Tuesday, June 19, 2007

Wednesday Watch

Late-Night Headlines
- Is Israel the new South Africa? A determined group of British academics thinks it might be. They couldn’t be more wrong.
- PetroChina Co., the country’s biggest oil company, plans to sell as many as 4 billion shares in Shanghai, which may raise $5.6 billion, based on the company’s share price in Hong Kong.
- Microsoft Corp.(MSFT) reached an agreement with state and federal antitrust officials to make competing desktop search programs run more easily through the software maker’s Windows Vista operating system.
- New Zealand’s Finance Minister Michael Cullen said there’s a risk of a “significant downturn” in housing after the central bank raised its benchmark interest rate to a record to cool demand.
- The Bank of Japan’s policy board retained its commitment to gradually raise the country’s interest rates, the lowest among major economies, according to the minutes published today in Tokyo.
- China’s annual inflation rate may climb to about 3.3% in 2007 from a year earlier, citing a government agency.

Wall Street Journal:
- Iraq will ask China to invest in the Middle East nation’s oil fields in a visit by Iraqi President Jalal Talabani to Beijing.

- North Carolina lawmakers passed a bill that would allow Governor Mike Easley to immediately remove suspended Durham County District Attorney Mike Nifong from office.

London-based Times:
- News Corp.(NWS/A) discussed swapping its Internet social-network unit, MySpace, with Yahoo!(YHOO) Inc. for a 25% share in the combined group to gain more Net exposure.

- China has passed the United States to become the world’s biggest producer of carbon dioxide, figures released yesterday reveal, citing the Netherlands Environmental Assessment Agency.

Shanghai Securities News:
- China Vanke Co. Chairman Wang Shi said bubbles in the country’s property market will burst in two to three years, or earlier. Vanke is the country’s largest publicly traded real estate developer.

Late Buy/Sell Recommendations

- Reiterated Buy on (BBY), target lowered to $57.
- We continue to expect record natural gas storage levels by the end of the 2007 injection season. We expect ending inventory this year to be 3,617 Bcf, 5% above last year’s record of 3,461 Bcf and 1% above our prior estimates. Higher storage vs. previous estimates is due to our reduced industrial demand forecast.

Night Trading
Asian Indices are unch. to +.75% on average.
S&P 500 indicated +.01%.
NASDAQ 100 indicated -.03%.

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
- (KMX)/.30
- (CC)/-.32
- (CMC)/.79
- (CMVT)/.17
- (FDX)/1.97
- (MS)/2.00
- (SONC)/.31

Upcoming Splits
- (SEIC) 2-for-1
- (AGN) 2-for-1
- (ESRX) 2-for-1

Economic Releases
10:30 am EST
- Bloomberg consensus estimates call for a weekly crude oil drawdown of -50,000 barrels versus an 87,000 barrel build the prior week. Gasoline supplies are estimated to rise by 1,190,000 barrels versus a 3,000 barrel rise the prior week. Distillate inventories are expected to increase by 870,000 barrels versus a 287,000 barrel gain the prior week. Finally, Refinery Utilization is expected to rise by .75% versus a -.40% decline the prior week.

Other Potential Market Movers
- The Fed's Geithner speaking, Fed's Fisher speaking, Fed's Yellen speaking, weekly MBA Mortgage Applications report, (NVDA) analyst meeting, (MDT) analyst meeting, Jeffries Financial Services Conference, NXTcomm 2007, William Blair Growth Stock Conference and Merrill Lynch Financial Services Conference
could also impact trading today.

BOTTOM LINE: Asian indices are higher, boosted by technology and automaker 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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