Sunday, December 30, 2007

Monday Watch

Weekend Headlines
- James Halloran, who helps oversee $35 billion at National City Private Client Group, sees ‘downside’ risks for oil is 2008. (video)

- Richard DeKaser, chief economist at National City Corp., sees ‘better times’ for the US housing market in 2008. (video)
- US and Canadian theaters this weekend set a record for yearly ticket sales, taking in an estimated $9.59 billion.
- The Pakistan Peoples Party named Benzir Bhutto’s son Bilawal as its new leader and said it would participate in parliamentary elections next month.
- President Bush said he is committed to making sure the US economy grows next year, and pledged to work with Congress to see that it happens.
- China, the world’s biggest grain producer, will tax exports of wheat, corn and rice to increase domestic supply and control rising food prices.

- Nickel will lead a decline in industrial metals next year as stockpiles expand and demand slows with the US housing market, a survey of analysts showed.

- Using the options markets, we can infer the marketplace’s expectations for a company’s future dividend payments.

NY Times:
- The NY Times, the third-largest US newspaper by circulation, named Fox News commentator and Weekly Standard editor William Kristol as a columnist on its Op-Ed page.
- General David Petraeus, the top US commander in Iraq, said violent attacks in Iraq have declined 60% since June. He said the number of car bomb, suicide car bomb and suicide vest attacks was also down about 60% since March. Petraeus attributed the drop in violence to the increase in US and Iraqi troops and officers and more aggressive operations. General Abdul Kareem Khalaf, a spokesman for the Iraqi Interior Ministry, said in a separate briefing that 75% of al-Qaeda’s network and safe havens had been destroyed.
- A look at the winners and the losers behind the most notable mergers and acquisitions of the year.
- ‘Dogs of Dow’ Have Subpar Year, Thanks to Citibank.
-’s(BIDU) CFO Dies in Accident.
- In-vehicle technology in focus in Las Vegas. This year’s Consumer Electronics Show will highlight an unlikely innovator: the automotive industry. GM’s Rick Wagoner will be the first car chief to deliver a keynote speech.

- Tech Firms’ Sales Keep Growing On Hot Gadgets, Business Gear. Call it the sector that saved Christmas. As the mortgage mess and higher energy prices cast a pall on Wall Street, investors are finding refuge in technology stocks, which have remained largely immune to the broader spending woes.
- Get Your Portfolio in Shape for 2008.
- Google’s(GOOG) Grip Tightens.

- Bears Are Full of Bull. The US Economy is faring well despite the housing mess. Just look around.

Boston Globe:
- Town governments, school districts and other municipalities looking to borrow money got a new option Friday when trying to insure their bonds: billionaire investor Warren Buffett. Buffett’s formation of a bond insurance company provided some validation to an industry that has been battered by fears of collapse in recent weeks.

Business Week:
- Inside Toyota’s Hybrid Truck. The automaker is introducing a concept compact hybrid pickup designed in America, for Americans.
- Will Apple(AAPL) Upset the Rental Cart? A plan to offer online video rentals could turn up the heat on Netflix and – and reinvigorate interest in Apple TV.
- iRobot(IRBT): Ready to Clean Up. The Roomba maker says it’s readying more robots to do the dirty work of cleaning and the fun work of keeping people connected.

USA Today:
- Setting up your HDTV not as easy as it looks; tips to help.
- Southwest(LUV) hopes changes add up to some ch-cha-ching.
- Growth funds outpace value names in 2007. Funds dedicated to growth companies had surprisingly solid gains for 2007. A tally of mutual fund performance for the year by Lipper Inc. found that one of the broadest mutual fund categories – large-cap US growth funds – had an average return of 14.9% for the year versus a 2.7% gain for large-cap US value funds.
- Deutsche Bank’s Walter sees oil price dropping to $80/bbl. over the next year.
- Oil investing: 2007 a tough act to follow. It was a banner year for energy – the sector was up 30% and crude jumped 60%. But don’t count on a repeat performance in ’08.
- Real Estate: The best- and the worst – of 2007.
- Cars: Best of the best, 2007.

- Osama bin Laden warned Iraq’s Sunni Arabs not to join tribal councils opposed to the terrorist group al-Qaeda, citing an internet audiotape released today. He also told Sunnis not to support a unified government in Iraq. US and Iraqi officials want to establish a “national unity government” to join Sunnis, Shiites and Kurds. “Our duty is to foil these dangerous schemes, which try to prevent the establishment of an Islamic state in Iraq,” he said.

- Bin Laden remarks make Gulf dollar peg likelier. Gulf Arab oil producers may be less likely to drop their currency pegs to the US dollar after Al Qaeda leader Osama bin Laden criticized dollar pegs as “unjust and arbitrary,” economists said. The Saudi-born militant leader urged Muslims in a video recording on Saturday to support militants so they can “preserve your oil and wealth and protect your money that is slipping between your fingers due to the unjust and arbitrary dollar pegs.” “Your support to sincere mujahideen (holy fighters) … guarantees all aspects of your security,” bin Laden said.
- Wall Street gurus optimistic for ’08.

Financial Times:
- Equity capital markets may receive a boost next year as financial institutions seek to repair their balance sheets.
- Just an illusion? British business looks bright even as consumers fret. Mario Thomas, managing director of Chapter Eight, says his Bradford-based website design company has full order books and is still taking on staff. “I’ve never seen an economy like this before, with all the doom and gloom. But it hasn’t let up for us at all – with existing customers commissioning work and new business flooding in.”

- Google Inc.(GOOG) is in talks with newspaper publishers about selling advertising space in their pages to the company’s online clients, citing comments from Google. Google, based in Mountain View, California, plans to use a bidding system to sell newspaper advertising space, and it will earn commission on the deals. Google’s UK advertising revenue rose 40% this year to $2.49 billion.
- China’s markets flashing red. Sooner or later, the world’s hottest market will burn up.

- Nanosolar Inc., a privately held California-based solar-panel maker, has started production of wafer-thick solar cells printed on aluminum film.
- Merrill Lynch(MER) is in talks with Chinese and Middle Eastern sovereign-wealth funds to raise capital through selling another “big” stake in the company, citing London and NY sources.

Auto Motor und Sport:
- General Motors Corp.s(GM) Chevrolet brand sales in Europe increased to a record in 2007, boosted by purchases of cars in Russia and eastern European countries, citing Chevrolet Europe chief Wayne Brannon. Sales may double to 900,000 vehicles by 2018.

Kyodo News:
- Japan aiming for 30% of households to have solar panels by 2030.

Nihon Keizai:
- Hitachi Ltd. will stop producing small hard-disk drives for use in video cameras and music players as manufacturers increasingly favor flash memory chips as a means of data storage.

Sankei newspaper:
- Mitsubishi Heavy Industries Ltd., France’s Areva SA and Japan Nuclear Fuel Ltd. will form a joint venture in the US to focus on building fast reactor nuclear plants and fuel reprocessing.

Middle East News Agency:
- President Nicolas Sarkozy said France will have no contact with Syria until it allows Lebanon to end a political crisis and appoint a new president.

Weekend Recommendations
- Made positive comments on (BK) and (LTR).
- Made negative comments on (COGT).

- Reiterated Buy on (LM), target $108.

Night Trading
Asian indices are unch. to +.75% on avg.
S&P 500 futures +.06%.
NASDAQ 100 futures unch.

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
- None of note

Upcoming Splits
- (CMI) 2-for-1
- (GHM) 5-for-4

Economic Data
10:00 am EST

- Existing Home Sales for November are estimated at 4.97M versus 4.97M in October.

Other Potential Market Movers
- Early close for financial futures and options at 1 pm EST.

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

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