Sunday, January 22, 2006

Monday Watch

Weekend Headlines
Bloomberg:
- Iran expects OPEC to reject its proposal to cut oil output at the Jan. 31 meeting in Vienna, an oil official said.
- Morgan Stanley, eager to expand its asset-management unit, may buy or form a new company with bond investor BlackRock Inc. to become the largest money manager among US securities firms.
- Music sales through mobile phones, maturing to full songs from tinny ring tones, are forming a growing part of the digital downloads that industry executives are counting on to make up for flagging sales of compact discs.
- President Bush said tax cuts passed in his first term have helped create a strong US economy and called on Congress to make them permanent and address rising health costs that crimp small businesses.
- The Palestinian Authority’s ruling Fatah party may have a narrow lead over Hamas ahead of Jan. 25 legislative elections that could be critical for Israeli-Palestinian relations and the prospect of achieving peace.
- Starbucks Corp.(SBUX), seeking to expand its entertainment business at a time of music industry “chaos,” plans to move beyond compact disc sales and CD burning to allow customers to transfer songs onto MP3 portable music players.
- Tens of thousands of opponents of Venezuelan President Hugo Chavez protested in the streets of Caracas, demanding fair elections and a rolling back of policies they said are intended to turn the South American country into a communist state.
- China probably overtook France as the world’s fifth-largest economy in 2005 as a record trade surplus and surging investment drove the fourth straight year of more than 9% growth.

Wall Street Journal:
- The FDA criticized the way safety concerns about approved medical devices are handled and is proposing changes to the system.

NY Times:
- Microsoft Corp.(MSFT) co-founder Paul G. Allen, who made billions on personal computer software, is creating jobs and housing in Seattle, aiming to turn his hometown into an urban center.
- The bidding war for medical-device maker Guidant Corp.(GDT) is a sign that companies are focusing on a market that’s expected to “grow by double digits for years to come.”
- The Pakistani army’s campaign against al-Qaeda and other terrorist groups in the country’s border areas adjacent to Afghanistan is faltering, citing unidentified Pakistani officials.
- The US Congress is weighing a budget bill that would provide $3.75 billion in new college aid over five years, as well as increase federal oversight of high-school education.
- Shifting habits in the way youngsters read the news, watch television and shop are forcing advertising companies to find new ways to reach them, as people born after 1980 make tailor-made media choices.

Financial Times:
- 2929 Entertainment, a Dallas based company founded by Internet entrepreneurs Todd Wagner and Mark Cuban, will release the first film to be distributed simultaneously in cinemas and by video-on-demand this weekend.
- Carl Icahn may submit a full list of alternative directors including a CEO for Time Warner(TWX) as part of the billionaire shareholder’s fight for control of the company.
- A United Nations internal review of its peacekeeping activities found “substantial evidence of abuse” in procurement operations that led to “financial losses,” citing a copy of the document seen by the newspaper.
- Toshiba Corp. will acquire British Nuclear Fuels Plc’s Westinghouse Electric power-plant unit for almost $5 billion.
- The value of worldwide hotel property sales reached $44.5 billion last year, an increase of 63% on the previous year.

Sunday Telegraph:
- Pixar(PIXR), maker of animated films “Finding Nemo” and “Toy Story”, may approve a $7 billion buyout by Walt Disney(DIS) tomorrow.

Sunday Times:
- Vodafone Group Plc(VOD) investors may have asked the world’s largest mobile-phone operator to sell US unit Verizon Wireless(VZ), to raise as much as $44 billion, citing unidentified shareholders.

Economic Daily News:
- AU Optronics(AUO) has obtained orders to produce television panel displays for Japanese makers such as Toshiba Corp. and Matsushita Electric Industrial.

NDTV:
- King Abdullah of Saudi Arabia said the price of oil is too high and is damaging developing countries, citing an interview with the monarch of the world’s largest oil exporter.

Asharq al-Awsat:
- Kuwait Real Estate Company and state-owned Kurdistan Development Corp. plan to develop property in the northern part of Iraq this year.

Weekend Recommendations
Barron's:
- Had positive comments on (SNE), (XMSR) and (MOSY).

Goldman Sachs:
- Reiterated Outperform on (SLB), (DIS) and (GE).

Night Trading
Asian indices are -1.50% to -1.0% on average.
S&P 500 indicated +.09%.
NASDAQ 100 indicated -.06%.

Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule

Earnings of Note
Company/Estimate
(AXP).59
(ACF).46
(AV).12
(BAC)1.02
(ET).29
(ETN)1.36
(ENR)1.61
(F).01
(PPC).39
(SEBL).11
(TXN).42

Upcoming Splits
- None of note

Economic Releases
10:00 am EST
- Leading Indicators for December are estimated to rise .2% versus a .5% increase in November.

BOTTOM LINE: Asian Indices are lower, weighed down by exporting companies in the region after oil rose to a four-month high. I expect US stocks to open lower and to rise into the afternoon, finishing modestly higher. The Portfolio is 50% net long heading into the week.

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