Morning Buy/Sell Recommendations

Goldman Sachs:
- Reiterated Underperform on MU and HRB.
- Reiterated Outperform on AIG.

Smith Barney:
- Said to Buy AD.
- Reiterated Sell on MU, target $11.50.

CSFB:
- Raised APOL to Outperform, target $84.
- Reiterated Outperform on TTMI, target $13.

Merrill Lynch:
- Raised AMR to Buy, target $14.
- Raised FRNT to Buy, target $12.
- Raised STON to Buy, target $24.50.
- Raised POT to Buy, target $94.
- Raised KOSP to Buy, target $50.

Morgan Stanley:
- Raised SSI to Overweight, target $64.
- Rated EMC Overweight, target $16.
- Reiterated Overweight on NYT, target $45.
- Reiterated Overweight on APOL, target $87.
- Reiterated Underweight on SLM, target $46.

Banc of America:
- Reiterated Buy on BFAM, target $38.

Jeffries:
- Rated IMA Buy, target $32.
- Rated L Buy, target$14.87.

Prudential:
- Raised SFD to Overweight, target $35.
- Raised SHFL to Overweight, target $35.

Thomas Weisel:
- Rated AKAM, TWW, GRIC Outperform.
- Rated INLD Underperform.

Piper Jaffray:
- Cut SBIB to Underperform, target $12.

Legg Mason:
- Rated DF Buy, target $40.

Chart of Interest

Wednesday Watch

Late-Night Headlines
Bloomberg:
- The US dollar weakened for the first day in 10 against the yen in Asia, ending the longest winning streak since 2001, as some traders bet the currency's rally was excessive.
- Bristol-Myers Squibb won FDA approval for its Baraclude hepatitis B drug.
- Nikko Citigroup Ltd. eclipsed Nomura Holdings Inc. as Japan's leading stock underwriter in the first quarter after arranging the biggest block trade in its six-year history for computer maker Fujitsu Ltd.
- Qwest Communications hired a proxy adviser to build shareholder support for its takeover bid for MCI Inc. and escalate a battle with Verizon Communications.

Wall Street Journal:
- The number of securities class-action suits filed against US companies rose 16% last year to 203.

Washington Post:
- The American Association of Retired Persons is spending more than $5 million over two weeks attacking President Bush's plan to save Social Security.

Financial Times:
- Russia's slowing investment growth is making it difficult to meet a "catastrophic excess" of domestic demand.
- The share prices of international companies with listings in the US may decline if the Sarbanes-Oxley Act compels them to disclose inadequate internal controls, citing research by Mori and PricewaterhouseCoopers LLP.
- Inflation in China may ease this year, falling to 3-3.5%.

Orange County Business Journal:
- Kia Motors, South Korea's second-biggest automaker, bought land for $28 million in Southern California that will be the site of its new US headquarters.

Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on HOT, PFE, DIS, AMR, RIG, DIS and FS.
- Reiterated Underperform on EQR and VTS.

Banc of America:
- Reiterated Buy on DJ, target $44.
- Reiterated Buy on JRC, target $21.
- Reiterated Buy on NYT, target $40.

JP Morgan:
- Upgraded INSP to Overweight.
- Reiterated Overweight on HPQ.

Night Trading
Asian Indices are -.50% to unch. on average.
S&P 500 indicated +.14%.
NASDAQ 100 indicated +.10%.

Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Analyst Actions
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule

Earnings of Note
Company/EPS Estimate
AGE/.66
AMT/-.17
KMX/.28
NRG/-.16
RI/.39
TEX/.45

Splits
None of note

Economic Releases
8:30 EST:
- Final 4Q GDP is estimated to rise 4.0% versus a prior estimate of 3.8%.
- Final 4Q Personal Consumption is estimated to rise 4.3% versus a prior estimate of 4.2%.
- Final 4Q Price Deflator is estimated to rise 2.1% versus a prior estimate of 2.1%.

BOTTOM LINE: Asian indices are lower as commodity and exporter shares in the region continue to decline on worries over slowing global demand. I expect US equities to open modestly lower in the morning on higher energy prices and losses in Asia. However, stocks should stage a short-term rally beginning sometime over the next 2 days. The Portfolio is 25% net short heading into tomorrow.

Tuesday Close

Indices
S&P 500 1,165.36 -.76%
DJIA 10,405.70 -.76%
NASDAQ 1,973.88 -.94%
Russell 2000 604.63 -1.71%
DJ Wilshire 5000 11,477.20 -.86%
S&P Barra Growth 576.-.79%
S&P Barra Value 597.95 -.73%
Morgan Stanley Consumer 572.94 -.34%
Morgan Stanley Cyclical 733.31 -1.69%
Morgan Stanley Technology 449.62 -.76%
Transports 3,673.57 -1.80%
Utilities 349.65 -1.35%
Put/Call .66 unch.
NYSE Arms 1.45 +69.37%
Volatility(VIX) 14.49 +5.38%
ISE Sentiment 166.00 -14.87%
US Dollar 84.32 -.22%
CRB 308.93 +.51%

Futures Spot Prices
Crude Oil 54.41 +.67%
Unleaded Gasoline 157.50 +.15%
Natural Gas 7.32 +4.63%
Heating Oil 156.00 +.80%
Gold 426.00 unch.
Base Metals 127.85 +.26%
Copper 146.25 -.54%
10-year US Treasury Yield 4.57% -1.45%

Leading Sectors
Hospitals +2.15%
Insurance +.60%
Foods -.06%

Lagging Sectors
Gaming -2.12%
Oil Service -2.46%
Iron/Steel -3.27%

After-hours Movers
ANGO +5.12% after beating 3Q estimates and raising 05 guidance.
VTS +6.77% after beating 2Q estimates.
MERX +7.11% after beating 3Q estimates and raising 4Q outlook.
IMH +11.64% after announcing 1Q dividend of .75/share.
TTEK -20.3% after lowering 2Q guidance and taking substantial charge.

Evening Review
Detailed Market Summary
Daily ETF Performance
Style Performance
Market Wrap CNBC Video(bottom right)
Futures Recap
S&P 500 Gallery View
Timely Economic Charts
PM Market Call
Real-time/After-hours Stock Quote
In Play

Afternoon Recommendations
Goldman Sachs:
- Reiterated Outperform on KO and YUM.
- Reiterated Underperform on PBG.

Afternoon/Evening Headlines
Bloomberg:
- US Supreme Court justices questioned the federal rules that say Time Warner and other cable-tv operators don’t have to open their Web-access networks to rival Internet service providers.
- Natural gas futures rose for the first time in five sessions on speculation that US demand this summer will be stronger than normal.
- Delta Air Lines hired two companies to perform maintenance on about half its fleet, allowing it to eliminate as many as 2,000 jobs and save $240 million over five years.
- Liberty Media Chairman John Malone said he wants to hold or expand his company’s stake in Rupert Murdoch’s News Corp., heightening a conflict between the executives over the future of Malone’s investment.
- Eight former Morgan Stanley executives urged the board to oust CEO Purcell, saying his “failure of leadership” has caused the firm’s shares to lag behind Wall Street rivals.
- Miramax Film founders Harvey and Bob Weinstein will leave Walt Disney in September following clashes with CEO Eisner.
- Japan’s industrial production fell more than expected in February as overseas demand cooled, adding to evidence that a recovery in the world’s second-biggest economy may stall.

AP:
- Telecommuters who work for New York employers while living outside the state must pay New York taxes on their full incomes, the state’s highest court ruled.

The Star:
- GE is seeking a stake in a Malaysian bank.

BOTTOM LINE: US stocks finished lower today on continuing worries over slowing global growth. The Portfolio finished higher on gains in my Base Metal shorts, Chinese ADR shorts and Internet shorts. I did not trade in the afternoon, thus leaving the Portfolio 25% net short. The tone of the market deteriorated into the close as the advance/decline line dropped considerably to its daily lows, almost every sector declined and volume rose from low levels. Cyclicals and Small-caps underperformed substantially throughout the day and measures of investor anxiety were mostly higher. Overall, today’s market action was negative, considering recent losses, declining long-term interest rates, merger activity and the modest decline in Consumer Confidence. I expect a short counter-trend rally will begin sometime tomorrow or Thur.

Mid-day Scoreboard

Indices
S&P 500 1,168.35 -.51%
DJIA 10,424.17 -.59%
NASDAQ 1,978.87 -.68%
Russell 2000 608.01 -1.16%
DJ Wilshire 5000 11,513.50 -.55%
S&P Barra Growth 564.64 -.51%
S&P Barra Value 599.99 -.39%
Morgan Stanley Consumer 574.12 -.14%
Morgan Stanley Cyclical 736.17 -1.30%
Morgan Stanley Technology 450.55 -.56%
Transports 3,684.45 -1.51%
Utilities 351.93 -.72%
Put/Call .66 unch.
NYSE Arms 1.23 +43.62%
Volatility(VIX) 13.92 +1.31%
ISE Sentiment 161.00 -17.44%
US Dollar 84.37 -.17%
CRB 308.70 +.44%

Futures Spot Prices
Crude Oil 54.10 +.09%
Unleaded Gasoline 156.90 -.24%
Natural Gas 7.27 +3.87%
Heating Oil 155.00 +.16%
Gold 426.00 unch.
Base Metals 127.85 +.26%
Copper 147.05 +1.10%
10-year US Treasury Yield 4.58% -1.19%

Leading Sectors
Hospitals +2.41%
Insurance +1.12%
Foods +.12%

Lagging Sectors
Biotech -1.06%
Gaming -1.48%
Iron/Steel -2.40%

Links of Interest
Market Internals
Movers & Shakers
I-Watch Sector Overview
NYSE Unusual Volume
NASDAQ Unusual Volume
NASDAQ 100 Heatmap
DJIA Quick Charts
Chart Toppers
Hot Spots
Option Dragon
Real-time Intraday Chart/Quote

BOTTOM LINE: US stocks are lower mid-day on worries over slowing global growth. The Portfolio is higher on gains in my Chinese ADR shorts and Internet shorts. I added a few new shorts this morning, thus bringing the Portfolio’s market exposure to 25% net short. One of my new shorts is PD and I am using a $102 stop-loss on this position. The tone of the market is negative as the advance/decline line is lower, most sectors are lower and volume is light. Small-caps and Cyclicals are once again underperforming and measures of investor anxiety are mostly higher. Today’s overall market action is negative considering recent losses, the decline in interest rates and merger activity. This appears to be the beginning of the final push lower that I have been anticipating. Levels of investor anxiety should reach levels necessary to help form a meaningful bottom over the next few weeks. I continue to expect the second half of the year to be much better for the equities. I expect US stocks to trade mixed-to-lower into the close on worries over slowing global growth.

Today's Headlines

Bloomberg:
- Russian President Putin’s government expects to speed up state asset sales as the country seeks to restore investor confidence after the state seized OAO Yukos Oil’s biggest unit.
- US consumer confidence fell in March for a second straight month as higher gasoline prices damped the enthusiasm sparked by job growth.
- The SEC, trying to ease concerns over shareholder lawsuits, gave companies flexibility in reporting stock options as expenses on their financial statements beginning as soon as June.
- Hewlett-Packard chose NCR Corp. CEO Mark Hurd as its new CEO.
- MCI Inc. accepted a new $7.64 billion takeover from Verizon Communications, rejecting a higher bid from Qwest Communications.
- US Treasury notes rose as a drop in consumer confidence bolstered speculation high energy prices will damp consumer spending, helping to keep inflation in check.

The Wall Street Journal:
- Billionaire investor Warren Buffett was called by regulators to answer questions about an insurance transaction between a unit of his Berkshire Hathaway and American International Group.
- Cingular Wireless LLC had more complaints than any other cell-phone service in the fourth quarter.
- VeriSign Inc. is the leading candidate for operating the “.net” registry when its existing contract with the Internet Corporation for Assigned Names and Numbers expires.
- Closely held Cook Inc. is developing drug-coated stents, or small tubes used to open clogged arteries, for use in arteries away from the heart to see if they help blockages.
- Merck & Co. hasn’t been able to find a “heavy hitter” prepared to take over from CEO Raymond Gilmartin, who retires in March 2006.
- Identity thieves can find sensitive information using Google’s search engine or other services by knowing what to look for, putting the onus on Web sites to remove such data.

The New York Times:
- Less than 5% of the 20 million low-income US residents receiving Medicare applications for financial assistance will respond because the form is too complex.
- US airlines are cutting seat capacity by retiring less efficient planes because of fuel price increases.
- A former aide to UN Secretary General Kofi Annan, Iqbal Riza, will be criticized in a report for throwing away documents on the Iraqi oil-for-food program.
New York Post:
- Kohlberg Kravis Roberts is negotiating to buy a majority stake in GM’s GMAC Commercial Mortgage unit for at least $1 billion.

Dow Jones Newswires:
- OPEC suspended talks to raise output quotas for a second time this year.

Barron’s:
- Tiffany & Co. may be a target for a takeover, citing money manager and shareholder Shawn Krevetz of Esplanade Capital in Boston.

Yonhap News:
- Samsung SDI, the world’s largest maker of plasma display panels, forecast the present glut in the products will turn to a shortage during the fourth quarter.

Press Trust of India:
- PepsiCo Inc. plans to spend as much as $500 million to expand its business in India in the next three to five years.

Tex Report:
- Tokyo Steel Manufacturing has offered to pay as much as $19 more on each ton of ferrous scrap it will buy in the domestic market starting tomorrow.