Today's Headlines

Bloomberg:
- Amgen Inc.(AMGN), with more cash than all but two U.S. pharmaceutical industry rivals, will compete with Pfizer Inc. and other large drugmakers to snatch up distressed biotechnology companies at bargain prices. Amgen, the world's largest biotechnology company, has $9.76 billion in cash and marketable securities, according to Bloomberg data. The company is seeking ``attractive opportunities'' in the ``challenging environment for biotech companies needing to raise cash,'' said David Polk, a spokesman, in a Nov. 3 e-mail. The comments follow similar pledges last month by Pfizer, Bristol-Myers Squibb Co. and Wyeth.

- Treasury Secretary Henry Paulson is considering taking stakes in non-bank financial companies after already allocating $250 billion for government investments in banks, two people briefed on the matter said.

- CSFB cut its oil forecast for 2009 to $60 from $75/bbl.

- A rising threat of inflation earlier this year ``froze in its tracks'' in recent months as the credit crisis worsened, Federal Reserve Bank of Dallas President Richard Fisher said. Plunging commodity prices, including a 55 percent decline in the cost of oil since July, have eased inflation pressures. ``I don't believe we are likely to have sustainable deflationary impulses,'' Fisher told reporters after his speech.

- Contracts on the Markit CDX North America Investment Grade Index of 125 companies in the US and Canada decreased 10 basis points to 188, according to Phoenix Partners Group. The Markit iTraxx Europe Index of 125 companies with investment-grade ratings declined 10 basis points to 135, JPMorgan prices show.

- Surging prices for oil, copper, gold and corn sent commodities rallying as a U.S. Election-Day plunge in the dollar boosted the appeal of raw materials as a hedge against inflation. Speculation that Democratic candidate, Senator Barack Obama, who leads national polls, will win against Republican John McCain helped send the dollar lower and lift commodity and equity markets. ``With the Democrats, there's the assumption of the potential of more inflation, given their spending plans,'' said William O'Neill, a partner at Logic Advisors in Upper Saddle River, New Jersey.

- Chicago is bracing itself for Barack Obama's hometown election-night rally. The event scheduled for Grant Park, known as the city's front yard, may draw as many as 1 million people, Mayor Richard M. Daley said. Officials are hoping for a peaceful gathering, while preparing for possible violence that could further tarnish Chicago, which has the highest murder rate among the country's biggest cities.

- Democrats have been pushing for months a second economic stimulus package worth at least $100 billion. Now that will only be a down payment. Lawmakers are facing growing calls from a measure that would dwarf the $168 billion economic stimulus package signed into law in February and the $175 billion measure Democratic presidential candidate Barack Obama has called for.

- The cost of borrowing dollars for one month in London fell to the lowest level in almost four years as central-bank cash injections and interest-rate cuts worldwide showed signs of thawing the freeze in lending. The London interbank offered rate, or Libor, that banks charge each other for such loans slid 18 basis points to 2.18 percent today, the lowest level since November 2004, and the 17th straight decline, according to British Bankers' Association data. The three-month rate dropped 15 basis points to 2.71 percent, the lowest level since June 9, according to BBA figures.

- Interest rates on U.S. commercial paper fell to the lowest in four years as Federal Reserve efforts to unlock short-term credit markets, including buying the debt directly from companies, showed signs of working. Interest rates on the highest-ranked 30-day commercial paper fell 0.27 percentage point to 1.74 percent, the lowest since Sept. 22, 2004, according to yields offered by companies and compiled by Bloomberg. Yields on 90-day paper fell 0.06 percentage point to a three-month low of 2.62 percent.

Wall Street Journal:

- Republican John McCain and Democrat Barack Obama joined voters eager to cast ballots on Tuesday before making one last pitch for supporters to turn out for their historic presidential contest.

- Big iron-ore miners, in a swift reversal of fortune, are privately bracing for significant price cuts in coming contract negotiations with the world's steelmakers as demand for autos, construction infrastructure and appliances weakens. Although contracts won't be signed until next year, there are indications that steelmakers will be seeking prices 20% to 40% less than this year's levels from BHP Billiton, Rio Tinto and Companhia Vale do Rio Doce, popularly known as Vale. Together, these companies control about 75% of the world's iron-ore production.

- Pain in the market for convertible bonds is crippling big hedge funds and cutting off a key avenue of financing for many companies. This market, which has long welcomed businesses struggling to raise cash, is the latest to suffer from too much borrowing and faulty hedges, which came unwound in the recent turmoil. Overall, the $200 billion convertible-bond market has lost 36% so far this year, a bit more than the stock market, according to Merrill Lynch. But the average convertible-bond hedge fund has lost about 50% in that time, including a 35% plunge in October.

- Intel Corp.'s(INTC) next big shift in chip design is receiving strong early reviews from Web sites that test computer hardware.

- More than three-quarters of the world's largest hedge fund managers have lost money for their investors in the first nine months of the year as crisis deepens in the industry. None of the world's five largest managers' flagship funds has made money for the year to September, according to details supplied by investors. Of the 79 of the world's 100 largest hedge fund managers where Financial News has been able to obtain details, 61 of them, or 77%, have flagship funds that have lost money.

Washington Post.com:

- Study Links Violent Games, Hostility. Research in US, Japan Shows Aggression Increased for Months After Play.

Platts:
- Flight from hedge funds affects gas market, stocks. In the third quarter, investors pulled more than $31 billion from hedge funds, the largest net capital redemption in the industry's history, said Hedge Fund Research, a leading firm specializing in the analyzing hedge fund returns. HFRX Global Hedge Fund Index, which is designed to represent the overall composition of the hedge fund universe, fell 6.9% in September and is off 15.19% year-to-date. Energy-related funds have posted even stiffer losses. The HFRI EH Energy/Basic Materials Index, which represents funds with a primary focus in energy or basic materials, fell 13.21% in September and is down 20.84% year-to-date. Gas market participants also have seen a sell-off from hedge fund traders who have been active in the futures and cash markets over the past few years. While CME Globex electronic trading has made it more difficult to identify who is trading what positions at what size, Ed Kennedy, vice president of energy trading at Hencorp, said the market looks like many of the funds are liquidating their trading positions as investors panic and flee to cash. "Open interest continues to decline," Kennedy said. "People are looking to get out of these hedge funds and mutual funds," Kennedy added. "It's huge what you're seeing here. It's overpowering the scaled-down buying by end-users," he said. Open interest - the number of long or short active positions held - in the prompt-month gas contract has declined about 100,000 since July according to the Commodity Futures Trading Commission's Commitments of Traders reports. During the same period, the prompt month gas futures contract has plummeted about 55% from its July high of $13.577/MMBtu.

Reuters:
- Saudi Arabia has cut supplies to some customers “significantly” after last month’s OPEC meeting. The kingdom may have cut exports since August by as much as 900,000 barrels a day.

- Most Gulf of Mexico oil and gas production that remains shut after Hurricane Ike will be restored by one pipeline repair project expected to finish by March, a U.S. government official said on Tuesday.The repair will bring several deepwater platforms back on line at once, said Lars Herbst, Gulf region director for the U.S. Minerals Management Service."Once that ... pipeline system is repaired, all of that will come back on at one time, and that's at least half if not three-quarters of what's remaining shut in," he said.

Etemaad:
- Iran’s former President Mohammad Khatami criticized the economic policies of his successor, for failing to revive the economy.

Kargozaraan:

- Iran will face ‘big trouble’ if the price of oil falls below $60.60 a barrel for the next five months, citing Ramin Pashaifam, the central bank’s deputy for economic affairs. Pashaifam said that with oil at $60 a barrel, Iran will deplete its oil stabilization fund by the end of the Iranian year on March 20^th.

Bull Radar

Style Outperformer:
Mid-cap Growth (+3.53%)

Sector Outperformers:
Construction (+9.02%), Oil Service (+7.06%) and Telecom (+5.77%)

Stocks Rising on Unusual Volume:
DB, SI, OSIR, MYGN, WPPGY, CSIQ, ENSG, SYKE, FSLR, CRXL, IPCM, HURC, SINT, WMGI, STRA, EXPD, HAYN, JCOM, NCIT, AMSC, CPHD, SWSI, TNH, TGP, WF, CUK, TMB and HIG

Stocks With Unusual Call Option Activity:
1) SOLF 2) KGC 3) CIT 4) MRVL 5) A

Links of Interest

Market Snapshot Commentary
Market Performance Summary
Style Performance
Sector Performance
WSJ Data Center
Top 20 Biz Stories
IBD Breaking News
Movers & Shakers
Upgrades/Downgrades
In Play
Exchange Volume vs. Average
NYSE Unusual Volume
NASDAQ Unusual Volume
Hot Spots
Option Dragon
NASDAQ 100 Heatmap
DJIA Quick Charts
Chart Toppers
Real-Time Intraday Quote/Chart
Dow Jones Hedge Fund Indexes

Stocks Finish Mostly Higher, Boosted by Airline, HMO, Telecom and Alternative Energy Shares

Evening Review
Market Summary
Top 20 Biz Stories
Today’s Movers
Market Performance Summary
WSJ Data Center
Sector Performance
ETF Performance
Style Performance
Commodity Movers
Market Wrap CNBC Video(bottom right)
S&P 500 Gallery View
Timely Economic Charts
GuruFocus.com
PM Market Call
After-hours Commentary
After-hours Movers
After-hours Real-Time Stock Bid/Ask
After-hours Stock Quote
After-hours Stock Chart
In Play

Tuesday Watch

Late-Night Headlines
Bloomberg:
- MasterCard Inc.(MA), the world's second- biggest credit-card company, rose 6.7 percent in late New York trading after beating analysts' estimates on overseas revenue gains. Profit excluding a previously disclosed $515.5 million charge to settle a lawsuit with Discover Financial Services was $322 million, or $2.47 a share, beating the $2.24 average estimate of 21 analysts surveyed by Bloomberg, the Purchase, New York-based firm said today in a statement.

- The corporate bond market showed encouraging signs last week as the extra yield borrowers typically pay on new debt to lure investors shrank and bond prices rose in secondary market trading, Bank of America said. The “new issue concessions” companies paid on debt sold last week fell to 70 basis points, from 130 basis points the previous week, analysts led by Hans Mikkelsen and Mike Cho wrote. “The one of the market improved significantly in the latter part of the month,” the analysts wrote, with newly priced bonds trading “meaningfully tighter.”

- Dow Jones Hedge Fund Indexes, Inc., today announced it will temporarily suspend publication of the Dow Jones Hedge Fund Equity Long/Short and Equity Market Neutral Strategy Benchmarks, effective November 3 until further notice. The company also said that its Dow Jones Hedge Fund Balanced Portfolio Indexes also will be suspended. In a statement, Dow Jones said: "The decision to halt publication of the benchmarks is the result of the temporary measures taken by the investment manager of the managed account platform that supports the Dow Jones Hedge Fund Strategy Benchmarks and Dow Jones Hedge Fund Balanced Portfolio Indexes to temporarily reduce the risk profiles of some of its managers."

- The cost of protecting investors in Australian corporate bonds from default declined, according to traders of credit-default swaps. The Markit iTraxx Australia index was quoted 10 basis points lower at 235 basis points as of 11:26 am in Sydney, Citigroup Inc. data show.

- European finance ministers ruled out a joint stimulus package to revive the region's economy and vowed instead to coordinate national policies as they try to limit the fallout from a recession on consumers and companies. ``We do not believe that in the euro area we need a general revival package, a sort of traditional program designed to stimulate the economy,'' Luxembourg Finance Minister Jean-Claude Juncker told a press conference after leading a meeting of euro- area counterparts in Brussels yesterday.

- UBS’s Jan Stuart, global oil economist at UBS Securities LLC, says crude oil may hit $50 a barrel next year.

- Australia's central bank cut its benchmark interest rate by a larger-than-expected three quarters of a percentage point, the third reduction in as many months, amid evidence global financial turmoil is buffeting the economy. Governor Glenn Stevens lowered the overnight cash rate target to 5.25 percent from 6 percent in Sydney today, adding to last month's 1 percentage point reduction.

Wall Street Journal:
- Yahoo Inc.(YHOO) and Google Inc.(GOOG) have sent the Justice Department a revised version of their search-advertising agreement, adding a number of new provisions designed to limit the scope of the deal as they scramble to get it past regulators, according to people familiar with the matter.

- In a world hard up for cash, even hedge-fund winners can wind up losers. Such is the fate of major credit fund Blue Mountain Capital Management, whose investors have begun yanking investments despite the fund's performance this year, a modest 2.4% loss, compared with an average 20% loss across all funds. Performance was largely beside the point for many Blue Mountain investors, who need access to cash. The perverse effect is that some investors have begun raiding their better-performing investments, giving the laggards a chance to recover.

- A report has cleared Gov. Sarah Palin of ethics violations in the firing of her public safety commissioner. The report, released Monday, said: "There is no probable cause to believe that the governor, or any other state official, violated the Alaska Executive Ethics Act in connection with these matters." It was prepared by Timothy Petumenos, an independent counsel for the Alaska Personnel Board.

NY Times:
- The US Treasury’s team of 45 staff members tasked with rescuing the financial system are working with “urgency” to deploy capital to banks, citing Treasury official James Lambright.

BusinessWeek:

- An analyst said Monday he is beginning to see a ramp up in demand for toys ahead of the holidays, but added that toy stocks so far have been as volatile as the rest of the market.

USA Today.com:

- The average price of gasoline has slipped to less than $2 a gallon in some metro areas for the first time since February 2007. The drop has even sparked some old-fashioned gas-price wars.

Financial Times:
- One of Goldman Sachs‘s(GS) flagship hedge funds, run by two of the Wall Street bank’s most talented traders, has lost close to $1bn since its launch in January in further evidence of the crisis facing the industry. Goldman Sachs Investment Partners, which was hailed in January as one of the biggest hedge fund launches, raising more than $6bn, has told investors that it had lost $989m by September. It said the fund was down about 13 per cent in the third quarter. Year-to-date performance fell about 15.5 per cent in the year to September. The fund was launched after a poor year for the bank’s quantitative, or computer-driven, hedge funds which were hit hard in August 2007 forcing the bank to inject $3bn to rescue its Global Equity Opportunities fund. More than half of GS Investment Partners’ losses in the third quarter was from its investments in commodities, basic materials, metals, mining, energy and agriculture.

- US retail investors have been trading stocks and options at record levels in recent months, apparently responding to the financial crisis by taking greater control of their own investments.The level of trading has helped brokers such as TD Ameritrade, Charles Schwab and Fidelity to lift their brokerage commission revenues, making this one of the few areas where financial services companies are making money.

Business Times:

- More companies have given up their factory space in Singapore because of the credit crunch, citing JTC Corp., the city’s largest industrial developer. Termination at ready-built facilities jumped 45% in the third quarter from a year earlier as manufacturers merged their operations, citing JTC.

South China Morning Post:

- China carmakers including Jianghuai Motor, Changan Ford Mazda and Dongfeng Peugeot Citroen are cutting staff because of a slowdown in the global economy.

Investor Daily Indonesia:

- PT Perusahaan Listrik Negara will delay the construction of 31 power-plant projects because of a lack of funding, citing an official of the utility.

Late Buy/Sell Recommendations
- None of note

Night Trading
Asian Indices are -1.0% to +1.25% on average.
S&P 500 futures -.14%.
NASDAQ 100 futures -.09%.

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
Upgrades/Downgrades
Rasmussen Business/Economy Polling

Earnings of Note
Company/EPS Estimate
- (ADM)/.72

- (PPL)/.61

- (VNO)/1.22

- (RDC)/.87

- (JEC)/.92

- (AMSC)/-.09

- (MVL)/.45

- (JOE)/-.03

- (DF)/.31

- (EMR)/.86

- (PZZA)/.36

- (KCP)/.07

- (DNR)/.52

- (LPX)/-.29

- (NILE)/.16

Economic Releases
10:00 am EST

- Factory Orders for September are estimated to fall .8% versus a 4.4% decline in August.

Upcoming Splits
- None of note

Other Potential Market Movers
- The Fed’s Fisher speaking, weekly retail sales reports, (FFIV) analyst meeting, Oppenheimer Healthcare Conference and Goldman Sachs Software Conference could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by automaker and technology stocks in the region. I expect US equities to open modestly lower and to rally into the afternoon, finishing modestly higher. The Portfolio is 100% net long heading into the day.

Stocks Mostly Higher into Final Hour on Lower Energy Prices, Diminishing Credit Market Angst and Less Financial Sector Pessimism

BOTTOM LINE: The Portfolio is slightly higher into the final hour on gains in my Medical longs and Biotech longs. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is neutral as the advance/decline line is slightly higher, sector performance is mixed and volume is below average. Investor anxiety is high. Today’s overall market action is neutral. The VIX is falling 8.4% and is very elevated at 54.85. The ISE Sentiment Index is below average at 133.0 and the total put/call is above average at .96. Finally, the NYSE Arms has been running high most of the day, hitting 1.47 at its intraday peak, and is currently 1.36. The Euro Financial Sector Credit Default Swap Index is falling .72% today to 92.67 basis points. This index is up from a low of 52.66 on May 5^th, but down from 157.81 on Sept. 16^th. The North American Investment Grade Credit Default Swap Index is falling 1.0% to 198.0 basis points. The TED spread is falling another 8.6% to 242 basis points. The TED spread is now down 222 basis points in about three weeks. The 2-year swap spread is up 4.79% to 125.75 basis points. The Libor-OIS spread is falling 6.47% to 223 basis points. The 10-year TIPS spread, a good gauge of inflation expectations, is falling 5 basis points to .86%, which is down 177 basis points in about four months and at the lowest level since January 1999. The market’s consolidating, low volatility, action today is a large positive after last week’s gains. The (XLF) trades well despite more weakness in shares of (GS). Oil trades very poorly considering recent stock gains and the pullback in the US dollar. I still expect another substantial move higher in US stocks to begin no later than Wednesday. One of my longs, (ISRG), is 6% higher today. I still see substantial upside in these shares from current levels over the intermediate/long-term. Nikkei futures indicate an +483 open in Japan and DAX futures indicate a -8 open in Germany tomorrow. I expect US stocks to trade modestly higher into the close from current levels on short-covering, less financial sector pessimism, diminishing forced selling, less credit market angst, lower energy prices and bargain-hunting.