilities” in growth and inflation and of bigger effects if found to transmit between humans. The outbreak, which has sickened at least 82 people and killed 17 so far, threatens to extend the longest streak of growth below 8 percent in at least 20 years in the world’s second-largest economy. The 2003 global pandemic of severe acute respiratory syndrome showed the risks associated with such incidents, with Credit Suisse Group AG estimating China’s expansion in the second quarter of that year was cut by about 2.4 percentage points after seasonal adjustments. “Consumption is likely to stay weak in the second quarter because of the outbreak,” said Li Wei, a Shanghai-based economist at Standard Chartered Plc. “We don’t know how the bird flu is going to evolve.” The virus is affecting restaurant sales as people eat more meals at home and having an impact on factory production through the food industry, Li said without giving specific estimates. 

• Li Ka-Shing Port Workers Widen Protests After New Wage Offer. Hundreds of port workers at Li Ka- shing’s Hong Kong terminals surrounded his Cheung Kong Center headquarters in the city’s business district after rejecting a pay raise aimed at ending a three-week strike. 

• Moutai Profit Growth Slows Amid Xi Austerity Push. Kweichow Moutai Co. (600519), China’s largest maker of baijiu liquor, said first-quarter profit rose 21 percent, less than half the pace of the year-earlier period as President Xi Jinping pushes to curb extravagant spending by government officials.

• Asian Stocks Decline, Led by Mining Companies on Growth. Asian stocks fell, led by mining companies after commodity prices slumped on concern a weaker outlook for global economic growth will crimp demand for raw materials. BHP Billiton Ltd. (BHP), the world’s biggest mining company, sank 3.3 percent in Sydney. LG Display Co., which supplies touch screens for Apple Inc.’s iPhone and iPad, dropped 3.4 percent in Seoul after audio-chip maker Cirrus Logic Inc. reported an inventory glut that suggests iPhone sales may fall short of analysts’ expectations. Softbank Corp., Japan’s third-largest wireless carrier, lost 1.7 percent as a rival’s bid for Sprint Nextel Corp. gained shareholder support. The MSCI Asia Pacific Index (MXAP) slipped 0.5 percent to 136.79 as of 11:57 a.m. in Tokyo, with about three shares falling for every two that rose on the gauge.

• Brazil Raises Rate From Record Low as Inflation Saps Growth. Brazil’s central bank raised its benchmark rate for the first time since July 2011, as policy makers seek to slow inflation levels jeopardizing an economic recovery. The bank’s board, led by President Alexandre Tombini, voted 6-to-2 to increase the Selic rate 25 basis points to 7.50 percent from a record low, matching the median forecast from 58 economists surveyed by Bloomberg. Policy makers said that “the high level of inflation” and “resilience of inflation” required a response, which was tempered by the central bank’s recognition that “external uncertainties” also required “that monetary policy be managed with caution,” according to the board’s statement posted on Banco Central do Brasil’s website. 

• Copper Below $7,000 for First Time in 18 Months as Metals Slide. Copper in London fell below $7,000 for the first time in almost 18 months as data from Europe to China, the biggest user, raised concern that demand is faltering. Aluminum, nickel, zinc, tin and lead also retreated. Copper for delivery in three months on the London Metal Exchange plunged as much as 4 percent to $6,800 a metric ton, the lowest level since October 2011, and was at $6,840.25 at 9:38 a.m. in Shanghai. Metal for delivery in August was at 50,530 yuan ($8,175) a ton, declining by a daily limit, on the Shanghai Futures Exchange. The July futures contract on the Comex dropped 3.1 percent to $3.1035 per pound. European car sales are sliding to a 20-year low as demand plunged last month in Germany.

• Rebar Falls to Lowest Level in Four Months on China Economy. Steel reinforcement-bar futures declined to the lowest level in more than four months as slowing economic growth in China, the biggest user, led to a slump in industrial metals. The contract for October delivery on the Shanghai Futures Exchange dropped as much as 2.7 percent to 3,598 yuan ($582) a metric ton, the lowest level for a most-active futures since Dec. 7, before trading at 3,665 yuan at 10:15 a.m. local time. 

• Rubber Tumbles to Lowest Level in Five Months on Demand Concerns. Rubber slumped for a fifth day to the lowest price in five months as a selloff in commodities from crude oil to metals raised concern that global demand is waning. Rubber for delivery in September lost as much as 3.9 percent to 242.6 yen a kilogram ($2,474 a metric ton) on the Tokyo Commodity Exchange, the lowest level for the most-active contract since Nov. 14. Futures traded at 247.1 yen by 11:34 a.m.

• Kim Says World Bank Can’t Reject Coal If People Freeze. The World Bank, which has boosted investment in renewable energy, cannot refuse to finance a coal- fired plant in Kosovo if the alternative is having people there “freeze to death,” the lender’s president said. As the Washington-based institution considers providing partial guarantees for a lignite-fired power plant in the Balkan country, World Bank President Jim Yong Kim said today he’s looking for all possibilities to avoid investing in coal. If the lack of energy became “a humanitarian issue” and the bank got involved, it could at least make the project cleaner, he said. “I don’t think it’s fair to tell the people in Kosovo ‘While the rich countries continue to burn coal, you’re going to have to freeze to death because it’s against our political ideology to support you,’” Kim said on a panel discussion in Washington today. “I can’t do that.”

Wall Street Journal: 

• Video Provides Clues to Bomber. Federal investigators said Wednesday they are working to identify a person in a video who appeared to leave a bag in the spot where one of two bombs later exploded near the finish line of the Boston Marathon. Authorities also are trying to identify at least one other person seen in videos of the crowd, according to people familiar with the matter.

• The Boston Bombings: Live Updates.

• Dark Pool Brawl Breaks Out. A behind-the-scenes brawl has broken out between two market powers that represent opposite ends of the stock-trading spectrum. In one corner is NYSE Euronext, which claims to represent the good of the average investor and transparent trading on public exchanges. In the other corner: Credit Suisse Group AG, which runs the nation’s largest dark pool, Crossfinder. 

• For Stocks, Fed Stimulus Wearing Thin. 

• Rove: Steaming Toward the ObamaCare 'Train Wreck'. The implementation of this unpopular law is a story of missed deadlines and general bungling. In congressional testimony last week, Health and Human Services Secretary Kathleen Sebelius blamed Republican governors for her department's failure to create a "model exchange" where consumers could shop for health-insurance coverage in states that don't set up their own exchange. Nice try, but GOP governors aren't the problem. Team Obama's tendency to blame someone else for its shortcomings is tiresome. The Affordable Care Act requires HHS to operate exchanges in states that won't operate their own. Since the act became law in March 2010, it has been abundantly clear that the agency would have to deploy a model exchange. It is Ms. Sebelius's fault there isn't one.

Fox News:

• FBI has images of two persons of interest in Boston bombings, source says. A federal law enforcement source told Fox News that investigators are looking for two men that are persons of interest in Monday's Boston Marathon terror attack and have distributed photos for “law enforcement eyes only.” The FBI is not sharing the photos with the public. A Fox News reporter has seen the photos and called them “clear.”  

• Background check plan defeated in Senate, Obama rips gun bill opponents. The Senate on Wednesday defeated a vital background check amendment seen as the linchpin to Democrats' gun control bill, dealing a major setback to President Obama -- who lashed out at opponents in unusually blunt terms during remarks from the Rose Garden. The vote was 54-46, with supporters falling six votes short of the required 60-vote threshold. 

Breaking News:

• Texas Fertilizer Plant Explosion. 

MarketWatch.com:

• Heading off a China-style subprime crisis. Warning of local governments’ high exposure to bad debts, the credit agency Fitch recently downgraded China’s long-term local-currency rating from AA– to A+. Officials should take note: the downgrade underlines how closely international markets are watching developments in the country. 

• China is repeating Japan’s economic mistakes. Commentary: Wasteful investment and spending stunts growth.

• Beware the Transports’ weakness. Commentary: A potential Dow Theory non-confirmation brewing.

CNBC: 

• EBay(EBAY) Earnings Beat by a Penny; Outlook Falls Short. EBay delivered a slight beat on earnings but its outlook disappointed and shares fell after-hours.

• American Express(AXP) Earnings Beat; Revenue Falls Short. American Express reported first-quarter earnings that beat analysts' expectations on Wednesday but revenue was light as cardmember spending growth remained muted for the fourth time in a row. After the earnings announcement, the company's shares slipped in after-hours trading.

• Oil Slide Could Continue As Demand Picture Weakens. Oil prices have cascaded lower in the global commodities rout and may still have further to go before finding a floor, analysts say.

Zero Hedge: 

• Egan-Jones Downgrades Germany From A+ To A, Outlook Negative.

• Rick Santelli Asks The $14 Trillion Dollar Question. (video)

• Massive Fertilizer Plant Explosion Shakes Texas, Town Evacuated, Toxic Fumes - Live Stream.

• More Evidence That The Economic Peak Is In. (graphs)

• Late To The Party? After 203% Annualized Surge, Record Number Of Foreigners Buy Japanese Stocks.

• A Closer Look At Today's German Stock Market Flash Crash.

Business Insider: 

• MASSIVE EXPLOSION AT TEXAS FERTILIZER PLANT — HUNDREDS INJURED. (video)

• Cars Are Becoming So Expensive Auto Loans Take Record Time To Pay Off.

• The Gold Plunge May Have Been The First ETF-Led Death Spiral.

• CNN SOURCE: Everyone Went Silent For 15 Minutes After We Screwed Up The Boston Marathon Report.

The Blaze:

• Mind-Boggling Details Emerge About Ricin Letter Suspect: ‘I’m on the Hidden Front Lines of a Secret War’.

Reuters: 

• US regulator says banks still a risk for taxpayers. A top U.S. bank regulator said on Wednesday the country must do more to protect taxpayers from having to spend billions on bank bailouts, one of a growing chorus of critics of the current rules. Tom Hoenig, vice chairman of the Federal Deposit Insurance Corp (FDIC), said in New York that the Volcker rule - which would bar banks from betting their own money on financial markets but has not yet been finalized by regulators - would not go far enough. Instead, Hoenig wants to force banks to hive off risky activities such as trading and creating derivatives and to eliminate any taxpayer subsidy for these businesses.

• Vote on Italy president risks centre-left split. Italy's divided parliament begins voting for a new state president on Thursday, with former Senate Speaker Franco Marini the main candidate in a ballot that will severely strain the unity of the centre-left alliance led by Pier Luigi Bersani. The vote for a successor to President Giorgio Napolitano, whose term ends on May 15, will be a crucial step towards resolving the stalemate since the inconclusive election in February left no party with enough support to form a government. Even by the tangled standards of Italian politics the situation is complicated, but until the new president is elected, the paralysis that has hobbled government more than 50 days after the election will continue.

• SanDisk(SNDK) sees brighter 2013 with higher NAND prices. SanDisk raised its forecast for revenue this year and said it expects higher prices for its NAND memory chips, which are used in smartphones and tablets. Chief Financial Officer Judy Bruner's comments to analysts on a quarterly conference call on Wednesday helped reverse losses in SanDisk's stock after the company posted quarterly results that disappointed some on Wall Street, despite beating estimates.

• Investors sound alarm over AAA ratings on subprime auto bonds. While many new subprime auto bonds are getting the highest Triple A ratings, the ratings agencies themselves admit standards are loosening - and some in the market say that needs to change soon. Skeptical investors are increasingly warning that ratings for the white-hot asset class should become more conservative, especially regarding smaller, second-tier lenders with no long-term record in issuing asset-backed securities (ABS). The issue is particularly pressing, as subprime auto bond issuance has skyrocketed over the past year. So far in 2013, nearly US$7.5bn of new subprime auto ABS has been issued, roughly 32% higher than in the same period of 2012, according to Deutsche Bank data. There was only US$18.5bn in issuance for all of 2012, and just US$11.75bn the year before that. As supply expands, however, there is a marked difference in the quality of issuers - even among those getting similar ratings from the agencies.

• Risk assets slip on growth worries, gold tumbles. Risk assets slipped broadly on Thursday, following the overnight drop in U.S. and European equities on fears for global growth, and gold slid as money continued to flow out of gold-backed exchange-traded funds.

Telegraph:

• Fed and Bank of Japan caused gold crash. Commodity prices have been falling since September, culminating in a rout over the past two weeks. That is a classic warning for the global economy.

Sueddeutsche Zeitung:

• Audi's Stadler Warns German Consumer Uncertainty Growing. Audi Chairman Rupert Stadler says increased insecurity driven by debt crisis in southern Europe, citing interview. Says massive concern over reforms needed to cut debt in many European countries behind slump in sales of cars in Europe.

South China Morning Post:

• China's 'Golden Decade' for Coal Ended in 2011. Cleaner-burning natural gas to develop rapidly in coming decade, citing Liu Xiangdong, deputy director-general of China Electricity Council's dept of planning and statistics. China's market for coal-fired electricity to suffer "structural oversupply". Annual growth of coal fired-power to be less than 5% in coming decade, compared with 11% in previous 10-year period.

Shanghai Securities News:

• China Investigates Fixed-Income Trades. Chinese regulators are investigating fixed-income transactions in accounts typically used by senior traders at financial institutions. The government has sent teams to inspect trading records at firms in Shanghai, Beijing and Jiangsu province. A bond sold by a local government financing vehicle is the key target of the probe, citing people familiar with the situation.

• China Economic Growth May Slow in 4Q. China's economic growth may slow in 4Q, Li Zuojun, vice director of resources and environment at the State Council's development research center, wrote in an article. Fading stimulus effects started last May and new policies likely beginning in 2Q-3Q will contribute to slowing 4Q growth.

21st Century Business Herald:

• China Shenzhen Firms May Have Falsified Trade Data. Some trading houses in the southern Chinese city of Shenzhen may have falsified exports data to bring in "hot money," citing government officials.

Evening Recommendations 

• None of note

Night Trading

• Asian equity indices are -.75% to unch. on average.

• Asia Ex-Japan Investment Grade CDS Index 115.50 +1 basis point.

• Asia Pacific Sovereign CDS Index 92.0 +1.25 basis points.

• FTSE-100 futures +.19%.

• S&P 500 futures +.04%.

• NASDAQ 100 futures +.13%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (PPG)/1.54

• (KEY)/.19

• (UNP)/1.96

• (BTU)/-.14

• (NUE)/.24

• (ADS)/2.52

• (AN)/.64

• (SHW)/1.09

• (BX)/.53

• (BBT)/.68   

• (UNH)/1.14

• (DHR)/.76

• (FITB)/.39

• (PEP)/.71

• (BAX)/1.05

• (PM)/1.34

• (OMC)/.75

• (MS)/.56

• (VZ)/.66

• (FCX)/.71

• (CMG)/2.13

• (COF)/1.62

• (IBM)/3.05

• (MSFT)/.68

• (RH)/.61

• (GOOG)/10.67

• (ISRG)/3.96 

Economic Releases
8:30 am EST

• Initial Jobless Claims are estimated to rise to 350K versus 346K the prior week.

• Continuing Claims are estimated to fall to 3075K versus 3079K prior. 

10:00 am EST

• Philly Fed for April is estimated to rise to 3.0 versus 2.0 in March.

• Leading Indicators for March are estimated to rise +.1% versus a +.5% gain in February. 

Upcoming Splits

• (CRM) 4-for-1

Other Potential Market Movers

• The Fed's Lacker speaking, Fed's Kocherlakota speaking, Fed's Raskin speaking, German/French auctions, 5Y TIPS auction, Bloomberg Economic Expectations Index for April, weekly Bloomberg Consumer Comfort Index and the weekly EIA natural gas inventory report could also impact trading today.

BOTTOM LINE: Asian indices are mostly lower, weighed down by commodity and technology shares in the region. I expect US stocks to open mixed and weaken into the afternoon, finishing modestly lower. The Portfolio is 25% net long heading into the day.

Stocks Falling into Final Hour on Rising Global Growth Fears, Terror Worries, Rising Eurozone Debt Angst, Tech/Financial Sector Weakness

Broad Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Every Sector Declining
  

• Volume: Around Average

• Market Leading Stocks: Underperforming

Equity Investor Angst:

• VIX 16.52 +18.34%

• ISE Sentiment Index 88.0 +3.53%

• Total Put/Call 1.20 +36.36%

• NYSE Arms 2.53 +260.42%

Credit Investor Angst:

• North American Investment Grade CDS Index 84.34 +3.01%

• European Financial Sector CDS Index 171.12 +2.52%

• Western Europe Sovereign Debt CDS Index 101.18 -1.78%

• Emerging Market CDS Index 234.24 +.67%

• 2-Year Swap Spread 14.25 +.25 bp

• TED Spread 22.5 +.5 bp

• 3-Month EUR/USD Cross-Currency Basis Swap -18.0 -1.5 bps

Economic Gauges:

• 3-Month T-Bill Yield .05% -1 bp

• Yield Curve 147.0 -3 basis points

• China Import Iron Ore Spot $139.30/Metric Tonne -.07%

• Citi US Economic Surprise Index -3.70 +.4 point

• 10-Year TIPS Spread 2.37 -3 basis points

Overseas Futures:

• Nikkei Futures: Indicating -62 open in Japan

• DAX Futures: Indicating +25 open in Germany

Portfolio: 

• Slightly Lower: On losses in my retail/tech sector longs
• Disclosed Trades: Added to my (IWM)/(QQQ) hedges
• Market Exposure: Moved to 25% Net Long

Today's Headlines

Bloomberg: 

• Schaeuble to Press G-20 for Debt Cuts Armed With German Example. German Chancellor Angela Merkel’s Cabinet backed a spending plan that will yield budget surpluses this year and next, strengthening the government’s hand as it presses international partners to focus on cutting debt. Ministers meeting in Berlin today adopted the annual Finance Ministry report to the European Commission in which they agreed to cut Germany’s debt over the next four years. The German stance sets up a potential clash among finance chiefs from the Group of 20 biggest economies when they gather in Washington from tomorrow. Finance Minister Wolfgang Schaeuble plans to press the group to sign up to similar “growth- friendly,” deficit-reduction policies to those he pursues at home, a government official told reporters in Berlin yesterday. “Germany is committed to complying with all the national and European fiscal policy requirements,” the Finance Ministry said in a statement after the Cabinet meeting. “Sound public finances are a significant basis for effective government action and on-going favorable growth conditions.”
• Italy May Need $9.2 Billion of Spending Cuts, Official Says. Italy may need to make as much as 7 billion euros ($9.2 billion) in additional spending cuts this year to cover jobless benefits and other expenses, said Finance Undersecretary Gianfranco Polillo. “There are additional expenses worth 5 billion euros to 7 billion euros that need to be covered,” Polillo said in an interview in Rome on April 15. These include as much as 600 million euros to finance military operations abroad and about 1.2 billion euros for unemployment programs, he said. Funding the expenses through tax increases would aggravate Italy’s fourth recession since 2001, he said.
• Europe Car Sales Heading for 20-Year Low on German Slide. European car sales are sliding to a 20-year low after German concerns over the debt crisis sent demand plunging last month in the region’s biggest economy and removed the main buffer protecting automakers. Registrations in March fell 10 percent to 1.35 million vehicles, the 18th consecutive decline, with Germany’s auto market plunging 17 percent, the Brussels-based European Automobile Manufacturers’ Association, or ACEA, said today. First-quarter deliveries in the region dropped 9.7 percent to a record-low 3.1 million cars. 
• IMF Sees Some Corporate Debt Unsustainable in Parts of EU. As much as 20 percent of non-bank corporate debt in the weakest euro-area economies is unsustainable and may force companies to cut dividends and sell assets, dealing further blows to investor confidence, the International Monetary Fund said. Businesses (SXXP) in Italy, Spain and Portugal have the largest “debt overhang,” according to the IMF’s Global Financial Stability Report released today, which analyzed 1,500 publicly traded non-financial European firms. Strains in the corporate sector may in turn hurt banks’ asset quality, the report showed. “Firms in the euro-area periphery have built a sizable debt overhang during the credit boom, on the back of high profit expectations and easy credit conditions,” the IMF said. Now they “face the challenge of reducing the debt overhang in an environment of lower growth and higher interest rates, in part related to financial fragmentation in the euro area.”
• Cyprus Finance Minister Sees Gold Sale Within Next Months. The Cypriot government plans to sell part of its gold reserves within the next months, a decision that needs to be approved by the country’s central bank, Finance Minister Haris Georgiades said. “The exact details of it will be formulated in due course primarily by the board of the central bank,” Georgiades, 41, told Bloomberg TV’s Ryan Chilcote in an interview in Nicosia. “Obviously it’s a big decision.”
• Former ECB Board Member Bini Smaghi Says Draghi Will Weaken Euro. Former European Central Bank Executive Board member Lorenzo Bini Smaghi said policy makers led by President Mario Draghi will act to weaken the euro. “They have to find ways to avoid that the euro appreciates and actually try to make it depreciate,” Bini Smaghi said in an interview on “Bloomberg Surveillance” with Sara Eisen and Tom Keene today. “They will do something, I think that’s unavoidable.” 
• Spanish Squatters Invoking Robin Hood Deter Investment. The proliferation of illegal tenants threatens to complicate efforts to manage the bad bank, set up by Spain under the terms of a European bailout for its financial system to absorb 37 billion euros of soured real estate.
• Washington Gripped by Alarm as Ricin Poison Letters Found. Washington went into terrorism alert mode as authorities reported preliminary tests showed a letter sent to President Barack Obama contained the poison ricin and suspicious packages triggered a lockdown in parts of two Senate office buildings. With the capital already on edge following the Boston Marathon bombing, alarm spread on both ends of Pennsylvania Avenue as officials tried to determine the extent and nature of the threats. There is “no indication” the ricin mail is connected to the terrorist bombing in Boston, the FBI said in a statement. 
• Rosengren Says Banks With Broker-Dealer Units Need More Capital. Boston Federal Reserve President Eric Rosengren said banks should hold more capital if they own a broker-dealer unit because such businesses pose greater risks during periods of financial stress. “Bank holding companies with large broker-dealer affiliates should hold more capital to reflect the reduced stability of their liabilities during times of stress,” Rosengren said in prepared remarks for a speech today in New York.
• Fed Says ‘Moderate’ Growth Across U.S. Was Led by Housing. The Federal Reserve said the U.S. economic expansion remained “moderate” amid gains in manufacturing, housing and autos that offset weakness in defense-related industries in some regions. 
• Crude Tumbles Amid Equity Selloff as U.S. Output Climbs. West Texas Intermediate oil fell to a four-month low as equities declined and U.S. output rose to a 20-year high. Brent slid below a key technical level at $97.91. WTI dropped for the fourth time in five days as U.S. stocks tumbled on disappointing corporate earnings and after the dollar strengthened against the euro. Output was 7.2 million barrels a day, the most since July 1992, and fuel use slid, according to the Energy Information Administration, the Department of Energy’s statistical arm. Brent breached the 23.6 percent Fibonacci retracement level from 2012’s low to the year’s high.
• U.S. Amasses Big Data on 10 Million Consumers as Bankers Protest. The new U.S. consumer finance watchdog is gearing up to monitor how millions of Americans use credit cards, take out mortgages and overdraw their checking accounts. Their bankers aren’t happy about it. The Consumer Financial Protection Bureau is demanding records from the banks and is buying anonymous information about at least 10 million consumers from companies including Experian Plc. While the goal is to sharpen enforcement and rule-making, banking executives have questioned why the bureau is collecting so much without being more specific about the benefits. “Do they need the reams and reams and reams of data we’re having to provide to them?” Susan Faulkner, senior vice president at Bank of America Corp., asked at a banking conference in March. “Don’t we have to find a healthier balance here?”
• BofA(BAC) Slides Most Since November as Net Misses Estimates. Bank of America Corp. led the Dow Jones Industrial Average lower today after shortfalls in mortgage banking and trading marred first-quarter results and slowed the company’s turnaround. While net income quadrupled to $2.62 billion, or 20 cents a share, analysts surveyed by Bloomberg had predicted 23 cents a share, and revenue dropped 8.4 percent on an adjusted basis to $23.9 billion. Bank of America slid 6.7 percent to $11.46 at 12:30 p.m. in New York, near its low for the day and the biggest decline since November. Chief Executive Officer Brian T. Moynihan, 53, has sold more than $60 billion in assets, settled more than $40 billion in mortgage claims and repaired the bank’s balance sheet since taking over in 2010. He’s now focused on trimming $8 billion in annual expenses and adding revenue. “It’s going to be very hard for these banks to generate revenue, and mortgage is continuing to shrink,” Chris Whalen, managing director at Carrington Investment Services LLC, an asset manager in Greenwich, Connecticut, said in an interview. “The regulatory environment for mortgage is so hostile.” 
• Online Sales-Tax Bill Said to Be Primed for Senate Vote. A bill to let states collect taxes on out-of-state sellers may get a vote in the U.S. Senate as early as next week, said a Senate Democratic aide. The bill, backed by Wal-Mart Stores Inc. (WMT) and Amazon.com Inc., would let states collect some of the $24 billion in revenue they lose to untaxed sales made by retailers with no physical presence in their states. EBay Inc. (EBAY) and anti-tax groups such as Americans for Tax Reform oppose the measure.

Wall Street Journal:

• FBI Says Suspect Identified in Boston Marathon Blasts. The Federal Bureau of Investigation has isolated images of what it believes to be a suspect in the Boston Marathon bombings, a government official said Wednesday. Surveillance video and other images helped FBI agents identify a suspicious person right around the moment one of the bags believed to contain a bomb was deposited near the finish line of the race, the official said. The FBI and the Boston police department said no arrests have been made in the case. The Associated Press reported that a suspect was in custody but later retracted the report.
• The Boston Bombings: Live Coverage.

MarketWatch: 

• Europe faces threat of full-fledged depression. Data taking turn for the worse, a likely black eye for earnings. Data taking turn for the worse, a likely black eye for earnings.

CNBC:

• Insider Trading in DC Just Got Easier.
• Sliding Yen Could Herald New Asian Currency Crisis: Albert Edwards. The falling yen coupled with a fall-off in Chinese investment inflows "increasingly resembles" the run-up to the 1997 currency crisis, said Albert Edwards, Societe Generale's ultra-bearish strategist.
• The VIX Is Getting Ready to Take Market on a Ride. Call options buying recently hit a three-year high for the CBOE's Volatility Index, a popular measure of market fear that usually moves in the opposite direction of the Standard & Poor's 500 stock index.

Zero Hedge: 

• Cyprus Parliament To Vote On Bail-out After All: Fire And Brimstone Threats Begin.
• Goldman(GS) Throws In The Towel On A 2013 "Recovery" As Does Bank Of America. 
• European Stocks Plunge Most In Six Months. (graphs)
• Farage Unleashed: "You Are Common Criminals". (video)
• Boston Bombing Suspect Arrested. (video)

Business Insider: 

• Here's What Ricin Poison Can Do To The Human Body.
• CHART: These Major Retailers Are Most Threatened By Mobile Showrooming.
• LIVE: Democratic Senator To Vote No On Background Checks — Gun Control Bill Basically Dead.
• RICHARD RUSSELL: I See A Bearish Pattern In The Latest Buffett, Paulson, And Soros Trades.
• CHART OF THE DAY: Apartment Construction Is Reaching 'Dangerous Levels'.
• Bomb Squad Called To Senate Office Buildings.
• UBS: Now Is The Time For Investors To Dial Back Risk.

The Hill:

• Leading Democrat Baucus warns of 'huge train wreck' enacting ObamaCare provisions. Sen. Max Baucus (D-Mont.) said Wednesday he fears a "train wreck" as the Obama administration implements its signature healthcare law. Baucus, the chairman of the powerful Finance Committee and a key architect of the healthcare law, said he fears people do not understand how the law will work. "I just see a huge train wreck coming down," Baucus told Health and Human Services Secretary Kathleen Sebelius at a Wednesday hearing. "You and I have discussed this many times, and I don't see any results yet."

Reuters: 

• METALS-Copper drops as IMF report strengthens growth fears.
• IMF frets about U.S. corporate borrowing excesses. Easy monetary policy in the United States has led to looser standards for corporate borrowing as company debt continues to grow, posing a risk to financial stability, the IMF warned on Wednesday. Pension funds and insurance companies may also be taking on more risk than they should as they search for higher-yielding assets to fill a funding gap, which for pension funds stood at 28 percent at the end of last year, the International Monetary Fund said in its Global Financial Stability Report. All of this is happening while the United States is still only one-third of the way through the current credit cycle, the Washington-based global lender said. Usually looser borrowing standards only emerge in the later parts of the cycle, as happened in 2007, the IMF said.

Telegraph: 

• European debt crisis could last a decade, warns Bundesbank chief Jens Weidmann. Germany's top central banker Jens Weidmann has warned that Europe's debt crisis could last for a decade. 
• Global economy faces 'chronic' crisis if reforms are not completed, warns IMF. A growing trend towards excessive risk-taking and lack of action to repair broken bank balance sheets could trigger a “chronic” new phase in the financial crisis, the International Monetary fund has warned. 

Euromoney:

• China must slow growth to tackle 'unsustainable' debt. China’s new government must push through reforms to slow the country’s economic growth within the next two to three years or its rapidly rising debt levels will get out of control, a leading financial academic has told RBS.

Digitimes:

• China market: Veeco(VECO), Aixtron(AIXG) cut MOCVD prices by 30-40% due to competition from local makers. MOVCD vendors US-based Veeco Instruments and Germany-based Aixtron SE have lowered quotes in the China market from about US$2 million to about US$1.4 million for a single-wafer MOCVD set and by 30-40% for a multi-wafer model mainly because at least four China-based makers are set for market competition, according to industry sources.
• iPad mini shipments expected to drop as high as 30% in 2Q13. Upstream sources in the iPad mini supply chain expect a 20-30% decline in shipments for the device during the second quarter of 2013 due to lacking demand in the market. The lacking demand stems from consumers waiting for the release of the next generation iPad mini, said the sources.

The Australian: 

• Russia's Growth Slows Drastically. RUSSIA has reported a sharp slowdown in growth over the first three months of the year to 1.1 per cent from 4.9 per cent in the same period of 2012, amid growing alarm over the state of its economy amid a slew of poor data and falling oil prices. Deputy Economy Minister Andrei Klepach said the estimate came in after downward revisions for the figures for January and February - a month in which the economy contracted by 0.4 per cent. But he added that a stronger March helped Russia's overall performance in the first quarter. "By our estimate, GDP grew in March by 2.3 per cent in annual terms, and we confirm our estimate of 1.1 per cent for the first quarter," the RIA Novosti news agency quoted Klepach as saying. The estimate was released a week after Russia slashed its 2013 growth forecast to 2.4 from 3.6 per cent due to a slowdown in both industrial output and consumer demand.

Xinhua:

• Beijing Home Sales Rise 80.7% Y/Y. Beijing's 1Q home sales total 3m square meters, citing the city's official statistics.

China Daily:

• Chinese Authorities test family infected by H7N9. China's top health authority confirmed that a family infected by H7N9 in Shanghai might involve human-to-human transmission of the new bird flu strain. The family involves two brothers and their 87-year-old father, who died on March 4 and was reportedly China's first human death from H7N9.

Bear Radar

Style Underperformer:

• Small-Cap Value -2.23%

Sector Underperformers:

• 1) Steel -4.02% 2) Coal -3.41% 3) Semis -3.23%

Stocks Falling on Unusual Volume:

• AAPL, FCX, GDP, SFY, PGI, FULT, FBP, PBR, TV, HES, BCO, RLD, SHLM, THO, INWK, EOPN, CRUS, TXT, BMI, PACW, APL, SI, BERY, WTFC, ACOR, CVE, FLTX, SLW, MAIN, BHLB, GNT, EC, GVA, WDR, ATW, FSL, FCS, AVGO, OIH, EWG, RRC, ADI, SNDK, ESC, KMX, LLTC, MAIN, UCO, RTI, WLT and ADNC

Stocks With Unusual Put Option Activity:

• 1) SCCO 2) FXI 3) UNP 4) BBT 5) FOSL
  

Stocks With Most Negative News Mentions:

• 1) DE 2) MCD 3) EQR 4) BK 5) TXT
  

Charts:

• ETFs Falling on Unusual Volume

• Stocks Falling on Unusual Volume