Thursday, June 14, 2007

Morning Market Comment

The Wall Street bulls will attempt further follow through to yesterday's gains, but their world is not perfect with a larger than expected headline PPI number and tomorrow's CPI figures looming large. It's not the first time that the PPI figures have come through way stronger than expected and the street has become used to largely shrugging off the big PPI swings and looking at core which again came through at a .2% rise; so S&P futures are nudging higher by a point.

As the old saying goes, "It ain't over 'til the fat lady sings". On the CBOT (BOT) takeover front yet another wrinkle: CME and CBOT Revise Merger Agreement to Provide Increased Value to ...

Big names in the brokerage world have posted results and their stocks are lower:

Goldman Sachs quarterly profit rises, beating estimates. GS is down over 2%.

Bear Stearns (BSC) reports a 2nd quater profit of $3.40/shr vs estimates of $3.49. Revenue at $2.51 bln beat consensus estimates by $200 mln. So much for the folks who bought the June 150 and 155 calls. BSC is down $3 at the $146 level.

There are a few very interesting analyst calls this morning:

  • UBS downgrades Dow Jones (DJ) to Reduce from Neutral believing the Bancroft family could still rejected News Corp's $5 bln offer. UBS says it doubts another offer will come along and that shares are vulnerable to falling back to where they were before Murdoch's offer - the mid $30s.

  • Bank of America initiates hi flyer Mannkind (MNKD), a developer of inhalable insuline, with a Buy rating and a $20 target. BofA sees launch of MNKD's lead diabetes product by 2010.

Trouble for Jones Soda (JDSA): Starbucks to drop Jones Soda . Jones is down 4%.

This week Greenspan said China's economic pace is unsustainable. But when does it end? More figures showing boom times: China May industrial production surges 18.1%.

WTI crude is drifting higher by 59-cents to 66.95. The Euro is flat and Yen futures are down 25 points.

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