Weekly Scoreboard*

Indices

• S&P 500 1,337.38 +1.74%
  
• DJIA 12,505.90 +1.80%
  
• NASDAQ 2,820.16 +2.17%
  
• Russell 2000 845.64 +2.20%
  
• Wilshire 5000 14,029.05 +1.84%
  
• Russell 1000 Growth 617.22 +2.37%
  
• Russell 1000 Value 678.01 +1.29%
  
• Morgan Stanley Consumer 774.13 +.99%
  
• Morgan Stanley Cyclical 1,107.40 +3.06%
• Morgan Stanley Technology 693.96 +2.29%
  
• Transports 5,290.72 +.77%
  
• Utilities 418.37 +1.58%
  
• MSCI Emerging Markets 49.88 +1.96%
  
• Lyxor L/S Equity Long Bias Index 1,050.03 -.97%
  
• Lyxor L/S Equity Variable Bias Index 892.69 -.54%
  
• Lyxor L/S Equity Short Bias Index 607.26 +2.57%
  

Sentiment/Internals

• NYSE Cumulative A/D Line +123,899 +1.06%
  
• Bloomberg New Highs-Lows Index 234 +177
  
• Bloomberg Crude Oil % Bulls 38.0 -15.56%
  
• CFTC Oil Net Speculative Position n/a
  
• CFTC Oil Total Open Interest n/a
  
• Total Put/Call .98 +3.16%
  
• OEX Put/Call 2.11 +6.03%
  
• ISE Sentiment 109.0 -.91%
  
• NYSE Arms 1.07 -8.55%
  
• Volatility(VIX) 14.69 -9.71%
• G7 Currency Volatility (VXY) 11.08 +1.74%
  
• Smart Money Flow Index 10,293.99 +2.61%
  
• Money Mkt Mutual Fund Assets $2.710 Trillion -1.30%
  
• AAII % Bulls 32.16 -23.97%
  
• AAII % Bears 30.99 -.03%

Futures Spot Prices

• CRB Index 367.44 +1.88%
  
• Crude Oil 112.29 +2.99%
  
• Reformulated Gasoline 330.86 +2.14%
  
• Natural Gas 4.41 +4.60%
  
• Heating Oil 319.92 -.05%
  
• Gold 1,503.80 +1.90%
  
• Bloomberg Base Metals 270.56 +2.58%
  
• Copper 441.90 +2.20%
  
• US No. 1 Heavy Melt Scrap Steel 416.67 USD/Ton unch.
  
• China Hot Rolled Domestic Steel Sheet 4,874 Yuan/Ton -.53%
  
• UBS-Bloomberg Agriculture 1,701.84 +2.0%
  

Economy

• ECRI Weekly Leading Economic Index Growth Rate 7.7% +90 basis points
  
• S&P 500 EPS Estimates 1 Year Mean 94.34 unch.
  
• Citi US Economic Surprise Index 11.60 -11.4 points
  
• Fed Fund Futures imply 44.0% chance of no change, 56.0% chance of 25 basis point cut on 4/27
• US Dollar Index 74.10 -.78%
  
• Yield Curve 273.0 +1 basis point
  
• 10-Year US Treasury Yield 3.40% -1 basis point
  
• Federal Reserve's Balance Sheet $2.669 Trillion +.77%
  
• U.S. Sovereign Debt Credit Default Swap 45.0 +6.16%
• California Municipal Debt Credit Default Swap 223.0 -5.25%
  
• Western Europe Sovereign Debt Credit Default Swap Index 189.42 +9.41%
• Emerging Markets Sovereign Debt CDS Index 158.61 +3.38%
• Saudi Sovereign Debt Credit Default Swap 115.50 +1.03%
• Iraqi 2028 Government Bonds 91.56 -.71%
• 10-Year TIPS Spread 2.60% -2 basis points
  
• TED Spread 22.0 +1 basis point
  
• N. America Investment Grade Credit Default Swap Index 93.06 -2.60%
  
• Euro Financial Sector Credit Default Swap Index 91.33 +7.23%
  
• Emerging Markets Credit Default Swap Index 203.63 +1.07%
  
• CMBS Super Senior AAA 10-Year Treasury Spread 179.0 -6 basis points
  
• M1 Money Supply $1.884 Trillion -1.05%
  
• Business Loans 633.50 +.57%
  
• 4-Week Moving Average of Jobless Claims 399,000 +.60%
  
• Continuing Claims Unemployment Rate 2.9% unch.
  
• Average 30-Year Mortgage Rate 4.80% -11 basis points
  
• Weekly Mortgage Applications 467.50 +5.29%
  
• Bloomberg Consumer Comfort -42.60 -.4 point
  
• Weekly Retail Sales +4.90% +20 basis points
  
• Nationwide Gas $3.84/gallon +.02/gallon
  
• U.S. Heating Demand Next 7 Days 20.0% below normal
• Baltic Dry Index 1,254 -4.20%
  
• Oil Tanker Rate(Arabian Gulf to U.S. Gulf Coast) 37.50 unch.
  
• Rail Freight Carloads 230,460 +.76%
  

Best Performing Style

• Small-Cap Growth +2.68%

Worst Performing Style

• Large-Cap Value +1.28%

Leading Sectors

• Computer Hardware +4.68%
• Disk Drives +4.47%
  
• Oil Service +3.75%
• Construction +3.06%
• Gold & Silver +3.02%

Lagging Sectors

• Tobacco -.41%
• Road & Rail -1.07%
• Education -1.18%
  
• Banks -1.44%
  
• Oil Tankers -1.88%

Weekly High-Volume Stock Gainers (21)

• ACOR, GNOM, BBBB, TIVO, ELMG, SVU, PII, TITN, BRNC, MBI, HITK, AMRC, TRS, HBI, AMLN, DPL, MMSI, USPH, OIS, AME and RUE
  

Weekly High-Volume Stock Losers (11)

• BMI, SFG, HOG, WFC, CDE, CRUS, THG, GOOG, URI, HTWR and DMD
  

Weekly Charts
ETFs

• High-Volume Gainers
• High-Volume Losers

Stocks

• High-Volume Gainers
• High-Volume Losers
  

*5-Day Change

Stocks Rising into Final Hour on Earnings Optimism, Technical Buying, Less Tech Sector Pessimism, Short-Covering

Broad Market Tone:

• Advance/Decline Line: Higher
  
• Sector Performance: Most Sectors Rising
  
• Volume: Slightly Below Average
  
• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• VIX 14.68 -2.59%
  
• ISE Sentiment Index 123.0 -2.38%
  
• Total Put/Call .98 +2.08%
  
• NYSE Arms 1.05 -28.54%
  

Credit Investor Angst:

• North American Investment Grade CDS Index 93.06 +.08%
  
• European Financial Sector CDS Index 90.25 +5.01%
  
• Western Europe Sovereign Debt CDS Index 186.08 bps +2.20%
  
• Emerging Market CDS Index 203.50 -.50%
  
• 2-Year Swap Spread 18.0 +1 bp
  
• TED Spread 22.0 unch.
  

Economic Gauges:

• 3-Month T-Bill Yield .05% unch.
  
• Yield Curve 273.0 -1 bp
  
• China Import Iron Ore Spot $178.90/Metric Tonne +.22%
  
• Citi US Economic Surprise Index 11.60 +8.2 points
  
• 10-Year TIPS Spread 2.60% -2 bps
  

Overseas Futures:

• Nikkei Futures: Indicating -20 open in Japan
• DAX Futures: Indicating +18 open in Germany

Portfolio:

• Higher: On gains in my Medical and Tech sector longs
  
• Disclosed Trades: None
  
• Market Exposure: 100% Net Long

BOTTOM LINE: Today's overall market action is mildly bullish as the S&P 500 builds on recent gains, despite US/European debt fears, emerging markets inflation worries, rising food/energy prices, Mideast unrest and Japan concerns. On the positive side, Education, Construction, Insurance, HMO, Medical Equipment, I-Banking, Computer Service, Networking, Disk Drive, Computer, Internet, Ag, Oil Service and Coal shares are especially strong, rising more than 1.0%. Cyclicals and Small-caps are outperforming again. The MS Tech Index is also trading relatively well. Copper is rising +1.01%. The Japan sovereign cds is falling -3.73% to 80.09 bps. The 10-Year Yield is falling -1 bps to 3.4%. The AAII % Bulls fell to 32.16 this week, while the % Bears fell to 30.99, which is also a positive. On the negative side, Restaurant, Homebuilding, Drug and Semi shares are under pressure, falling more than .75%. Oil is rising +.86%, the UBS-Bloomberg Ag Spot Index is rising +.87% and lumber is declining -2.81%. The US price for a gallon of gas is unch. today at $3.84/gallon. It is up .72/gallon in 65 days. The Ireland sovereign cds is climbing +3.34% to 643.51 bps and the Greece sovereign cds is gaining +6.85% to 1,422.05 bps. The Greece and Portugal sovereign cds are making new record highs again. The Ireland sovereign cds is now approaching its record. The US dollar continues to trade very poorly given the rise in eurozone debt angst. The market's resilience remains extraordinary and today's action is technically healthy ahead of a three-day weekend. I expect US stocks to trade mixed-to-higher into the close from current levels on short-covering, less tech sector pessimism, earnings optimism, buyout speculation and technical buying.

Today's Headlines

Bloomberg:

• Greece Default Hit on Banks Cushioned by ECB, Goldman Says. The impact of a Greek debt restructuring on non-Greek European banks would be “milder” now than a year ago thanks to European Central Bank loans, according to Goldman Sachs Group Inc. analysts. A so-called haircut of 20 percent to 60 percent on Greek government bonds corresponds to losses of between 13 billion euros ($19 billion) and 41 billion euros for European banks, Goldman Sachs banking analysts led by London-based Jernej Omahen said in a research note today. That represents 1 percent to 3 percent of their aggregate Tier 1 capital, they said. “In the context of the sector aggregate, this is small,” the analysts said. “By extending 91 billion euros of refinancing facilities to Greek banks (and a further 153 billion euros to Portuguese and Irish banks), the ECB has effectively dis-intermediated the ‘core’ banks from the periphery.” “As a consequence, the knock-on effects of a restructuring would be milder for European banks today than, say, just last year,” the analysts added.
  
• JPMorgan(JPM) Sees S&P 500 Surpassing 2007 Peak: Technical Analysis. The Standard & Poor’s 500 Index will climb to record highs in the next three to four years because the market’s breadth indicates the rally will continue, according to JPMorgan Chase & Co.’s Michael Krauss. The cumulative advance-decline line for stocks listed on the New York Stock Exchange, which represents the number of daily gains minus the number of declines, exceeded its February peak on April 6, reaching the highest level since July 2004, when Bloomberg started tracking the data. That indicator of market breadth suggested the rally that began in March 2009 may lift the S&P 500 to 1,600, said Krauss. That’s 20 percent above the index’s closing level yesterday of 1,330.36. “The bull market is a ways from being completed,” Krauss, JPMorgan’s head of technical research, wrote in a note to clients today. “The A-D lines are in a downtrend for three to six months before a final bull-market peak.” He added, “we’re nowhere near that condition yet.”
• Initial Jobless Claims in U.S. Fell 13,000 Last Week to 403,000. New applications for unemployment benefits in the U.S. fell less than forecast last week, indicating the labor market will take time to improve. Jobless claims decreased by 13,000 to 403,000 in the week ended April 16, Labor Department figures showed today in Washington. Economists projected a decline to 390,000, according to the median estimate in a Bloomberg News survey. “The labor market is improving gradually,” said Joshua Shapiro, chief U.S. economist at MFR Inc. in New York. “We have headwinds due to rising gasoline prices but there will be enough income generation to support moderate growth in consumer spending.” The four- week moving average, a less volatile measure than the weekly figures, rose to 399,000 last week, the highest since the week of Feb. 19, from 396,750. The number of people continuing to receive jobless benefits dropped by 7,000 in the week ended April 9 to 3.7 million, the fewest since September 2008. The unemployment rate among people eligible for benefits, which tends to track the jobless rate, held at 2.9 percent, today’s report showed.
• Consumer Comfort Index in U.S. Climbs for Fourth Week on Economic Outlook. Consumer confidence rose for a fourth consecutive week as Americans became less pessimistic about the state of economy and their personal finances. The Bloomberg Consumer Comfort Index climbed to minus 42.6 in the period to April 17, the best reading since the end of February, from minus 43 the prior week. A measure of expectations fell to the lowest level since September, a sign rising fuel costs are causing families to think the economy will take a turn for the worse in coming months. While employment has picked up over the past two months, households are struggling to maintain spending as the price of gasoline climbs to the highest level in almost three years. The world’s largest economy probably grew at a slower pace in the first quarter as consumer spending cooled, according to economists surveyed by Bloomberg News. “Consumer sentiment is resting on the knife’s edge,” said Joseph Brusuelas, a senior economist at Bloomberg LP in New York. “Sentiment is likely to continue to move based on labor market conditions, fuel costs and equity prices.”
• Philadelphia-Area Manufacturing Slows More Than Estimated as Orders Drop. Manufacturing in the Philadelphia region slowed more than forecast in April as measures of orders and sales fell. The Federal Reserve Bank of Philadelphia’s general economic index dropped to 18.5, the lowest level since November, from 43.4 the prior month which was the highest level since 1984. Rising energy prices and supply-chain disruptions at auto producers like Ford Motor Co. (F) following last month’s earthquake and tsunami in Japan may slow manufacturing in coming months.
• Funds Bet Aginst Volatility While VIX Notes Plummet 94%. Investors have poured about $265 million over the past year into exchange-traded notes that rise as stock-market volatility declines, looking for profits where others have lost. Accuvest Global Advisors and Armstrong Investment Managers LLP are two buyers using the exchange-traded notes, or ETNs, to bet against futures linked to the Chicago Board Options Exchange Volatility Index. The bet seeks to make money from the contracts’ tendency to decline in value over time, a phenomenon that causes losses for volatility speculators. Barclays Plc (BARC)’s VXX note, which gains when the futures rise, has lost 94 percent of its value since it started trading in 2009. “I was sitting around here and thinking, ‘If it’s that bad, what about getting on the other side of it?’” said David Garff, who helps manage about $350 million as president of Accuvest in Walnut Creek, California. He bought about $5 million of a UBS AG (UBSN) note called XVIX in January, seeking to profit from declining VIX futures prices.
• India Builders Face 'Large-Scale Distress' on Debt Trap, Knight Frank Says. India’s real estate industry is expected to face “large-scale distress” amid rising borrowing costs and shrinking access to credit that may force developers into fire sales for assets, according to Knight Frank LLP. Indian developers will have to repay 1.8 trillion rupees ($40.8 billion) of debt to state-run banks, private equity funds and other lenders over the next two to three years, said Amit Goenka, national director of capital transactions at the Indian unit of Knight Frank. Their cash flow may also be under pressure as creditors seek earlier repayments, he said. “I see large-scale distress coming up,” Goenka said in an interview today. “Right now it’s more of financial jugglery which is keeping builders alive for a few months before everything starts to cave in.”
• Pakistan at Impasse With U.S. on Drone Attacks After Meetings With Mullen. A visit by U.S. President Barack Obama’s top military officer to Pakistan underscored disagreements over the use of drone aircraft to target militants in the country’s mountainous northwest. Admiral Mike Mullen, the chairman of the U.S. Joint Chiefs of Staff, said his country won’t stop the attacks in Pakistan’s tribal areas bordering Afghanistan. He expressed concern that Pakistani intelligence has a “longstanding relationship” with a militant Afghan group headed by U.S.-designated terrorists.

Wall Street Journal:

• BlackRock(BLK) Bondwatcher Says Rates May Not Rise Post QE2. A top fund manager at Blackrock Inc., the world’s biggest asset management firm by assets, said a rise in bond yields is not a “given” after the Federal Reserve steps aside in June, even after Standard & Poor’s cut its outlook on U.S. government debt to negative earlier this week. At a time when some of the asset management company’s chief rivals are betting against the U.S. Treasury bond market, Rick Rieder, chief investment officer of fixed income, fundamental portfolios and a member of the Fixed Income Executive Committee at BlackRock Inc. in New York is taking a more bullish view.

Bloomberg Businessweek:

• Obama Says U.S. Probing Speculators, Traders in Oil Markets. President Barack Obama said a Justice Department probe will examine the role of “traders and speculators” in oil markets and how they contribute to high gas prices. “The attorney general’s putting together a team whose job it will be to root out any cases of fraud or manipulation in the oil markets that might affect gas prices, and that includes the role of traders and speculators,” Obama will say today in Reno, Nevada, according to text of his remarks released by the White House. “We are going to make sure that no one is taking advantage of the American people for their own short-term gain.”

MarketWatch:

• Oil Trades Higher, Rising Above $111 a Barrel. Crude-oil futures inched higher Thursday on a weaker dollar, resuming their upward trajectory ahead of a three-day weekend for most markets. Crude for June delivery added 18 cents, or 0.2%, to $111.63 a barrel on the New York Mercantile Exchange. It traded marginally lower in early floor trading after spending most of electronic trading in the black. It earlier hit an intraday high of $112.48 a barrel.
• N.Y. Times(NYT) Can't Get Out Of Its Own Way. Pity the plight of shareholders of the New York Times Co.’s stock. They have invested in a company with arguably the most famous brand name in the entire media business, and yet the Times can’t seem to maximize its prestige in its results.
• China's Forex Reserves Spell Trouble For Banks. China’s bulging foreign exchange reserves may spell bad news for the nation’s lenders, as the central bank must drain the resulting liquidity through measures including further increases in banks’ reserve requirement ratios.

CNBC.com:

• GM(GM) Says Japan Quake Could Still Bring Output Cuts. General Motors says it still could be hurt by parts shortages caused by the earthquake in Japan.
• What to Expect From Bernanke at First Fed News Conference.
• NYSE(NYX) Rejects Sweetened Nasdaq, ICE(ICE) Bid.
• Citigroup(C) Shareholders Slam Pandit and Parsons Over Stock.
  

Business Insider:

• 12 Amazing Facts About Apple's(AAPL) Monster Quarter.
• The Raj Trial Just Got Weird.
• People Are Now Literally Plucking Their Gold Teeth Out In The Middle Of The Pawn Shop.
  

Zero Hedge:

• China Inflation And Wage Protests Spread, Turn Violent. Yesterday we reported news that has so far received almost no media exposure, namely that thousands of striking truck drivers had poured into Shanghai's Waigaoqiao zone, one of the city's busiest container ports, protesting over "rising fuel prices and low wages." Today, via Reuters, we learn that this situation has escalated materially, and progressed into violence: "A two-day strike over rising fuel prices turned violent in Shanghai on Thursday as thousands of truck drivers clashed with police, drivers said, in the latest example of simmering discontent over inflation.

New York Times:

• Fiat to Raise Chrysler Stake to 46%. Fiat said on Thursday that it would spend $1.3 billion to raise its stake in the Chrysler Group to 46 percent, and aimed to have a majority shareholding this year. The Italian automaker, which increased its stake to 30 percent this month, is exercising its right to acquire an additional 16 percent once Chrysler pays off the roughly $7 billion it owes the American and Canadian governments. Fiat, based in Turin, Italy, and Chrysler, based in Auburn Hills, Mich., are working with their banks to refinance that debt before the end of June. The Italian company will then exercise a $1.3 billion equity call option for the 16 percent stake, with the money adding to Chrysler’s capital. Fiat will draw on its cash reserves of more than 14 billion euros ($20.4 billion) to purchase the stake.

FINalternatives:

• Redemptions Drop To Historic Low, New Index Shows. Hedge fund redemption requests fell to near an all-time low this month, according to a new report from GlobeOp Financial Services. The hedge fund administrator's new Forward Redemption Index fell to just 2.45% on April 15, 81 basis points lower than it had been on March 20. The index stood at 19.27% in November 2008 at the height of the financial crisis, and at 2.83% a year ago.

Huffington Post:

• Obama White House, Pentagon At Odds Over Libya Policy. After 26 months in office, President Obama still has not forged a smoothly working national security team that can both nimbly pounce on military crises and deftly manage festering problems, say current and former U.S. officials.

Politico:

• GOP Escalates Debt-Limit Demands. One day after being named to a presidential task force to negotiate deficit reduction, House Majority Leader Eric Cantor fired off a stark warning to Democrats that the GOP “will not grant their request for a debt limit increase” without major spending cuts or budget process reforms.

Rasmussen Reports:

• Daily Presidential Tracking Poll. The Rasmussen Reports daily Presidential Tracking Poll for Thursday shows that 25% of the nation's voters Strongly Approve of the way that Barack Obama is performing his role as president. Forty percent (40%) Strongly Disapprove, giving Obama a Presidential Approval Index rating of -15 (see trends).

Reuters:

• Doha Trade Talks Chasm "unbridgeable today" - WTO. The gaps keeping trading nations from a deal that could promote global free trade remain "unbridgeable today", World Trade Organisation Director-General Pascal Lamy said on Thursday. In a statement accompanying the publication of hundreds of pages of legal texts outlining the state of play in the discussions, Lamy said the Doha round of world trade talks that began decade ago was at "serious risk of failure".
• Portuguese Yields Soar Ahead of Easter Break. Yields on Portuguese and Irish government bonds soared on Thursday as markets scaled back exposure to sovereign risk ahead of the long Easter weekend even while stocks rallied on strong corporate results. Worries over a possible Greek debt restructuring were expected to keep pressure on rattled peripheral bond markets into next week, resulting in yields -- already at euro lifetime highs -- continuing to push higher. Given the extreme levels already offered on Greek debt, with two-year yields at more than 23 percent, Portuguese and Irish bonds bore the brunt of market uncertainty. "With what's happening in Greece and the expectations of restructuring, really the momentum behind that is so strong the risks are that Portugal and Ireland trend that way too," said Chris Scicluna, deputy head of economic research at Daiwa Capital Markets. "It's difficult to see what might turn it around in the near term and even into mid-May." Ten-year Portuguese bond yields PT10YT=TWEB rose above 10 percent for the first time since the launch of the euro, while two-year bond yields PT2YT=TWEB climbed by more than 100 basis points to 11.978 percent. Shorter-dated Irish yields rose by around 85 basis points <0#IEBMK=> while two-year Greek yields were up by around 25 bps.
• US Public Pension Fund Assets Nearly $3 Trillion - Study. The assets held by state and local government pension funds rose to $2.93 trillion in 2010, a 35 percent increase from their lowest point during the financial crisis, two national associations said on Thursday.

Telegraph:

• Rich Chinese Consider Leaving China. More than half of Chinese "new rich" said they want to leave the country and are considering buying citizenship elsewhere, according to a new report. While Western businessmen are heading East to make their fortunes, 60 per cent of those with fortunes of more than $10 million (£6 million), had either considered "investment immigration" or already completed the process.
• Ben Bernanke's Life Gets Tougher as America is Sent to the Debt Doghouse. Forget Congress. It's the Fed that has the real headache now America's in the debt doghouse.

Financial Times Deutschland:

• German Chancellor Angela Merkel doesn't have a majority in her coalition government in favor of bailing out eurozone members under current terms and conditions, citing people in the coalition.

Kyodo News:

• Radiation in excess of 100 microsieverts per hour was measured at four locations between 2 to 3 kilometers away from Japan's Fukushima Dai-Ichi nuclear plant, citing the science ministry.

China Daily:

• Baidu(BIDU) Copyright Row Probes Underway: Official. Investigations of a copyright fight between more than 40 Chinese writers and Baidu, China's largest search engine, are underway, an official with China's copyright watchdog group said Thursday

Bear Radar

Style Underperformer:

• Large-Cap Value (+.29%)

Sector Underperformers:

• 1) Homebuilders -1.99% 2) Semis -1.45% 3) Drugs -.82%

Stocks Falling on Unusual Volume:

• VOD, CAKE, PFE, CMG, GE, TEVA, LRCX, TIVO, GILD, AMGN, SINA, TROW, HNI, DOM, PTI, BBT, SHW, IRM and PII
  

Stocks With Unusual Put Option Activity:

• 1) XRX 2) EP 3) TEVA 4) AMGN 5) ARIA
  

Stocks With Most Negative News Mentions:

• 1) SINA 2) DPL 3) GPC 4) MAT 5) HL
  

Charts:

• ETFs Falling on Unusual Volume
• Stocks Falling on Unusual Volume
  

Bull Radar

Style Outperformer:

• Large-Cap Growth (+.73%)

Sector Outperformers:

• 1) HMOs +3.61% 2) Computer Hardware +1.61% 3) I-Banking +1.60%

Stocks Rising on Unusual Volume:

• UNH, AET, PZE, AAPL, FCX, DB, MXWL, IMO, BJRI, YUM, CHU, GEOY, IBM, CHU, BIIB, SCSS, UTEK, TZOO, IXYS, PENN, PLXS, IBKR, ALGN, FFIV, POOL, UTIW, IIIN, FWRD, CYOU, RGLD, TCBI, BJRI, TDSC, SUR, GDI, SLM, MAN, TEX, BSFT, BAS, WBC, URI, RRR, KRA, POOL, GNTX, IEX, COF, WLP, NUAN, SRZ, HON, MAR, ESI, LHO, MTZ, ETFC and ADS
  

Stocks With Unusual Call Option Activity:

• 1) CTIC 2) TEVA 3) MAR 4) LSI 5) HIG
  

Stocks With Most Positive News Mentions:

• 1) BIIB 2) UNH 3) POT 4) UTX 5) PETM

Charts:

• ETFs Rising on Unusual Volume
• Stocks Rising on Unusual Volume
  

Thursday Watch

Evening Headlines
Bloomberg:

• Global Supply-Chain Repairs May Spur Investment Powering Economic Growth. Repairing supply chains frayed by Japan’s earthquake and surging fuel prices may provide a further spur to business investment powering global economic growth. Joseph Carson, director of global economic research at AllianceBernstein LP in New York, says companies exploiting new ways to ensure cost-effective delivery of raw materials and their own goods may help extend last year’s 5.4 percent surge in worldwide fixed investment. That may boost spending in the U.S. alone beyond the 8 percent he estimates for this year, double the pace of 2010 and more than three times the projected rate of consumer demand. “Recent events raise questions over the global supply chain and reliance on single-source suppliers,” said Carson, a former analyst at General Motors Corp. A shift “could add fuel for a prolonged investment cycle that would have been impossible to predict a year ago.”
• Crude Oil Rises for a Third Day Amid Outlook for Improving Global Demand. Crude oil for June delivery gained as much as 55 cents to $112 a barrel, in electronic trading on the New York Mercantile Exchange. It was at $111.88 at 10:16 a.m. Sydney time. Yesterday, the contract climbed $3.17 to $111.45, the highest since April 8. Prices are up 34 percent the past year. Brent crude oil for June settlement advanced 49 cents, or 0.4 percent, to $124.34 a barrel. It rose $2.52, or 2.1 percent, to end the session at $123.85 a barrel on the London-based ICE Futures Europe exchange yesterday, the highest settlement since April 11.
• Tepco Must End 'Whack-a-Mole,' Cover Fukushima Reactors as Typhoons Loom. Tokyo Electric Power Co. must speed up plans to cover reactors at its crippled nuclear plant and drain tainted water to prevent more radiation leaks as Japan’s typhoon season approaches, engineering professors said.
• Emerging Stocks Face Risk of Earnings Downgrades, Citi Says. The pace of earnings growth in emerging markets is slowing, leading to an increased risk of downgrades to analysts' profit estimates in coming months, according to Citigroup Inc.(C). Analysts are now predicting 12-month per-share earnings growth of 16%, compared with an average estimate of 30% in early 2010, analysts led by Geoffrey Dennis wrote in a report. "Investors are worried about top-line growth due to gross domestic product downgrades and margin pressure due to rising commodity prices and higher wages," teh report said.
  
• Mongolia Rail Boom Seen Breaking China's Rare Earths Grip: Freight Markets. Mongolia’s aim of quadrupling its rail network will send coal, copper and rare earths to nations such as Japan and South Korea under a plan to reduce dependence on the Chinese market and boost economic development.
• BP(BP) Sues Transocean(RIG) Seeking to Recover Billions in Damages for Gulf Spill. BP Plc (BP/) sued Transocean Ltd. (RIG), owner and operator of the Deepwater Horizon oil drilling rig that exploded one year ago today, saying the company is to blame for the accident and seeking to recover costs for billions of dollars in damages related to the Gulf of Mexico oil spill. BP said in a complaint filed today in federal court in New Orleans that it has already incurred costs of $17.7 billion and took a pre-tax charge last year of $40.9 billion in relation to the spill. The London-based company said that without Transocean’s “misconduct,” there wouldn’t have been any explosion, fire, deaths or oil spill.
• Brazil Raises Rate to 12%, Slowing Pace on Currency, Steps to Curb Credit. Brazil’s central bank slowed the pace of rate increases on a less-than-unanimous vote, saying they need to implement policy adjustments “for a sufficiently long period” to bring inflation to target next year. Policy makers, led by central bank President Alexandre Tombini, voted 5-2 to raise the Selic rate by a quarter point to 12 percent from 11.75 percent, as expected by 15 of 58 analysts surveyed by Bloomberg. Forty-one analysts forecast a half-point increase and two predicted a pause. The bank said that two board members voted for a half-point increase. Consumer prices rose 6.44 percent in the year through mid- April, close to the upper limit of the central bank’s target range of 4.5 percent, plus or minus 2 percentage points.

Wall Street Journal:

• Japan Imposes Ban on Nuclear Zone. Japan's government announced Thursday it is creating a formal ban on entry into the 20-kilometer evacuation zone around the quake-hit Fukushima Daiichi nuclear-power plant after some residents ignored pleas to stay away from the potentially hazardous areas. The announcement came as workers at the plant are pumping water that is flooding the basement of the turbine building for reactor No. 2, which contains more than 30 million times Japan's allowable level of Cesium-137, a long-lived radioactive isotope. At the current rate of pumping, it would take more than 100 days to remove the water. That doesn't take into account additional water that could enter—either through continuing operations to cool the reactor with water, or from other sources—or government plans to eventually pick up the pace of pumping.
• Bernanke to Open Up as Fed Embarks on Era of Glasnost. Next Wednesday, Federal Reserve Chairman Ben Bernanke will do something no Fed chief has done before: Stand before a room full of journalists after officials conclude a policy meeting and answer questions about the central bank's decisions.
• Chipotle(CMG) Faces U.S. Probe Over Hiring. The federal government has begun a criminal investigation into whether Chipotle Mexican Grill Inc. has knowingly hired illegal immigrants at its restaurants, a person familiar with the matter said. The criminal division of the U.S. Attorney office for Washington, D.C., wrote the burrito chain April 13 seeking documents related to hiring, the person familiar with the matter said. The company recently fired 40 employees at two Washington, D.C., restaurants who allegedly submitted false documents related to their eligibility to work in the U.S., this person said.
• Ethnic Militias Fuel Tensions in Northern Afghanistan. Government officials in northern Afghanistan are building up their own ethnic-based militia groups to expand their influence and keep the Taliban at bay. But the spread of mostly Tajik and Uzbek militias is aggravating tensions with local Pashtuns—the country's largest ethnic group but a minority in the north—some of whom say they are being driven to turn to the Taliban, a largely Pashtun group, to defend their interests.
• Uptick in Loans Could Aid Businesses. Three years after credit markets froze, two crucial forms of bank lending that remained stubbornly weak are finally showing signs of life, another indicator that the credit crisis is on the mend. Small-business lending and the use of existing lines of credit, both slow to rebound, are showing faint but intelligible signs of recovery. An uptick in the two forms of lending could help businesses expand and reduce unemployment, which are crucial to a broader economic recovery. Commercial and industrial lending, the most widely tracked measure of business-loan demand, had already improved at the end of last year, and growth continued for the second quarter in a row. But the rebound in lending remains in its early stages, with credit growth more anemic than in past recoveries.
• Fleeing the Dollar Flood. The world tries to protect itself from U.S. monetary policy. Members of the International Monetary Fund emerged from their huddle in Washington last weekend resolved to keep every option open to slow the flood of dollars pouring into their countries, including capital controls. That's a dangerous game, given the need for investment to drive economic development. But it's also increasingly typical of the world's reaction to America's mismanagement of the dollar and its eroding financial leadership. The dollar is the world's reserve currency, and as such the Federal Reserve is the closest thing we have to a global central bank. Yet for at least a decade, and especially since late 2008, the Fed has operated as if its only concern is the U.S. domestic economy. The Fed's relentlessly easy monetary policy combined with Congress's reckless spending have driven investors out of the United States and into Asia, South America and elsewhere in search of higher returns and more sustainable growth. Even in the U.S., Americans are buying commodities (oil per barrel: $111) and gold ($1,500 an ounce) as a dollar hedge, and the state of Utah recently took steps to make it easier for citizens to buy and sell gold as a de facto alternative currency. Whether or not these prove to be wise investments, they are certainly signals of mistrust in Washington's economic stewardship. At an economic town hall this week, President Obama blamed "speculators" for rising oil prices. He should have mentioned the Fed and his own Treasury, which have encouraged the world to invest in hedges against the falling dollar. Chairman Ben Bernanke and Mr. Geithner have deliberately pursued a policy of unprecedented monetary and spending stimulus to reflate the economy and boost asset prices. The bill is coming due in a weak dollar, food and energy inflation, and the decline of U.S. economic credibility.

CNBC:

• Apple(AAPL) Profit Leaps, Easily Outpaces Forecasts. Apple reported a profit that blew past analysts' estimates, pushing its shares higher, as sales of its iPhones and Macs easily topped what analysts expected. The maker of computers and personal electronics reported a net profit of $5.99 billion, or $6.40 a share, in its fiscal second quarter. That compared with $3.33 a share a year earlier on the same basis. On the sales side, Apple garnered $24.67 billion in revenue, a full 83 percent higher than $13.499 billion from a year before. Analysts who follow Apple expected the company to report a profit of $5.37 a share on sales of $22.383 billion, according to an estimate compiled by Thomson Reuters. Apple's gross margins for the second quarter came in at 41.4 percent, compared with 41.7 percent a year earlier. The company said it expects June quarter earnings of $5.03 a share on sales of $23 billion. The company has a reputation among investors for consistently low-balling its financial outlook. In the quarter, the company sold 3.76 million Macintosh computers and 18.65 million iPhones. Both figures were above analysts' estimates, which stood at 3.64 million and 16.3 million, respectively. "You've got a company, it's best capturing the profits going on in the mobile space. The iPhone continues to set records," said analyst Colin Gillis at BGC Partners. However, sales of iPods and iPads came in short of estimates. Sales of iPods were 9 million, versus expectations of 9.85 million. The number of iPads sold was 4.69 million. Some analysts had projected shipments of closer to or even more than 6 million for the tablet computer launched on March 11. But the lower-than-expected number could be attributed to the fact that Apple recognizes revenue from its stores when its customers receive the products. The initial wait time for the iPad 2 was four to five weeks. "The iPad numbers were light though not really surprised. We don't even have full year data on it. Also in the quarter the product got refreshed," Gillis said. "I was looking for 6 million in sales." Shares of Apple were about 3 percent higher in extended trading.
  

Business Insider:

• New Hampshire Senate Passes Right To Work Bill. In yet another blow to unions, the New Hampshire Senate passed a right-to-work bill today that would end the practice of requiring non-union members to pay for union negotiations, the Associated Press reports.
• Facebook Says It May Be Allowing 'Too Much' Free Speech In Some Nations.
  

Zero Hedge:

• Meet Keratea: Greece's War Zone. One of the more interesting "war zones" that most have never heard of is not in North Africe, nor in the Middle East, but in Greece. Meet Keratea, a small city of 15,000 people located close to Athens, where after over 100 days of struggle between authorities and the broder population, the riot police has officially decided to abdicate the city to its fate in what is the first popular mini-revolution in the developed world.

IBD:

• Dice(DHX) Focuses Job Seekers On Fast-Growing Sectors.

CNN Money:

• AIG(AIG) Stock's Slide May Hurt Taxpayers. AIG may not generate as much outrage as it did in 2008 and 2009 when the financial sector was in freefall. But I've got 1.655 billion reasons why you should still care about the insurance giant. The Treasury Department owns a 92% stake in AIG: 1.655 billion shares. And that investment is dangerously close to slipping into the red.

NY Post:

• Awakening to Obama's 'Hosni' Hell. First, the bad news. If you're keeping score at home, another day passed with more slaughter of demonstrators in the streets of Syria without serious objection from the White House. The stalemate in Libya remained a stalemate and Jordan can't get a handle on a new wave of protesters. Now, for the really bad news. There are increasing signs that the "Arab Awakening" is a gift to Iran and its terrorist franchises. In Bahrain and especially Yemen, anti-American and anti-Western forces are filling the gaps as government control shrinks. And now for the worst news. The most dangerous developments are happening in Egypt, which was a bulwark for 30 years against Iranian expansion and Arab Islamic fundamentalists. But the risky departure of Hosni Mubarak, under American pressure, threw the door wide open to both and the results already are disturbing. Many people saw this coming -- but apparently, they did not include a single soul in the White House.

Boston Herald:

• Spillover Effect Can't Be Less Drilling. Much has transpired since the disaster, both positive and negative. On the positive side, the widely-predicted environmental disaster has not materialized. The combination of man-made efforts to contain the spill and the earth’s own resiliency in the face of both natural and man-caused environmental disasters have limited the effects of the accident. The environmental damage should not be minimized but the effects have fallen far short of what many experts expected.

Lloyd's List:

• Grand China Shipping plans to build a fleet of more than 70 container vessels, with a combined capacity of 240,000 boxes, by 2015, citing Senior Vice President Gary Luo.

Rasmussen Reports:

• 22% Say U.S. Heading in Right Direction, Ties Lowest Level of Obama's Presidency. Seventy percent (70%) of voters now say the country is heading down the wrong track.

Politico:

• Donald Trump: The $7 Billion Dollar Man. Donald Trump, who has said he looks forward to filing disclosure statements if he becomes a presidential candidate, has a net worth of more than $7 billion, sources told POLITICO. The eye-popping figure is far higher than the $2.7 billion that Forbes Magazine valued his net worth to be last month.

Reuters:

• China Bank Regulator: Western Loose Monetary Policy Fueling Global Inflation. The ultra-loose monetary policies in developed countries are driving up global inflation, China's top banking regulator said in comments published on Thursday. "The spill-over effect of quantitative policy easing in major economies is becoming more evident. Global inflation is on the rise while the sovereign debt crisis is deepening," Liu Mingkang, Chairman of the China Banking Regulatory Commission, said in a speech published on the agency's website (www.cbrc.gov.cn).
• EU's Rehn: Finland Mustn't Hold Up Portugal Aid. Finland needs to take a stance on aid to Portugal by a May 16 euro zone finance ministers' meeting, the European Union's economic and monetary affairs commissioner, Olli Rehn, said. Meeting that time frame, however, could prove difficult because Finland may not have a new government by then following its parliamentary elections last Sunday. "Democracy and election result have to be respected," Rehn, who is Finnish, told the daily Helsingin Sanomat in an interview. "But in parallel with that, the euro group must be able to make such decisions that prevent Portugal from drifting into insolvency." His remarks, published early on Thursday, followed Finland's Sunday parliamentary elections in which the euro-sceptic True Finns party scored big gains, which raised fears that Finland could derail a bailout for Portugal.
• Gingrich Derides Obama Over Energy Policy. Rising gas prices threaten to derail the fragile U.S. economic recovery and are becoming a potent campaign issue in the Republican race to challenge Obama in 2012. Republican former House of Representatives Speaker Newt Gingrich, mulling a run for the White House, on Wednesday derided President Barack Obama over energy policy and high gasoline prices. Gingrich, who was holding meetings with members of the Tea Party movement and other conservative activists, tried to get ahead of the curve, blaming high prices for heating oil and gasoline on Obama, and outlining proposals of his own. "Obama is waging war on American energy," he said. He also proposed lifting a ban on oil shale development in the West; imposing new oil and gas royalties; giving coastal states federal royalty revenue sharing and enacting a law to reduce "frivolous" lawsuits sometimes used to stop energy projects.
• Qualcomm(QCOM) Beats Street, Raises 2011 Targets. Wireless chip maker Qualcomm Inc (QCOM.O) posted better than expected quarterly results and raised its full-year financial targets on improving demand for advanced phones, and its shares rose 5 percent. The company, which also sells technology licenses, said demand was strong in most regions of the world and that investor concerns about the wireless phone sales fall-out from massive earthquake in Japan were overdone.
• F5 Networks(FFIV) Sees Strong Q3; Allays Japan Fears. Network equipment maker F5 Networks Inc expects to post a strong third-quarter profit, as the boom in mobile computing and the need to speed up Internet traffic drive demand for its products. F5 shares were up 13 percent at $112.43 after the bell in heavy trade. The stock closed at $99.74 on Wednesday on Nasdaq.
• Special Report: From Hannibal Lecter to Bernie Madoff.
  

Global Times:

• China Banking Regulator to Launch Mortgage Stress Testing. The country's banking regulator will launch a new round of stress tests for property loans to minimize the financial risks, while a senior researcher at a government think tank said on Wednesday that further credit tightening policies may be needed. The China Banking Regulatory Commission said in a statement on its website late Tuesday that banks should start stress tests on lending in the property market, citing a speech by commission chairman, Liu Mingkang. Banks should strictly control financial risks, both in mortgage loans for homebuyers and in lending to developers, the China Banking Regulatory Commission statement said. "There are signs that there is still a risk of a property bubble, and further credit tightening policies may be the most effective measure to cool down the over-heated market, judging by the current excess in liquidity," said Wang Jun, deputy director of the research department with the China Center for International Economic Exchanges, a government think tank, on Wednesday. "Some policies, like limiting home purchases for homeowners of multiple properties, is a short-term strategy since money being squeezed out of the property market can enter into other areas like commodities, thus adding to the country's inflationary pressure," Wang said. "Minimum down payments for multiple home purchases could be higher, for instance," Wang added.

ShanghaiDaily.com:

• Shanghai will increase housing subsidies for "top young professionals" to attract them to work in the city, citing a local government official. The city has been losing out on top professionals as high living costs and housing prices are discouraging them from settling in Shanghai, according to the report.

21st Century Business Herald:

• China's banking regulator has required the nation's lenders to incorporate price drops of as much as 50% in seven cities in stress tests on their property loans, citing an unidentified bank official. Banks were told to do the tests for "high-risk" cities of Shanghai, Beijing, Shenzhen, Guangzhou, Chongqing, Hangzhou and Nanjing. The stress tests include three scenarios: if property prices drop 30% and interest rates increase 27 basis points, if prices drop 40% and rates rise 54 basis points and if prices drop 50% with rates up 108 basis points, according to the report.

jiaotanqihuo.com:

• China March coal imports fell 40.7% to 9.05 million tons compared with a year earlier.

Evening Recommendations
Citigroup:

• Reiterated Buy on (UNP), target $112.
• Reiterated Buy on (HBI), target $39.
  

CSFB:

• Reiterated Overweight on (FCX), target $75.

Night Trading

• Asian equity indices are unch. to +1.0% on average.
• Asia Ex-Japan Investment Grade CDS Index 105.0 -2.0 basis points.
  
• Asia Pacific Sovereign CDS Index 112.50 -3.25 basis points.
  
• S&P 500 futures +.37%.
  
• NASDAQ 100 futures +.88%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (GR)/1.25
• (ESI)/2.54
• (APD)/1.39
• (PPG)/1.33
• (LLL)/1.82
• (BLK)/2.76
• (ALXN)/.51
• (BBT)/.30
• (MAN)/.32
• (VZ)/.50
• (BAX)/.93
• (BIIB)/1.41
• (MCD)/1.14
• (TRV)/1.48
• (NEM)/1.00
• (SLB)/.75
• (GE)/.28
• (UNH)/.88
• (DD)/1.37
• (MS)/.40
• (PM)/1.04
• (SHW)/.53
• (DHR)/.57
• (COF)/1.54
• (CYMI)/.81
• (SNDK)/.99
• (CB)/1.15
• (STI)/.11
• (DO)/1.41
• (GNTX)/.29
• (BX)/.41
• (LUV)/.03
• (IGT)/.20

Economic Releases
8:30 am EST

• Initial Jobless Claims for last week are estimated to fall to 390K versus 412K the prior week.
• Continuing Claims are estimated to fall to 3675K versus 3680K prior.
  

10:00 am EST

• The House Price Index for February is estimated to fall -.3% versus a -.3% decline in January.
• Leading Indicators for March are estimated to rise +.3% versus a +.8% gain in February.
• Philly Fed for April is estimated to fall to 36.8 versus a reading of 43.4 in March.
  

Upcoming Splits

• (EEQ) 2-for-1
• (EEP) 2-for-1
• (HEI) 5-for-4

Other Potential Market Movers

• The $14 Billion 5-Year TIPS Auction, weekly Bloomberg Consumer Comfort Index, Bloomberg April Economic Expectations Index and the weekly EIA natural gas inventory report could also impact trading today.
  

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