Thursday, June 28, 2007

Friday Watch

Late-Night Headlines
- Research In Motion Ltd.(RIMM), maker of the BlackBerry e-mail phone, said first quarter profit rose 73% on demand for new devices with cameras and music players. The company also announced a 3-for-1 stock spit. Shares soared 17% in after-hours trading.
- Some seafood imported to the US from China will be detained by regulators because of possible contamination with unsafe drugs, the latest health warning about products from that country.
- FedEx Corp.(FDX) truck drivers would be able to join unions more easily under US legislation approved by a House panel today, in a victory for organized labor.
- The yen headed for the biggest quarterly loss against the US dollar since 2001 before reports that are forecast to show falling prices and slowing consumption in Japan.
- North Korea’s pledge to close its Yongbyon reactor and dismantle its nuclear program may help establish a security agreement for northeast Asia, South Korean Foreign Minister Song Min Soon said.
- Japan’s consumer prices fell .1% in May, a pace of decline that’s unlikely to deter the central bank from raising its benchmark interest rate, the lowest among major economies.
- The US House of Representatives moved toward giving small companies an additional year to adhere to the Sarbanes-Oxley Act’s accounting rules, which are being revised by the SEC.
- Consideration of an energy package in the House of Representatives that had been scheduled for July may be delayed until September partly because of pending work on other legislation, Speak Nancy Pelosi said.
- The highest-rated collateralized debt obligations holding subprime mortgages may be worth buying if an abundance of selling causes prices to drop, according to Morgan Stanley.
- Members of the International Swaps and Derivatives Assoc. said they will not change trading contract language to address concerns raised by a group of hedge funds that banks who invest in derivatives tied to subprime mortgage bonds may try to suppress defaults by buying bad loans out of the deals.
- Apollo Group(APOL), the for-profit education company, reported profit excluding some items of 81 cents a share in the third quarter and said it plans to buy back as much as $500 million of its own stock. The stock rose 6.7% in after-hours trading.
- Komag(KOMG), the maker of computer disk-drive components, agreed to be bought by Western Digital(WDC) for $32.25 a share, or $1 billion, in cash. Komag rose 7.7% in after-hours trading.
- South Korea has accepted new labor and environment provisions for its free-trade agreement with the US, allowing it to be signed tomorrow, Kim Jong Hoon, the Asian country’s chief negotiator said.

Wall Street Journal:
- Apple Inc.(AAPL) may not be able to meet demand for its iPhone, Chief Executive Officer Steve Jobs said. The iPhone hasn’t had an effect on iPod sales, Jobs said.
- Ford Motor(F) plans to resume paying a dividend sometime in the future, citing a video of CEO Mulally talking to dealers.

LA Times:
- Doug Frantz, managing editor of the LA Times, will leave the paper, citing Editor James O’Shea.

Daily Mail:
- Russia wants to add oil reserves twice the size of Saudi Arabia’s by laying claim to untapped oil and natural gas fields beneath the North Pole.

Late Buy/Sell Recommendations

- Reiterated Buy on (MON), target raised to $77.
- Rated (CMG) Buy, target $100.
- Reiterated Buy on (SNDK), target $52.

Needham & Co.:
- Rated (SNDK) Buy, target $55.

Business Week:
- Shares of USG Corp., the No. 1 maker of gypsum wallboard in the US, may rebound next year if the housing market turns around. The stock may rise 44% to $70 a share in the next year, citing Michael Metz, chief investment strategist at Oppenheimer Holdings.
- Shares of Kaydon Corp.(KDN) may rise as increased interest in wind energy will strengthen demand for the anti-friction bearings the company makes for turbines.
- United Retail Group(URGI), whose clothing caters to women wearing size 14 or larger, will benefit from summer sales.

Night Trading
Asian Indices are -.25% to +.75% on average.
S&P 500 indicated +.05%.
NASDAQ 100 indicated +.12%.

Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Pre-market Stock Quote/Chart
Before the Bell CNBC Video(bottom right)
Global Commentary
WSJ Intl Markets Performance
Commodity Movers
Top 25 Stories

Top 20 Business Stories
Today in IBD
In Play
Bond Ticker
Economic Preview/Calendar
Daily Stock Events
Macro Calls
Rasmussen Business/Economy Polling
CNBC Guest Schedule

Earnings of Note
Company/EPS Estimate
- (NDN)/.01
- (AZZ)/.42

Upcoming Splits
- (CXW) 2-for-1

Economic Releases
8:30 am EST

- Personal Income for May is estimated to rise .6% versus a -.1% decline in April.
- Personal Spending for May is estimated to rise .7% versus a .5% gain in April.
- PCE Core (MoM) for May is estimated to rise .1% versus a .1% gain in April.

9:45 am EST
- The Chicago Purchasing Manager Index for June is expected to fall to 58.0 versus a reading of 61.7 in May.

10:00 am EST
- Construction Spending for May is estimated to rise .1% versus a .1% gain in April.
- Final University of Michigan Consumer Confidence for June is estimated to rise to 84.0 versus a prior estimate of 83.7.

Other Potential Market Movers
- The JPMorgan Global Tobacco Conference could also impact trading today

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

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