Wednesday, June 27, 2007

Wednesday Watch

Late-Night Headlines
- General Motors’(GM) Cadillac luxury-vehicle division is considering hybrid versions of all its models.
- A unit of General Electric(GE), the world’s biggest maker of power generators, will invest in three windparks in New York State, its first wind energy investment there.
- Shares of Cameco Corp.(CCJ), the world’s largest uranium producer, fell the most in eight months on concern that the price of uranium has peaked.
- Countrywide Financial Corp.(CFC) called “unfounded” market speculation that the company was the subject of raids by federal authorities.
- North Korea is “committed” to scrapping its nuclear program and is “positive” about its relations with the US and the international community, a group of European Union lawmakers told reporters in Seoul today.
- Japan’s retail sales unexpectedly rose for the first time in eight months, signaling spending by consumers may drive second-quarter economic growth.

Wall Street Journal:
- Apple’s iPhone is a breakthrough smart phone with some flaws, according to a review by Walter S. Mossberg. The “simply beautiful” handheld computer, set to go on sale June 29, offers the “best Web browser,” the biggest and highest-resolution screen and better battery life than key competitors, according to the review, also written by Katherine Boehret.

Late Buy/Sell Recommendations

- (TSO) and (VLO) are downgraded to Sell and (SUN) is lowered to Hold. We are lowering ratings across the board for the US refiners. Valuations have moved within striking distance of levels we believe take full account of structural changes that have underpinned our positive view since early 2007. But from here the balance of risk has moved to the downside. Share price appreciation has benefited from a number of transitory factors that have inflated earnings expectations beyond levels we believe can reasonably be viewed as repeatable.
- Reiterated Buy on (NKE), target $65.

Morgan Stanley:
- Reiterated Outperform on (ORCL), target $24.

Night Trading
Asian Indices are -1.0% to -.25% on average.
S&P 500 indicated -.09%.
NASDAQ 100 indicated -.10%.

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
- (ATML)/.03
- (BBBY)/.37
- (CKR)/.27
- (CAG)/.31
- (GY)/-.04
- (MLHR)/.49
- (MKC)/.33
- (PKE)/.41
- (PAYX)/.36
- (RHT)/.15
- (SMOD)/.22
- (SMSC)/.25
- (TBL)/.15
- (XRTX)/.14

Upcoming Splits
- (SPAR) 3-for-2
- (VSEC) 2-for-1
- (FLO) 3-for-2

Economic Releases
8:30 am EST
- Durable Goods Orders for May are estimated to fall -1.0% versus a .8% gain in April.
- Durables Ex Transports for May are estimated to rise .2% versus a 1.9% increase in April.

10:30 am EST
- Bloomberg consensus estimates call for a weekly crude oil build of 1,500,000 barrels versus a 6,902,000 barrel build the prior week. Gasoline supplies are estimated to rise by 1,000,000 barrels versus a 1,791,000 barrel increase the prior week. Distillate inventories are expected to rise by 500,000 barrels versus a 157,000 barrel build the prior week. Finally, Refinery Utilization is expected to rise by .83% versus a -1.63% decline the prior week.

Other Potential Market Movers
- The weekly MBA Mortgage Applications report, (LUV) analyst meeting, Wachovia CEO Summit and Jeffries Healthcare Conference could also impact trading today

BOTTOM LINE: Asian indices are lower, weighed down by automaker and 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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