Monday, June 11, 2007

Tuesday Watch

Late-Night Headlines
- The Senate unanimously voted to take up energy legislation that would raise US car fuel economy standards and increase the use of alternative fuels in an effort to reduce oil consumption.
- House Speaker Nancy Pelosi is losing support with Americans who don’t see Congress producing any real change. A 39% plurality of Americans disapprove of the California Democrat’s performance, according the latest Bloomberg/LA Times national survey; 36% approve. In January, the new speaker scored a 34% to 21% favorable rating.
- Texas Instruments(TXN) said second-quarter sales and profit will miss its highest estimates as demand for handsets and calculators declines. The stock fell $.70/share to $35.10 in after-hours trading.
- An index of energy and raw materials prices paid by companies in Japan rose 2.2% in May from a year earlier after climbing 2.3% in April, the Bank of Japan said.
- The yuan had the biggest gain in a month before the US Treasury Dept. is scheduled to name currency manipulators in a semiannual foreign-exchange report.
- The US dollar may strengthen for a fifth day against the euro as reports this week will probably show US economic growth is recovering, making an interest-rate cut this year less likely.
- Inflation in China accelerated in May, increasing the likelihood that interest rates will be raised. Consumer prices gained 3.4% from a year earlier versus a 3.0% rise in April and estimates of a 3.3% gain.

Wall Street Journal:
- Dow Jones’(DJ) controlling Bancroft family is expected to send News Corp.(NWS/A) a new list of proposals for creating a board that would ensure editorial independence at the Wall Street Journal.

- United Microelectronics and Texas Instruments(TXN) are jointly developing 45-nanometer and 32-nanometer chipmaking technology, citing Jackson Hu, the Taiwan company’s chairman.

Financial Times:
- The growth of cities in China has “devastated” the country’s historical buildings and cultural heritage, citing Qiu Baoxing, vice-minister for construction.

Daily Telegraph:
- Royal Bank of Scotland Group Plc and Bank of America Corp.(BAC) are understood to be approaching agreement over how to split ABN Amro Holding NV’s US division, LaSalle.

China Daily:
- About 60% of cities in China have polluted air and lack centralized sewage systems.

South China Morning Post:
- China suspended approvals of overseas listings by private companies because it wants them to sell shares to domestic investors.

Late Buy/Sell Recommendations

- Reiterated Buy on (SNDK), target $52.

Morgan Stanley:
- Reiterated Overweight on (AAPL), target $150.

Night Trading
Asian Indices are -.25% to +.50% on average.
S&P 500 indicated -.12%.
NASDAQ 100 indicated -.12%.

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
Conference Calendar
Daily Stock Events
Macro Calls
Rasmussen Business/Economy Polling
CNBC Guest Schedule

Earnings of Note
Company/EPS Estimate
- (FNSR)/.02
- (LEH)/1.87
- (SAPE)/.03
- (STEI)/.12
- (ROLL)/.41

Upcoming Splits
- (CROX) 2-for-1
- (WMS) 3-for-2
- (ADVNA) 3-for-2
- (BNHN) 3-for-2
- (BWLD) 2-for-1
- (MIDD) 2-for-1
- (PEBK) 3-for-2

Economic Releases
2:00 pm EST
- The Monthly Budget Statement for May is estimated to widen to -$70.0 billion versus -$42.9 billion in April.

Other Potential Market Movers
- The Fed’s Moskow speaking, Fed’s Lockhart speaking, former Fed head Greenspan speaking, weekly retail sales reports, JPMorgan Basics/Industrials Conference, Goldman Sachs Global Healthcare Conference and Bear Stearns Tech/Communications/Internet Conference could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by commodity stocks in the region. I expect US equities to open modestly lower and to rally into the afternoon, finishing mixed. The Portfolio is 75% net long heading into the day.

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